Fundraising Part II: ABCs of Grantseeking

1. Fundraising Part II: ABCs of Grantseeking 6th Annual Club MAC June 15, 2006 Elizabeth Pentak Averill, CFRE Director of Philanthropy North Texas Food Bank 214.330.1396  elizabeth@ntfb.org

2. Topics of Discussion • Organizational Readiness • Sources of Grant Funds • Types of Grants • Successful Grantseeking • Private Sector Sources & Process • Public Sector Sources & Process • Research

3. Critical Concepts • Synergy • Keys • Planning • Systems • Grantsmanship is a process, not simply a writing exercise

4. Organizational Readiness • Mission & Vision • Strategic Plan • The Development Process • Case Statement • Development Plan • Policies

5. Factors That Determine Grantseeking Success: 1. Quality of the nonprofit organization 2. Critical importance of the proposed project 3. Appropriateness of funding source or the level of competition in a grantmaking cycle

6. Factors That Determine Grantseeking Success 4.Skills of writer in building a compelling case Many people think this last item is the only important factor and do not take the first three into consideration! - grantproposal.com

7. Sources of Grant Funds • Foundations • Government Sources

8. Foundations • Types of Foundations 1. Independent (private) 2. Community 3. Corporate 4. Operating

9. Types of Foundations 1. Independent (private) Endowed funds from a single source Examples: Meadows Foundation, The Moody Foundation, Sid W. Richardson Foundation, Robert J. and Helen C. Kleberg Jr. Foundation, The Cullen Foundation, Hillcrest Foundation

10. Types of Foundations (cont.) 2. Community Pooled funds from multiple donors Examples: Communities Foundation of Texas, Inc., The Dallas Foundation, Community Foundation of North Texas

11. Community Foundations • Types of Funds a. Unrestricted b. Field of Interest and Named Funds c. Donor Advised

12. Types of Funds a. Unrestricted • Donors give to the community foundation without restriction • Foundation’s trustees determine how to distribute them • Experience the greatest demand • Smallest “pocket” of funds

13. Types of Funds (cont.) b. Field of Interest and Named • Donors specify an area of interest, such as education, medical research, etc. • Foundation’s trustees determine how to distribute them • Foundation usually determines which proposals match area of interest • Second largest “pocket” of funds

14. Types of Funds (cont.) c. Donor Advised • Donors place funds with community foundation rather than create own • Donors benefit from investment management • Donors direct how funds are distributed • Typically requests are made directly to donors • Largest “pocket” of funds

15. Types of Foundations (cont.) 3. Corporate Endowed by annual contributions from a corporation, usually bearing the corporation’s name. Percentage of contribution is determined on an annual basis. Examples: J. C. Penney, Exxon/Mobil, Verizon, IBM, Kimberly Clark, Texas Instruments

16. Types of Foundations (cont.) 4. Operating Established for the benefit of one non-profit organization Examples: Baylor Health Care System Foundation, VNA Foundation, McKinney Education Foundation

17. Government Sources 1. Federal 2. State 3. City/County

18. Types of Grants 1. Capital 2. Endowment 3. Challenge 4. Matching 5. Operating 6. Project or Designated 7. Research 8. Seed

19. Types of Grants (cont.) 1. Capital Funding provided for construction, renovation, equipment. 2. Endowment Funding set aside in perpetuity. Interest generated benefits the organization. Trustees of organization decide how to use funds

20. Types of Grants (cont.) 3. Matching Funds given in direct proportion to additional funds raised from other sources. A specific match ratio of 2:1 or 1:1 is predetermined and then documented as gifts are received.

21. Types of Grants (cont.) 4. Challenge Funds given with the provision that a specific amount of contributions be secured from other donors within a certain time period.

22. Types of Grants (cont.) 5. Operating Funding provided for day-to-day expenses. 6. Project or Designated Funding provided for a specific program or activity, usually within the operating budget.

23. Types of Grants (cont.) 7. Research Funding provided for the specific development of a project. 8. Seed Funding provided to initiate a project or an agency.

24. Grantseeking • Successful Grantseeking is: • 2/3 Planning • 1/3 Writing • Complete all planning before writing!

25. Program Planning • Do you really have your ducks in a row?

26. SuccessfulGrantseeking Requires • Understanding funders’ needs: • Build relationships with funders • Appropriately match mission & program goals to the funder’s expressed interests • Follow the funder’s instructions - explicitly!

