1 FUNDING PLANS Grantsmanship and Fundraising College of Public and Community Service University of Massachusetts at Boston © 2008 William Holmes

2 FUNDING PLAN GUIDELINES 1 Incorporate with Secretary of State Incorporate with Secretary of State Register with AG Register with AG Get Taxpayer Identification Numbers—EIN, STEN Get Taxpayer Identification Numbers—EIN, STEN Involve Board in Planning and Implementation Involve Board in Planning and Implementation Focus goals on resources needed to achieve strategic goals Focus goals on resources needed to achieve strategic goals

3 FUNDING PLAN GUIDELINES 2 Identify multiple sources and strategies for each goal Identify multiple sources and strategies for each goal Find persons with experience in each strategy chosen Find persons with experience in each strategy chosen Specify who will do what Specify who will do what Establish positive public relations Establish positive public relations

4 FUNDING PLAN GUIDELINES 3 Create appropriate support structure Create appropriate support structure Assess source tradeoffs Assess source tradeoffs Identify qualified donors Identify qualified donors Plan approach for donors Plan approach for donors Get financial house in order Get financial house in order

5 SourceAdvantagesDisadvantages Individuals · Largest source of giving · Ongoing source one can build · Once a giver, also an advocate · Volunteers are a good source of money · Costly to develop, small return per individual unit · Hard to generate unless broad- based direct service appeal · Risky for the inexperienced · Need significant assistance from the Board and volunteers Large-Family Foundations · Source of large sums of money · Accessible, professional staff · Clear guidelines, process · Most likely to research your request · Board volunteers can help, not always key · Start-up funds only · Lengthy process · More difficult to access through personal influence · Proposals may be more lengthy FUNDING SOURCE TRADEOFFS 1 Source: Management Help Organization, 2007

6 SourceAdvantagesDisadvantages Community Foundations · Much like large- family foundations · Staff may be sufficient · Host of foundations within foundations · Most money is earmarked, special funds Small-Family Foundations · May fund ongoing operating expenses · Personal influence with board members helps · Guidelines often broad · Not very fussy about grant format · Hard to access, no professional staff · Often not large sums of money · Without personal influence, may not be possible FUNDING SOURCE TRADEOFFS 2

7 SourceAdvantagesDisadvantages Large Corporations / Corporate Foundations · Can be source of large sums of money · Smaller amounts of money may be ongoing · Often accessible, professional staff · May be tied to volunteer involvement · Business strategy may be clear · Source of cause-related marketing · Large sums of money aren't ongoing · Hard to get around staff · Must be within their guidelines · Not likely to contribute if not headquartered locally or have a public consumer base · Often want board representation Small Corporations · Very informal approach · Money may be ongoing · Personal connections will suffice · Neighborhood focus will help · Small amounts of money · Narrow range of interest · Personal contacts are key FUNDING SOURCE TRADEOFFS 3

8 SourceAdvantagesDisadvantages Federated Funds (United Ways, United Arts, Combined Health Appeal) · Steady source of relatively large sums of money · Clear process · Professional staff, can be agency staff driven · Generally can't be a start-up organization · Must be social service and fit priority focus · Very lengthy entry process · Very time consuming as must be part of yearly fund raising process, with periodic in-depth review Government · Large sums of money possible · Process is set, clear · Political clout helps · May be source of ongoing money · Application procedures may be long, tedious · May only pay by unit of service, fluctuates · Unspent monies may be returned · Difficult record keeping Churches and Organizations · Often looking for group projects · In-kind services most likely · Need to fit their service focus, neighborhood or religious outlook FUNDING SOURCE TRADEOFFS 4

9 IDENTIFY QUALIFIED DONORS Who do you know? Who do you know? Who do your friends know? Who do your friends know? What are they interested in? What are they interested in? What issues do they support? What issues do they support? How much to they support their issues? How much to they support their issues? How does your program relate to their issues? How does your program relate to their issues?

10 APPROACHING DONORS 1 Use personal contacts Use personal contacts Establish prior contact without pitching Establish prior contact without pitching Arouse non-financial involvement Arouse non-financial involvement Establish fundraising effort Establish fundraising effort Establish program credibility Establish program credibility

11 APPROACHING DONORS 2 Establish fundraising benefits Establish fundraising benefits Establish fundraising credibility Establish fundraising credibility Establish fundraising levels Establish fundraising levels Have fallback participation available Have fallback participation available

12 DONORS AND GIFTS May be real, personal, or financial May be real, personal, or financial May be conditional May be conditional May be restricted May be restricted May or may not be revocable May or may not be revocable Requires competent decision-making Requires competent decision-making Requires evidence of intent Requires evidence of intent

13 DONORS AND LIFE ANUITIES Provides cash for donor when alive Provides cash for donor when alive Provides cash for charity after death Provides cash for charity after death Poor response to financial change Poor response to financial change Provides until conditions met or funds dispersed Provides until conditions met or funds dispersed More certainty, less flexibility More certainty, less flexibility Can’t be revoked. Can’t be revoked.

14 DONORS AND LIFE TRUSTS Provides cash for donor when alive Provides cash for donor when alive Provides cash for charity after death Provides cash for charity after death May respond to financial change May respond to financial change May provide cash indefinitely May provide cash indefinitely Less certainty, more flexibility Less certainty, more flexibility Can be revoked. Can be revoked.

15 GETTING FINANCIAL ORDER 1 Review financial system completeness Review financial system completeness Consider fundraising software Consider fundraising software Do cost analysis for program Do cost analysis for program Do cost analysis for resource desired Do cost analysis for resource desired Check income and expense projections Check income and expense projections

16 GETTING FINANCIAL ORDER 2 Consider contingency budgets Consider contingency budgets Reduce unnecessary overhead Reduce unnecessary overhead Establish reasonable fees Establish reasonable fees Remember non-cash contributions Remember non-cash contributions Identify and track “unrelated income” Identify and track “unrelated income”

STRATEGIC FUNDING PLAN SUMMARY Identify strategic goals Identify strategic goals Document goal related needs Document goal related needs Discuss how relates to funder’s goals Discuss how relates to funder’s goals Present actions to achieve goals Present actions to achieve goals Discuss how document results Discuss how document results Present costs and justification Present costs and justification Discuss alternative funding sources Discuss alternative funding sources 17