Developing Relationships with Grant Funders

Cardinal Rule: Never submit a "cold" proposal to a potential funder.

Cardinal Question: So...how do I warm them up?

A couple of years ago, I noticed a trend among my clients: those clients who were good at creating relationships with funders had a significantly higher grant approval rate than those clients who preferred to sit in their offices and not talk to anyone. No duh...right?

Personally, I'd almost rather have oral surgery than try to develop a relationship with someone I hope to get something from someday. I'm an introvert - schmoozing is not my thing. Thus, I completely understand when a client says they aren't sure the best way to develop a relationship that could lead to a grant.

Here is a list of ways you can break that ice and begin to establish a relationship in advance of seeking a grant or other support:

• Don't think about building the relationship as "schmoozing." If you are going, hat in hand, feeling that your position is weak, remember these facts:
• Charitable foundations are REQUIRED BY LAW to give money for the public good. They would not exist without organizations like yours. You are helping them be better aware of the different opportunities in their community.
• By the same token, corporate donation programs exist SOLELY for the purpose of donating (money, time, gifts-in-kind, etc.) to worthy causes. Again, they would not exist without you and you are helping them do their job better.
• Determine which foundations, corporations and/or government agencies should have a natural interest in your organization. For instance: 
• If you provide health services, you should get to know officials in the health department. 
• If you have several volunteers from a large local corporation, you should get to know their corporate donor staff. 
• Find out which charitable foundations support work like yours and target them for relationships.
• Begin building relationships in a way that makes sense for your organization. Some activities could include:
• Offering tours of your facilities and programs can be very effective. I have a client who does this on a regular basis - they invite board members, volunteers, funders, potential funders and other stakeholders to tour their programs. They hire a bus to visit various locations and offer a box lunch to participants. Nearly every tour is full. 
• Put them on your mailing list for any newsletters or other publications. Be strategic in what information you mail them. You don't want to send them your annual campaign letter (that would be a "cold" request) or an invitation to your gala. Until you have a relationship, stick to simple information-sharing pieces. Just don't overload them with junk mail!
• Call a potential funder and ask if you can schedule a meeting with them to share information. Some smaller funders may not be interested in doing this but large foundations with professional staff are almost always interested in learning more about your organization.The more they know about nonprofits like yours in the community, they better they look to their bosses!
• Use your board! If you are an executive director or employee, you should not be the only person trying to create these relationships. Your board members should be comfortable making calls and going to meetings as well. 
• Use your connections wisely - if you have identified some potential funders with whom you want to develop relationships, ask around to see if there are any natural connections. Maybe your board chair goes to church with a foundation trustee. Maybe an employee went to high school with the director of corporate relations. It's a small world - use it to your advantage and allow your "team members" to open some doors for you.

Most of these folks are not naive. They know you are working to develop a relationship because, sooner or later, you are going to ask for something. If they ask about that, don't pretend you aren't. Maybe you have a project or proposal ready to hand them. If not, tell them you just want to get to know them right now so that, when a perfect funding opportunity comes up, you will be ready to present it to them. 

So, when does this relationship become fruitful? Each relationship will be different. As the grant seeker, you will (hopefully) develop a sense of when the time is right.

It won't guarantee that every proposal will be funded. But once you are on the radar for these potential funders, things WILL begin to happen.

Grants for Small Business Start-Ups

Do they really exist? The best source for information.

[Phone ringing]
Me: Good morning, this is Dana.
[Static and mumbling]
Me: Hello?
Voice: Yep!
Me: Good morning!
Voice: Hey, my wife was looking for some grant, uh, grant writer people, people who get grants like and saw your website.  Is that what you do?
Me: Oh, how exciting - I'm flattered that you called me. Yes, I'm at grant writer, how --
Voice: Hang on, my dog got out the derned truck. [shuffling, muffled yelling and truck door slamming.]
Me: Hello?
Voice: Yeah, sorry. I'm back on the road now. 
Me: Great! Is your dog okay? [silently glad I'm not sharing that road at the moment...]
Voice: So anyway, I got some roofing business. Well, sort of. There are roofing equipment (mumble) and this guy I met Saturday said there's grants I can get on business. Roofing. Hail.. (mumble) ...asphalt ...shingle...(mumble).
Me: Oh, you are a business man and you are looking for a grant to help you?
Voice: Well, yeah, I mean, I just wondered...'cuz this guy I was talking to said I could get money that  I didn't have to pay back or only had to pay some back or....aw, heck, I'll have to call you back, my dog just run off again.

