What is the best way to conduct due diligence on potential grantees and partners?

1 Define your criteria

Before you start your due diligence, you should have a clear idea of what you are looking for in a grantee or partner. What are your mission, vision, and values? What are your strategic priorities and objectives? What are the indicators of success and impact that you want to measure? What are the minimum requirements and standards that you expect from your grantees and partners? Having a set of criteria will help you narrow down your options and focus on the most relevant and promising candidates.

2 Research their background

Once you have a shortlist of potential grantees and partners, you should do some background research on them. You can use various sources of information, such as their websites, annual reports, financial statements, tax returns, social media, news articles, testimonials, references, and ratings. You should look for evidence of their legitimacy, reputation, track record, achievements, challenges, strengths, weaknesses, opportunities, and threats. You should also check for any red flags, such as legal issues, ethical violations, conflicts of interest, or negative feedback.

3 Conduct interviews and site visits

After you have done your background research, you should conduct interviews and site visits with your potential grantees and partners. This will give you a chance to interact with them directly, ask questions, clarify doubts, verify claims, and observe their work in action. You should prepare a list of questions that cover the key aspects of your criteria, such as their mission, vision, values, goals, strategies, activities, outcomes, impact, challenges, risks, opportunities, and expectations. You should also be prepared to answer their questions and share your own information and expectations.

4 Analyze and compare your findings

After you have completed your interviews and site visits, you should analyze and compare your findings with your criteria. You should use a systematic and objective method to evaluate and rank your potential grantees and partners, such as a scoring system, a SWOT analysis, or a decision matrix. You should also consider the qualitative and quantitative aspects of your findings, such as the data, the stories, the feedback, and the impressions. You should look for the best fit between your goals and values and their capabilities and compatibility.

5 Communicate and negotiate your terms

Once you have selected your preferred grantees and partners, you should communicate and negotiate your terms with them. You should be transparent and respectful in your communication, and explain the rationale behind your decision and the expectations that you have. You should also be open and flexible in your negotiation, and listen to their concerns and suggestions. You should aim to reach a mutual agreement on the scope, duration, budget, deliverables, reporting, monitoring, evaluation, and learning of your collaboration.

6 Document and formalize your agreement

After you have reached a mutual agreement with your grantees and partners, you should document and formalize your agreement with them. You should draft a written contract or memorandum of understanding that outlines the roles, responsibilities, rights, and obligations of each party, and the terms and conditions of your collaboration. You should also include a dispute resolution mechanism and a termination clause in case of any problems or changes. You should review and sign the document with your grantees and partners, and keep a copy for your records.

7 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?