Want to see “sea change” at work in a foundation that knows how to navigate uncharted waters? Read on.
I was fortunate enough to earn a feature article in The NonProfit Times for my session at AFP New York City’s Fund Raising Day in New York in June. Pleased to share with you here: Answer The Question, Win Valuable Grants – The NonProfit TimesThe NonProfit Times.
This morning’s press release from The Giving USA Foundation reports that overall foundation giving for 2014 logged in at 8.2% higher than 2013. Adjusted for inflation, the figure clocks in at 6.5% higher. Foundation giving accounting for a full 15% of overall philanthropy, reflecting an overall high for this sector.
The report appears to substantiate The Foundation Center’s prediction that overall foundation from November 2014 that foundation giving was experiencing an uptick, with contributions increasing among both independent and family foundations. The Giving USA report notes that independent foundation giving does indeed drive the increase according to its researchers.
Link to both reports/releases below:
Each fall, I teach a course on foundation and corporate grants as part of Columbia University’s Masters in Fundraising Management program. In our first class, after the usual introductions, I tell my students the following: “60% of writing a grant proposal involves following the instructions; the other 40% involves choosing your words, choosing your approach and making the right connection with the reader — that’s the fun part!”
Now I realize that “grant writing” and “fun” are not two words/figures of speech commonly found in the same sentence. But I look at most applications as a puzzle or challenge to be worked out. Who is this foundation? Who is the individual reading my proposal? What might motivate them to take this application seriously and, better yet, take action on it and become a stakeholder in our work?
To me, the 40% boils down to the following:
1.Understand the prospect. This is one of the basic tenets of all successful fundraising. How do I make the right connection between my opportunity and what the donor wants to accomplish via their philanthropy.
2. Move from need to opportunity. Speaking of which, its more about opportunity than need. Most grantmakers understand the needs and problems we are addressing. And most don’t know about the opportunities we have to do something it.
3. Frame your story. For most foundation readers, engagement comes down to context. Are we presenting too big of a picture to the reader and, in doing so, suggesting that we are trying to bite off way more than our organization can chew? Are we presenting too small of a picture, asking for a lot of money to help relatively few people? Or are we framing something that balances capacity with our capability to stretch to do something more — and hence the need for a foundation’s support?
4. Pick up clues and cues. I read foundation websites for way more than the application instructions. What kind of language do they use? Is their point of view “old school” or “new school”? What are the foundation’s particular values?
5. Mirror, Mirror. Picking up on clues and cues, how can I write in a way that will demonstrate to the reader that we have comparable values, points of view, approaches? And if we don’t match on every point, how are our differences in approach complimentary?
6. Choose your words carefully. Every semester, I assign Tony Proscio’s wonderful essay “In Other Words” to my students. It is an incredibly thought-provoking work about how language is used among grantmakers and grantseekers and how content can get lost in jargon.
60% perspiration, 40% inspiration? Interpretation vs. information? How do you view the writing process? Continue the conversation below.
I love the days immediately before the New Year begins. For me, they are filled with reflections of the joys and challenges of the prior 11.9 months and anticipation for what is to come. Anticipation is a good word as we stand on the verge of 2015, since we are ending a year in which foundation philanthropy seems to be solidifying a long-awaited comeback.
The conventional wisdom is that foundation giving will always remain strong as we head into a recession (after all, many give based on prior-year returns when the market was stronger) and will trail a recovery (alas, the same principal still at work but based on a weaker market). The Great Recession seemed to have challenged that rule significantly since not only were foundation boards trying to sustain their philanthropic mission (not to mention the minimum 5% distribution) but were at the same time trying to rebuild endowments. Talk about building the boat as you sail across an ocean!
And lets not forget the game change of the disappearing foundation. Atlantic Philanthropies is in its final spend-down phase having left an enormous legacy, a deep footprint on its way to leaving a significant void among the giants of the foundation world. To be sure, new “Atlantics” are abloom but perhaps being created with the same notion of spend and invest generously during the lifetime of the donor. I refer to this as “supernova philanthropy” — a magnificent burst of energy as a star explodes leaving behind a beautiful aura as a legacy for astronomers and star-gazers (like moi) to behold.
Which brings us to “The Cautious Comeback.” For your consideration:
* According to Giving USA 2014, foundation giving marked a 5.7% increase in 2013.
* The Foundation Center’s own “2014 Key Facts” report published in November 2014 predicts that when all is said and done, ” overall foundation giving will continue to grow a few points ahead of inflation in 2014.”
