The R.E.A.L. Formula for attracting grantors

There are approximately 1.5 million nonprofits vying for funding from approximate 100,000 foundations every year.  Standing out in that crowd requires a strong survival strategy.

There are a few core criteria that every funding source adheres to when sifting through grant applications. Those criteria can be summed up in the R.E.A.L. formula, as follows:

• Relevancy.  Does your organization's application match up well with the donor's mission, vision and geographic limitations?
• Efficacy – If the funder gives you money, will their mission get the most bang for the buck from your organization, or will it just enable you to keep the lights on a little longer?  Various sources have reported that between 30 and 60 thousand nonprofits disappear from the IRS database each year, prompting grantors to confine their support to those organizations that can deliver benefits well into the future.
• Accountability – Does your organization have a strong track record of transparency relative to your previous operations, outcomes  and funding partnerships? Can you provide concrete examples to prove your successes and verify your financial data?
• Legitimacy – are you a legally recognized nonprofit with good references and strong outcomes?

Increasingly, as detailed in an article by Rick Cohen in the Nonprofit Quarterly, foundations are simply refusing to accept unsolicited applications. While some of that reluctance is due to recent economic factors, it is also due to simply receiving too many applications from organizations that obviously can't accomplish their mission.

Other foundations are adding restrictions to application requirements, such as not funding startups, or those whose current revenues are under a preset amount. Most have always required that you provide copies of the long form 990, indicating that your revenues are above six figures.

All prospective grantors use some sort of rubric, either written or implied, to separate the wheat from the chaff. Failing to deliver on funder expectations in any of the above areas can and probably will kill your application.

Some  shortcomings I see often are a lack of data and an unprofessional public persona.

For instance, let's look at legitimacy. The first thing I do when approached by a new nonprofit client seeking grants is to look for them online. I'm looking for a website that actually tells me something about the organization and its key personnel and programs. I want to see some sort of evidence of positive outcomes. There should be a link to the financials and  a copy of their determination letter, or at least the ability to request them.

I am also going to check all the databases for verification of their nonprofit status, including the IRS website, if necessary. While I also check out social media, the most important thing for me is to see if they present well on first impression, since I know that any funding source will be doing the same.

Grantors that ask for a website URL are going to click on the link. Even if they don't ask, they may well include your online presence as a scoring metric.

Master the R.E.A.L. formula and your funding success rate is going to go up dramatically.

Don't know if you will fit the formula?  Drop me a line at rightwords@ida.net for a review.   

Documenting volunteer hours

All nonprofits want and need volunteers.  Volunteers are literally the lifeblood of most public charities.  No matter how much money an organization raises, they typically can't afford to hire paid help to do everything.

Volunteer hours have a monetary value as reported by Independent Sector in this report: http://www.independentsector.org/volunteer_time. The generally accepted average overall value is currently $22.14 an hour, and this figure is further broken down by state in the above-referenced report. The state values range from $15.58 in Mississippi to $34.04 in the District of Columbia.

This is important in many areas but from the standpoint of grant applications, it provides both a yardstick for community involvement and a source of those elusive matching funds required for some types of grants. It also conveys a sense of how efficiently the nonprofit is managed.

In late 2012 I was working with a client to obtain funds for one of their programs.  The application required an invitation from the grantor after submission of a one-page letter of introduction/inquiry.  The LOI sailed through, and the client was invited to submit a full application for a maximum award figure of $25,000, with a matching requirement for $10,000.

One of the requirements was:

"Enter the total number of volunteer hours for the most recently completed fiscal year with a breakdown of how they were applied. Documentation may be required at a later date."  followed by a table:

How used	1st quarter	2nd quarter	3rd Quarter	4Th Quarter	Total for FY 2011
Administrative
Fundraising
Subject Program
Column Totals

Not only did the client not have documentation of the hours, they had not tracked how they were used. It wasn't that they didn't have volunteers, but as one of the principals said:  "We are just happy when people show up to help. We don't count noses or keep track of hours for each one. After all, they aren't employees".

No matter how many times I tried to get even ballpark figures the client simply would not comply with this requirement. In general, they felt that having set attendance requirements, tracking hours and applying them to specific categories "…takes away from the spirit of volunteering" to quote the program director.

 Since they would not and could not produce substantiating documentation for any estimates, I couldn't include even a guesstimate in the table provided. Although we made a general statement to the effect that they held four events a year staffed by volunteers, and the organization had sufficient cash to meet the matching requirement, they didn't get the grant. They just didn't or wouldn't understand the impact that not providing the documentation would have on their application.

It is true that volunteers are not compensated for their time. However, their contributions of time should be tracked as carefully as though you have to pay them $22.14 an hour for every hour they help. They should be entered into a volunteer logbook, and some effort should be made to assign or at least document their contributions.  Volunteer management is, or should be treated as a sort of quasi-human resources function. Each program or task they help with should be traceable to a specific benefit to your organization.

As nearly as I could determine, this organization got about 400 hours a year from their volunteers. Leaving out the management aspects of effective volunteer recruitment and management, why would you not want to track volunteer contributions?