It often comes true in the fluorescent light of a conference room. It typically happens in a meeting that includes senior agency staff and leadership volunteers. Researching grants for nonprofits come up, and a board member will say:
“I was reading a magazine article about the Gates Foundation. Do you know that they have over $35 billion in assets? We should write a proposal requesting $25,000. After all, it’s such a small amount for them, and they’ll certainly love the work we do.”
Maybe the executive director doesn’t know that requesting a $25,000 nonprofit grant from the Gates Foundation would be a mistake. Maybe the executive director doesn’t want to challenge this particular board member today. Whatever reason, the executive director does his best to avoid the grant writer’s laser-focused stare.
Now the grant writer is stuck researching this funder with the hope of convincing the executive director that the suggested grant request is futile. Driving home that evening, the grant writer realizes the best course of action: research the Gates Foundation and many other possible funders. This will fill the grant calendar with good prospects while making the case for not submitting a proposal to the Gates Foundation.
Rarely is a grant writer’s job as easy as asking the nation’s most well-known foundations for funding.
The ability to research potential funders and develop a targeted list of prospective foundations is a skill that all grant writers must develop. After all, most organizations don’t subscribe to a database listing foundation sources, such as Foundation Search and GrantStation. However, grant writers have many resources for identifying prospective funders, determining the specific pitch, and writing the proposal itself.
This step-by-step guide aims to help grant writers build a list of likely funders, narrow down the list to the best prospects, and help them create a strategic grant calendar.
Developing a list of likely foundation funders is the first challenge in researching grant sources. With more than 110,000 private foundations in the nation, a list of just their names would use more than 2,390 sheets of paper. Despite this overwhelming list, it should be easy for grant writers to identify the 25 to 40 foundations most likely to fund their organization.
How easy? It largely comes down to grant writers asking themselves three questions.
The annual reports and websites of partner and competitor organizations will often list the names of funders, and these funders should be at the top of your list.
An often underestimated fact about the United States: We have an association for everything, and this is equally true among foundations. Often known as funder affinity groups, these formal associations provide technical assistance and have annual conferences to discuss the latest trends in their specialized funding area.
A simple way to find them? Use this basic search formula on Google and other search engines: a keyword from your mission + “funders” + “association.” This is an easy to locate associations for funders interested in your cause. A few funder affinity groups include:
|Search Terms||Organization Retrieved||URL|
|LGBT + Funders + Association||Funders for LGBT Issues||http://www.lgbtfunders.org|
|Jewish + Funders + Association||Jewish Funders Network||https://www.jfunders.org|
|Animal + Cruelty + Funders + Association||ASPCApro||https://www.aspcapro.org|
|Older + Adults + Funders + Association||Grantmakers in Aging||https://www.giaging.org|
|Environmental + Funders + Association||Environmental Grantmakers Association||https://ega.org|
Though a direct approach from a grant writer would not be well received by a funder association, a little website snooping can pay big dividends. Some of these websites list their member foundations, which is a goldmine begging for additional research. Even the associations that don’t list foundation members are likely to list their board members—and all of their board members probably work for foundation members.
Don’t forget that the best free resource for identifying prospective funders is the Foundation Center, the network of federally funded foundation centers located in Atlanta, Cleveland, New York, San Francisco, and Washington D.C. They are all free to the public. Each of these six centers has a free searchable database of funders, and searches can be performed based on area of interest, geographic restrictions, types of funding provided, and more.
“With more than 110,000 private foundations in the nation, a simple list of just their names would use more than 2,390 sheets of paper.”
Even if you don’t live near one of these centers, the Foundation Center also has more than 410 partner libraries throughout the nation. Each of the partner libraries offers free access to its electronic Foundation Directory.
Once you have a large list of funders, it’s time to research each one to create a carefully focused target list of 25 to 40 funders to approach over the next 12 months.
The Foundation Center’s electronic directory is an excellent resource, but you can gain the same valuable information from a foundation’s IRS Form 990-PF. Just as nonprofits must complete an IRS Form 990 each year, foundations also must file an annual tax form. This form discloses the names of board members, explains how nonprofits can request funding, and provides full contact information. It also lists all grants for nonprofits made that year.
Every private foundation’s IRS Form 990-PF is publicly available on Guidestar and on ProPublica. I prefer the ProPublica database because it offers a deeper archive of IRS Form 990-PFs and does not require registration.
– Contact information: Foundations must provide contact information at the top of page 1; Part VII A (page 5); Part XV (page 10).
– Application instructions: Part XV (page 10) also details application instructions, deadlines, and funding restrictions.
– Board members: Part VIII provides a full list of board members. Though grant writers should not approach board members directly, this list can be used to determine if an executive or board member knows a member of the foundation’s board. If a relationship does exist, the organization can cultivate the foundation’s board member by inviting them to an open house or special event.
– List of grants made: Since Part XV 3a of the form provides a limited amount of space to type a list of grants made, most foundations provide this information in an appendix to their tax form.
I find the last section to be the most helpful part of the 990-PF. I read the list of grants made in the prior year before reading any other part of the tax form. This section lists (a) the nonprofit receiving the grant; (b) the nonprofit’s city and state; (c) the grant amount; and (d) the general purpose of the grant.
This information enables grant writers to focus the prospect list on foundations that make grants to similar organizations in their region. It also provides the information necessary to eliminate small funders that only make a few grants each year to preselected organizations.
Whether using a paid subscription service or the free resources listed above, grant writers should always do their homework—and be prepared to explain their results. After researching prospective funders and developing a prospect list of 25 to 40 likely funders, an organization should have the information necessary for a healthy grant proposal calendar.
So the next time a board member suggests approaching the Gates Foundation (or the Coca Cola Foundation, or Ford Foundation), you can help educate your board about the process of researching grants for nonprofits. Furthermore, you can note that your grant research started with a universe of over 110,000 foundations, and you narrowed that 2,390-page list down to the 25 to 40 most likely prospects.
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