Starting a Grants Program: Is Your Organization Ready? (Part 1)

Sections of this topic

    In my (May 12, 2011) post, “Grantsmanship: The Good, the Bad and the Ugly,” I quoted from a 2010 WealthEngine white paper stating that the average cost-per-dollar-raised for grants is 20 cents … an ROI of 500%. With such an impressive return on investment, starting a grants program at your NPO might seem like a great idea…

    But, as Hank Lewis wrote in his (May 14, 2010) post, “Grants: Free Money – Not Quite !! ,“ “Grants come with a variety of obligations. Corporations, foundations and government agencies don’t just give it away. It takes more than mailing applications and waiting for the checks to arrive.”

    So, what do you need to consider before starting a grants program?

    I advise (potential) clients to consider the following four points before launching a grants program at their NPO:

    Financial Readiness
    Hank wrote in his post, “The vast majority of grantors want to see your audited financial reports and your budgets. They want to know where the rest of your funding is from, and you will need to prove that you are fiscally responsible, can be trusted and that you operate in a business-like manner.”

    In my experience, all of this is true. You will need to provide detailed financial information with most of your foundation grant applications. The exceptions may be with family foundations that don’t always require this level of detail.

    A good example of what will be required can be found in the Missouri Common Grant Application, downloadable here.

    The application requires the following financial attachments:

        Internally prepared income statement for current fiscal year

        AND A complete copy of organization’s audited/reviewed/compiled financial
        statements for the last fiscal year which includes two (2) years of financial

        OR An organization’s most recently filed Form 990 plus internally prepared financial
        statements for the past two (2) years.

    Along with these organizational financial records, you will also need to provide a project budget, your long-term funding plan for the project, and often a budget justification. The Missouri Common Grant Application and Budget Templates provide good information on what will be required.

    Stay tuned for Part 2, in my September 20th post, where I will outline three additional points for you to consider before launching a grants program at your NPO.


    Lynn deLearie Consulting, LLC, helps nonprofit organizations develop, enhance and expand grants programs, and helps them secure funding from foundations and corporations. Contact Lynn deLearie.


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