New nonprofits are often eager to start grant writing. Grants are often seen as free, easy money, given the abundance of foundations and other grantmakers cutting checks to charities. Grants can be a great way to bring in tens—or even hundreds—of thousands of critical dollars, but it’s important to make sure your nonprofit isn’t rushing into grant writing.
New nonprofits are often too eager to start grant writing, spending too much money or committing to many resources to a venture that is ultimately doomed to be unsuccessful. The industry standard says that only about 1 in 10 grants are successful, and that’s even for the most high-profile nonprofits.
More and more, foundations are requiring two to three years of audited financials before they will even accept a grant application. So if you’re a new nonprofit, you will be very limited in the grants you can apply for.
In addition, new nonprofits often aren’t prepared to meet a range of other requirements listed in grant applications. Grantmakers like to see that you are measuring the outcomes of your programs and making progress towards affecting real change in your community. They’ll want to see a healthy board of directors and robust sources of other income.
Grantmakers are like investors, who want to know that their grant will make a real impact with a nonprofit that isn’t going to close its doors in a year. It’s best to wait until you have a strong organization and can make a good case for why you deserve their funds.
There are several steps you can take to become more prepared to compete for grant funding.
- Start measuring your program’s outcomes and successes.
- Thoroughly research possible grantmakers and become familiar with their application requirements and who they typically fund.
- Build a set of diversified, strong income sources
- Develop a robust, well-connected board of directors who can be resources in all aspects of your nonprofit’s development
Where to start
Once your nonprofit has become prepared to write grants, there’s the matter of actually starting the grant writing process.
First, decide whether you can handle the often cumbersome task of writing grants in house, or if you need to hire an outside firm to take care of business. If someone in your office has the time, energy, and experience to do so, great! If not, there are lots of experienced companies that you can contact to help out.
Next, if you don’t already know of relevant grant opportunities and funders, start with prospect research. There are subscription-based databases like Foundation Directory Online that can be great places to look for strong matches. Local libraries often offer free access to FDO, or you can contract this piece out to a grant writing company.
Third, know that building relationships with foundations is crucial to grant writing success. Some foundations don’t want to hear from you unless it’s via paper application, and they’ll say that on their website or in their guidelines. But most will welcome an introductory call to get some questions answered before you apply, or a follow up if you’ve been rejected. They’ll want to make site visits to see your program—and their dollars—in action, and they will want to be invited to program events and apprised of major changes at your organization. Don’t be afraid to keep your door open, as doing so will keep theirs open too.