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A Conversation About Grant Collaboration Across Different Nonprofit Sectors

Fri, 23 Jan 2026 19:26:48 GMT

Elise and Elijah discuss the realities of collaboration

Elijah: Elise, it’s good to be back in touch and to talk about grants again, especially after our last exchange about grant readiness. One topic I think about a lot is grant-funded collaboration. It comes up frequently in nonprofit conversations, often framed as something organizations should do more of.

A parallel that often comes to mind for me is the corporate world. Once companies reach a certain level of maturity, they often grow by acquiring or merging with other companies. That strategy does not always succeed. The AOL and Time Warner merger is a well-known cautionary tale. But sometimes it pays off spectacularly, like Facebook acquiring Instagram and later WhatsApp.

In the nonprofit sector, mergers do happen, but far less often. When they do, they are usually driven by financial stress, such as one organization absorbing another to prevent collapse, or as a defensive move to consolidate staff and overhead. Much more common, especially when nonprofits are trying to grow revenue or expand reach, is collaboration through grants.

Over my 20 years as a grants professional, I have noticed that collaborative grants seem more common in some sectors of nonprofit and government work and relatively less so in others. I want to explore why that is, and how differences in problem structure and funding shape when collaboration actually works.

Elise: Right. Grant-funded collaboration is often treated as a default best practice, but how often it actually occurs varies widely by sector. In environmental work and in human services, collaborative grants are encouraged. In arts and culture, much less so.

And that difference is not just about organizational culture or leadership style. It has a lot to do with how problems are structured and how funding flows through systems.

Elijah: The environmental example is the easiest for me to picture because my first grant writing job was at American Rivers. I learned quickly that rivers and watersheds do not align neatly with counties, cities, or even states. They cross jurisdictions by definition.

So whether you are removing a dam on a small tributary, negotiating a Federal Energy Regulatory Commission relicensing agreement for a hydropower dam on a major river, or running a conservation advocacy campaign across the Great Lakes region, you almost always need multiple organizations involved. There is no plausible single-actor solution.

I wrote many proposals that included several nonprofit partners, and funders expected that. Budgets routinely included subawards that transferred funds directly to partner organizations to carry out specific parts of the work.

One of my first grants was a small collaborative award of about $25,000. It involved American Rivers working with a local watershed nonprofit in Wisconsin to reduce stormwater runoff into the Great Lakes.

Elise: So collaboration was not something you opted into. It was baked into the problem itself.

Elijah: Exactly. I was looking for funders in the Great Lakes region and identified the Brico Fund, a local family foundation. They supported environmental work tied to specific geographies, including small-scale conservation projects in Wisconsin, and they had a particular interest in the health of the Great Lakes.

American Rivers was leveraging its network of local river groups around the Great Lakes to build public pressure and awareness to advance stronger water conservation policies. We partnered with Friends of Milwaukee’s Rivers, a local watershed nonprofit, to develop a project in a small town outside Milwaukee and successfully secured funding from The Brico Fund.

The project centered on a vacant lot surrounded by apartment buildings and single-family homes. During rainstorms, water from nearby roofs flowed into this empty lot, where it pooled like a shallow lake before surging into storm drains on the lot and the surrounding street. During heavy rains, this kind of runoff increased the volume of water entering local sewer systems, regularly overwhelming treatment plants and forcing the discharge of untreated water into nearby waterways and, eventually, into the Great Lakes. Our goal was simply to slow that water down and filter it. Building rain gardens and swales on the lot helped slow and filter the water while also beautifying the neighborhood.

We realized early on that measurement would matter, both for credibility with funders and for learning. So we reached out to a local university. Their engineering department agreed to contribute pro bono labor. Graduate students were interested in using the site as a real-world learning opportunity, and they helped us design a method to measure the actual reduction in stormwater volume resulting from these natural infrastructure interventions.

The Brico Fund funded the initial $25K grant. After that award came through, I went looking for ways to leverage it. Using the Foundation Directory database, I identified a small family foundation called the John Ben Snow Memorial Trust . They were based in New York, but they had a stated interest in environmental issues in Wisconsin. I cold-called them, explained the project, described the collaboration, and walked them through the early results and the design.

After several back-and-forth conversations, and because the project was mostly funded and clearly collaborative, they came in with an additional $10K. All told, grant funding came to around $35,000. This was back in 2005.

Elise: And each partner had a clearly defined role.

Elijah: Yes. American Rivers handled grant writing, reporting, and overall coordination. The local watershed group did most of the on-the-ground operational work. The university contributed research and evaluation capacity. Local families participated directly by installing rain barrels on their homes and helping build rain gardens on a nearby vacant lot.

It was truly collaborative, as no single organization could have done it alone. The geography demanded collaboration. The funders expected it. And the outcomes depended on multiple kinds of expertise.

Elise: Human services operate on a similar logic, but for different reasons. Families do not experience needs one at a time. Housing instability, food insecurity, mental health challenges, and job training needs often overlap. No single provider can address all of that.

Government grant contracts often require collaboration, and private funders expect it too. But in practice, many of these grants are more serial than truly collaborative. There is usually a lead agency and one or more subawardees delivering discrete services toward a shared outcome.

Elijah: That distinction is important. Collaboration does not necessarily mean people working together closely on the same tasks. Often it just means shared outcomes and formal commitments to pursue them together.

I tend to think of a wide range of arrangements as collaborative grants. A single awardee that subawards to another organization. A grant where there is one budget, but staff from another organization are listed as contractors or consultants. Two organizations can work toward the same goal without actually working together day-to-day. They can be working on entirely different projects independently, yet aimed at the same population or outcome. It is not that different from how departments inside a single nonprofit often operate, fairly siloed, but aligned around a common mission.

Elise: And that is actually the norm. Most so-called collaborative grants look like this in practice. There is a lead agency, one or more subactivities, and fairly limited interaction beyond reporting and coordination. For example, a community center might receive a grant to support families and then issue a subaward to another nonprofit to deliver karate classes, STEM programming, or some other enrichment activity. That subawardee is not collaborating day-to-day with the community center staff. They are providing a discrete service to the same population. It is collaborative on paper, but not deeply integrated in practice.

Which is why it is important not to romanticize collaboration.

Elijah: Exactly. I remember, too, from my days as a university grant writer, working on NSF grants to support researchers in Antarctica conducting STEM-based work. A senior researcher once told me a story about a grant that supported multidisciplinary research on an Antarctic vessel. On the boat, different researchers were funded, including a geologist working on one angle and a mammal researcher on another, yet they did not meaningfully collaborate beyond sharing meals. Eventually, they produced a monograph collecting articles from that voyage, but the pieces had little in common beyond their focus on Antarctica.

Even in the environmental sector, where collaboration feels natural, it does not happen as much as people assume. I saw a lot of collaboration at American Rivers because its work focused on convening, supporting, and galvanizing local watershed groups to advance state and federal policies. But many environmental organizations do not collaborate much at all, or just superficially, even when their missions and geographies suggest that collaboration could help them achieve greater impact.

Elise: Because formal collaboration is hard.

Elijah: Right. It requires sharing resources, sharing credit, and holding each other accountable. That is a human behavior issue as much as a structural one. It is hard to play in the same sandbox with other people – especially people you don’t know very well – and particularly when money is involved.

And that connects to another piece that often gets overlooked. Even though collaborative grants are often framed as a way to unlock new funding streams, in practice, grants are still a limited resource.

The scarcity mindset is real. It pushes organizations to focus on risk factors rather than growth factors. True synergistic collaboration introduces unknowns. It requires trust, familiarity, and a willingness to accept some loss of control. Unless organizations already know each other well, that can feel like too much uncertainty, especially when leaders are under pressure to keep the lights on.

Elise: So it is not that collaboration does not work. It is that the conditions under which it works are difficult to create.

Elijah: Exactly. Collaborative grants do not fail because collaboration is a bad idea. They fail because they demand behaviors and relationships that are hard to sustain under conditions of competition and scarcity. And the further away that you get from essential services and into the realm of “nice to have but not necessary,” the less pressure there is to try to make collaboration work.

Which is why I think collaboration should be treated like a tool, not a belief. Use it when the problem structure, the geography, the service mix, or the research aim truly requires partners, and when the funding structure rewards the extra work. Otherwise, it is often more realistic to keep things simpler, deliver well, and build trust gradually before taking on the added complexity and risk of a formal collaborative grant.

* * * * *

Here's another take on the subject of nonprofit mergers and collaborations: https://www.inc.com/cindy-eby/why-nonprofit-mergers-are-no-longer-optional/91294447

What Grant Professionals Know That Nobody Wants to Hear

Sun, 02 Nov 2025 16:46:15 GMT

Grants don’t build sustainability—they reveal whether it exists in the first place

I've been a grants professional for more years than I care to count. And in that time, I've raised millions of dollars for wonderful nonprofits.

But I've also faced quite a few (truthfully, a lot more than a few!) situations where the organization wanted me to sell programs to funders prematurely, before the details had been worked out sufficiently .

Because you're reading this, I bet you have too.

Does this sounds familiar?

* Programs that don’t have defined outcomes

* Budgets that don’t reflect actual costs

* Panic-written proposals with no post-award plan

* Organizations chasing whatever funding is available instead of what fits

If so, I strongly recommend this enormously helpful post on the Grant Professionals Association (GPA) blog entitled What Grant Professionals Know That Nobody Wants to Hear ( https://grantprofessionals.org/news/708861/What-Grant-Professionals-Know-That-Nobody-Wants-to-Hear.htm?utm_source=Newsletter&utm_medium=Newsletter&utm_campaign=iLearn%20Live%20-%20One%20Day%20DEI%20Mini-Conference&_zs=7setj1&_zl=q2qOA )

It clearly lays out the case for using your knowledge and experience to tactfully point out the kinds of program weaknesses that almost certainly doom any chance of funding success, no matter how well a grant is written.

Even after all my years in the field, I found this GPA post a worthy read!

The Imperfect Love Affair Between Nonprofits and Their Funders

Thu, 19 Jun 2025 19:14:29 GMT

The relationship between nonprofits and funders is mutually beneficial... but not always easy.

When I’m racing to meet the deadline on a particularly complex (read:” infuriating”) grant proposal, “love” is not a word that expresses my feelings toward the funder responsible.

But when my clients receive kind words and big checks from their funders, I feel great appreciation. You might even say love.

Tax breaks aside, foundations and other funders support nonprofits from the desire to make the world a better place. Nonprofit organizations arise from the same impulse.

Nonprofits need funders, just as funders need nonprofits to execute their visions for a better world.

But ask any grant seeker how they feel about funders and you'll probably get mixed reviews. That’s certainly the case for me!

