July 2020 – Social Impact Yodas

I’ve been getting many questions lately from fledgling nonprofits about how to raise funds. Some of it is not rocket science and just requires a lot of work. And some of it is a matter of access and that’s been an ever-present equity issue in philanthropy. It’s not fair who has access to high-net worth donors. I’m writing this blog off the cuff, so it’s not comprehensive. I’m not, for example, discussing getting public funding since typically more well-established nonprofits receive that type of funding. I encourage you to Google search as well!

Lead with the Point

To start, work with a friend who is in marketing/communications (or is a strong communicator) to help you create a crisp 30-second elevator pitch to summarize your nonprofit:

A problem statement. Clearly articulate the problem you’re trying to solve. Why is this a problem? How many people does it affect? Why does this matter?
Your proposed solution. How exactly does your proposed project address this problem? Why is your solution is better than existing solutions?
Your expected outcomes. What would success look like for your project? What will your impact be? How many people will be served? How do you expect to change their lives?

I’ve met nonprofit leaders who spend 15-20 minutes trying to describe their nonprofits, and I still don’t understand what they do. Clear communications is key.

There are thousands of nonprofits out there. You’re basically competing against them for funds. You must have a compelling message.

Individual Donations – General Strategies

Start with friends and family. These are naturally your biggest supporters, so ask for donations from them first. Also ask them to introduce you to others.
Strategically recruit board members who are well-connected. Perhaps they can introduce you to high-net worth individuals who’d be interested in your cause. Your board members should all expect to help with fund raising and should themselves make at least a token donation to your nonprofit, so you can say that 100% of board members financially support your work.
Create an email and snail mail list of all your donors, volunteers, any people who are interested in your work. Ask them to refer people to add them to your mailing lists. Send out fairly frequent and short email updates (not too often as to be annoying, not too seldom so that they forget about you). Updates with stories, photos, and results of your work are important. Do a snail mailing in November, before Thanksgiving, with a donation request — this is when people start thinking about end-of-year donations.

Individual Donations – Virtual Options

During COVID and sheltering in place, it will be more challenging to raise money since you can’t just throw a big gala.

Try raising awareness via Facebook Fundraisers. Try to find someone with a lot of Facebook friends to host a FB fundraiser for you. This is effective if someone has a birthday or special occasion tied to the fundraiser.
Host virtual information sessions via Zoom. For example, this could be a small group event where you ask one of your board members or volunteers to invite 5-8 of their friends to attend to learn more about your work. Have the host make the ask for donations on your behalf.

Individual Donations – In-Person Options

Ask volunteers to host happy hours (where a small % spent on drinks might go to your nonprofit) or small group dinners so you or they can present about the nonprofit to their friends.
A lot of larger nonprofits like to host annual marquee events like soirees, galas, auctions, etc. I do NOT advise this for small nonprofits because it’s risky to pay a lot of money to rent a space, pay for food, without guarantee that you will more than break even. If someone can offer you a free space/facility, that might be an option.

Philanthropy and Grants

Check out Candid / The Foundation Center and use their database to search for foundations that fund nonprofits similar to yours.

Look at your region’s community foundation to see if there’s a contact that you can reach out to, to see if there would be any grant opportunities. Sometimes community foundations might have small grants available. Sometimes when there’s a disaster (natural or otherwise), they offer rapid response funding.

A lot of foundations don’t accept unsolicited grant proposals. In other words, nonprofits have to invited to submit a proposal (or a letter of intent). Unfortunately, due to access issues, you may need an introduction to a program officer at a foundation in order to have them invite you to submit a grant proposal. This access issue is an equity issue: the people who tend to know philanthropists are probably themselves well-resourced.

Check if you have connections to people who work at foundations (especially those you identified via your search on the Candid website mentioned above). One way is to search via LinkedIn. Another way to meet foundation staff is to attend philanthropy events. For example, different regional foundation associations (e.g., Northern California Grantmakers for the Bay Area region) have free events open to anyone. There are also associations of foundations focused on similar issues (e.g., Grantmakers in Health) – I’m not sure if there are events open to the public, but at least you can look at which foundations are members on their website for funding ideas. Also, philanthropy “affinity” organizations might have events open to both philanthropists and nonprofits. An affinity org is typically a foundation membership organization comprising of people who share a certain affinity, such as race. For example, Asian American Pacific Islanders in Philanthropy (AAPIP) is geared towards AAPI philanthropy professionals, but, while AAPI-focused nonprofits cannot be formal members, they are invited to become affiliates and can attend some events. However, please note that if you do attend a funder-focused event, they typically have a “non-solicitation policy” — i.e., you cannot make any direct asks for funding at these events. These meetings should be “safe spaces” for funders because they are constantly being asked elsewhere for funding. But know that funders always know that nonprofits are looking for funding, so you don’t need to say anything explicit. Be tactful.

Do your homework. If you reach out to a foundation that you don’t have a prior relationship with, be sure to do research on their funding priorities to check if your nonprofit is in alignment. Foundations often have issue areas (e.g., education, climate, workforce development) that they are committed to giving to, and in those cases, it is rare they will deviate from those priorities. Foundation staff are approached constantly with funding requests, ranging in relevancy. It doesn’t present well if you approach them without spending 10 minutes browsing their website to understand their focus areas.

If you can’t afford to hire / pay for a contract grant writer, see if you can recruit a volunteer to help you — ideally someone who has written grants in the past, but if not, at least someone analytical and results-driven who is a very strong writer. Grant writing is a profession and large, well-resourced nonprofits can afford to have grant writers on staff and therefore have a natural advantage to writing strong grant proposals.

When you write a grant, make a clear case for how your grant proposal fits the foundation’s stated priorities. If your proposed project doesn’t fit their priorities, I wouldn’t even bother submitting a proposal unless you’ve already spoken with the program officer about this and gotten a nod from them to proceed. Include these components:

A problem statement. Clearly articulate the problem you’re trying to solve. Why is this a problem? How many people does it affect? Why does this matter?
Your proposed solution. How exactly does your proposed project address this problem? How do you know that your solution is better than existing solutions? Do you have any data/evidence? Have you piloted this approach? Do you have any promising results? Have you consulted with the impacted community you’re trying to serve to see if they believe this is the best solution?
Your expected outcomes. What would success look like for your project? What will your impact be? How many people will be served? How do you expect to change their lives? How will you measure your progress?
You/your team. Why do you have the right team to implement this solution? Why not someone else? Do you have directly impacted people leading on or advising this work? In other words, if for example you have a program to serve formerly incarcerated people (FIP), do you have FIPs on staff? Do you have FIPs on your leadership team / board of directors?
Your sustainability plan for this work. Are there other funders you’re approaching to fund this work? Even if you’re able to implement this project, what are your plans for sustaining the work after the grant expires? Don’t expect funders to perpetually fund your work — many of them may not renew your grant. But the good news is, once you get funding from one foundation, it may become easier to get funding fro other foundations. The first foundation helps to serve as validation for your work. Also your program officer should be willing to introduce you to other funders.

More Resources

Use Google to search for fund development advice. There’s lots out there.

Learn about the nonprofit sector and philanthropy:

I invite you to add any other advice, resources, or perspectives on fundraising below in the comments.

Month: July 2020

Raising funds for your new nonprofit