Do You Need a Website?

Cloudlancer Writing Services usually sends a prospective client a questionnaire to assess organizational readiness to apply for grants. One of the questions asks whether they have a website, and for some reason, in the last two or three months, many organizations have answered “no” to that question, or indicated they have a simple page with their name and donation contact information only.

I absolutely recommend that your NPO have a well-designed and informative website. There are so many hosting services out there that have DIY templates, there is simply no reason not to have one. On the other hand, a really bad website is undoubtedly worse than no website.

The website should provide information as well as ask for donations. Many grantors will ask for your URL, and they may expect to be able to visit the website and receive information that may not be on your grant application. For that reason alone, you should have a website with the information they may be seeking.

The latest surveys of foundation-based grant funders indicate that approximately 20% have gone to a web-based application format.  That is an increase of 5% in two years. That is both a blessing and a curse. Aside from the Common Grant Application format, there is no standardization of these online application processes. Many of them are severely limited in space to provide your grant narrative, and they often do not have space to list your other funders. Others ask for your top five funders, sometimes with amounts, sometimes without amounts. Most of them do not allow you to send other data, such as expanded program descriptions, or documentation regarding funding. They may not ask for your board of director’s information.

A well-designed nonprofit website will answer many of the questions they may have. Smaller nonprofits with low budgets for web development should still strive to answer at least the five “W” questions; Who, What, When, Where and Why.  The website should provide donor recognition (your new donor may well expect some sort of recognition on your website) opportunities, news of events past and future, and some mention of your most outstanding accomplishments in the past year.

Your website should look and feel professional. What is acceptable on social media pages is often not acceptable in the business world. If you must take a really informal tone, provide a link to your Facebook or other social media page. Typos, poor grammar, slang, and Twitter-style writing does not belong on your website.  I actually looked at a website recently whose landing page started out with “Hey there dude, whazzup?” Somehow, I don’t think the review board of the Carnegie Foundation will be impressed. If you don’t feel that you can present just the right impression, we can help you to achieve that balance between professional and empathetic.

Your website is your organization’s online persona. It’s the first impression many people will have of your organization. Make it a good one.

ASPCA Emergency Funding for Hay Purchases

A grant for nonprofits specializing in equine rescues has just opened at ASPCA.  The website states that they will fund from $5,000 to $10,000 for emergency hay/feed relief, with preference given to organizations in drought-stricken areas.  They may also consider applications for rescues affected by Hurricane Isaac. See the full informaton at:

http://www.aspcapro.org/aspca-equine-fund-hay-bale-out.php

If you need assistance, please don't hesitate to contact Cloudlancer Writing Services at www.cloudlancerwriting.com

How do nonprofit funders assess your financial health?

Here at Cloudlancer Writing, I often counsel nonprofits on positioning themselves for maximum competitiveness when applying for grant funds. Mission is important, the ability to show results is important, program development and documentation is important, but financial accountability and sound management of funds is equally, if not more, important. When you move out into the larger philanthropic world, it increases the need to be as professional as possible. These people do not know you, and they have to have a way to assess your organization. The best prose in the world is not enough to put your organization at the top of the pile when applications are reviewed by national, regional or government agencies.  Your local philanthropist may be able to come to your office and chat with you, but larger organizations typically do not visit every nonprofit that they fund.

Many nonprofits have specific financial methodology for deciding which nonprofits should receive funding.  One example of such a tool can be found at:

 http://nonprofitfinancefund.org/files/images/initiatives/financial-scan-sample-report.pdf. 

This report format, which was developed with considerable collaboration with a major financial institution, is the epitome of the formula-based evaluation and uses the data obtained from your 990. It reads and functions like a loan evaluation form. Other foundations have their own, perhaps less rigid formulas that they have developed over years of experience with the nonprofit sector. The common denominator is that all of them seek to discover whether your nonprofit can survive and accomplish its mission.

As I have often stated, in many ways the criteria by which grant funding is awarded is no different from that used by a bank or loan company to loan funds. The only difference is that your nonprofit doesn’t repay the funds in cash. Rather, the use of the grant funds is justified from the grantor’s standpoint if it is used effectively to advance whatever cause or mission they are supporting. Since these particular dollars will never be repaid, the criteria for disbursing them can be, and often is, even more stringent than a loan application.

