Basic Principles of Right-Sizing Grant Applications

In the last article we explored some of the operating frameworks behind philanthropists and we saw that one size does not fit all. This is worth repeating:

One size does not fit all philanthropists. One size does not fit all grant amounts. One size does not fit all grant types.

Rarely does one size really fit anyone, anywhere - not in clothing, not in parenting, not in life.

How do Philanthropists Decide how much to Give?

In the last article we explored the idea that grant makers are tasked with stewarding their own resources. Almost all grant makers have a budget! Many have a set pool of funds to divvy out by calendar year:

• This amount can be influenced by profitability in the for-profit sector (for philanthropists connected to a business) because when the business does well, there is more money to give.
• Private foundations, on the other hand, have a 5% payout requirement annually (it’s a little more complicated than that), serving as a guidepost for giving. They are free to give more, but if they want to operate in perpetuity, they will often balance giving with investments so that granting funds can be nearly replenished annually.
• Individual givers may have a set or ballpark figure set aside in their bank account or Donor Advised Fund. Givers work with their financial planner to decide how much to give. (Check out Kingdom Advisors if you are looking for a financial advisor who can help with purposeful giving).

The point is, money is not limitless! As stewards of money, givers vet their giving prospects, collecting information needed to help them choose the right donation, for their priorities, for the right amount of money.

Right-Sizing Philanthropy Based on Contributor Type

This is part of a larger conversation touching on giving scale, timeframe, and expertise (more on this another day!) but identifying what type of philanthropist you are is a good starting point.

• If you are a minor contributor and a champion of the little guys you may not need a formal application! Get to know the organization through their annual report, follow them on social media, get to know their staff or leadership through volunteering or community events. You may only need a copy of their IRS Letter (or proof of sponsorship) to accompany your gut feelings that you should give.
• If you are a mid-sized contributor, offering small to mid-sized grants, closely consider the typical size of your grants, the likelihood of getting a grant, and the time it will take a grant seeker to complete your application. The content of the grant request itself will need to be crafted to collect everything your stakeholders require: legal due diligence, program alignment with your mission, and anything else your board or leadership has requested. Resist the temptation to request more because you are curious.
• If you are a major contributor, your grants still may vary greatly by size. The important thing to remember is to try to tailor your grant application size to the size (time invested) of your grant seekers. Major contributors often have a larger group of stakeholders the answer to and requests reflect the breadth or depth of information needed. If possible, offer a variety of grant applications based on grant size. It’s possible to have a suite of right-sized grant applications within the same organization!

Key Principles to Keep in Mind

When requesting information ask yourself the following questions:

“How will I use this information, and do I really need it?”

“Are there other ways of collecting the information beyond the request?”

“How likely is it that the grant seeker will get a grant?”

“What is the size of the possible grant, and how much time will it take to complete the request?”

Time is Money

The goal of givers is to support people doing good work on the ground. The goal is to build stronger, more resilient organizations equipped and ready to carry out their work that we cannot do. Amazing programs do not happen without people and money behind them. Wise philanthropy looks for a way to come alongside organizations, being a blessing rather than a burden.

Due diligence is not the enemy of giving. Due diligence is stewardship. But time is money, and every grant request represents an investment of time of staff. Carefully crafted proposal represent hours of writing, revision, and submission into required formats. Staff time spent on proposals can present a learning experience, but it should not become so burdensome that it detracts from the work and the mission!

Take some time and ask yourself, how am I sizing my due diligence?

In the next article, we will explore some specific strategies for creating tiered applications within an organization.

Next time you are tempted to think, “one size fits all” just remember all of the times in the rest of life when that wasn’t true!

#philanthropy #nonprofits #grantwriting #giving #grants #generosity