* The 2014 survey of 637 foundations by Grantmakers for Effective Organizations found that the median level of grants devoted to general operating support rose to 25 percent in 2014, up from 20 percent in 2011.
* Foundation Source, which consults to and helps family foundations manage their funds notes in its annual report that “the combination of a recovering stock market and additional contributions by their funders resulted in increased foundation endowments for a second straight year, in spite of charitable distributions that exceeded the 5% minimum by almost 50%.”
The conditions for a comeback have been created and creatively used by foundations to increase giving. Looking ahead, I see both opportunities and challenges:
Opportunity: General operating support grants are on the rise as many grantmakers seem to be willing to help charities maintain/sustain operating infrastructure costs. According to a colleague in foundation world, this may be because they have seen many grantees make efficient, wise and pragmatic management decisions during the recent financial crises and this has reduced the sense of risk in these types of grants.
Challenge: I see more foundations closing portfolios, preferring to continue to support long-time grantees. Finding new grant opportunities is becoming more difficult and time consuming, adding to the length of time it takes to build or expand a grant portfolio.
Opportunity and Challenge: From my own work as a consultant, I have seen how many foundations have emerged from the Great Recession with stronger, more-targeted philanthropic investment strategies. This will be boon to some and a barrier to others.
I close by wishing all of you every success in your grantseeking efforts in the year ahead. May 2015 bring the investments of others toward the good you bring to those who benefit from your mission, passion and good work.
Its high noon, Eastern Time, and am taking a look at the just-released information from Giving USA’s report on 2013 philanthropy. Two items jump out at me this time around.
•Foundation giving overall posted a 5.7% increase. This is better than the previous 2% to 3% gains which kept foundation philanthropy just about on an inflationary par. This likely reflects a good market earnings year for foundation portfolios coupled with the creation of some new foundations over the past year.
•Giving to foundations, adjusted for inflation, made up 11% of philanthropic giving. Very significant. Nonprofit Quarterly appears to have taken a closer look at this number at it appears to be weighted by mega-gifts to large foundation trusts from donors like Mark Zuckerberg, Michael Bloomberg, Paul Allen, et. al. Potentially big and promising news for those charities operating in the spheres of interest and influence where those donors are making investments.
Read more from the Nonprofit Quarterly here
How do these numbers compare to your results? Is foundation giving higher for your organization? Please add your thoughts!
As a means of donor engagement, the grant proposal presents an interesting challenge for the fundraiser. It is a two-dimensional medium — words or graphics on paper — leaving much to the imagination of the reader. The choice of words and messages gain importance. Brevity is key given that most experienced grant readers skim, cut-to-the-chase and then reread for depth.
Framing — choosing the right words, vision, messaging — becomes much more important. Done well, framing helps you gain some distinct advantages with a grant reader.
Standing out from the crowd: Your work is important. The needs of your constituency and community are urgent. So are those of a lot of other organizations and chances are that many of them have a proposal sitting on the same desk at the same time. Finding your unique niche becomes key when the reader has to decide which programs and proposals will take priority for his/her foundation.
Defining your story: Many grantmakers openly say that they consider themselves educated about our challenges and issue before our proposal arrives on their desk. An important mission for your proposal is to define the distinct challenges your organization must address and the unique opportunities afforded to make a real difference. One of my clients, a youth service agency in New York City, has done a superb job of capturing the attention of grantmakers by demonstrating that their services are in high demand because they get results. Their grant proposals use results to frame an important message for funders — we have the ability to put your money to work now and get solid results.
Bringing the reader into your point of view: Elizabeth Costas of the Frances L. and Edwin L. Cummings Memorial Fund says: “A compelling proposal tells me what you see when you go to work each day and brings me into your point of view.” Providing the grantmaker with an engaging picture of your community can engage the reader and inspire them to learn more.
Defining your measures of success: Most grantmakers have defined missions and desired outcomes for their philanthropy — and the measures of success to go along with them. Sometimes those measures do not apply to our program. Your proposal is an opportunity to frame how you define success and, hopefully, the funder will agree. One of my clients approached a grantmaker heavily focused on college acceptance rates as a key measure of success. The client’s program graduated fewer students but focused on college retention — the number of program graduates remaining in college after one year. remaining in college. By leading with this number, the proposal communicated information that was interesting enough to engage the funder, leading to a conversation resulting in a grant.
Engagement is key and framing is a critical element. I have posited a few ideas as to why. What are your thoughts? How have you used framing to create success for proposal? Please add your comments and ideas.
