“Are grants even worth my time?” (Part 4)

Question 4: What other fundraising mechanisms are available to your organization?

This is the final installment of a four-part series about whether grants are worth your time.

Read the first, second, and third posts. Think someone you know might be interested in these posts? They can subscribe here.

Grants aren’t a silver bullet for project or program funding (no matter what your board might say!), nor should they be the only element of your fundraising strategy. You and your team should consider a few questions to determine if there are other ways to fundraise.

How much lead time do you have?

When you’re evaluating your fundraising strategy, think about the lead time you need. Lead time means the amount of time between the ask (whether that’s a letter of intent or an application) and the need (when your organization will actually be implementing the program and paying related expenses). If you’re launching a project in three months but won’t find out about a grant award for six months, maybe a private donation would be a better fit. Moreover, grant funders are unlikely to fund programs that have already taken place. If you’ve already finished the project but face a deficit, explore other options.

Is cash flow an issue for your program?

Government grants are often made on a reimbursement basis (with a matching requirement), meaning you must have the cash on hand to pay your program expenses upfront. Then, when you submit your final report, you request reimbursement for those expenses. If your organization is smaller, new, or struggles with cash flow, a corporate or individual donor might be willing to make a donation before you incur expenses. Your development, program, and financial teams should have a conversation about this before you move forward.

Is your program new or unknown to funders and your community?

Grant applications usually assume that your program already has a structure: you can describe the goals, objectives, timeline, and so on. For programs that either haven’t launched or are still new, a special fundraising event might be a good way to find initial funding. Or, you could host a media event publicizing a lead donation from a board member. It’s important to be able to tell the story of your program and the people you serve, and hosting an event can help you refine that story before you tell it later in more detail to grant funders.

Who does your program benefit?

Funders most often want to see their grant awards benefiting people who otherwise wouldn’t have access to the types of services you’re providing through your program. If you take a hard look at your program and realize you’re serving individuals who could otherwise pay for this service, it’s unlikely to be attractive to grant funders (e.g., private music lessons for students in families with high socioeconomic status). However, that’s not to say that a donor with fond memories of her middle school piano lessons wouldn’t be interested in funding the program. But before you pursue grant funding, consider conducting a needs assessment in your community and identifying the populations that could really benefit from your program.

Could earned revenue help close your budget gap?

Depending on your business model and who you’re serving, think about options for earned income (that is, money in exchange for goods or services versus raised income). Would your clients be able to pay a nominal participation fee? If you’re carrying out significant education programs in your local school district, what about a fee-for-service structure with the district? While it may take a few years to build up earned income, this helps ensure a diversity of funding that is attractive to funders.

Conclusion

Although grant funding is a well-known way to raise funds for your organization, they’re not right for every project. Before you pursue grants for your organization, know the pros and cons of different types of funding. Talk through alternatives with your staff and board. There are times when a corporate sponsor might make more sense, or perhaps a special event. Maybe a private individual donor has expressed an interest in a program and might be willing to make a leadership investment. If it still seems like grants are the right way to go, make sure you’re grant ready!

Cover photo by Markus Winkler on Unsplash