Inside Foundant – the Blog

Want to Increase Nonprofit Funding? Start by Increasing Your Transparency

On July 16th, GuideStar partnered with GlobalGiving, Foundant Technologies, and The California Endowment for a live demonstration on how nonprofits can update theirGuideStar Nonprofit Profile and give their organization the potential to increase its funding through major foundations, corporate giving portals, and individual donors.  In case you missed it, click here to download the full recording and slides from this webinar. As a follow up, here our panelists answer some of the most popular questions attendees asked during and after the event!

Webinar Panel

What are the “red flags” that grantmakers look out for when reviewing applications?
There are many and I think you should gather feedback from multiple funders on this subject but I’ll focus on one that I hear over and over again.  Grantmakers typically want to hear your story in very concise terms with limited “fluff”.  Grantmakers receive many applications and it is a tremendous amount of work to read and evaluate each proposal so there’s a reason why they do things like place character limits on each question on their online grant application forms.  There are exceptions, but most grantmakers view lengthy applications with supporting materials such as multimedia, annual reports and copies of the invitation from the annual fundraising gala as a burden that costs them valuable time.  Focus your efforts on telling the concise story of why you are the most qualified organization to deliver results that will maximize the use of the grantmaker’s funding. – Daren Nordhagen

How can nonprofits work together even though they’re, in a sense, in competition with one another?
Great question and you’re right, nonprofits definitely compete for the same funds. But this doesnt mean they don’t see value in collaborating and it’s not unusual for organizations to group together in a single proposal to a large donor.  When it comes to fundraising on the GlobalGiving platform, we have seen different organizations raising funds for the same program when they are all involved in that program. But when it comes to sharing individual donor bases, this is less common. Individual donor relationships are really difficult to cultivate and organizations rarely share this information with others.  – Linda Oatley

What’s one top way to attract the attention of grantors?
Share you stories of success AND failure. Everyone rushes to tell grantmakers about their success stories and it is critical that you show how you deliver successful outcomes. However, I believe that the willingness to share your failures and lessons learned along the way can help you stand out from the crowd. Sharing such stories helps demonstrate that you’re comfortable in your own skin and have gained valuable experience in the causes that you serve. -DN

Any tips on how to find new sources of revenue besides government and foundation grants?
Crowdfunding is a great source of revenue that doesn’t involve grants. Alternatively, organizations that have the right set-up can charge membership fees or have revenue-generating activities. But the alternative we talk about most is crowdfunding (and GlobalGiving of course!) to fill the revenue gap. – LO

What advice do you have for nonprofits where transparency is not a true value of fellow officers?
In the age of digital information, a story is being told about your organization whether or not you choose to participate.  Grantmakers and other donors have access to a wealth of public information as well as the social media dialogue about all nonprofits.  At a minimum, nonprofits should be monitoring these channels to protect their brand from negative dialogue.  More strategic thinking nonprofits should be leveraging their public data profiles to create positive momentum for their image. – DN

What are some tools to increase public/stakeholder understanding of organization’s role/benefit to community?
Definitely check out Nesta’s DIY toolkit and Feedback Store for tools to collect and analyze community feedback. GlobalGiving also just launched GG Rewards (learn more here.) We’re using gamification, incentives, and behavioral economics to encourage organizations to listen to the people they serve, to act on what they hear by testing new ideas, and to learn faster and more efficiently. (We call this the Cycle of Progress: Listen, Act, Learn. Repeat.) – LO

What do grantmakers really look for in the finances of NPOs in order to make a decision to fund or not? 
Each funder has different criteria by which they assess nonprofits.  Ultimately, funders want to make sure that their investments are not just programmatically sound, but financially sound as well.  Here are a few of the items The California Endowment reviews when considering funding requests.  These items don’t necessarily mean we opt out of funding, but rather consider how our funding will empower the organization to success.  Funders can look at the diversity of an organization’s funding stream.  Are there multiple sources of funding or a single large funder over an extended period of time.  Does the organization have audited financials? If so, are there any red flags, legal expenses, unpaid payroll taxes.  How much operating reserve is available? – DE

Any tips for how nonprofits can attract new funders?
Complete your GuideStar profile as a first step and utilize your existing funding sources to help you make new connections! – DE

Thank you to Linda Oatley, Director, Partner Services Team, GlobalGiving, Dolores Estrada, Manager, Grants Administration, The California Endowment, and Daren Nordhagen, President, Foundant Technologies for partnering with GuideStar in this webinar and answering the preceding attendee questions.