Foundant Technology , a software company for foundations and other social good organizations, has put together a brilliant piece that beautifully sums up a lot of these frustrations.

Entitled, “Funders: What Nonprofits Wish You Knew,” it might just as easily be called, “Funders: We Love You, But….”

If you’re a nonprofit professional, see how many of your pain points this article captures. If you represent a foundation, I hope you will take these concerns to heart:

Funders: What nonprofits wish you knew

AUTHOR: FOUNDANT + SMARTSIMPLE TECHNOLOGIES

Funders like you and your efforts to support your nonprofit partners are an inspiration. Helping nonprofits advance their mission benefits your communities and increases your organization’s impact. But, as the philanthropic sector evolves, what are the most effective ways to support your partners?

Why I give my time to Unfunded List (and maybe you should too!)

Mon, 19 May 2025 14:09:01 GMT

I’m a strong believer in volunteering my time and expertise to support organizations I believe in. Unfunded List is one of them.

What is Unfunded List?

Unfunded List is a nonprofit on a mission to educate the public – especially grant seekers – about philanthropy. In addition to publishing articles, hosting a podcast, and running events related to grant making, they offer a critical service to organizations that are struggling to get their proposals funded.

Twice a year a year Unfunded List offers other nonprofits the chance to get their proposals reviewed by up to six volunteer grant professions for a nominal administrative fee (currently $100 per proposal). This is an incredible service, especially for newer grant writers learning the ropes of grant seeking.

Why I'm an Unfunded List Evaluator

Along with hundreds of volunteers around the world, I give my time to review and provide detailed comments on all aspects of a proposal, including narratives and budgets. One of the things I appreciate about the process is that I can choose how many proposals I review, and even sit out a round if I don’t have the time.

So why do I give my precious time to this particular organization, when there are so many worthy causes to support?

Two main reasons. Three really.

First, it’s a great way for me to give back. Sharing my decades of experience with others with less knowledge of what makes a compelling grant proposal allows me to help train the next generation of grant writers in a direct way.

But my motivation isn’t entirely altruistic. The truth is, reviewing proposals from organizations I’ve never worked with for funders I’m not familiar with makes me a better grant writer. And who doesn’t want to hone our professional skills!

And finally, I enjoy the art of reviewing combined with helping great organizations make the world a better place.

Is Joining Unfunded List’s Evaluation Committee a Good Fit for You?

If you’re a passionate grant writer who enjoys the challenge of creating a winning proposal, joining Unfunded List’s Evaluation Committee might just be the thing for you.

Here’s how Unfunded List describes the Evaluation Committee:

Unfunded List reviews hundreds of proposals every year. The proposals come from all over the world and cover nearly every conceivable topic. To ensure that we can provide the most helpful and candid advice to each proposal, we are constantly recruiting members to our evaluation committee. We currently have over 900 evaluators in our pool with a wide variety of experience and interests. We believe all perspectives are important and we regularly seek to add to the diversity of the committee. Our members include program officers at grant-making institutions, members of family foundations, founders of giving circles, directors of notable prizes and competitions, fundraising consultants, communications professionals, engineers, doctors, lawyers, as well as formerly homeless and incarcerated evaluators, LGBTQIA members, people from every continent and over 50 countries and, at last count, 9 different faith traditions.

To learn more, visit Unfunded List’s FAQ page

To apply, simply fill out the Unfunded List Evaluator Application (https://www.unfundedlist.com/join-the-committee/)

And if you’d like one of your unfunded proposals reviewed , here is the link to submit it: https://www.unfundedlist.com/submit-your-proposal/

The Challenges of Grant Readiness

183:747132823 (Elise Saltzberg) — Fri, 25 Apr 2025 17:34:07 GMT

As grant professionals, we hear the term grant readiness all the time—but what does it really mean?

To explore the topic of grant readiness, Elise Saltzberg sat down with fellow grants professional Elijah Mermin to discuss a topic that is at the heart of many organizations’ approach to fundraising. We take a candid look at what grant readiness truly means, common pitfalls, and takeaways.

Let’s dive in.

Elijah: Hi Elise, thanks for taking the time to chat with me about all things grants.

Elise: Hi Elijah, of course! Always fun to share insights with another grants pro.

Elijah: So, Elise, we’ve both been in grants for many years (at least 50 years combined experience), and I thought we could tackle a topic that every organization grapples with: grant readiness —a term that’s widely used but often means different things to different people.

Grant readiness exists on a spectrum—from organizations preparing their first proposal to those with ample experience securing competitive awards. But here’s the reality: No matter how grant ready an organization is, each application still must honestly articulate the organization’s vision, programs and needs in a way that addresses the unique concerns of the funder. So how do we, as grant professionals, continually assess and address grant readiness in a way that leads to long-term success?

Elise: That’s a great question. I think of grant readiness as both a process and a mindset . It’s not just about financial statements, program data, or having a strategic plan—it’s about clearly communicating why an organization deserves funding and being prepared to manage and sustain it once awarded.

Focusing too much on grant readiness checklists or developing a range of well-articulated templated narrative material can cause organizations to miss the bigger picture: Are they truly prepared to implement what they’re proposing? Have they considered how their current grants will position them for future funding? Some of the most successful organizations I’ve worked with don’t necessarily have the most polished materials, but they have clarity about their mission, funding gaps, and a strategy to gradually scale through grants and philanthropic support.

Elijah, what’s your approach when an organization thinks it’s grant-ready but isn’t quite there yet?

Elijah: A common challenge is enthusiasm outpacing readiness. Some organizations are eager to pursue large government or foundation grants before securing a few smaller awards that would better position them for success. These smaller grants help refine their case for support, develop internal grant management processes, and build relationships with funders.

Without enough of a history of securing and managing an array of smaller grants, organizations often struggle—not just with writing a competitive large-scale proposal, but with managing and implementing “the big government grant” if they win it. I’ve seen organizations secure funding but then struggle to staff and execute the project effectively. That’s why grant readiness isn’t just about getting the grant—it’s about having the capacity to deliver on it successfully.

Elise: That’s an important point. Many organizations see grants as a financial fix , when in reality, they’re just one tool in a larger funding strategy. I always encourage organizations to think about how a grant fits into their broader financial picture. Do they have the systems to track and report on the funds? Do they have staff capacity to meet deliverables? What’s their plan after the grant period ends?

Elijah: Exactly. And funders notice when an organization is trying to “punch above its weight.” I’ve spoken with program officers who can tell when a nonprofit is chasing funding rather than applying strategically. Funders want to see a track record of successful grant management, a clear alignment between the request and the organization’s capacity, and a plan for long-term impact.

Elise: Yes. A funder’s investment should be a catalyst for maximizing impact. Organizations that approach grants with a clear vision and a strategy for growth are the ones that turn funding into meaningful, long-term change.

Elijah: If I had to give organizations one key takeaway, I’d say: Be honest about where you are . If you’re not sure if you are ready for a large, multi-year government grant, start with smaller funders. If you’re struggling to define your impact, invest in program evaluation before applying.

Elise: Absolutely. Grant readiness is about constantly strengthening your ability to secure and manage funding. The most successful organizations aren’t just focused on getting grants; they’re making sure their capacity and strategy evolve alongside their funding.

Elijah: Well said! I think that’s a great note to end on. Thanks, Elise—this was a great conversation.

Elise: Always great to dig into these topics with a fellow grant pro.

Cold Call Grant Proposals: A Risky, Yet Occasionally Rewarding, Strategy

Thu, 13 Feb 2025 15:36:47 GMT

In grant seeking, there are few absolute rules. But one adage stands out: "You can't win if you don't apply." So yes, we can all agree that submitting proposals is essential, but success requires more than just applying. This is where “best practices” come into play—guidelines to improve your nonprofit’s chances by strategically aligning with the right funders.

Among these best practices is a commonly accepted idea: Avoid submitting “cold” proposals to foundations or corporations with no history with your nonprofit and no prior contact. Generally, developing relationships with potential funders before submitting a proposal significantly increases your chances of success. However, exceptions exist—and understanding when and why to submit a “cold” LOI or proposal is worth exploring.

The Case Against Cold Proposals

The rationale behind the "no cold proposals" rule is straightforward. There are far more grant seekers than grantmakers. Many foundations and corporations give repeatedly to the same organizations they already know and trust, making it challenging for new applicants to break through.

Consider a 2019 article from Grant News, which cites data released by the Ford Foundation, where in one year, Ford received 144,000 inquiries, including email requests, LOIs, and full proposals, and awarded less than 3,000 of these inquiries, an award rate of less than 2%. Not every foundation/corporation has award rates as low as the Ford Foundation, so if we go with the working hypothesis that the odds are less than 10% for foundation/corporate grant funding, which is probably on the high side for an award given to “cold” inquiry, it’s clear why relationship-building is considered essential. Establishing rapport with program officers lets you understand a funder’s priorities and tailor your application accordingly.

When Cold Proposals Make Sense

Despite the odds, there are situations where submitting a cold proposal can make strategic sense. In a Fall 2024 article in the Journal of the Grant Professionals Association, a seasoned grant professional, Valerie A. Grant, offered a compelling argument for cold applications. Her consulting firm submitted 270 grant applications for various nonprofit organizations over 19 months between 2022 and 2024 and tracked outcomes. Of the 162 responses they received, 7% of cold applications—submissions without any prior relationship or contact—resulted in funding. While this percentage is small, it demonstrates that cold proposals can occasionally be successful.

Grant noted that the key to success with cold applications lies in the research and vetting process. Her team only submits cold proposals when the funder’s priorities align closely with the nonprofit’s mission. They also see these proposals as initiating the relationship-building process, as submitting a cold proposal can be the first of several communications that eventually open the door to grant funding.

Small Nonprofits: A Special Case

Cold proposals may be necessary rather than a choice for small nonprofits with limited resources. Consider a local nonprofit with an operating budget under $500,000 and minimal staff. Such organizations may lack the connections to secure warm introductions to funders. However, if they provide critical services addressing a clear need in their community, cold proposals may be their only viable option.

For example, the Teddy Bear Cancer Foundation in Santa Barbara, CA, is a small nonprofit providing financial assistance to low-income families with children undergoing cancer treatment. Despite having limited access to well-connected board members or major donors, they consistently sent “cold inquiries” to the same local foundations in the early 2000s, many of which only accepted letters by mail and eventually secured grants through persistence.

Large Institutions: Another Exception

At the opposite end of the spectrum, large, prominent organizations can also benefit from cold proposals. Major museums, universities, and hospitals often have well-established fundraising infrastructures but may find it worthwhile to pursue cold applications as part of a long-term strategy. Funders tend to perceive these institutions as trustworthy and capable, increasing the likelihood that well-crafted cold proposals will be considered, especially if the organizations demonstrate persistence by reapplying over several years.

