Would it surprise you to know that some nonprofits have never, and will never, turn to grant funding as part of their development plan?

I have worked with nonprofits that have been around for 50 years and are just now venturing into the grant world. They usually take the journey because of the economy, not because they want to rely on grants.

So, don’t assume just because you are a nonprofit organization, you are ‘supposed’ to apply for and rely on grants. This is not the case. Many experts in the field agree that a healthy nonprofit should never depend on grant funding for more than 30 percent of its total operating budget.

Consider the following to determine when your organization should start looking at grants:

  1. If you are in a place where you have met your capacity (staff, space, program, etc.), then it might be time to look at capacity building grants so you can grow.
  2. If you have a capital campaign, you may consider making grants a portion of that campaign to ensure its success and speedy completion.
  3. If you are in a field where long-term funding sources have been cut or eliminated, then you may need to look to grant funding until you can rework your game plan for sustainability.
  4. If you have programs or projects that are excelling at what they do and you feel grants may highlight some of these opportunities and allow you to serve more in your field, perhaps it is time to research what is available in terms of grant dollars.
  5. If you have to ‘create’ a program or project to fit a grant you have found, ask yourself why you want to pursue those funds. Chasing dollars is never a good idea. Decide on your needs, list them, understand them, and then research grants that match those needs.
  6. If your organization has a budget or a previous year’s budget in the red, you may not want to begin writing grants until you have a few years in the black. Donors will see you as a risk and often will not look favorably upon your request.
  7. If your organization is in its infancy, you may find seed money to support your work. Often donors require organizations to demonstrate their history of success prior to considering funding. In many cases, donors may require 3-5 years of successful programming. So, despite a perfect fit on paper, you may not qualify due to the amount of time you have been providing services.

There are many nuances to consider before beginning to utilize grant writing as part of your annual fundraising plan. But, there is also a lot to consider each year before you decide to continue grant writing in your fundraising plan, or removing it, decreasing the dollars you hope to raise through grants, or reducing the dollars you need.  Your reliance on grants should be strategic. I recommend consulting with peers or other development professionals to help analyze your organizational needs before making these decisions.

If you need an easy way to get your documents in order for grant writing, we have a free Grant Readiness Checklist you can download and make your own. This tool will help you track each item you will need for a majority of applications and save you time and energy as you begin preparing winning proposals.

About the Author(s)

Mandy Pearce Funding For Good, Inc.

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