27. SuccessfulGrantseeking Requires (cont.) • Effective working relationships: • Create a “team” culture • Demonstrate credibility • Provide services with equal access for target clients • Network, collaborate, partner

28. Successful Grantseeking Requires (cont.) • Effective processes: • Shop proposals around • Demonstrate accountability • Secure needed resources, staff, facilities, etc.

29. Successful Grantseeking Requires (cont.) • Effective processes: (cont.) • Gather input from a client-based advisory body • Create processes for collecting outcome measurements

30. SuccessfulGrantseeking Requires (cont.) • Clearly communicating the story: • Craft a compelling needs statement • Reveal implementation detail: how, when, who, where • Include outcome measurements • Include evaluation criteria

31. SuccessfulGrantseeking Requires (cont.) • Clearly communicating the story: (cont.) • Use jargon-free narrative • Reflect names & spell accurately • Respond to requests for specific information while weaving in the key points that make your case compelling

32. Successful Grantseeking Requires (cont.) • Accurate financial data: • Establish financial systems: • That allocate administrative overhead (see handout - Budget Allocation Worksheet) • Capable of managing the project • Attach a financial audit • Include a detailed budget

33. Whatever you do . . . • Don’t chase funding! and • Remember that people give to people!

34. Private Sector Sources: • Have many different personalities • Can not be treated the same • Rarely fund an entire project • Grant a portion in relation to the whole

35. Private Sector Sources (cont.): • Never give to what has already been done • Always want to know how their grant will enable you to do something you wouldn’t otherwise be able to do!

36. Public Sector Sources • Will tell you what they want, but not how to implement the program • Do not “want to control the project” • Want you to spend all you are granted • Want you to spend it according toyour detailed budget

37. Public Sector Sources (cont.) • Have reporting requirements • Require a federal audit for grantstotaling over $300,000 • Provide a 1st quarter advance, & then reimburse expenses

38. Public Sector Sources (cont.) • May require a local private sector matching (cash or in-kind) • Specify “allowable costs” • Will pay a portion of administrative overhead expenses

39. Public Sector Sources (cont.) • Will monitor your rate of spending • Will establish a permanent “overhead” or “indirect cost” ratio,usually between 8 – 30% • Will fund an entire project

40. Public Sector Sources (cont.) • Will not “supplant” private sector funding • Usually don’t fund a new organizationthe first time they submit • Will negotiate budget changes

41. Public Sector Sources (cont.) • Usually make multi-hundred thousand or million dollar grants • Require funds be placed in a separate audit-traceable account

42. Public Sector Sources (cont.) • Require excellent record keeping – expenses, volunteer time, etc. • Will pay for the federal audit &audit-traceable account

43. Public Sector Sources (cont.) • Are required to allow 45 days between grant announcement & deadline • Require that service delivery beginthe day funding is approved

44. Research • Private Sector • Public Sector

45. Private Sector Research • Who knows who - Foundation Questionnaire handout • The best research possible! • Qualified prospects are individuals to whom you have a “link” • Get Nonprofit Resource Center’s List of Texas trustees (www.nprc.org)

46. Private Sector Research • Foundation directories • Foundation Center (www.fndcenter.org) • Directory of Texas Foundations (www.nprc.org) • Directory of Dallas County Foundations (Dallas Public Library - 6th floor) • Directory of Tarrant County Foundations (Funding Information Center, Fort Worth)

47. Private Sector Research (cont.) • Periodicals • Chronicle of Philanthropy • Nonprofit Times (free to nonprofits) • Local Business Journal • Book of Lists • Local newspaper columnist • Philanthropy Magazine

48. Foundation Profiles Private Sector Research (cont.) • Application Process • Deadline • Trustees & Officers • Contact • Tax Year • Sample Grants • Areas of Interest • Restrictions

49. Foundation Profiles (cont.) Average Grant Calculation Number of Grants Given Total Amount Grants Made Subtract High & Low Amounts Divide by 2 less than “# of Grants” Private Sector Research (cont.)

50. Foundation Profiles (cont.) Stemmons Foundation 53 Grants Made $352,300 Granted Less $25,000 & $1,000 = $326,300 Divided by 51 = $6,398 Private Sector Research (cont.)