Cold Proposals as a Long-Term Strategy

Cold proposals should not be a primary strategy but rather a component of a broader, long-term approach to grant-seeking. Persistence can pay off for organizations willing to invest the time and resources to submit proposals year after year, even without initial responses.

However, nonprofits must be realistic about the time and effort involved. Cold proposals often have a high rejection rate, and many funders do not even respond to unsolicited applications. Organizations must weigh the potential benefits against the resources required to pursue this approach.

Qualifying Funders for Cold Proposals

When considering whether to submit a cold proposal, qualifying potential funders is essential. Use tools like the Foundation Directory Online or GrantStation to research funders’ giving histories and priorities. Find alignment between your nonprofit’s mission and the funder’s focus areas. If a funder’s 990 form lists only a mailing address and no email or phone contact, you must decide whether the potential payoff justifies the effort.

Valerie A. Grant’s data underscores the importance of being strategic. While only 7% of the cold proposals were successful, 52% of their proposals were successful when the organization had a prior relationship with the funder. Yes, cold proposals have a lower success rate, but they can still yield results, especially if you have done your homework and are committed to ongoing stewardship and relationship-building.

Final Thoughts

The decision to submit cold proposals should not be taken lightly. Building relationships with funders is a more reliable path to success for most nonprofits. However, for small organizations with limited networks or large institutions seeking to diversify their funding sources, cold proposals can be a worthwhile part of a comprehensive grant strategy.

The “Teach a Man to Fish” Proverb: It's Complicated...

Mon, 21 Oct 2024 15:47:34 GMT

applying this old proverb to workforce development is an oversimplification

We’ve all heard the saying: If you give a man a fish, you feed him for a day; if you teach a man to fish, you feed him for life. This tidy little phrase promotes the idea that teaching self-sufficiency is better than providing short-term solutions.

It’s tempting to embrace the idea that empowering people with skills is the key to long-term success, but this aphorism oversimplifies the real world. What if the water is polluted or overfished? What if we’re teaching people to fish who are struggling with personal challenges like addiction, mental health issues, or family trauma?

Without addressing external barriers or personal struggles, teaching someone to “fish” is like handing them a roadmap to a journey filled with blocked roads and dead ends.

For grant professionals focused on supporting workforce development or social service programs, the challenge is clear: How do we effectively address complex social issues that call for far more than "teaching skills" or carrying out other types of limited-impact interventions?

The nonprofit and governmental sectors address deeply entrenched issues like poverty, systemic inequality, and lack of access to resources. These problems are multifaceted and interconnected, making them difficult to address with any single solution. It can be tempting to shift focus to less complicated projects—planting trees, painting murals, or organizing community events. While these kinds of projects improve the quality of life in small ways, they don’t hold the potential for transformational change that addressing systemic social problems can bring.

As Thomas Kuhn outlines in The Structure of Scientific Revolutions , true progress isn’t achieved through incremental adjustments to a failing system. Instead, it often requires a paradigm shift—a complete overhaul in thinking when the old models can no longer accommodate the complexities or anomalies we encounter. Kuhn’s theory suggests that societal change mirrors scientific progress: we can’t continue working within outdated systems expecting better results. At some point, the structures must be challenged and, where necessary, replaced.

Failure, in this context, isn’t something to fear—it’s something to embrace. Every “failed” grant project, every initiative that doesn’t quite achieve its goal, offers valuable data. This data helps us refine future approaches, allowing us to get closer to real solutions.

We must also acknowledge that change often comes from the margins, not the center. Kuhn argues that scientific revolutions don’t come from within the existing power structures but from innovators and thinkers on the edges, those willing to challenge the prevailing norms. The same holds in social work. Grant professionals often work with underfunded, grassroots organizations—groups that are pushing boundaries and trying new approaches. These are the organizations that can disrupt the status quo and create real change, even if they don’t follow the linear, measurable outcomes funders might expect.

The results of our work may take years to manifest or may appear in unexpected ways. This is where the creativity and flexibility of grant professionals come into play. We can guide our organizations to see beyond immediate, short-term metrics and focus on the broader, long-term impact.

Ultimately, real change isn’t about teaching people to fish in polluted or empty waters. It’s about challenging the systems that led to contaminating or overfishing of those waters in the first place. As grant professionals, we’re in a unique position to push for that change—working at the edges, fostering creativity, and helping to spark the paradigm shifts that make true progress possible.

DAF Day is coming October 10

Tue, 24 Sep 2024 23:16:55 GMT

First annual DAF Day is the time to put Donor Advised Funds to work

According to a 2023 Donor Advised Fund (DAF) report by the National Philanthropic Trust, more than $229 billion is currently held in DAFs, with donors giving nearly $86 billion to DAFs in 2022, compared to $45 billion to private foundations. The report indicates over a quarter of all individual giving now goes to DAFs, far surpassing private foundations as the favored charity vehicle for the wealthy. This trend presents a significant challenge for charitable nonprofit organizations that rely on philanthropic giving.

Once funds are contributed to a DAF, the DAF is not obligated to distribute them to charitable nonprofit organizations. Donors benefit from a tax deduction upon contributing to the DAF, but no further tax incentives are tied to actual disbursements. Thus, billions continue to accumulate in DAF accounts without benefiting anyone other than the financial managers of these portfolios, which typically keep a percentage of the assets.

Despite the growing popularity of DAFs, most Americans are unaware of how the lack of accountability for DAF distributions is diminishing the ability of charitable organizations to address urgent societal needs, as large sums of money in DAFs are either delayed or may never fully reach nonprofits. To raise awareness around these issues, 60 major nonprofit organizations are leading the effort to organize the first-ever DAF Day on October 10, 2024.

Saltzberg Consulting is sharing the link here for nonprofits to register for DAF Day. On the DAF Day digital platform, nonprofits can list and describe themselves in the participant directory and be eligible for DAF gifts.

Just as important, DAF Day offers DAF donors/advisors the chance to actively promote the distribution of the $229 billion currently held in DAF accounts in a highly visible, public manner. Once registered , donors can browse a directory of participating nonprofits, choose organizations to support, and make their contributions. Donors will be encouraged to disclose the amount they give on DAF Day and the nonprofits they support, promoting transparency. By taking part in DAF Day, donors will play a crucial role in mobilizing these funds for philanthropic action and contributing to solutions for pressing societal challenges.

How does a grant writer get paid?

Sun, 15 Oct 2023 15:57:30 GMT

Ethical... and not so ethical... approaches to paying grant writers

Suppose you have decided to hire a grant writing company or freelancer. In that case, you may wonder about the best way to pay. First, your organization and the grant writing company will need to agree to the scope of the services and how much you will pay and sign a contract with the terms of the agreement. One of the details outlined in the contract is the payment terms.

When is payment for grant writing expected?

Grant writing companies differ a lot in when they take payment. They may require all or a portion of the price at the beginning. They may send you an invoice at the end of the project. They may offer a payment plan or a retainer fee for a certain amount of services provided. At SGR, we charge either all or 50 percent of the payment for federal grants before a project begins. The length of the project determines the remaining costs. When the project is near completion, the final payment is due. Our retainer packages have quarterly payments.

How is payment received?

Grant writers and grant writing companies may take payment via check, money order, or electronic payment. There is little difference between paying a grant writer and another service provider. At SGR, we send and accept electronic payments via ACH, bank transfer, or credit card.

Are grant writers paid on commission or a percentage of the grant award?

We can guarantee that most grant writers expect payment when services are delivered. Which means grant writers do not work on contingency (paid if the grant is awarded) or commission (paid a percentage of the grant award). This is because many grantmaking organizations only allow grant funds to pay for services provided after the award, which excludes grant writing. Therefore, nonprofits should pay for grant writing services whether a grant application is accepted or declined.

As members of the Grant Professionals Association, our organization adheres to the GPA Code of Ethics , which states the following regarding compensation.:

"Compensation:

17. Members shall work for a salary/wage or fee. Pro bono work is also allowable.

18. Members may accept performance-based compensation, such as bonuses, provided such bonuses are in accordance with prevailing practices within the members' own organizations and are not based on a percentage of grant monies.

19. Members shall not accept or pay a finder's fee [3], commission [4], or percentage compensation based on grants and shall take care to discourage organizations from making such payments.

20. Compensation should not be written into grants unless allowed by the funder."

How can my organization afford a grant writer?

Nonprofits may pay for grant writing services from cash on hand, unrestricted funds, individual donations, general operating funds, earned income, or from their salary accounts. In addition, some organizations can apply for capacity-building grants to hire a grant writer.

The majority of SGR's grant-writing customers are established organizations with multiple sources of revenue. They pay for grant writing with cash on hand, operating funds, and unrestricted funds.

Key Takeaways

Knowing how and when you will need to pay for grant writing is as important as picking the right grant writer. How to pay for grant writing will differ by each company or freelancer The details will be outlined in your contract or agreement. A few things to remember:

1) Grant writers are discouraged from working on commission or contingency, so most charge an hourly rate or flat fee;

2) You can expect to pay for a portion or all of the fee upfront before services start. There may be payment plans available or retainer packages for long term projects; and

3) Your organization should set aside funds to cover the cost of the contract from an approved expense account.

Promoting Equity and Responsible Philanthropy

Fri, 15 Sep 2023 15:09:48 GMT

While contributions made by the wealthy play a crucial role in supporting nonprofit organizations, it comes at a substantial cost.

I wanted to share this article by Alan S. Davis, president of the Leonard and Sophie Davis Fund and board chair of the Excessive Wealth Disorder Institute, which appeared in Candid's Philanthropy News Digest . It points out that while involvement of the ultra-wealthy in philanthropy can bring tremendous positive change, this generosity should be accompanied by a sense of responsibility and civic duty. This isn't always the case.

Davis describes the situation this way:

Many Americans generously contribute to various philanthropic causes, driven by the desire to make a positive impact, whether through small acts of kindness or significant monetary donations. However, the concept of charity can have a different meaning for the ultra-rich, often becoming a calculated strategy to accumulate wealth disguised as philanthropy.

While contributions made by the wealthy play a crucial role in supporting nonprofit organizations, hospitals, and educational institutions, it comes at a substantial cost. For every $100 donation made by a wealthy donor—with at least $2 million in annual income—they can receive $40 in tax breaks and up to $90 if they donate certain types of stock. Americans in lower income brackets, if they itemize charitable deductions at all, receive considerably less for their charitable giving.

