The politics of funding – Is your program relevant to grantors?

The reality of nonprofit funding is that sometimes your mission isn't trendy enough to attract support.

Take the current interest of increasing participation in post-secondary education, and contrast it with the goal of helping low-income people get jobs.

One the one side you have millions being poured into missions supporting STEM education, such as instruction in how to access financial aid for college.

On the other hand you have more local nonprofits struggling to get enough funding to do things like improving access to the workplace for people who just need a steady paycheck.

One group with the latter mission focuses on providing decent clothes for interviewees and training to improve interviewing skills and focuses primarily on workers aged 40 and up, displaced from the job market during the recession. Typically they purchased clothing from local retailers and made it available to interviewees. The program budget was in the low five-figure range annually.

This group is starting to find that even jobs which shouldn't require any sort of post-secondary degree are suddenly being restricted or at least are preferential to college grads only.

An example of this is seen in an advertisement for seasonal employees for a major home improvement supplies retailer. The specific opening was for a seasonal week-end position assisting customers in the lumber department.

The ad reads as follows:

"Preferred Qualifications:  Associate's Degree in Business, Retail Management, Specialty related to department (e.g., design, appliances) or related field OR Certification in trade related occupation required."

Most potential applicant's never get past that sentence, although much further on in the ad it does say a minimum of one years experience is also acceptable.

The low-income-focused nonprofit had several people available who had actually done the job for other employers, or who have experience in other types of sales, but they don't have any of the paperwork required. No degrees, no certifications, just decades in the building material or building trades. Several of their people applied, but none were even interviewed.

That matters, because it lowers the impact, i.e. the provable results of their program, making their program appear less effective.

The aforementioned NPO working with the older jobseekers stated that most of their previous funding sources had switched over to what the frustrated ED called "more media-attractive" support. Their funding has dropped by over 50% since 2010, due to grantor mission realignment.

I suggested that perhaps they needed to incorporate programs that were more, shall we say, "funding-friendly" such as programs to get their people into some type of educational setting or training to make a complete career change.

His answer was that maybe funders need to start looking at the world his people lived in today.

He said "These are people with an excellent work ethic and fully marketable and useful skills, who have from another 15 to 25 years left in the labor force. They have families to support NOW. They have household expenses NOW. They haven't done a thing wrong except to become politically and socially irrelevant. Maybe by the time they can retire or die, we will all be replaced by robots, but that time isn't NOW"

Unfortunately that conundrum is the reality of funding. Sometimes, no matter how worthy or timely the cause, it doesn't resonate with grantors.

That reality will eventually impact your results, so getting a handle on a solution will definitely affect your future.

The answer is to either pursue a shift in your own focus or seek out new funding streams and new supporters, and continue to educate the public on the value and relevance of your mission.

In the end, we designed a campaign to appeal directly to individual donors, utilizing both direct clothing donations and a crowdfunding appeal that ultimately raised enough money to meet goal. Longer term, the NPO is seeking to develop relationships with new grantors.

If I can help you with funding solutions, drop me a line at rightwords@ida.net. 

Happy New (giving) Year!

If you waited too long to maximize the holiday giving season, your appeal just isn't  generating enough funding, or grants are a significant part of your revenue planning, it's time to start your planning for next year.

If you're reading this you might be saying "Aaagh!!  I'm not up for another big campaign right now!"

You and your staff may still be in the middle of all the seasonal charity events, Twitter and Facebook campaigns, and endless envelope stuffing. Sleep might be the only thing on your wish list.

That's known as the post-Christmas burn-out effect. Since the holiday season is often the highest point in most organization's revenue cycle, it's natural to go all out at the end of the year.

That doesn't really matter to grantors. Grants  are awarded at set intervals, and they can take a very long time to produce funds.

A webpage on the site of the  W.M. Keck Foundation perfectly illustrates why you need to be transitioning into next year's grant planning NOW.

Notice that next December's awards are in the planning stages right now. Applications to be awarded June 2016 open up in July 2015. In other words, the grantor is planning a full year ahead. That means you should be too.

To compete effectively for grants you need to have a forward-looking plan, meaning that you should be defining your needs well in advance of needing the funds.

You can't wait until two weeks before an application is due to start planning for it. A perfect example of that can be found on a National Institutes of Health (NIH) webpage: 

http://www.niaid.nih.gov/researchfunding/grant/pages/timelinerev.aspx

If you clicked on the link, you might notice that the suggested lead time to preparing to submit the application for funding is two months, and the award review could take "…days, weeks, or months."

That assumes that you have all your data ducks in a row. Your budget is complete, your procedures are in order, and your actual or projected results are verified, or will be by the time you actually begin the application.

Only then should you start researching possible donor matches.

If you don't have good data at your fingertips, now would definitely be the time to compile and organize it.

Is your charity meeting donor expectations?

Given the high trust level that charities are expected to measure up to, could you look a donor in the eye and swear that all their donations will go to the mission?  More importantly, should you?

Donor confidence is not just important to your nonprofit, it is critical. If donors get even a faint whiff of something a little off, it can take years to regain that confidence.

In an article on 9/11 of this year, the Huffington Post noted that  even the venerable Red Cross took a hit for misleading donors after 9/11/01. The article noted that in the wake of the problem, donor and public confidence in charities in general dropped from 25% approval in July 2001 to 18% by May of 2002.

