Fundraising Planning - A Vital Key to Nonprofit Success

 by: Ken Goldstein

As a professional grant writer and consultant, I am often amazed at how few nonprofit organizations actually have a fund development plan beyond a vague idea of applying for a few grants and sending out an annual appeal letter.

Recognizing that lack of planning, I am not amazed at how often these same organizations have rounds of emergency budget cuts when they realize that they have no assured streams of income.

Very typical is the agency that has received a large grant to run their programs for one year. Then, in the tenth month of the grant period, comes the realization that they have no idea how they will fund the next year's programs. With less than two months of money left in the bank they go into emergency fundraising mode.

Their first impulse is to start applying for another large grant. But at most foundations, the process - from letter of inquiry to proposal to acceptance - typically takes at least three months, and often six to eight months.

Their next idea is to turn to their individual donors with a panicked letter that essentially says, "Send us money now or we might go out of business." That, of course, is the least effective fundraising letter you can write. Donors want to invest in your successes, not bail out your failures.

So, how do they avoid these situations? The answer is to plan.

Through the planning process, you will achieve the following:

* Limit crisis fundraising: This, as the example above illustrates, is our primary reason for creating a fund development plan, but there are others as well...

* Diversity builds in flexibility: Changes in other sectors of the economy can have a major impact on nonprofit funding. A cut in the state budget can be passed down as fewer contracts for local service organizations. The dot-com bust of a few years back cut foundation endowments, reducing the funds they had available to grant. Agencies that had become comfortable relying on one or two sources of funding found themselves struggling to survive these changes. Those with plans and diversified funding bases had the flexibility to adapt and survive.

* Planning for diversity brings in more opportunities: Through the planning process you come to identify funding opportunities you never knew existed. Further, when you stop having to scramble to pay next month's bills, you will be able to devote more time to developing new sources of income for your agency.
  (continued...)

Fundraising Planning - A Vital Key to Nonprofit Success
  Page 2

About The Author Ken Goldstein is a grant writer and consultant working and living in Silicon Valley. Since 1989 he has been an executive director, a board member, volunteer, and consultant to nonprofits. His education includes a BA in Politics from UC Santa Cruz and a Master of Public Policy and Administration from CSU Sacramento. Goldstein Consulting can be found at http://www.goldsteinconsulting.com. Ken is also the author of "Introduction to Fund Development Planning" - Please see http://www.fundraisingplanbook.com for more information. (c) 2006 by Ken Goldstein, all rights reserved. You may re-print or re-post this article only complete and un-edited, and including the author information, active web links, and copyright notice.

Additional Resources

category - Grants for Nonprofits

Origin-Destination Database of Border Traffic Flows for Transportation Planning
The Federal Highway Administration has recently announced a cooperative agreement entitled, Origin-Destination Database of Border Traffic Flows for Transportation Planning, to support Ontario's Ministry of Transportation in conducting training workshops focused on data collection, and the process of understanding and maximizing the use of the data collected.

---

National Science Foundation: Geoinformatics Solicitation Grant
Geoinformatics is the science and technology of developing and using information service sciences in addressing the problems related to geography, geosciences and other branches associated to engineering.

---

National Endowment for the Humanities: National Digital Newspaper Program
The goal of the National Digital Newspaper Program is to crate a national digital resource of historically significant newspapers published between the years 1836 and 1922, from all of the States and its territories.

---

Zambia Economic Resilience Program for Improved Food Security
The Zambia Economic Resilience Program for Improved Food Security is designed to implement innovative techniques and approaches that would hopefully enable the community's most vulnerable and poor rural families to improve food security by strengthening their economic resilience.

---