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Five Steps to Secure Foundation Funding

Julie Divine with Devlin Donaldson

Writing grant requests can be a complex and frustrating procedure. Foundation specialist Julie Divine guides you with a proven, step-by-step approach.

American foundations play a major role in the U.S. philanthropic world. In 2004, foundations gave $32.4 billion to various charities, ministries, and institutions—a 4.1% increase from 2003.

For some ministries, foundation grants represent the difference between breaking even or breaking the bank. For other ministries, foundations underwrite important but hard-to-fund programs that have a powerful spiritual impact around the globe.
Every year, more and more organizations are pursuing foundation funding. And while foundation grants aren't for every organization, there is probably a foundation out there somewhere that is interested in supporting at least part of what your organization does.

Writing grant requests can be a complex and frustrating procedure, at least initially. But like everything else, the process gets easier with experience.

"I would say it's an art, and not a science," says Paul Nelson, Executive Director of the Crowell Trust in Colorado Springs. "The art piece of it is at times the most frustrating aspect of the whole process."

The two most important things you need to do to get started are:

  1. Identify the foundations that may be sympathetic to the programs your ministry conducts.

  2. Develop a procedure for engaging them and requesting their support, which includes working to develop a personal relationship with foundation leaders and personnel.


Grant writing is a complex subject that is covered in numerous conferences, seminars, books, articles, and Web sites. One of the best single sources we've seen is The Foundation Center's Guide to Proposal Writing (www.fdncenter.org).

This brief article will take a look at some of the key steps ministries must take if they hope to secure foundation funding for some of their work.

Step 1: Research
There are thousands of foundations in America. If you're starting out from zero, finding the one or two that may be interested in supporting some of the unique projects your organization does may seem like hunting for a needle in a haystack. That's why gathering the following information needs to be your first step.

Your request. What is it that you want to request funding for? Who might be interested in funding this? Narrowing down your answer to these two questions will help focus your research and help you more clearly communicate the organization's unique needs.

Organizational distinctives. Next, consider your organization's distinctives. Think through the following questions: Why should anyone care about your programs? What is the specific need that your project addresses? What are the unique approaches that your organization utilizes in its program delivery? Why is your organization better equipped to address those needs than others? And why must these particular needs be addressed now?

Foundation relationships. Examine any possible foundation relationships your organization might already have. Research any lapsed foundation relationships that may need to be repaired/re-engaged.

Board connections. Survey your board's connections. Often your board members know individuals serving on foundation boards. Don't let this important resource escape your attention. If board members have relationships with foundations, ask them to introduce your organization to some of the key players at the most relevant foundations.

Research foundation prospects. Once you have identified a few foundation prospects, go deeper to make sure that your requests are appropriate. Pay attention to what a foundation says about itself, including its stated interests and limitations. Note also the kind of information the foundation wants from an organization making a request. Religiously follow the foundation's instructions/guidelines.

Step 2: Build Bridges
Once you have identified a few foundations whose interests may be a match for your organization's programs, begin building bridges to their key officials.
    
When you feel ready, make contact with some of these officials. Most institutional foundations welcome a phone call to discuss questions, guidelines, and programmatic interests. Usually if a foundation does not want a phone call, this information will be listed on its Web site or in its published guidelines.

Better than a call is a personal visit. If the foundation is local, or you will be traveling to an area near a foundation's offices, inquire about an in-person meeting.

Develop a schedule for contacting appropriate prospects according to the stated deadlines for submission and your own organization's programmatic needs. For example, if one of your projects is slated to start in 2 months, that probably is not enough time to work through the grant process. In some cases, a year and 2 months would be a much better time frame!

Before you make your grant application, ensure the project you are proposing and the amount of funding you are requesting is appropriate. Confirm this through your research and through your contact with the foundation.

Step 3: Write the Proposal
You knew it would have to come to this stage sooner or later! But since many ministry fundraising executives are already drowning in more projects and deadlines than they can ever meet, perhaps this is a good time to discuss the issue of personnel.

Many large ministries have a grant administration manager or department, while many smaller organizations hire out their grant-writing duties to an outside consultant or freelancer. Regardless of whether you handle grants in house or out of house, the important thing to keep in mind is specialization.

Few documents your ministry creates can have as significant a financial impact as a well-crafted grant proposal. Therefore it's important for you to work with a professional. A well-crafted proposal may not ensure funding, but it can keep you from being eliminated from the process.