No funding agency, whether philanthropic or not, wants to see the dollars they provide squandered. Your nonprofit track record of getting maximum good out of the dollars you have been given is the charitable equivalent of a 900-point credit rating. No matter how great the need, no matter how committed your organization is to its mission, if you can’t prove good stewardship, your application is likely to be rejected.

I do not necessarily subscribe to the idea that all nonprofits must “solve” a problem to be considered for funding. Sometimes, the best that can be achieved is mitigation of the issue at hand. If your nonprofit supports victims of domestic violence for instance, your single organization can’t eliminate all the root causes. Poverty, substance abuse, illiteracy and a myriad of other factors enter into the equation. What funders DO want to see is that you are having a measurable and sustainable impact. Perhaps it’s a program to retrain the people to obtain a better income. Perhaps it’s substance abuse counseling. Perhaps it’s simply a way to be removed from the violent situation. If you can show that the dollars you were granted are providing solid, measurable results, and that you can support your daily operating expenses, that is usually enough to meet the grantors expectations.

To provide that proof, and keep track of your results year-over-year, you will need sound financial reporting, a program that provides for a clear description of the problem you are addressing, and clear result-based reporting. That is what funders are attempting to measure, using not just glowing accolades, but financial evidence that you have a defined mission, that you spend money wisely to gain maximum impact on the problem, and that you have a clear path to sustaining the program even without their specific funding. When applying for funding, don’t start out with a built-in roadblock. No matter how small your nonprofit is, good financial recordkeeping will help to position you for success.

If I Could Assemble the Perfect Board of Directors

Because I deal with numerous small and newer nonprofits, I see many ineffective boards. Not bad boards, in the sense that they are disinterested, or self-serving (those tend to crop up more in long-established organizations), just good people with good intentions and a lack of organization and little to no understanding of what a nonprofit board is supposed to accomplish.

The first board of directors for new NPO’s is typically comprised of people united in their vision for the organization. They took the steps to “make it happen”. They are emotionally and often financially invested in providing goods or services to needy populations of one sort or another. They are the “founders”. That’s a great place to start, but the very closeness they first enjoyed, eventually leads to a sort of organizational paralysis. 

The Board, by definition, is not supposed to perform the daily duties of running the organization. They are supposed to formulate policy, generate the first budgets, write and approve the first strategic plan, and provide ongoing ethical, financial and legal oversight (governance) for the organization. At the outset, the lines between employee and board member are going to be blurred.  Most initial boards do not observe a firm policy for term limits and recruitment of new board members.  They may have such a policy in the bylaws, but in reality, their investment in the organization makes it very difficult to add new blood.

If I could design the perfect first board, I would envision it as having enough members to form committees or at least to have “specialists” in one area or another.

My ideal board would have:

A.  One member with a financial background, to evaluate investment strategies and assess the financial statements with a professional eye. This could be a CPA, a banker, an investment broker or anyone that deals with numbers and finance on a daily basis.

B.  A marketing/public relations/fundraising professional to evaluate fundraising and campaign strategies.  

C.  An attorney, to ensure that the NPO doesn’t run afoul of the myriad regulations governing nonprofits.

D.  One or more business owners or managers, to provide common sense perspectives on the organization.   

E.  The founding members, to keep the passion alive.

If the founders themselves encompass these attributes, fantastic!  If not, I would advise them to recruit members that do, at the outset.   One caveat here…although I recommend having professionals on the board, remember that they can’t benefit monetarily from those skills as contractors to the organization while they are serving on the board. Your financial person can’t be the CPA who performs your audit, for instance.

And, as hard as it may be, plan on adding new people to the board on a regular basis.  That might be every two years, it might be every four years, but recruit, evaluate and add them regularly. Of course, that means that at some point, someone is going to have to “retire”, or you are going to have a 500-member board.  Plan for that in your initial bylaws, and accept that if new members are properly vetted, they will be an asset to the organization.

Grant opportunity.

The Intermountain Funder Network (IMWFN) has announced the launch of a small grants program for locally based nonprofits in the eight-state region of Montana, Idaho, Wyoming, Colorado, Utah, Nevada, Arizona, and New Mexico, and the eastern regions of Washington, Oregon, and California.

The primary focus of the program is to identify and fund examples of innovations that can help expand thinking about how a community or region can engage its constituents to create innovative solutions to a variety of topical issues, including sustainable land use, water, public lands, etc. IMWFN intends for these grants to support authentic community engagement that leads to environmentally sustainable, socially equitable, and economically prosperous regions and communities. Grant mounts will range from $2,500 to $15,000. 