Visit Candid's Philanthropy News Digest to read the full article, which points out how remarkable progress could be achieved in addressing the world’s most pressing challenges, if more of the ultra-wealthy engaged in genuine philanthropy.

Foundations: Let's "Un-Stack" the Cards Against the Very Organizations Who Most Need Your Funding

Fri, 18 Aug 2023 20:35:03 GMT

This post originally appeared in the Wagner Review

Imagine you’ve earned a competitive bonus at work. You’ve spent time demonstrating your worth and value to the organization, and finally, your hard work has paid off. Then, your supervisor tells you—as if you must have known—sure, you’ll earn an extra $8,700, just as soon as you pay us $1,800 of your own money.

This scenario parallels what happened to my organization when applying for a federal grant—multiplied by 10. After months of effort on my part as a development professional, and that of my colleagues, we were ecstatic to receive nearly $87,000 in funding from the Federal Emergency Management Agency (FEMA). I worked at a synagogue, and we planned to use the funds to renovate our building so as to be more secure and protected from antisemitic attacks (which increased by 275% in NYC in 2021). Later, we were informed that $18,000 of the total grant originally awarded was no longer permissible under the terms of the grant. That amount was to be used for maintaining compliance with landmarks rules—a requirement for renovation of any building with historic significance—which FEMA said was not directly applicable towards preventing terrorism. As that budget line was integral to the execution of the project, if we wanted to complete it and receive the remaining funds, we would have to pay.

Fortunately, I worked for a large organization, and they were able to provide the additional $18,000 from the capital budget. Yet, if it were a small grassroots organization, what would we have done? Due to the investments required, the unfortunate reality is that those organizations which most need the funding may be least likely to receive it. For many small organizations, this cash outlay would be impossible. Furthermore, the scenario described above only becomes an issue if an organization is able to receive the grant in the first place. This itself would be extremely difficult without funds to hire a professional grant-writer and/or the capacity to devote staff hours towards development. Grants should not only be accessible to large, established groups.

The disparity between large and small organizations is also related to race and diversity, as leaders of color report smaller budgets on average than white nonprofit leaders. Also, unrestricted net assets of Black-led organizations are on average 76% smaller than those of white-led organizations. Edgar Villanueva, author of Decolonizing Wealth, has coined the term “racial philanthropy gap.” There is abundant evidence that this funding disparity is pervasive, both between large and cemented organizations when compared to small and grassroots ones, as well as between white- and BIPOC-led organizations. For instance, only 9 to 12% of funding from the 1,000 largest U.S. foundations goes towards projects that are intended for minority populations.

The barriers to entry for fruitful grant applications are quite high. There is a capacity paradox whereby an organization with small capacity can’t apply for and receive a grant, and therefore can’t use the funds to increase their capacity, thus perpetuating this cycle. A smaller organization would be faced with much tougher choices than mine was: should they invest the money to hire a grant-writer to increase the chances of receiving the grant, or should they delegate the responsibility of grant writing and additional work hours to a singular development professional, or even their executive director? Worst of all, even if they do receive the grant, will there be sufficient flexibility in the budget to produce the additional resources needed?

To be clear, I do believe that funders genuinely want to distribute their money to those applicants who propose the best ideas and the strongest projects, and not just the most visible candidates or established organizations. In fact, in the last two decades, FEMA has distributed over $54 billion to organizations across the country, large and small, to prevent domestic terror attacks.

I urge funders—whether governmental or as trustees of a foundation—and the philanthropy sector as a whole, to actively combat the ways in which the cards are stacked against small organizations. One of the most effective ways for funders to do so is by diversifying their boards of directors and ensuring they are representative of the target population. Homogenous boards are susceptible to groupthink, which makes them less effective in serving their communities. I also recommend that when reviewing grant proposals, funders group organizations by the size of their annual budgets and select winners from each category. This way, small organizations are compared to one another rather than to larger organizations, and we can begin to level the playing field.

When traditional power structures are challenged in this way, barriers to entry for receiving equitable funding fall away. Increasing representativeness among those who distribute the resources should result in a more equitable distribution of those resources, and ultimately, that the true recipients will be those people we set out to serve. It is my hope that, beginning with this small step, grassroots organizations run by people of color could be funded as thoroughly as larger organizations with pre-existing resources.

The original posting, can be found on the Wagner Review website.

NIMBL Bridge Loans for Nonprofits - Update

Thu, 03 Mar 2022 01:55:49 GMT

The Nonprofit Interest-Free Micro Bridge Loan (NIMBL) program was intended to provide liquidity for Maryland's nonprofits while they waited for government payments...but that's not what happened.

In February 2022, Elise Saltzberg and several other nonprofit professionals testified in support of Maryland Senate Bill 245, which would provide much needed funding to the NIMBL program. (To learn more see our 2018 post Interest-Free, Micro Bridge Loans Now Available for Maryland Nonprofits! ) Nancy Easterling is the Executive Director of Historic Sotterley, Inc. Her testimony before the Senate was so compelling that we invited her to share her experience of NIMBL with our readers.

For the past 13 years I have served as the Executive Director for Historic Sotterley, Inc., a 300-year-old National Historic Landmark, UNESCO Site of Memory for the Slave Route Project, and historic museum site which interprets our complex, and often difficult, shared history. Sotterley offers a full range of programming to include education programs and field trips, tours, cultural events, recreational opportunities, a working farm that donates produce to our local community, our Common Ground Initiative supported by our Descendant community, and much more. Historic Sotterley is truly an exceptional educational and cultural resource for our community, our State, and our Nation.

Historic Sotterley is unlike many museums, however, in that it is not owned by a county, state or federal government, and its does not have an endowment to support its operations. This means we need to earn and work for every dollar to support our efforts and our mission, and this makes for a pencil-thin budget with often no reserve accounts to serve as a cushion. Despite our challenges, we have never wavered in our dedication to improving how we serve our community, and we have made many advancements over the years of which we are incredibly proud. Generous grants have been responsible for many of these important projects and advancements.

There are many grants which I have hesitated to apply for, however, because I know that most governmental grants work on a reimbursement basis which is difficult for small organizations like ours. Cash flow is everything for a small nonprofit, and we typically do not have funds in reserve to fall back on. It can sometimes take months and months after paying a bill to work our way through the reimbursement process, and we have had to draw on our operational line of credit which then incurs interest payments we will not be reimbursed for, as well as tying up our line of credit and making it unavailable for critical operational expenses such as payroll. We have even had to delay paying other bills when funds became too tight, hoping somehow that the people to whom we owe money will be understanding.

When the Nonprofit Interest-Free Micro Bridge Loan (NIMBL) program became available, needless to say I was ecstatic, and to date we have used it twice. The first time was for a $100,000 Bond Bill from the State, and while we were about halfway through the project at the time we applied, it was getting harder and harder to make cash-flow work. The NIMBL funds did not see us entirely though the project, but it helped us through a difficult period. We applied for our second loan to support our $100,000 African American Heritage Preservation Program grant, and this time we had to wait until others repaid their loans before funds could be made available since the pool of funds was so small. I quickly went through the $25,000, but I had to pay it back as soon as I received our grant reimbursements and could not continue to recycle these funds throughout the course of the grant. I was incredibly grateful to have received both loans, but if more funds become available for NIMBL, perhaps the loan amounts can be increased, or repayments delayed, allowing for continued use of loan funds.

NIMBL has been a godsend to Historic Sotterley and it can offer the same relief for other nonprofits, all of which are serving our communities and making them a better place, but which need help with cash flow during their governmental grant projects.

The ACE Act Needs Your Support

183:747132823 (Elise Saltzberg) — Wed, 11 Aug 2021 18:01:52 GMT

The “Accelerating Charitable Efforts (ACE) Act” has the power to channel more dollars to worthy causes

UPDATE:

October 2021: Henry Bogdan, Director of Public Policy at Maryland Nonprofits, has identified some of the drawbacks to the ACE Act. In the interest of reining in the for-profit companies that have zero incentive to encourage donors to ever give money to charities out of their DAF’s, the ACE Act may also hurt some community foundations, Jewish federations, and other organizations that do have a charitable mission. Read his statement here: https://www.marylandnonprofits.org/ace-act-highlights-the-problem-of-commercial-actors-in-donor-advised-funds/

In our December 2020 blog post ( “It’s Time for Foundations and Donor Advised Funds to Give More!” ) we urged readers to sign a petition asking Congress to change the tax code to channel billions of dollars to worthy causes – dollars that are warehoused in Donor Advised Funds (DAFs), where they can remain forever under current tax rules.

The GOOD NEWS is that a bipartisan bill has been introduced in the US Senate known as the “Accelerating Charitable Efforts Act” or the “ACE Act,” which will change the rules for DAFs.

What’s In the Act

The ACE Act goes right to the heart of the issue with DAFs. Under the current Internal Revenue Code, donors receive a tax deduction when they contribute money to their DAF. But there is no incentive for them to ever distribute these funds. As a result, this money is only benefitting the financial institutions that manage it, not the charitable organizations that should receive it.

According to the Associated Press: “That criticism has helped drive a Senate bill that would tighten the rules for DAFs and aim to speed the transfer of donations to charities. The bill, introduced by Sens. Angus King, a Maine independent, and Chuck Grassley, an Iowa Republican, appears to be gaining bipartisan support in Congress.”

The provisions of the ACE Act are hardly onerous, and only apply to DAFs over $1 million. Wealthy donors will still be able to take tax deductions upfront, but they must distribute DAF funds in a timely manner.

Why it Matters

As the holder of a DAF myself, I’m mystified that any donor would choose not to distribute their funds, especially as the money can’t be use for anything else.

But that’s what’s happening: There’s an estimated $142 billion sitting idle in DAFs – money that could be doing so much good in the hands of charitable organizations.

Opposition to the Act

Sadly, not everyone supports the ACE Act. An appalling number of foundation and nonprofit leaders want to retain what amounts to a pointless tax deduction for wealthy donors – instead of channeling much needed funds to organizations that support the most vulnerable among us.

Opponents of the Act claim that tighter restrictions on DAFs are unnecessary because the average annual payout rates are around 20% – way above the 5% that’s required for private foundations.

But that 20% number is deceptive. Some donors send a large percentage of their funds to charities every year, and their DAFs are essentially a pass-through. Others give nothing at all, and legally they can do nothing for decades.

Again, according to the Associated Press, “A June report by the Council of Michigan Foundations showed that 35% of DAFs sponsored by Michigan community foundations distributed no money in 2020, a year marked by enormous need because of the viral pandemic.”

Revising DAF tax breaks is more important than ever. In the past decade, there’s been a 300% growth in DAF accounts. More than 12% of charitable donations now go into DAFs. The more money that flows into DAFs, the greater the need to require disbursement.