This is my reconstruction of an actual phone call I got not too long ago. Mr. Voice never called back (I hope the dog is okay) and I suspect he never got his roofing business off the ground (sorry for the pun.)

I get phone calls along this vein quite often.

Inevitably, the caller has seen a commercial that described business grants, talked to "some guy" who told them they were available, or went to a "seminar" where someone talked about government grant programs to help small businesses (I am perplexed that these seminars talk about grant programs but apparently give NO information about them...)

Here's what I know about grants for businesses: There aren't too many. At least not in the U.S. And they aren't very easy to get.

That doesn't mean there aren't resources for people who have a certain expertise and want to begin an enterprise.

If this is you, here's where I recommend you start:
The United States Small Business Administration. http://www.sba.gov/home

If you are an American tax payer, you've already paid for SBA service, so you might as well use it! The website offers all kinds of resources. In fact, it would take days to read all the articles, use the tools, etc. available there. But there's more!

Just in Oklahoma, where I am based, there are 24 SBA offices around the state whose sole purpose is to provide resources and advice to people who own or are considering opening a small business. Free mentoring, free help writing a business plan, free advice - it's all there! You just need to call them.

Guess what? In all likelihood, the people at the SBA will also know about any random business grant programs out there for people who are interested. There's probably no need to hire a professional grant writer.

Although I loved my experience talking to Mr. Voice and I truly hope his derned dog is okay, I also hope he stopped listening to the guy he met while pumping gas at the Nick'n'Run store and gets some really good, free advice from real experts.

Part II: Starting a Nonprofit?

Please allow me to crush your dreams.

In my last post, I began trying to crush the dreams of people wanting to start a new nonprofit. Sounds harsh, doesn't it?

Truthfully - I don't want to crush anyone's dreams. I would rather see those dreams succeed beyond their wildest imaginations! That kind of success, however, might be better achieved by NOT starting a new 501(c)(3) organization.

According to the National Center for Charitable Statistics:

• In 1999,  there were 631,902 nonprofit organizations in the U.S. 
• In 2009, there were 1,006,670 of them - a 59% increase. 
• In 2012, there were 1.4 million. That's about a 120% increase in 13 years!

Even more amazing is this: in 1999, only 32% of nonprofits had receipts less than $25,000 a year. By 2009, 79.4% of them were that small.

Thus: only 18% of the new nonprofits started in 13 years have enough revenue to hire even ONE full-time employee. The rest of them - all 691,008 of them - are tiny.

In my mind's eye, I see all those 691,008 nonprofits scrambling like ants - working hard for every little crumb they can get. And more ants are arriving on the scene daily to compete for those crumbs.

Is your dream crushed yet? 

I hope not. 

If you are truly committed to making the world a better place through charitable work - please do it! In fact, we should all be doing that anyway. But if you think a NEW nonprofit is the BEST way to do that, please answer these questions first:

• Are there other, already-established organizations doing related work, even if it isn't exactly the same as what you are envisioning? In your community? In your state? Anywhere? You can do a Google search to find them or go to Guidestar and do some research there (it's free).
• If yes, can you offer your time and passion to help them achieve their mission? If there isn't a local group, is there a regional or national group you could encourage to come to your community? Could you ask them to adjust their programming to meet the need you've identified? There is TRULY no reason to re-invent the wheel. If another group is working to meet the need - don't duplicate them; help them!
• If no, check again. Of all those 1.4 million nonprofits, I seriously doubt that there isn't one addressing that issue in some way.
• Still want to start your own nonprofit? Okay, then keep going.
• Do you realize that, if you start a nonprofit, it will not truly be "yours?" You will have to establish a board of directors, who will become your boss. They can even fire you (it happens all the time). Are you okay with that?
• Do you have sources of funding up-front? Lottery money or rich uncle? A circle of friends with deep pockets?  Nonprofits take money and grant-makers are seldom interested in start-ups.
• Do you have the skill set needed to run a nonprofit? Business acumen? Bookkeeping knowledge? Organizational skills? Vision? Communication skills? If you have deep pockets, you can hire people with these skills but, in all likelihood, you will be doing them all.
• Finally, answer this question as honestly as possible: WHY do you want to do this? I often get some version of one of these answers:
• To honor someone I love;
• Because I need a job;
• I don't have anything else to do;
• I used to volunteer for another organization but they made me mad and I knew I could do it better;
• I don't really know why - but I just know that I want to.
• None of these answers - by itself - is a good enough reason to start a new nonprofit.