Cashing In: How to Get Grants from Small Family Foundations
If your organization is like most nonprofits, you’ve crafted a strategy for annual fundraising — including where and when to apply for grants. As you put this year’s plan into action, don’t overlook small family foundations.
Why? Because follow the money: According to the Foundation Center, in 2001, there were some 3,200 family foundations donating a total of $6.8 billion; by 2015, there were 42,000+, collectively distributing $25.9 billion. Since then, charitable giving by family foundations has gone up by 18.3%.
Here are five tips for helping your nonprofit to carve out a slice of that lucrative philanthropic pie.
1. Do your homework. Before applying for a grant, focus on understanding that particular family foundation’s giving parameters. You’re starting to build a relationship, and especially early on, it is important to respect how the foundation works.
This includes ensuring that your proposal aligns with the foundation’s priorities and guidelines. Check out the foundation’s website (assuming it has one); research its listings in directories such as Candid’s Foundation Directory Online and Charity Navigator; and look up its IRS 990s via a reliable source such as GuideStar.
2. Make sure your proposal is easily understood and explained. State your goals, plans, and how you will measure the success of your project. Be clear, concrete, and specific. Small family foundations tend to be wary of hyperbole. In addition, according to a study by Foundation Source, 54% dislike generic proposals.
Communications should be tailored to the foundation’s preferences. If there are published guidelines, follow them. For example, is there an online application process, or should grant requests to be submitted via email?
Remember, too, that most family foundations’ evaluation process involves multiple people — e.g., professional staff plus a Board of Trustees — all of whom lead busy lives outside of the foundation.
A well-defined project is more likely to be discussed by groups of individuals without your intentions being misconstrued.
3. Be clear not only about your project, but also about the impact it will have on your constituents. Building a new building is great, but the building itself is not the endgame; how will it be used, and by whom? This is where you can tap into a small family foundation’s passion.
4. Make sure your contact information is complete and accessible. Many foundations automate at least part of the application process. But when someone from the foundation wants to reach out with a question or for clarification, you or a member of your team had best be available.
5. Ask yourself why this grant is important not only to the project for which you seek funding, but to your organization. It’s helpful to briefly describe how and why the project will further your overall mission and really make a difference. Also explain what sets your nonprofit apart from others addressing the same cause.
There are other advantages to pursuing grants from small family foundations. Such entities often have more straightforward application processes than their larger counterparts, and there may be less competition for their support.
Furthermore, most U.S. family foundations are not endowed by old money. In fact, nearly 70% were created after 1990. Their founders are relatively young and closely attuned to charitable trends. They want to make a difference during their lifetime. So small family foundations may be more approachable as well.
Family foundations now comprise roughly half of all registered foundations in the U.S. Together, they hold approximately 44% of the country’s foundation assets. Each year, they are required by law to give away in the form of grants to nonprofits an amount equal to at least 5% of their assets. Some may give away even more than 5%.
Step up to the plate, and keep in mind the five strategies outlined above when vying for your share of funds from family foundations.