From what I’ve seen,, the bill’s main opponents are for-profit companies and other entities that garner a percentage of every dollar that is sitting in a DAF. If DAFs paid out more money, there would be less money to collect these fees on. Personally, as a DAF holder, I want my money to go to worthy causes, not financial institutions!

Voice Your Support on Social Media

If you agree that the ACE Act is ultimately in everyone’s best interest, show your support on social media. Raise awareness by publicly calling out the ACE Act’s opponents in Congress.

Here are suggestions for what to say and which representatives to focus on:

https://bit.ly/3lW005M

Join the #FixTheForm Movement

183:747132823 (Elise Saltzberg) — Fri, 12 Feb 2021 17:02:56 GMT

If completing a grant application ever makes you want to scream, you are not alone! #FixTheForm is a movement to simplify the process. So, nonprofits can spend more time serving their communities and less on grant seeking.

Org’s mission doesn’t

Fit in fifty characters

Myb rmv vwls?

– Amanda Paveglio GPC

It's true, nonprofits and funders share many common goals. Often, both are on the same page when it comes to achieving those goals.

But not always.

If you’re reading this, you probably know how difficult it can be to apply for a grant, let alone getting funded.

And if you’ve worked in the nonprofit sector for a while, you’ve seen the application process evolve with technological changes – but not always for the better.

So, what’s the solution?

#FixTheForm

#FixTheForm is a Transatlantic, grassroots movement to address pain points in grant applications, the brainchild of two nonprofits professionals:

Kari Aanestad serves as Co-Director of GrantAdvisor ( https://grantadvisor.org/ ) and is the Director of Advancement at the Minnesota Council of Nonprofits. In this role, Kari advances the mission and work of Minnesota’s nonprofit sector through strategic visioning, fundraising, relationship development, sector research, and education. She is also the Vice President of the Minnesota-Northstar Chapter of the Grant Professionals Association.

Laura Solomons sits on both sides of the proverbial fundraising table: By day Laura is the head of donor relations for the Sutton Trust, a foundation that champions social mobility in the UK through evidence-based programs, research, and policy advocacy. She also serves as a Board Chair of the Peter Minet Trust, which aims to improve the quality of life for people living in the inner-city boroughs of South East London.

#FixTheForm grew out of the frustration that so many grant seekers have experienced with on-line application portals. Yes, this technology has benefits – like reduced paperwork and not having to stand in line at the post office. But poorly designed or overly complicated portals can significantly increase the time it takes to apply. One that especially peeves me is when you click on something in a drop-down menu and it causes a whole new set of little boxes to open up.

According to GrantAdvisor the cost to nonprofits in time wasted – searching for passwords, editing text because portal character counts don’t match those of MS Word and so many other annoyances – can equal up to 20% of full time work , create barriers and inequitable access to funding, and lead to burnout and turnover in key roles.

The good news is that small changes, like eliminating character limits, can have big impacts – like reducing time costs and increasing the likelihood that smaller, resource-limited charities can and will apply. #FixTheForm is all about promoting practical approaches that will benefit funders and fundraisers alike.

The Forerunner: Project Streamline

Twelve years ago, I served as the nonprofit representative to Project Streamline, which is now part of Peak Grantmaking ( https://www.peakgrantmaking.org/ ). It was an effort by some forward-thinking foundations to right-size the grant seeking process so that nonprofits weren’t spending 20 hours putting together a proposal that might only be worth $5,000 (if funded).

We described the project this way:

Our sector faces an effectiveness paradox. Funders, striving to be strategic and diligent, adopt what seem like sensible application and reporting requirements. But these practices place a heavy burden on organizations seeking funding, hampering their ability to be efficient with their time and effective in their missions. Project Streamline will engage grantmakers and grantseekers in a conversation about improving grant information gathering for a stronger, more effective sector.

While Project Streamline’s recommendations did lead to some improvements the application process is still harder than it needs to be.

#FixTheForm is the natural next step in streamlining the process.

How to Support the #FixTheForm Movement

I started this blog post with one of my favorite haiku poems because it sums up the frustration I often feel with the grant seeking process: “Org’s mission doesn’t/Fit in fifty characters/Myb rmv vwls?” If you laughed (or cried) when you read it, you’ll want to get involved with #FixTheForm.

Here's how to lend your voice to the movement:

* Are you a funder interested in pledging to #FixTheForm? Email fixtheform@gmail.com 

* Did you have a recent experience with a funder who needs to #FixTheForm? Write an anonymous review of them on GrantAdvisor (https://grantadvisor.org/) and use #FixTheForm somewhere in your review. Our team will make sure the feedback gets their way. 

* Interested in staying connected to this work? Subscribe to GrantAdvisor.org.  

To learn more visit http://blog.grantadvisor.org/why-we-need-to-fixtheform/

It's Time for Foundations and Donor Advised Funds to Give More!

183:747132823 (Elise Saltzberg) — Thu, 31 Dec 2020 19:03:21 GMT

Urge Congress to change the rules governing fund distributions. Sign the petition. (See link at the end of the post).

2020 was a tough, even devastating, year for so many people in the US and around the world. And those of us who work in the nonprofit sector have seen first hand the suffering that so many have experienced. At the same time, billions of dollars are sitting, unused, in foundation accounts and donor advised funds. As shocking as that fact is, these foundations and funds are within their rights to do so; they are simply following rules put in place by the federal government.

Change Must Start with Congress

As a development consultant for nonprofits and as a holder of a donor advised fund, I’m well aware that U.S. tax rules award substantial benefits to the wealthy when they donate to their foundations and donor advised funds. At the same time, these rules allow the foundations and donor advised funds to stockpile funds – in some cases for decades – with little or no mandate to channel the money to actual working charitable organizations.

The U.S. tax code has long recognized the societal benefits of charities and the need to incentivize wealthy donors to support them. But the balance between the two has never been perfect. Over time, the tax code has been modified multiple times to close loopholes and rectify situations where charitable donations were used in ways that were inconsistent with the spirit of the laws that governed them.

It is time for Congress to once again address systemic flaws that currently allow foundations to limit the grantmaking to 5% of total assets and to shield their grant activity from public scrutiny by granting dollars to donor advised funds. Additionally, there is no distribution mandate whatsoever for donor advised funds, whose assets now total over $120 billion, according to the National Philanthropic Trust.

The "Rainy Day" Is Here

Many foundations and donor advised funds have responded to the challenges of this year’s unprecedented pandemic. However, their grantmaking doesn’t come close to meeting the needs of the current crisis – as the pandemic rages and unemployment remains stubbornly high, people are pulling money out of their retirement savings to pay for current expenses, and others are faced with impossible choices between food and heat or medicine. Whole communities, especially communities of color, are suffering needlessly, while more than a trillion dollars in assets are sitting idle, waiting for a “rainy day.”

Folks, the “rainy day” is here – and it’s torrential. Now is the time to channel a much higher percentage of donated funds to front-line charities serving those in desperate need.

Time for a Sector-Wide Effort

It’s heartening to see that some wealthy donors and foundations are pressuring Congress to act. Billionaire philanthropists, including John and Laura Arnold, Seth and Beth Klarman, and Kat Taylor, as well as the heads of the Ford, Hewlett, Kellogg, and Kresge foundations, announced that they have joined forces to press Congress to take action to speed up distributions from foundations and donor-advised funds. And MacKenzie Scott has shown tremendous leadership by giving away 6 billion dollars this year, mostly to small charities and non-profits.

I say, let’s make this a sector-wide effort. Each of us can commit to doing our part to raise awareness and encourage Congress to see that tax deductions for the wealthy lead to genuine benefits for the individuals, families, and communities that are struggling like never before.

Please Sign the Emergency Charity Stimulus Petition

If you agree that it’s time for Congress to act, please sign the Emergency Charity Stimulus petition , created by the Institute for Policy Study’s Charity Reform Initiative. Increasing the required annual payout from foundations from 5% to 10% and increasing the required payout from donor advised funds from 0% to 10% would redeploy $200 billion to charities over the next three years. And this will cost the U.S. Treasury nothing since these dollars have already benefited from the tax deductions that they received in prior years.

I encourage you to post a link to the petition on your website and/or social media. (Feel free to share this blog post.)

Black Lives Matter and the Nonprofit Sector

Wed, 16 Sep 2020 20:37:12 GMT

Those in the nonprofit sector are among the most good hearted, open-minded people I know. But, when it comes to race and equity, many of us are still waking up to how much there is to do.

Like most of my colleagues in the nonprofit sector, I was outraged by the brutal killing of George Floyd who died, like so many others, because of the color of his skin. The focus on Black Lives Matter sparked by Floyd’s death has gotten me thinking a lot about racial equality in different areas of my life, particularly in the nonprofit world.

One of the questions I’ve contemplated is this: How does it feel for a person of color to work in the nonprofit sector, where white women are the dominant culture? That question planted the first seed for this blog.

I’ve been thinking about this for the past few months and decided that now is the time to write this post. Now is the time to dig deeper, not to look the other way.

In fact, this moment in history reminds me of a speech that most people have never heard or long ago forgotten. Before Martin Luther King inspired the world with his Dream speech, during the 1963 March on Washington, a lesser known man took the stage. Rabbi Joachim Prinz called on this audience to look at what was happening in the United States and take action.

Rabbi Prinz told the thousands gathered on the Mall that day:

As Americans we share the profound concern of millions of people about the shame and disgrace of inequality and injustice which make a mockery of the great American idea...

When I was the rabbi of the Jewish community in Berlin under the Hitler regime, I learned… that bigotry and hatred are not “the most urgent problem.” The most urgent, the most disgraceful, the most shameful and the most tragic problem is silence…

America must not become a nation of onlookers. America must not remain silent. Not merely black America, but all of America.

Rabbi Prinz’s words ring as true today as they did over half a century ago. Silence and inaction are unacceptable.

Especially in the nonprofit world.

My friends and colleagues in the nonprofit sector are among the most good hearted and open-minded people I know. But, when it comes to race and equity, many of us (and I definitely include myself) are still waking up to how much work there is to do.

If you’ve read this far, you’ve probably been involved in conversations in recent months about the realities of race in the US, your local community, and the nonprofit sector. Talk may be cheap, but it is often an essential first step in the right direction.

Some of your conversations may have been spontaneous, others may be by design. I’ve had both.

In June, I invited two Saltzberg Consulting Associates, Monica McCann and Dondra Ward , who are both African American, to join me for open conversation on Zoom about our personal experiences with race in the nonprofit sector here in Maryland.

The conversation was so inspiring that I wanted to share a few of the highlights here.

Self-Segregation Among Nonprofits

I asked Dondra and Monica how they felt about being Black women working in a field where white women are the norm.