There is surprising lack of sophistication in some organizations' communications efforts. Most organizations would never entrust their human resource departments to people without actual management experience and the same would be true for their finance departments. But when it comes to communications, it seems that many ministries believe that any writer will be good enough. Unfortunately, the materials some ministries produce reveal the fallacy of this approach.

Even if your organization has been getting along thus far with less than Pulitzer Prize-winning caliber writing help, you may want to rethink this approach before you venture into the complex and demanding world of grants. Many foundations receive thousands of requests annually from hundreds of organizations. When the foundations you have approached compare your request to the others they have received, you will typically fare better if you go with a pro.

When your grant writer is ready to begin, they will need to gather the information to be used in the proposal, the letter of inquiry, or whatever initial step the foundation has indicated. Ask to see guidelines or samples of successful proposals. This will help you have a better grasp of the common sections, attachments, stories, statistics, endorsements, and other elements that make up the typical proposal.

Here's a brief list of things to have on hand as you create your proposal:

  1. Foundation funding preferences and grant guidelines

  2. Your organization's 501(c)(3) IRS determination letter, IRS Form-990, organizational budget, audited financial reports and/or auditor's report

  3. Endorsements from respected leaders or organizations that know about your work

  4. Your organization's statement of faith

  5. Membership in associations that add credibility to your organization (such as the Evangelical Council for Financial Accountability)

  6. An organizational chart

  7. Your board of directors listing with affiliations.


Common proposal elements include:

  1. Cover letter

  2. Executive summary

  3. Introduction, including information about the organization, its history, impact, mission, and track record

  4. Problem or need, emphasizing the specific needs the project will address

  5. Objectives you hope your project will accomplish

  6. Methodology, explaining how these objectives will be achieved

  7. Evaluation procedures you will use to assess whether or not the project has been successful

  8. Project budget and related costs for the project

  9. And last, but not least, the specific request you are making of the foundation.


Step 4: Develop Your Case Statement

Organizations that are serious about grants develop a document called the case statement. Case statements distill many years of work, many pages of writing, and many hours of meetings into a concise document that is distributed to donors and other funding audiences.

When developing a case statement, start with a checklist. Evaluate organizational reports and documents. Supplement this data with interviews with key staff, constituents, and/or board members, as appropriate.

Typically, you will develop a first draft of the case statement and submit it to the organization leadership for feedback, critique, and more information. The more information provided on the front end, and the better that information is, the smoother the entire process will be.

Many organizations invest significant amounts of time and money in developing a solid case statement that they then adopt as needed for the individual grant applications they submit.

If done right and regularly updated, the case statement can become one of the most important components of your interaction with foundations. It can also be useful for other purposes, such as providing an overview of your organization for your Web site, for major donors, or for other cases where you need a clear and compelling statement of who you are and what you do.

Step 5: Evaluating and Regrouping

Not all grant requests are successful, so don't be disappointed if your first effort is rejected. Seek any helpful guidance you can get from the foundation about anything you may have done wrong or what the grant recipients did right.
   
There are many reasons that grant requests are not funded, few are clear cut or quantifiable.

"Foundation funding is still a subjective process that at times comes down to what happens in the course of considering a proposal," says the Crowell Trust's Paul Nelson. "It's not necessarily quantifiable. In most cases, foundations will receive four out of five proposals that they aren't able to fund, but meet all of their criteria." Nelson says some of the most important factors are "an organization's perceived credibility, capacity, and track record. These are all critical elements to the process."
   
But an organization can meet all these criteria and still fail to meet other crucial tests. According to Nelson and others, it is crucial to continue the process of building a relationship with the foundation. Start by asking for feedback. Was the project not a good match with the foundation's interests? Is there a better match that should be presented next year?

If you are fortunate enough to receive a grant, make sure you report back to the foundation about the success and impact of your project. Ask the foundation what types of information they would like to receive from you, and make sure you provide it. Inquire to see if there is a specific reporting format your organization should follow.

Whether you are a grant recipient today or not, focus on tomorrow and follow up with the foundations you have identified as being interested in what you do. After all, the foundations and grants process isn't really about one specific proposal. It's about developing an ongoing relationship between your organization and foundations that may be willing to help you down the road.

Julie Divine is the director of client services and foundations for the Elevation Group (www.theelevationgroup.com) of Colorado Springs, CO. She can be reached at julie@theelevationgroup.com or 719/ 598-7594.

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