When you shouldn’t write a grant.
It’s an all too common occurrence. There’s a new initiative or a budget shortfall and someone on the team suggests: “Can’t we just write a grant for that?” It seems like the easy solution. But the truth is, writing a grant is not always a good use of resources. In fact, it may be pulling your staff away from more sustainable ways of raising the same amount of money. Read on to find out when to pursue foundation support and when to take a different approach.
There are three main reasons why you should consider NOT writing a grant proposal:
Grant writing is time-consuming. To apply for support, most foundations will require financial documents and a narrative discussion of outcomes and evaluation. Some will also require audited financial statements and letters of support. Pulling these materials together is painstaking and time-consuming work. A dedicated grant writer can spend 10 hours or more on a proposal. If you don’t have staff dedicated to grant writing, then you’re looking at paying a consultant $50-$100 an hour to do this work. And you’ll have to pay the consultant whether you win the award or not. Each grant application is a little bit different, so even if you’re recycling material from an already drafted proposal, you’ll spend time rearranging and reworking.
You’ll receive modest funding with strings attached. In the Portland market in particular there are so few major foundations and so many nonprofit organizations making competitive applications to these funders, it is not uncommon to receive an award for a few $1,000–with strings attached. National foundations are even more competitive. If you are lucky enough to get the grant award, it will likely be restricted for a specific purpose. Then, there’s any final reporting you may be expected to submit detailing how the funding was used.
Grant funding is not sustainable. Most foundations won’t fund your organization multiple years in a row. To be eligible, you’ll have to come up with a different project or ask for each application cycle. This means that applying for grants is fundamentally not a sustainable fundraising strategy. You simply can’t expect to receive the same amount annually from a foundation (family foundations can be an exception).
So, what’s the sustainable alternative? Look no further than your major donor program:
Major donors give because they’re personally invested. Even the simplest grant application requires more documentation than a major donor will expect to see when considering making a gift. The average donor gives because they have a personal or emotional connection to the cause or the people involved. In return, your donors expect personalized acknowledgment, but not lots of documentation.
Major donors make unrestricted gifts. And, when it comes to follow-up, a phone call or hand-written note with your annual report is generally more than sufficient to update your donor on how funds were utilized.
Major donors make annual gifts. An individual donor who is well stewarded throughout the year will see no problem with making an annual gift to your organization, possibly even more than one! The time you invest in building a relationship with an individual donor is more likely to generate future funding and long-term support.
I'm not suggesting that major donor fundraising is a piece of cake. It requires practice and experience and skills that don’t come naturally to everyone. I suspect many board members, and honestly some staff, lean on writing grant applications because they don’t feel comfortable making the ask to individuals. They fear being put on the spot and receiving a “no.” It can feel easier to sit alone at the computer and write. But, with a few notable exceptions, your major giving program will always bring in more than your foundation support program. If that’s not the case for your organization, it’s time to think about where you’ve allocated your resources.
So here I am, a professional grant writer telling you NOT to write a grant. That’s because I believe that a good consultant will advise on where to focus your time and money with your strategic priorities in mind. Northwest Capacity Development is here to provide holistic advice on fundraising strategy, and tips for making the case to individual donors if that’s a more effective way to advance your goals.
When is it worthwhile to apply for a grant? Give it a shot if you can check off at least two of the following:
You have an existing history of funding from the foundation you are approaching
You have a personal relationship with a current trustee on that foundation’s board
You’re seeking funding for something very specific with clear, measurable outcomes
Your need is not particularly time sensitive and other sources of funding have been secured