I was surprised by their answers.

They basically said the same thing: It wasn’t an issue for them, because they grew up in Prince George’s County, which is predominantly African American, and most of the nonprofits they’ve worked with are made up of people of color.

That gave me pause – and got me thinking about how self-segregated many nonprofit are. I know of a number of organizations where the entire staff and board are all white or all Black or all Jewish.

Segregation Between Leadership and Staff

While most nonprofits aren’t uniformly one race, religion, or ethnicity, there’s a troubling pattern in many of the nonprofits I’m familiar with. All too often, upper-management and board members are predominantly white, while middle-management and support staff are more likely to be people of color.

Dondra, Monica, and I discussed why we think these different forms of self-segregation happen and agreed that in the past it may have been somewhat unconscious. As human beings, we seem to be wired to surround ourselves with people we have something in common with – a tendency that gets reflected in hiring practices. But with increasing emphasis on the importance of diversity, it’s hard to imagine that nonprofits are unaware that this is happening. But being aware isn’t always enough. Many of these organizations have been sweeping the issue of diversity under the rug for years – because they don’t want to talk about it, don’t want to prioritize it, and/or they don’t know what to do about it.

Benefits of Diversity

What’s unfortunate about the lack of diversity in the nonprofit sector is that it’s not benefiting anyone (outside of creating cozy comfort zones). There’s plenty of research to prove that diversity leads to greater innovation and efficacy.

Here’s just one example: An article in the Harvard Business Review described testing that was done over a number of years on the way teams interact. The results consistently showed that diverse teams were able to solve problems faster than cognitively similar people. And other studies have shown that workers in diverse workplaces are more engaged and turnover is lower.

This is all great news for the non-profit sector! By inviting greater staff diversity, organizations could increase effectiveness and deliver better outcomes.

Creating More Diverse Nonprofits

One of the valuable aspects of our conversation were the concrete ideas that came up for addressing some of these issues (most of which came from Monica and Dondra) including:

Address White Privilege Skillfully: It’s good to keep in mind that people may not notice when they have privilege. An example was given of people who rely on lipreading and how they are having a really hard time with everyone wearing masks due to COVID-19. Being able to hear is a privilege that most people have and probably don’t think about. Talking about white privilege can make people defensive. It’s ok to talk about it anyway.

Stay Open: The main tools for addressing ignorance and injustice are an open mind and an open heart. Fighting against other people’s opinions generally doesn’t work.

Know Who’s at the Table : It’s important to have people with diverse points of view “at the table” – so one group of people isn’t trying to guess what another group of people needs. It’s valuable for nonprofits to literally look around the table at management and board meetings and see how well the communities they serve are represented – to see who’s missing and figure out how to include those missing voices.

Follow the Money: Grant makers are playing an important role in advancing systemic change simply by asking nonprofits to respond to questions about equity and inclusion. Nonprofits that don’t take this seriously may disappear in the long run, due to a lack of funding.

Enlist a Diverse Interview Panel: To achieve greater diversity among staff and board, start with a diverse panel of interviewers.

Create Affirmative Action: Nonprofits can institute their own version of Affirmative Action, where they set quotas to intentionally diversify their organizations.

Empower People to Grow into Their Roles: Instead of saying, “We can’t find a person of color to take this high-level position,” consider hiring someone with the training, potential, and enthusiasm to grow into the job.

Create a Career Ladder: To create long-term, lasting diversity, nonprofits can create career ladder training opportunities for workers in entry level positions and support them as they move up through the organization.

Empower Expression: To help convince leadership of the need to give more people a voice within the organization, nonprofits can create forums where staff can express the challenges they face because of a lack of diversity and lack of opportunities for advancement.

Start Small: It’s important to keep in mind that this is a huge issue. It’s ok to take little steps, as they will eventually lead to larger change.

Book Clubs… and Beyond

Another Zoom conversation I participated in recently was hosted by the Maryland Chapter of the Association of Fundraising Professionals (AFP). It was an informal gathering of fundraisers and nonprofit executives who wanted to talk honestly about our experiences with race and equity and our aspirations for the future.

The first thing that struck me about the group was how small it was – less than a dozen people. I expected such an important discussion would be well attended. I realize that everyone is busy and not everyone is excited to add another Zoom call to their schedule. Nonetheless, I think it’s telling that this was not the conversation that most white people were prioritizing.

That said, it was a great discussion with a wide range of experiences and perspectives presented. I came away feeling both inspired and hopeful.

Towards the end of the call, we talked about practical action steps that nonprofits, and the businesses that serve them, could take to raise awareness and shift organizational culture towards greater diversity.

The reality is that Maryland nonprofits fall along a very broad spectrum, in terms of their interest and willingness to embrace change. Some organizations are ready to invest in consultants to help them move towards greater diversity or have already done so. Others are barely aware of the issues. For them, just starting a book club to discuss titles like So You Want to Talk About Race, White Fragility, and How to Be an Antiracist would be a major breakthrough.

I applaud AFP for prioritizing this issue and hosting this discussion. They also did a great job of curating resources that organizations can use to move forward – regardless of their starting point. You’ll find their list at the bottom of this post.

Final Thoughts

I wrote this blog to remind myself and my readers that creating greater diversity and equity in the nonprofit sector is a big job, but we need to make it happen. I may not have an answer to the question that prompted this post, but I do know that we need to keep raising issues and moving forward until lasting change has been achieved.

Resources Recommended by the Maryland Chapter of the Association for Fundraising Professionals:

https://www.patreon.com/thegreatunlearn/posts

https://www.smithsonianmag.com/history/158-resources-understanding-systemic-racism-america-180975029/

https://www.racialequityinstitute.com/

https://www.racialequitytools.org/glossary#

Associated Black Charities ( http://www.abc-md.org )

What Do You Think?

I’d love to hear your thoughts about race and equity. Please use the Contact Form to reach me directly.

Elise Saltzberg Testifies in Favor of Bills to Establish the "Maryland Efficient Grant Application Council"

Mon, 16 Mar 2020 19:49:17 GMT

Applying for and managing grant money from State agencies is unnecessarily cumbersome. Elise is on the forefront of a movement to streamline the process.

If you’ve applied for a grant from the State of Maryland, you know how fragmented the procedure can be. The process is so daunting that some Saltzberg Consulting clients have decided not to apply, because the value of the grants wasn’t worth the time and effort.

The State is not trying to suppress applications. But the process has simply become unwieldy: Every State agency does their own thing, and sometimes what one agency is asking for contradicts (or at least doesn’t conform to) what another agency is requesting. Sometimes even within the same State agency , there will be no uniformity of application or reporting guidelines.

Hampered by unnecessary paperwork and requirements, the current process burdens State agencies and nonprofits alike. Not only is the application process painful, the excessive complexity often impairs or interferes with the delivery of services and use of funds.

Saltzberg Consulting, Maryland Nonprofits, and many nonprofit organizations in Maryland support two bills being considered by the General Assembly this session. Senate Bill 630 and House Bill 1539 would establish a new Council, along with working groups, to streamline the State grant-making process. Their goal would be to standardize the application, reporting, and budgetary formats, while providing enough flexibility to account for the size and scope of particular grant programs, grant-making entities, and grantees. Elise Saltzberg, founder of Saltzberg Consulting, has volunteered for one of the working groups.

Not surprisingly, this is a BIG task that will take years to implement. If the bills are passed this session, the new Council will submit annual reports to the General Assembly starting in December 2021 and submit all its recommendations to the General Assembly and the Department of Budget and Management by July 1, 2024.

In February and March, Elise provided written and oral testimony to the Senate Education, Health, and Environmental Affairs Committee and written testimony for the House Health and Government Operations Committee. To listen to oral testimony – both pro and con – given before the Senate committee, visit this page and click the camera icon beside the committee name. The video will be cued automatically to testimony for Senate Bill 630, which runs for about 30 minutes.

These bills have the potential to improve quality of life in Maryland, by freeing State money from the constrictions of red tape and putting it to work helping Maryland residents. We’re optimistic that these bills will pass into law and look forward to updating you accordingly.

Left to Right: State Senator Cheryl Kagan, Maryland Nonprofits’ Director of Public Policy Henry Bogdan, and Elise Saltzberg testifying before the Senate Education, Health, and Environment Committee

Elise’s February 27, 2020 testimony to the Senate Education, Health, and Environment Committee in favor of SB0650:

Thank you for the opportunity to present this testimony on behalf of my Maryland nonprofit clients. I have worked as a fundraising consultant to nonprofit organizations in Maryland since 2000, and I usually have 10-12 clients going at a time. Most Saltzberg Consulting clients are smaller nonprofits, with annual budgets in the range of $250,000 to $4 million.

Every year, at least four or five of my clients are confronted with a dilemma: The State has issued an RFP to provide funding for a program similar to something that they already offer or would like to offer. The first thought is, “Wow – this is GREAT” and we are flying high! Then we take a closer look at the RFP and the air is let out of the balloon. The RFP is 65 pages long. The amount of information that they are requiring is completely ridiculous and we have to submit it in a format that we’ve never encountered before, even though we’ve applied for funding from this same State agency in the past. The budget templates are 12 pages long and in a format that doesn’t match up with how we were required to create our line item budget last year for a different State agency. And the due date is in 30 days. Yikes!

So, then we have to perform a cost-benefit analysis around whether or not we should apply for the funding. Is it going to be worth the hassle to spend 60-80 hours putting together this grant application for the amount of money that we might be awarded? And if it’s awarded, is it going to be worth the time and effort that it will take to comply with all the grant monitoring and reporting requirements? Unfortunately, more often than it should, the answer to these questions is NO, and we end up forgoing the opportunity to apply.

Since my clients pay me by the hour, the time that we spend putting together an application such as the one described above can add up to thousands of dollars. And those dollars count towards their dreaded “administrative overhead,” which no funder wants to cover. Most importantly, this is time and money that my nonprofit clients would much rather devote towards delivering their services to Marylanders in need.

Standardizing the grant application and grant reporting formats across State agencies would be a blessing. Nonprofit organizations would be in a much better position to expend their limited resources towards operating their programs and delivering their services instead of expending them on completing needlessly complex jigsaw puzzles. As a bonus, I anticipate that streamlining the grant application and grant reporting processes will save the State agencies the headache of creating and re-creating RFP’s, forms, and web portals, and the time they spend monitoring grant awards.

Thank you again for the opportunity to present this testimony.

Elise’s March 10, 2020 testimony to the House Health and Government Operations Committee in favor of HB 1539:

Thank you for the opportunity to present this testimony on behalf of my Maryland nonprofit clients. I have worked as a fundraising consultant to nonprofit organizations in Maryland since 2000. Most Saltzberg Consulting clients are smaller nonprofits, with annual budgets in the range of $250,000 to $4 million.