More information about IMWFN may be found at the website:

http://www.fundersnetwork.org/participate/intermountain-west/

If this sounds like a good fit for your organization, Cloudlancer Writing Services would be happy to assist you in determining whether you qualify, and in writing the proposal.

ARE YOU REALLY SURE YOU WANT TO BE A NONPROFIT?

I get a couple of dozen inquiries a year that start out something like this:  “I love helping XXXXX and want to start a nonprofit so that I can apply for grants to help more XXXXX” Their interests are as varied as the people themselves. Animals, children, veterans, the homeless, the arts, plants, the environment, their local city park, all of them have worthy targets for their help.

Helping anything or anyone is an admirable goal.  However, there is a little bit more to becoming a nonprofit than most people realize.

It takes more money, more time, and especially more effort than most people imagine. Not counting professional fees, such as the on-going services of attorneys, accountants and yes, consultants, my general rule-of-thumb is a minimum of $2,000, just to file incorporation papers, draw up a set of by-laws that are legally compliant in your state, pay the Internal Revenue Service the fee to file the 1023 application, and set up a rudimentary website. All of that except the website has to be done before you can even apply for grants. I include the website, because the 1023 does ask if you have one, and because it is the first place most people will go to learn more about your organization.

Surprisingly, it isn’t the money that generally causes the would-be philanthropist to abandon the goal of becoming a non-profit. It’s the amount of organization and business-type effort required.

Assembling a board of directors, drafting by-laws and a code of ethics, writing cogent mission, vision and values statements, preparing a strategic plan with rudimentary budgets for operations and programs, and setting up an effective website all take time and energy. As one lady said, “If I get bogged down in all that stuff, I can’t help anybody”.

I have nothing but admiration for groups of people that form nonprofits. However, if all that “organizational stuff” doesn’t appeal to you, there is certainly nothing wrong with volunteering with an organization that aligns with your interests. Volunteers are the lifeblood of any nonprofit, so if you want to help, by all means, volunteer!

If you do want to form a nonprofit, start with good basics, and you will be well on the way to helping far more XXXXX than you are at the present time.

Financial Data Collection for RFP’s

Grant writers are seldom afforded the luxury of being able to compile a grant request or complete a final grant report with raw data. Generally, they are given data compiled internally by the organization. Budgets, program fund utilization, populations served, total widgets or services provided, all that data comes from reports such as income (profit and loss) statements, balance sheets, audited financials, annual reports or internal program reports.

If the figures provided are not verifiable or if they are incomplete, the grant application may contain skewed data. For instance, if the program director keeps statistics on say, number of people served (or animals rescued or whatever), that should bear some correlation to the final financial statement.

Say that your organization reports that it cost $100.00 per recipient to deliver a certain service. That should ideally include both direct and indirect costs. Let’s say that you are reporting on funds used for expenses related to adopting a pet.

The program director says the cost of shots, other vet bills, and food for an average animal is $75.00. These are direct costs specifically attributable to each animal. The accountant or bookkeeper says the true cost is $100.00. Why the difference?  Obviously there are general costs, such as rent, transportation, insurance, advertising, utilities, and staff salaries that are attributable to the organization as a whole. These are indirect costs. The financial department is going to take the total cost for these items, add it to the direct cost and divide it by the number of animals adopted, and that figure will be different from those of the program director. Technically, both are correct. So, which one does the grant writer use?

In most cases, they will use the larger cost figure, because the direct expenditures can’t occur unless there is sufficient funding available to pay the indirect costs. If the proposal requests a breakdown, they will show which expenses are general indirect (also called administrative) costs and which ones directly impact the cost of making the animal ready for adoption.  

It can be very important to the success of the grant request to portray the data accurately. Be sure that you at least note the sources of the data for the grant writer. In addition, data that you may make available on your website should match what you are reporting on the grant application, or in the final report. If you applied for funds stating that your cost was $100.00 per animal, and your website says it is $75.00 per animal, that could be a problem unless the discrepancy was explained at the outset.

Grant writers, even full-time employees of the organization, are expected to perform due diligence to verify any statements of fact in a grant application. The better your cost and service statistics are, the easier it is for the grant writer to attest that the facts are true to the best of their belief. Incomplete or conflicting information or “fuzzy math” can result in a grant writer refusing to submit the application, or the donor refusing the application entirely.