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[ASK AN EXPERT] Will Grant Funders Give To You If You Have Too Much Individual Funding?

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Our Ask An Expert series features real questions answered by Claire Axelrad, J.D., CFRE, our very own Fundraising Coach, also known as Charity Clairity.

Today’s question comes from a Director of Development who wants advice on what to do when the board thinks their individual fundraising success will depress grants.

Dear Charity Clairity,

I’m the Director of Development for a successful organization that has vision, capacity, and a proven track record of success. The future is bright, and our fundraising shows that donors and foundations agree. We’ve had a strong year on the fundraising front, and some of our board members have started to worry that our success will hurt our fundraising efforts in the future. My understanding is they worry that if a funder sees we’re getting support from a range of other organizations they will think we don’t need their money and not give.

This has come up several times in board and committee meetings and while I’ve tried to tell them that grant review panels rely on an organization’s narrative to determine who gets funded and donors like successful organizations — being able to accomplish our goals and expand our impact is a good thing, rather than a bad! — these ideas persist. Do you have any suggestions on how to help our board understand that funders want to support a winning proposition rather than a sinking ship?

— Don’t want to build the Titanic

Dear Don’t want to build the Titanic,

You suggest your board is telling you to become more of a sinking ship so donors will be inspired to send in lifeboats. 

Were I in you and your board members’ deck shoes, I would much rather never be in that kind of peril. Sure, some folks might swoop in to rescue you, but by then you might be beyond saving. And, frankly, any organization that intentionally put itself in worse shape as a political maneuver would not be one I would want to support.

Yes, you are right. Most funders prefer to support a winning proposition rather than a losing one. No one wants to see their money disappear into a black hole. And it’s difficult for me to imagine board members do not, fundamentally, understand this. I doubt they’d invest their own money in a tanking stock portfolio, for example. 

Let’s try to tease out the underlying source of this worry. What’s really causing them to want to see less of your support coming from a broad range of individuals and organizations, and more coming from institutional funders? My hunch is it’s something like this: 

  • They’re worried you’ll stay dependent on them, as your largest individual donors, so they’d rather give less personally and have you seek out more of your funding pie from institutions. 
  • Or, they’re tired of soliciting local organizations and/or friends, and would prefer to have you secure that money by writing grant proposals.
  • Or, they don’t want to grow. You suggest a desire to expand your impact, in which case more resources would be needed. Perhaps they think you’re fine as is, and maybe you expanded too much during the pandemic years. It’s scary to think about sustaining this, and they’re concerned you won’t be able to find the resources to do so. Bottom line? They worry you’ll have to ask them to give more as individuals, and they find this stressful.

In any of the above scenarios, they’re possibly telling you the level of support they’ve stepped up to offer may be more than they want to sustain. I would suggest the following approaches:

  1. Have a one-to-one conversation with the reluctant board members to ascertain whether something like this is going on. If it is, you need to reassure them they can give at a more comfortable level as the world begins to (hopefully) enter a lighter phase of the COVID pandemic and new sources of revenue can be explored.
  2. Explain the real reason grant funders – and anyone – will support you in the future has to do with your case for support — the things you describe as your “vision, capacity, and proven track record of success.”  
  3. If they have mixed feelings around your need for philanthropic support, discuss three potential scenarios with your board:
    1. You cut back on fundraising strategies and shrink to a more manageable size. If they choose this option, everyone buys in to what this will mean for your organization’s beneficiaries, today and in the future.
    2. You maintain the status quo, which means you won’t be able to grow programs or capacity. Again, everyone buys into what this no-growth stance means.
    3. You commit to growth, meaning fundraising must be enhanced. Board members understand the need to step up their commitment, while staff simultaneously diversifies fundraising strategies.

The point is to build a ship you’re capable of sustaining; then stay happily afloat!

— Charity Clairity

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