How Do You Decide Whether to Pursue a Grant?

Nonprofit Management
Written By Erin Tatum

The hardest grant decisions happen in the gray areas

In my last post, I wrote about the investment involved in finding the right grants. Prospect research isn’t just another administrative task. It’s a strategic investment of time, and like any investment, it should produce a worthwhile return.

Let’s say you’ve done that work. You identified a promising opportunity, read the guidelines, and confirmed that your organization is eligible.

But what happens next, especially for foundation opportunities that aren’t abundantly clear? Maybe the grant is a great fit, but the award amount is relatively small. Maybe the funding is substantial, but the application requires significant staff time. Maybe you’ve built a relationship with the funder, but the competition looks overwhelming. Or perhaps everything seems promising, except the deadline falls right in the middle of your busiest season.

These are the opportunities that deserve thoughtful discussion to suss out the black-and-white answers from the gray areas. But many nonprofits don’t have a consistent way to approach these conversations. When every opportunity is evaluated differently, priorities become inconsistent. Over time, that inconsistency can quietly drain time and energy from your grant program. Or worse, you neglect to have the conversation and skip right to preparing an application that’s not actually worth your time (tying you up when you could be working on another, more fitting, grant).

Some grants are an obvious and emphatic “yes, let’s go for it!” and others are a clear “thank you, next!” Two experienced professionals might reasonably come to different decisions about whether to pursue a grant, which is when a grant decision framework becomes invaluable. If it’s an obvious no, stop. If it’s an obvious yes, you probably don’t need a framework. The value comes in helping your team navigate the opportunities that live in the middle.

In this post, I’ll discuss how to build a grant decision framework around your organization’s priorities. We’ll cover what a framework should and should not involve, plus how to create and refine this for your own organization. And download my template to have a leg up in creating your own framework.

Build a grant decision framework around your organization’s priorities

If you’ve ever searched online for a grant evaluation checklist (oh, just me??), you've probably found dozens of them. Most include some combination of eligibility, deadlines, funding amount, mission alignment, and organizational capacity. Those are all worthwhile considerations, but they can create the impression that there’s a universally accepted formula for deciding whether to pursue a grant.

I can tell you from working with multiple nonprofit clients… there isn't.

Every nonprofit operates with a different mission, staffing structure, funding strategy, and tolerance for risk. A small organization with one development staff member will almost certainly make different decisions than a large institution with a dedicated grants team. Likewise, an organization trying to diversify its funding sources may intentionally pursue opportunities that another organization would pass on because they’re looking to deepen relationships with existing funders instead.

That’s why I encourage organizations to build a grant decision framework rather than adopt someone else’s. A framework gives your team a consistent way to approach the gray-area opportunities, but it should also reflect what matters most to your organization. The questions you ask should support your strategic priorities, not mine.

Notice that I keep using the word “framework” instead of “matrix.” The matrix is simply one way to organize your thinking. Some organizations may prefer a scoring tool, while others might use a series of discussion prompts or a simple decision worksheet. The format matters far less than the consistency behind it.

One of the things I appreciate most about a framework like this is that it forces your organization to define its priorities before the pressure of a deadline. If you wait until a grant is due in two weeks, it’s easy for the size of the award or the excitement of a new opportunity to dominate the conversation. When you’ve already agreed on the questions you want to ask, those conversations become much more productive. You’re no longer trying to figure out how to make the decision. You’re simply applying the process you’ve already agreed upon.

You might even discover that your organization values something you hadn’t considered before, like that you’re willing to pursue highly competitive opportunities if it will help build a new funder relationship. There isn’t a single right answer!

What should a grant decision framework include?

Once you've decided to build a grant decision framework, the next question is usually, “Okay… what exactly should we be evaluating?”

The answer depends on your organization, but over the years, I’ve found that the same handful of themes come up again and again. These are the conversations I find myself having with clients whenever we’re trying to decide whether an opportunity is truly worth pursuing.

Capacity

Capacity goes beyond whether someone technically has time to write the proposal. Every grant application has an opportunity cost, so think about what your organization may be giving up in order to pursue this opportunity.

Timing

Timing can completely change the answer. A grant that looks like a perfect fit in October may be unrealistic in March if your staff is already juggling reports, annual appeals, or major events.

Competitiveness

Competitiveness is about understanding both the funder and your own organization. You’re not trying to predict whether you’ll receive the grant (none of us has that crystal ball, although I’d pay good money for one), but to honestly assess how strong your application is likely to be.

Financial return

Financial return isn’t just about the size of the award. A modest award with a straightforward application and minimal reporting requirements may provide a much better return on your investment than a six-figure opportunity that requires weeks of preparation and years of detailed reporting. Before you focus on the award amount, consider questions like:

  • How often does this funder actually grant awards at the top of the stated range?

  • Would an award meaningfully advance the project or simply offset a small portion of the budget?

  • Does the funder typically support the kinds of expenses that are central to our work?

  • What contractual or reporting obligations does the award tie you to?

Strategic value

Strategic value often gets overlooked because it’s harder to quantify than budget numbers or deadlines. But in my experience, it’s also where some of the best conversations happen.

  • Will this opportunity help establish a relationship with a funder you’ve wanted to approach?

  • Does it support a priority your organization has committed to over the next several years?

  • Could it position you well for a future opportunity, even if this particular application isn’t successful?

A grant decision framework should support judgment, not replace it

If there’s one caution I’d offer, it’s this: don’t let your framework become a substitute for good judgment.

Whether you’re using a spreadsheet, a scoring rubric, a trained AI agent, or a list of discussion questions, the purpose isn’t to let a formula make the decision for you. After all, there are plenty of factors that can’t be reduced to a number. Maybe your executive director had a promising conversation with a program officer last week. Perhaps your organization is trying to establish a presence in a new funding community. Or maybe a funder has supported similar organizations in the past but has never funded yours. Those nuances matter, even if they don’t fit neatly into a scoring system.

What’s valuable about this framework isn’t the final score, but the conversation that happens while your team is working through it together. By the time you’ve reached a final decision, your path forward feels much clearer than it did when the discussion began.

Build your framework before you need it, and refine it over time

Like many strategic planning tools, a grant decision framework works best when you create it before you’re under pressure. If your first attempt happens while a proposal is due next Friday, you’re far more likely to make decisions based on urgency than on your organization’s long-term priorities.

Don't worry about getting it perfect the first time. In fact, I hope you don’t.

The first version of your framework is really a starting point. After you’ve used it to evaluate a handful of opportunities, you’ll probably discover questions that no longer seem important, criteria you wish you’d weighted differently, or entirely new considerations that deserve a place in the conversation. That's a good thing. It means your framework is evolving alongside your organization.

Most importantly, don’t let your framework sit in a folder after you’ve created it. Pull it out whenever you’re evaluating one of those gray-area opportunities. The more consistently you use it, the more valuable it becomes, not because it tells you what to do, but because it helps your team make decisions using the same set of priorities every time.

Ready to build your own?

If you’d like a place to start, I’ve created a downloadable grant decision framework based on the approach I use with clients. The download also includes ideas for adapting the framework to your own workflow, including ways to use AI to facilitate the discussion without replacing your team’s judgment.

Adapt it, simplify it, expand it, or make it entirely your own. Treat it as a starting point, not a finished product. As your organization gains experience, your framework should evolve right alongside it. As always, I’d love to hear if you successfully implemented this within your own organization!

Want to make these conversations easier? This downloadable framework is one of the tools I use with clients through Increase Your Mileage. Learn more about the service and book a discovery call.

Cover photo by Jopwell.

Erin Tatum
Next

The Hidden Work Behind Finding the Right Grants