A recent study by the Bridgespan Group reveals that only 5% of the total assets of America’s largest 50 foundations were held by spend-downs, compared to 24% in 2010. This means that nearly one-quarter of the assets of the 50 largest foundations in the US will be spent within the lifetime of their founders/donors.
What is driving this change in philanthropic strategy? A generation ago, foundations were seen as legacies by founders intended to perpetuate good and philanthropic intentions and, perhaps, to instill a philanthropic legacy among family heirs. This may well be giving way to a new philosophy, embodied by next generation foundation philanthropists like Charles Feeney (Atlantic Philanthropies), Warren Buffet and Bill and Melinda Gates where the donor sees the Foundation as a strategic mechanism for meaningful philanthropy. This is leading toward gifts — more accurately, philanthropic investments — that are likely to bring about more immediate and meaningful change.
Another reason for change is that the peer landscape has changed among the largest foundations. One third of the largest foundations where founded within my working life time of 26 years. Many were created as a by-product of new tax laws in the 1990s which encouraged young entrepreneurs to create foundations as a means to shelter income and lo and behold, many of those entrepreneurs have applied their acumen and aversion to risk to making a difference for the charitable sector.
We are now raising foundation money at a time where risk and reward are more prominent factors in giving and where a new generation of foundation donors are adopting strategic approaches to their philanthropy. Read Veronica Dagher’s excellent Wall Street article here
Does opportunity abound or will these changes favor the few? Is your charity seeing stronger and better results? Please add your thougths!
Recently, The Foundation Center released its annual report on US Foundation giving trends, “Key Facts on US Foundations 2013.” Here, I will share some of my observations about the data and what it might mean for grantseekers in the year ahead.
- Foundation giving continues to flat-line. While foundation giving experienced an uptick in 2012, that uptick managed to keep pace with inflation which means that foundation giving remains about level with 2007 — the last year before the recession. While that is good news considering the significant portfolio losses experienced between 2009-2011, it indicates that most foundations are not revving up grantmaking as markets continue to recover. This suggests to me that most are taking a more cautious and conservative approach to allocations, staying closer to the requisite 5% payout.
- Health and education continue to dominate giving. The report reflects significant giving to these two sectors, an allocation that has remained steady and consistent for years, comparable to individual philanthropy. Granted (no pun intended) that these two sectors are home to the largest grantseeking institutions (hospitals and higher education) so there is no surprise. The surprise is saved for #3 below.
- Arts and culture are making a comeback. This sector had a very strong showing for 2011. Indeed, colleagues in the sector tell me that they managed to recapture foundation grants that were lost after the 2008 crash when many foundations decided to support essential human services (e.g. food banks, employment training/placement, emergency assistance).
- General operating support is on an upward trend. General support grants made up 29% of total awards, according to the report — an increase of about 9% since 2008. The recession sparked an industry-wide conversation about the need/efficacy of this type of support among charities and grantmakers alike and it appears foundations are continuing to respond positively.
- The 1%ers did well. According to the report, 1% of grant recipients received 50% of all foundation dollars awarded. Enough said.
- Are the Waltons the new Gates Family? The Walton Family Foundation surpassed the Bill and Melinda Gates Foundation as the top foundation donor in 2011.
The report states that “According to the Foundation Center’s annual “Foundation Giving Forecast Survey,” the outlook for 2013 is for continued modest growth overall. It may not be the boom years of the late 1990s or mid-2000s, but U.S. foundations continue to provide a stable source of support for new ideas and ongoing programs that improve lives around the world.”
Link here to download your copy of the report: http://foundationcenter.org/gainknowledge/research/nationaltrends.html
I take a lot of inspiration from music and love to listen while I work. My earlier post, “Five Grantwriting Soundtracks,” received a pretty tremendous response with a lot of requests to post more listening suggestions. Without further ado, two more albums in my current rotation.
Jason Isbell, Southeastern.
I absolutely love Jason Isbell. He writes amazing, plainspoken lyrics and sets them to powerful music. Just like you would want a grant proposal to “sing” to a reader. One listen to this album and you feel that you have entered a personal world from which you simply cannot look away. Select track: “Elephant” (Warning: explicit lyrics).
Foxygen, We Are The 21st Century Ambassadors of Peace and Magic
In the Sixties, The Grateful Dead famously sang “What a long strange trip we’ve been on.” This 21st Century nouveau San Francisco old school duo are continuing the journey on this offering that echoes Lou Reed, Bob Dylan, The Kinks, The Beatles and any number of great psychedelic power pop bands. No surprise at the number of Frisco references. This is my go-to summer listen so far. Select Track: “San Francisco”