Hey there, Leaders and Changemakers!
Between COVID-19, widespread racial injustice, and election season, I think we all can agree that this year has definitely been one for the books! And for those of us working in the nonprofit world, we’ve been working around the clock to bring in extra revenue for our organizations.
As a Grant Writer and Development Consultant, the #1 question I’ve gotten in the last few months is, can I get a grant for...? Now, before you spend hours researching on Google, here are five things I think you should know about grants:
1) Grant readiness is key. "Grant readiness" is the preparedness and capacity to secure grant funding. Ask yourself the following questions before you apply for a grant:
Is my organization tax-exempt under section 501(c)3 of the IRS Code?
Do we have documented evidence of community need?
Do we have realistic, clearly articulated, and “fundable” solutions to meet those needs?
Have we cultivated relationships with prospective funders?
Do we have at least 2-3 years of documented financial history?
Do we have the capacity to manage, evaluate, and report the impact of awarded grants back to funders?
2) Grants aren't necessarily "free" money. I know this may come as a shock but let me explain! Grants are financial awards given by funders to achieve specific purposes. While they don't have to be repaid like a loan, they often have parameters around how the award should be spent. You're not free to spend the grant money however you want.
3) Find and apply for grants that actually "fit" your organization's purpose and needs. Finding the right grant opportunity is a lot like dating. Remember those specific purposes I mentioned earlier? In the nonprofit world, these are commonly known as funder priorities and interests. You should only seek grants from funders with priorities that align with the programs and services you offer. For example, if your organization specializes in early childhood education, don't submit a proposal to a funder interested in supporting disaster relief efforts. Don't waste their time or your own!
4) There’s more than one type of grant. There are a variety of grants to cover different needs. Here are some of the most common types:
Program and project grants: Restricted funding to support the expenses tied to a specific program or project. These are the most common type of grants. It’s also important to know that funders often cap how much money can be used to cover administrative or overhead expenses.
General operating grants: Unrestricted, flexible funding to support an organization's overall mission, and day-to-day activities.
Capital grants: Funding to help nonprofits construct, upgrade, and purchase buildings and equipment.
5) Grants are a great way to diversify your nonprofit's revenue strategy. One of the most valuable lessons that I've learned as a Grant Writer is that no funder wants to be the sole provider of any organization or program (unless they explicitly state otherwise). Ideally, grants should make up about 20% of your annual fundraising goal. Don’t let this discourage you, though; there are SO many ways to raise your nonprofit’s revenue! You’ve got individual donations, board giving, crowdfunding, fee-for-service, and special (virtual) events, just to name a few.
I hope that this has helped transform the way you think about grants. Want to learn more about how you can secure funding for your nonprofit? Let me know in the comments or book a strategy call with me to get the answers you need!