Every year, at least four or five of my clients are confronted with a dilemma: The State has issued an RFP to provide funding for a program similar to something that they already offer or would like to offer. The first thought is, “Wow – this is GREAT” and we are flying high! Then we take a closer look at the RFP and the air is let out of the balloon. The RFP is 65 pages long. The amount of information that they are requiring is completely ridiculous and we have to submit it in a format that we’ve never encountered before, even though we’ve applied for funding from this same State agency in the past. The budget templates are 12 pages long and in a format that doesn’t match up with how we were required to create our line item budget a few months ago for a different State agency. And the due date is in 30 days. Yikes!

Establishing a Council that would focus on standardizing the State grants process across agencies is a wonderful opportunity to find places where both grant application and grant reporting formats could be streamlined. A Council such as this one – made up of stakeholders from all sectors – would be a great way to examine the current landscape and look for ways to improve it, and I would be happy to serve on such a Council. In 2009-2010, I was the Nonprofits Representative to the Online Applications Working Group of Project Streamline , which was an effort by the Grants Management Council to do something similar for private foundations. That work carries on at PEAK Grantmaking ( https://www.peakgrantmaking.org/principles-for-peak-grantmaking/project-streamline/ ), which found that both grant-seekers and grant-makers benefitted from the process.

Similarly, with government grants, I anticipate that streamlining the grant application and grant reporting processes will save State agencies the time and energy of creating and re-creating RFP’s, forms, and web portals, as well as the time and energy they spend monitoring grant awards. And nonprofit organizations would be in a much better position to expend their limited resources towards operating their programs and delivering their services instead of expending them on completing needlessly complex jigsaw puzzles.

Thank you again for the opportunity to present this testimony.

Foundations Need to Step Up During the COVID-19 Crisis

Mon, 16 Mar 2020 17:51:31 GMT

Vu Le implores funders to give more, not less, during this time of uncertainty

I don't have time for much reading, beyond what's needed to serve my clients. But I make time to read Vu Le. Vu is the creator of NonProfit AF , the weekly blog that takes a no-BS, slightly irreverent, and often humorous look at the nonprofit sector. He's also the co-author of Unicorns Unite: How Nonprofits and Foundations Can Build EPIC Partnerships .

This week, Vu makes the case to foundations that now is the time to be generous with their funding, not to save their money for a rainy day. His analogy of firefighting with just 5% of your available water – so you can save the other 95% to fight future fires is perfect!

With Vu's permission, I'm sharing his March 16th post below. You can also read his post here .

Funders, this is the rainy day you have been saving up for

Hi everyone. I hope you are doing OK amidst the Coronavirus pandemic. It’s scary. Take care of yourself while socially distancing. Most of us have never faced anything like this before, and we cannot take any chances. Cancel everything and stay home. I am in Seattle. My kids’ schools are closed for the next six weeks, possibly longer. It is going to be rough, but we are far luckier than most, as my partner and I both have flexible schedules.

A lot of folks are hurting right now. Small business owners, people without sick leave, gig workers, folks without childcare, those who have no emergency savings, incarcerated people, people experiencing homelessness, disabled folks, kids who rely on school for food, those who are undocumented—all face daunting challenges with no foreseeable end date. Meanwhile, nonprofits face drastic reductions in revenues because of canceled events and other factors, which means we are less able to help during a time when we are most needed.

Amidst all this, I got a message from a colleague saying that a foundation just informed its grantees that due to its corpus being affected by the stock market, in part because of the Coronavirus, it may cut down on funding, possibly not even be able to disburse committed funds.

Foundations, I am begging you, if there was ever a time for you to increase your payout rate and get more money out the door, this is it. Please do not do what many of you did in 2008, when the markets tanked and people were crying out for help and many of you lowered your giving instead of increasing it. I know that you mean well. In your mind, you are thinking of the future. You think that if you spend beyond the 5% minimum payout rate as required by law, you will whittle down your corpus to nothing. You think of the future crises that humanity will face, and you want to be adequately resourced to handle them. You think that you are being prudent, saving up so that when society needs the funding the most, it is there.

But the reality is that your prudence has perpetuated so many of the problems you are saving up to solve, creating a self-fulfilling prophecy. Imagine if there are wildfires raging—(you don’t need to imagine, we’ve had plenty and will get more)—and you have all this water available, but you only allow 5% of it to be used, so you can save the 95% of the water for future fires. But by not putting out the current fires, they continue to spread. The future fires are caused by the current fires that we do not put out.

This line of thinking, of saving your corpus for a rainy day, has had severe consequences. Because of the lack of funding to advance environmental issues over decades, our planet has ten years left before climate change is irreversible. Because of the lack of funding for advocacy over decades, we have few safety nets. You are saving for a rainy day, but how much more water must fall, how many more people and communities must be swept away in the flood, before you will admit that it is raining?

COVID-19 has already started changing everything. We already botched our chance to contain the virus, and are now on track to experience the horrors Italy is going through. Surviving, much less rebuilding, from this will take billions. During this time of fear, uncertainty, crumbling infrastructure, and the suffering of people across the globe, coupled with the lack of resources for nonprofits to do our work, we need foundations to go beyond the bare minimum that many of you are doing. We appreciate the flexibility of timelines and deliverables. It’s great that that some of you are converting project grants into general operating funds and gathering your peers to talk about how to be helpful to nonprofits as we struggle to meet rising demands at this time.

However, you also need to immediately increase your payout rate . Whatever amount you’re giving out this year, double it. Double it and get it out the door fast and with as few grantwriting obstacles as possible. Get the money out to nonprofits that are feeding kids while schools are closed, preventing evictions as people lose income and can’t pay rent, supporting folks experiencing homelessness who can’t self-quarantine, helping older adults get meals and supplies during this period of isolation. Get funding out to hospitals and health clinics. Get funding out to artists and gig workers. Get funding out to advocacy organizations who are fighting for paid sick leave, increased wages, universal healthcare. Get funding out to intermediary organizations that are coordinating relief efforts. Get funding out to nonprofits and people in general.

A silver lining of COVID-19 is that it is forcing us to question so many constructs that we take for granted. Why doesn’t the US have paid sick leave? Why don’t we have universal health care? Why are nonprofits scrambling to do so many things that should be done by a functioning government? I hope that when we overcome this pandemic, we will work to change these things.

Of foundations, I would ask you to examine why you still adhere to the 5% minimum legally required payout rate. If this pandemic is not the time for transformative action, then when is? Please increase your payout rate. By giving more now in the present, you increase the chance that there will be a future.

_______________________

If you enjoyed this post, I recommend that subscribe to Vu's blog .

Congratulations to Kim Rhim on Her Big Win!

Mon, 04 Nov 2019 22:51:46 GMT

Kim Rhim, Founder and Executive Director of The Training Source, was just named Prince George's County Nonprofit Leader of the Year for 2019.

It’s been my privilege to have Kim Rhim, Executive Director of The Training Source (www.thetrainingsource.org), as a client for almost 10 years. During this time, I’ve been awed by her achievements and impressed with her ability to connect in a genuine and caring way with people from all walks of life. In honor of her well-deserved recognition as the Greater Washington Community Foundation’s Prince George’s County Nonprofit Leader of the Year, I want to share her inspiring story.

A Marriage of Business Acumen and Dedication to Service

Kim Rhim graduated magna cum laude from Howard University, received her MBA from Columbia University, and worked as a Program Manager at IBM before founding The Training Source in 1993, which she still helms today as its Executive Director. The Training Source is a community-based nonprofit that provides comprehensive job training programs for the unemployed and underemployed, youth development programs, safety-net services for families in-need, and professional training for employers.

The Training Source marries Ms. Rhim’s formal business training with her life-long commitment to community service. While working at IBM, she witnessed the layoff of 100,000 employees nationwide. A large percentage of those impacted were minorities, most of whom had been employed for 20+ years with limited growth and advancement. Ms. Rhim assisted many of those who’d been laid off with resume writing and job searches. She also provided them with a sense of hope for the future.

This experience sparked her passion for helping vulnerable populations navigate the hurdles of preparing for, securing, retaining, and advancing careers in a competitive and sometimes scary workplace. This passion led her to leave the security of her management job at IBM and found The Training Source.

Since 1993, The Training Source has helped over 20,000 vulnerable youth and adults prepare for college and the workforce, obtain family-sustaining jobs, and retain and advance in careers. The Training Source, which develops people, not just skills, is now a staple in the Prince George’s County community and a life-changer for everyone who walks through its doors.

Praise for Kim Rhim and The Training Source

Ask anyone who knows Ms. Rhim and you’ll hear nothing but glowing praise. For example, at The Training Source’s 25th Anniversary Gala celebration, Maryland State Senator Joanne C. Benson applauded Ms. Rhim and The Training Source’s achievements saying, “For those of you who have not had the opportunity to visit The Training Source, you need to do it. Your heart will be made glad when you see those students working and the divine unselfish staff and volunteers who are helping people who have lost their jobs and came there looking for hope and help.” The same night that Ms. Rhim was named the Nonprofit Leader of the Year, Senator Benson won the Wayne K. Curry Award for Leadership and Public Service.

A Truly Meaningful Award

There are awards… and then there are awards that have the power to raise awareness and benefit whole communities. The Civic Leadership Awards are the latter. Established in 2006, they recognize, honor, and promote outstanding community leadership.

These awards shine a light on individuals and organizations who too often go unrecognized for their important contributions—unsung heroes who have quietly, tirelessly, and unselfishly demonstrated outstanding commitment and service to improving and enhancing the quality of life in their community.

Being honored as Nonprofit Leader of the Year Award for 2019 is particularly significant, as 2019 is the first year that the Greater Washington Community Foundation has presented an award in this particular category. The foundation nominated four phenomenal nonprofit leaders and the winner was selected by community vote.

Upon receiving the award Ms. Rhim thanked everyone who voted for her saying, “Your support is a testament to the works of The Training Source in support of our vision of ‘economic mobility for all.’”

She has most definitely earned this important recognition. Congratulations, Kim Rhim!

GRANTADVISOR UPDATE - NOW BETTER THAN EVER!

Thu, 12 Sep 2019 21:45:47 GMT

This wonderful resource for the NonProfit sector has come into its own

Even though nonprofit organizations are often in competition for grant dollars, individuals who work at nonprofits are generally caring people who want to see the whole sector thrive, not just their own organization. That’s the underlying philosophy of GrantAdvisor’s foundation review service. In fact, when GrantAdvisor asked members why they took the time to review a foundation, the number one response was, “To help my colleagues.”

