Solving the Mysteries of Public versus Private Funders

In other posts, I’ve alluded to the distinction between public and private funders. Some grant professionals specialize in one funder type or another, although I’ve worked in both and enjoy (and dread) each one for their own reasons. 

As I’ve learned more about funder research throughout my career, I’ve started to treat it like a mystery to be solved: you’re piecing together clues, learning how individuals and organizations are connected, and crafting a profile. I can see the evidence board now!

Public versus private

When I say “public” funder, I mean any form of government at the local, state, federal, or international level. Local government could include your city, county, parish, and so on. Sometimes federal funding is administered at the state or local level, like a portion of National Endowment for the Arts (NEA) funding being subgranted to state arts councils.

For simplicity’s sake, I’m using “private” funder as a catch-all for every other type of funder. That could include funders who are required to file 990-PFs (private foundations, corporate foundations, etc.), the giving arms of corporations, or community-based nonprofits that file 990s (e.g., Kiwanis Clubs).

The purpose of the grant

Public grants are carrying out government legislation. If you want nerd points, you can review the original authorizing legislation online. It’s helpful to remember that, although legislators create and vote on legislation, it’s usually the broad swaths. After the bill has been voted on and approved, it’s up to the administering public agency (like the NEA) to come up with all the rules and regulations related to those grant awards. The focus for public grants is on transparency, and (typically) serving as many of the government’s constituents as possible.

Meanwhile, private funders can basically fund whatever they want, wherever they want. As long as they’re following tax regulations and reporting their financials as required by law, grants from private funders can carry out the wishes of long-deceased family members, the strategic priorities of a corporation, or whatever your local billionaire is dreaming up these days.

The decision-making process and strings attached

Public grants usually include a published rubric and clear eligibility criteria. As long as your nonprofit meets the eligibility criteria (the most important of which is serving a target population in the government’s jurisdiction, you can usually apply. Grants might be administered as contracts for service, often require matching funds, and are awarded on a reimbursement basis after your nonprofit has completed the required reporting.

Private funders, on the other hand, might initiate open, competitive grant applications available through online portals, email submissions, or snail mail. They might be invitation-only. You may or may not get the grant funds right away and may or may not be required to complete reports about the funding. And unless the funder has a website and/or files a 990-PF, you may or may not be able to determine their application and award process. Are you sensing a theme yet?

It’s all about who you know… or is it?

While it’s helpful to have a relationship with the staff of a public agency, that relationship has no bearing on whether or not you get funded. These staff can help answer your application questions and often lead public workshops about open grant opportunities. (You can and should initiate relationships with your lawmakers, although be aware of the line between nurturing a relationship and lobbying for funding.

In the private sector, relationships are sometimes more important than grant criteria. Grants by private funders are often directed by individuals, family groups, or committees. You may or may not be able to find any information about the decision-makers. Sometimes it’s helpful to have a contact on the foundation board. Sometimes you must have a foundation board member lobbying on your behalf or inviting you to apply. Sometimes there are foundation staff you can contact. Sometimes they don’t want you to reach out at all, ever!

The ultimate sleuthing: which nonprofits have been funded in the past

By now, you’re probably catching on to the theme that getting grants from private funders can take some serious detective work. That’s also true when it comes to which organizations have been funded in the past. For public funders, you can typically find a list of funded organizations with amounts and funded projects. In fact, this is usually required for government transparency. Meanwhile, if a private funder doesn’t file a 990-PF, you might be scouring press releases, Facebook pages, and any other publicly available info to find the funder’s programmatic and geographic priorities.

Ready to investigate?

It can sound overwhelming to think about all the different ways private funders can award and administer grants, and you might decide it’s just not worth it. Better to spend a bunch of time on a complicated federal grant, right? While that might be true in the case of your program, it’s important to have a diverse range of funders in your grant portfolio. Just start small and think through the private funders you already have relationships with.

Cover photo by Mediamodifier on Unsplash