Judging from the number of nonprofit founders that tell me
they need a grant because they have maxed out their personal ability to support
their nonprofit, I'd have to say the answer is a resounding "no".
In my white paper, "Climbing the Ladder to Nonprofit
Success" (you can get a copy by requesting one here) I explain why depending on getting
grants to start a nonprofit, or even winning grant funding in the first year or
two, is not a very wise financial plan.
So where do you get your initial funding after you have put
all the personal money you can afford into the mission? Normally, it is going to be from your board,
your immediate friends and family, small local events or a combination of all
three.
Everyone seems to get the friends and family and the small
events part, but they don't want to make fundraising a board duty.
There will probably always be a philosophical discussion
about whether to set fundraising goals for each board member. I don't understand why that is even a point for
discussion.
Admittedly, many people start nonprofits and ask people they know to be on the board, just
to satisfy the legal requirement that they have a board. It is a good bet that some
of the people they pick say something like "OK, but I won't have to do
anything, right?"
Wrong.
The board should be initially a development group. First and
foremost they should care passionately about accomplishing the mission, and
believe that they can do it. Right after they affirm their allegiance to that
idea, they need to understand that missions need money to succeed. Making the
board an integral part of that aspect of being a nonprofit right at the start
shouldn't be optional.
If founders would sit down and figure out how much money
they need in the first two years, cross grants off the list of possible
sources, and then approach perspective board members with a honest inquiry as
to whether they can contribute to the organization, or at the very least, be willing
to go out individually and raise funds to meet those goals, there would be
fewer failing nonprofits.
When someone asks me to write a grant and then says the
organization is essentially a one-man or woman show, I know that no matter what
I do, the grant thing isn't going to happen. That just isn't a model that
grantors can support.
Increasingly, prospective funders are starting to ask for a
statement as to how much money the board members contribute personally to the
organization. At the very least, they may ask for the amount the board as a
whole has personally contributed in the past year.
The reasoning behind that question is first, to judge how
committed the board is to the organization's survival and whether
they are taking personal responsibility to ensure that success. Second, if all
they see is zeroes or a few dollars from each board member, it tells them that
the organizational strength may not be good enough for them to trust with their
money. Third, they want to know that the nonprofit has enough reasonably stable
funding to stay in business.
Underlying all of those questions is another big one…if your
board doesn't support the nonprofit financially, why should anyone else do so?
Many more funding sources are starting to require proof of matching
funds before they will fund a program, or they are making an award into a
challenge grant. Very new nonprofits usually have a tough time with that, but
if the board is willing and able to gather a few thousand dollars toward that
requirement, it can open the door to
more funding.
For those that feel that accepting board members on the
basis of their ability to contribute monetarily leaves out some otherwise well-qualified prospects, then
consider setting a fundraising goal for those worthy but financially challenged
people. If asking them to go out and solicit donations puts them off, they will
probably never be fully committed in other areas either.
Like it or not, your organization will always be chasing the
next dollar. If your board is so passive that they can ignore that immutable
fact, it is probably the wrong board.
Having this conversation with your board can be tricky. You
don't want to start off by saying "OK, you lazy pot-lickers, it's time to
pony up", even if that's the way you feel. Sometimes all board members
need is a firm goal to chase instead of a never-ending whine about how broke
you are, and they will amaze you. By setting an attainable goal for board contributions,
you maximize the chance that they will put some effort into reaching it.
If you aren't sure how to have this conversation with your
existing board, or frame it in a recruiting pitch, drop me a line and I can help you present it in a
firm but non-accusatory manner.