Charities that lose donor confidence don't survive intact. Some may not survive at all. The above-referenced article also noted that out of about 300 9/11-related charities started after 9/11, only five were surviving by 2006.

The best way to retain donor confidence is to be able to prove effectiveness and be up-front with the donors regarding the use of funds.

Given what I do, i.e. grant writing and funding research, I see this statement a lot.

"Once we get some grant money coming in, we can use part of it to pay you."

Ah…no, you can't. Nor can you pay the back rent or the overdue power bill. Almost every RFP plainly states that funds may not be used to pay debts incurred prior to the grant award. This is known as "restricted" funding, i.e. the use of the funds is restricted by the donor to certain costs for defined programs.

Most of them also state that "usual and customary expenses unrelated to the delivery of mission-related goods and services" (or words to that effect) are not eligible to be paid out of grant funds. The exception would be any grant funds received that state the use of the funds is unrestricted, or may be used for "general operating support".

But what about those individual donors?  The ones that chip in a few dollars every month, or write one check a year?  Of course you would never outright lie, but should you sort of gloss over the fact that you are paying the utility bills with their money? After all, shouldn't they just know that you have to pay some administrative expenses out of donations?

Maybe they should, but they don't. However naïve it may be, casual donors think that every dollar buys a meal, a coat, a bag of dog food, or whatever else your appeal is highlighting.

The best way to avoid that is to either define the percentage of each donated dollar that goes to the charitable purpose, or state in the appeal that funds received are used for both general and program support.

In the beginning, that administrative percentage could be 50% or more. Once you have your infrastructure in place, it should be reflected in your program-to-administrative cost ratio.

Just don't over-promise. It is usually unrealistic to claim that your administrative expense-to-mission allocation goal is five or ten percent of total donations. If you've done a proper business plan, you should have at least a rough idea of what percentage of the money will eventually be used for organizational support versus program expenses.

Be sure to let donors know about the good things their money has purchased. If your food pantry  fed 100 people every Wednesday of the last year, put it in your year-end report and plaster it all over your website and social media accounts. If your program participants are willing, tell a few personal stories. Have an animal rescue?  Along with all the animals needing homes, have a page for those that found their forever homes.

Like your Mom always said…honesty is the best policy. 

Why should your nonprofit have a blog?

I look at a lot of nonprofit websites, Facebook pages and other online communication mediums while working on messaging or developing a grant narrative for clients. About half of them have a blog. After reading them, I sometimes wonder if they truly understand their audience, or the purpose of the blog

.

Business-related blogs today are not about posting a note about an up-coming event or a notice of a sale. There are too many short-form ways to communicate to use a blog for that reason.

Blogs today are a way to provide a way to keep customers or in the case of nonprofits, donors and supporters, interested in supporting your organization and recruit new supporters.

To do that you need to provide something that takes more than three seconds to read, and while there is an SEO (search engine optimization) element, good blogs are more than that.

    

Savvy for-profit businesses know that a good blog engages, educates and informs as well as selling something. The blog should integrate with another facet of the business.

For instance, a business selling safety equipment for homes might link to their blog from their product description page like this:

"Item Description: Home fire alarm. Do you know how long you have to escape a residential  fire?  Check out our blog(link here) to see how long you can safely stay in your house when a fire starts."

The blog post then goes into detail about how long you can safely stay in a burning room, why and how to escape and offers a link back to the product ordering page.

The blog post does two things. First it provides factual information that makes the purchase of the item they are selling seem imperative.  Second, it keeps the business name connected to the customer in a very personal way.

Nonprofit blogs usually don't seem to be written for the right reasons or the right audience.

I recently checked out a nonprofit blog for an organization that provides a type of monetary assistance for medical needs. The last few posts were all about how this or that legislation affected this organization, and it contained a lot of industry jargon and acronyms that only a health care-savvy insider would understand. Yet, on their SM page they were complaining that they were having trouble getting their message out. Other than the URL, the nonprofit name, mission and  program title wasn't mentioned in the blog.

The audience I would think they would be interested in is one that can use their help or support their mission, but they seemed to be writing to effect some sort of political change at best, or just complaining to the world in general at worst.

Perhaps a more useful approach would be to engage donors by explaining how their support could provide X dollars for Y medicines or medical devices.  Or, they could engage their potential beneficiaries by offering information on support groups that they work with to reduce medical costs, or show how much their help had increased access to care or equipment. Even better, they could have done the occasional in-depth feature post about a person they had helped.

The point is, there was no reason for someone to engage with them vs.some other nonprofit.

If I was a donor looking for background on them, I might worry that my contribution would be used to lobby for something, or that the organization was about to go under because of the legislative pitfalls they described. That's not a good message to send.

Good blogs bring good results. Think about what outcome you want your blog to have, and write it for the right audience. Don't assume that they know all about you. Offer them some reason to remember you, and to connect with you regularly.

 Don't be afraid to have some length to the posting if the topic warrants it. Most of the blog posts I write for clients are from 350 to 800 words.  If you'd like a free review of your blog, send me an email.  Let's make your blog a truly effective outreach medium.