Institutional Fundraising: 5 Top Tips
For many nonprofit organizations, institutional fundraising (foundations, corporate foundations, corporations, or national or international public funds) is an important part of resource mobilization activities. If the process of requesting funds from this target can be obvious and, sometimes, even shared publicly by the donor, it is possible to greatly improve its approach by being rigorous and strategic. Our Swiss Director, Emilie Compignie, gives you key tips and best practices to consider at each stage of the funding cycle…
1. Identification of potential institutional donors
You start by researching all potential lenders and gathering that information so you can qualify it later. During this step:
- Make sure you have a database to collect relevant information . A database does not necessarily mean a complex technological solution, it can also simply be a well-designed Excel table to collect and sort a large amount of data.
- Be clear about the type of institutional donors you want to target. In order not to waste time, it is advisable to choose the most suitable targets for your organization, its activities and its DNA.
- Have multiple and diverse sources where you can find new leads. A lot of information is freely available on the Internet. Before using any paid solution, make sure you have gone through business registers, lists of foundations, call for projects sites and also to have benchmarked organizations active in the same sector as you.
- Always have enough leads in your pipeline . If you want results, you will have to approach several institutional donors, see many!
- Allocate enough time to research your prospects , it takes time! Also think about the resources you may have. This type of research is easily carried out by students or volunteers.
2. Qualification of your prospects
Once your list is up, you will have to sort and select, among all the identified prospects, those who are most likely to support your organization and your activities according to matching criteria:
- Look for the right information : mission; intervention zone; types of organizations or projects they support; submission deadlines and application process; specific criteria related to the project (excluded costs, co-financing, etc.); financing capacity; etc
- Refine your list of prospects to prioritize those who best match your mission. At this stage, it may be useful to start contacting some of them to clarify points that are not clear.
- Allocate prospects to the most suitable projects.
- Have a timeline and a goal : how many prospects do you want to qualify and solicit per month? Organize yourself and distribute the prospects to qualify as much as possible.
- Make sure you have enough prospects to increase your chances of financing your projects 100% : mix “cold” contacts and contacts via direct introductions if possible. In institutional fundraising, the conversion rate is rarely above 10%.
3. Cultivation of prospects with whom you have contact
If you have the opportunity to be able to exchange with some of them or the chance to be directly introduced, take the time to build a relationship of trust with the qualified prospects from whom you wish to request funds and interact with them to generate their interest by informing them of your mission and your impact. During this step:
- Whenever possible, try to have personal contact. Feel free to call or send an introductory email, but also use social networks like LinkedIn to connect with team members.
- Mobilize your network , your board of directors and staff members to open doors. A direct introduction will always carry more weight than a cold contact.
- Make sure you have a compelling pitch. Whether speaking with a pitch or writing with a letter or email, make sure to be direct, compelling and attention-grabbing, while customizing some of the content to show your alignment with the contacted prospect.
- Keep in mind the relational approach and move away from a transactional vision!
- Use this opportunity to understand funder objectives and build trust and credibility. Perhaps other synergies, besides financial support, can be explored, such as an invitation to an event, the organization of a webinar, the exchange of key information on a theme or a region, etc. .
4. Request for funding
Finally comes the time when you can ask for money. Demonstrate seriousness and professionalism when writing or formulating your request:
- Be sure to strictly follow the donor’s requirements for the application: respect the number of pages or words requested, answer the questions precisely, do not forget any of the required documents, and respect the deadlines for submission.
- Have all your required documents ready and updated in one file to save time: articles of association, annual reports, financial reports, list of members, etc. This will save you from having to search for them in different folders for each request.
- If possible, be creative in writing your project proposal : stand out by using a graphic charter, photographs or diagrams, key figures.
- Be sure to request an amount appropriate to the funder’s capacity . Do not hesitate to ask the question if you do not manage to have this information during your research.
- Ask for an acknowledgment of receipt when sending by email or save your request when sending on a platform. This will be useful for following up on your request, but also for other requests where similar questions might be asked.
5. Loyalty of your institutional donors
You have obtained a grant and you can congratulate yourself! But the work does not stop there, quite the contrary. You must then maintain a relationship of trust with your donors through strategic actions to thank, recognize and inform in order to renew their support:
- Be sure to thank and recognize your funding partners in a timely and appropriate manner. It is always much easier to keep your donors close to you than to acquire new ones! Additionally, some funders tend to increase the amount of their support when reapplying if they are happy with the results and the relationship.
- Be sure to complete all aspects of the funding agreement. Please take the time to read this document carefully and keep in mind the reporting requirements.
- Have a donor tracking tool with deadlines , especially for sending interim and final reports. Don’t wait for the lessor to make the request! If there is a delay, let them know.
- Be transparent with your donors , even when facing challenges. Most are open to discussion and understand very well the constraints of implementation
- Have a loyalty plan. This is necessary for all your donor types. However, institutional donors often have lower expectations and requirements. Don’t overdo it either.
This blog was first published by Emilie Compignie on ee-consulting.ch