Transforming Philanthropy - One Review at a Time

GrantAdvisor's mission is to transform philanthropy. A 501(c)(3) nonprofit, it functions much like TripAdvisor and HomeAdvisor. Membership is free and members are invited to share, anonymously, their experience of working with foundations. The goal is to help nonprofits understand how best to approach foundations (and which ones to avoid). Reviews also provide excellent feedback to foundations, ranging from broken website links to requesting clearer funding guidelines and more open communication.

When we wrote about GrantAdvisor last year (GrantAdvisor: Bridging Communications Between Funders and Nonprofits https://www.saltzbergconsulting.com/grantadvisor-bridging-communication-between-foundations-and-nonprofits ), the organization was new and staff didn’t know what to expect. In order to ensure a balanced portrait of each funder, they decided not to publish reviews of any foundation on their website until the foundation had received at least five reviews. Not surprisingly, GrantAdvisor published reviews for fewer than 100 foundations in the first year.

But this year will be completely different. Based on how wonderfully fair and balanced member reviews have been so far, GrantAdvisor has decided to post all of them (barring those that don’t meet community guidelines). As of this writing, over 600 foundations are reviewed on the website, including 14 in Maryland.

I’ve worked in development for more than 30 years and know how challenging it can be to approach a new funder or to send yet another proposal to a foundation that seems like a good fit but rejects every request. GrantAdvisor provides valuable insights to help nonprofits navigate these essential relationships. I strongly encourage all grants seekers to sign up for a free membership and take advantage of this service - which is unlike anything in the nonprofit sector. If you have useful information about a foundation - take a few minutes to help your colleagues by writing a review!

Chronicling the Relationship Between Funders and Nonprofits

I also recommend that you look at GrantAdvisors' excellent articles, which cover the relationship between funders and nonprofits. For example, their piece called, "Navigating Funders’ Online Grants Management Systems” details some of the most frustrating situations nonprofits contend with and provides funders with a list of, “Best Practices” to ease users’ pain. (It also refers to Project Streamline, which I participated in years ago. I didn't even know they were still around!)

What Do You Think Of GrantAdvisor?

If you have experience with GrantAdvisor or thoughts about their service, we’d love to hear from you! Please leave your comments below.

Useful Links

https://grantadvisor.org/funders.php

http://blog.grantadvisor.org/grantadvisor-faq/

https://grantadvisor.org/register/reviewer.php

My Favorite NonProfit Haikus

Thu, 12 Sep 2019 21:25:23 GMT

Nonprofit AF ran their first ever "Unicorns Unite" #NonprofitHaiku contest on Twitter. I wanted to share two of my favorites. If you want a good chuckle read their article, "25 beautiful and profound haiku about nonprofit work."

This haiku captures the angsts of writing grant proposals, and the ingenuity of our sector:

Org’s mission doesn’t

Fit in fifty characters

Myb rmv vwls?

– Amanda Paveglio

This one expresses the passion many of us have for the Oxford comma!

The Oxford Comma

A writer’s choice no longer

When I’m president

– Johna Rogers

Infrastructure Investments Should Focus on Low-Income Communities

Mon, 08 Apr 2019 20:39:04 GMT

Federal Infrastructure dollars could do a lot of good in low-income communities.

Decades of inequitable distribution of resources mean that low-income communities are now in desperate circumstances with crumbling schools and inadequate transportation systems.

In their piece, "Infrastructure Investments Should Focus on Low-Income Communities," The Center on Budget and Policy Priorities makes an excellent case for using infrastructure dollars to improve communities that have been neglected badly in the past.

From the article....

As federal policymakers consider investments to address the nation’s pressing infrastructure needs, a core priority should be to direct substantial resources to low-income communities, our new report shows. Decades of policy choices and insufficient public and private investment have made the infrastructure needs of these communities acute, especially in many communities of color where past policy choices affected by racism, combined with continuing racial bias and discrimination, have resulted in a lack of needed economic resources. New investments could expand low-income communities’ access to safe living conditions and economic opportunity, and include... CONTINUE READING

Listen to Elise talk about growing Saltzberg Consulting

Mon, 11 Feb 2019 18:10:46 GMT

Elise shares her story on the Market Smart's podcast, "How I Built My Fundraising Consultancy"

Market Smart is a company that helps charities enhance their fundraising through marketing and technology. (If you're a fundraiser who wants to boost lead generation and cultivation efforts, see below for valuable free resources.) I learned about Market Smart when they asked me to be a guest on their podcast,”How I Built My Fundraising Consultancy.”

It was a great experience, and I invite you to listen to the program. (If you want to jump to certain topics, use the Topic Timestamps below to guide you or read the transcript below.)

Topic Timestamps

Introduction [00:00]

What inspired you to start your business? [02:33]

Home/Client Time Split? [03:21]

Are your clients local? [03:56]

Where did your interest in grants come from? [04:18]

Your background in psychology? [05:09]

How’d you decide to get into fundraising? [05:45]

What aspects of fundraising do you enjoy? [07:34]

What was it like working for a larger national nonprofit? [08:14]

How did you expand to include now 6 other consultants? [09:32]

Grant Research [10:36]

How has the business changed since you started it? [12:25]

What kind of clients do you work with? [13:21]

The “Are You Ready” form [14:56]

Any tough lessons you’ve learned? [16:16]

What are your favorite tools? [16:45]

Lightning Round [20:03]

Free Market Smart Resources for Fundraisers

Here are links to just some of their FREE fundraising resources:

Blogs: https://imarketsmart.com/smartideas/

Podcasts: https://imarketsmart.com/podcast/

Webinars: https://imarketsmart.com/category/resources/webinars/

PODCAST TRANSCRIPT

Introduction

Welcome to, “How I Built My Fundraising Consultancy” the stories behind the people driving results in the nonprofit sector.

We're here today with Elise Saltzberg. Welcome to the podcast. First off, please introduce yourself and what Saltzberg Consulting does.

Saltzberg Consulting is a fundraising consulting firm. I would say about 80% of what we do is grant related, either grant prospecting or grant writing, grant editing, grant reporting. The other 20% would be every other sort of fundraising, like annual fundraising and major gifts. I tend not to do much with capital campaigns and I also don't get involved too much with special events. If one of my clients wants to throw a party, I usually refer them to someone else.

Is the decision not to work with capital campaigns just because it is such a monumental endeavor to undertake?

There are just other consulting firms out there that do that. I let them

do their thing and they let me do my thing.

The Inspiration to Start

So what inspired you to start your business almost twenty years ago?

I had been working at the Center on Budget and Policy Priorities in Washington DC and I live in Baltimore so I was taking the MARC train down to DC and the commute was kind of getting to me. I had little kids and after awhile I just couldn't do the commuting anymore. I was a stay home mommy for a while and then I decided it was time to go back to work.

I knew I didn't want to go back to Washington so I started my own consulting practice, primarily so I could also be a mom at the same time. It worked out really well, because now my commute is from the upstairs of my house to the downstairs of my house.

Dividing Time Between Home and Clients

That's awesome. I’m very familiar with the MARC train. I've taken it many times from the airport back to home in DC where I'm based out of. So how do you split your time between being on-site at clients' offices versus working at your house?

Almost all of my work is done from home. I have a home office that's got everything that you could imagine. I have a couple of clients I've never actually met in person. Between email and phone calls, there's never been a reason to meet them in person.

I would say that at least once a week I like to get out of the house either go meet with a client or a prospective client or a colleague just sit and talk shop.

Where the Clients Are

And do you find most of your clients are locally based or do you try to branch out to other parts of the country?

Most of my clients are here in Maryland I have a couple who are outside of Maryland. Within Maryland, it's primarily Baltimore County and Baltimore City. I have a few in Prince George's County and somebody in Hagerstown. But mostly it's local.

Developing an Interest in Grant Writing

You mentioned grants was a big part of what your consultancy does. Where did your initial interest in that kind of work come from?

I figured out that I wrote my first grant in 1981. I know I'm dating myself!

I was living in Anderson, Indiana, and I was the Executive Director of an organization called Women's Alternatives. As part of the job of an Executive Director, I was doing a lot of fundraising, and the grantwriting part of it came very easily to me. My mother's a high school English teachers, so I learned how to write. That was where I found my most success in subsequent jobs. I always lean towards that part of the fundraising.

When I was at the Center on Budget and Policy Priorities, nearly all the funding at that time came from foundations. So grant writing was a big part of what I did.

Educational Background

Something I noticed in your background was that in college you studied psychology. Did that have any kind of influence on your perspective for the work you do in fundraising?

It was actually animal behavior in experimental psychology. I wasn't counseling that much or analyzing people or anything like that. I worked with rats and mice in the lab. What I do now isn't directly related to that, but I learned science and I learned how to be a critical thinker. That would certainly help anybody in any part of their life.

Becoming a Professional Fundraiser

That certainly would help. How’d you decide that you wanted to actually start working for nonprofits and do fundraising work?

I kind of fell into it. I was in grad school at Indiana University in Bloomington, Indiana. As I said I was working with rats and mice it was bothering me, because I felt like we were kind of torturing these animals – not so much in my lab but in the labs next to me were cats and dogs and chimpanzees, and they were planting electrodes in their brains and doing all kinds of things that I thought were just terrible.

In my lab the only thing that we did was starve the animals because we had to keep them on 80% body weight to get them to perform the behaviors that we were training them in. I would go in on the weekends and feed the pigeons and the rats and so Monday mornings everybody's experiments were all messed up. But anyway, I did that for a year and I just couldn't do it anymore so I left.

I was married at that time, and my husband got a job in Terre Haute, Indiana. Then we moved to Anderson, Indiana and I became a counselor at Women's Alternatives, as I mentioned. This was a shelter for battered women and their children, and we had services for rape crisis survivors. I was a counselor for three years. When the Executive Director was leaving, the Board asked me to apply for the Executive Director position.

As part of the interview they asked me if I knew how to raise money and write grants. I said, "oh yeah, sure I can do that.” They hired me as the Executive Director and I found out pretty quickly that a big part of the job of an Executive Director for that type of an agency is raising money and that was the part that I really liked the best. I was really good at it, so every job I've had since then has always been a fundraising position.

The Joys of Fundraising

What aspects of fundraising do you really enjoy?

Certainly building relationships with donors is a big big part of fundraising. It’s something that some organizations don't really understand.

Sometimes a client or a prospective client will call me and say, "Can you write a template grant for us that we can send around to a bunch of different foundations?” No, I won't do that because every funder is different and you have to talk to them first and build the relationship before you just blindly send grant applications.

It's like applying for a job and proposals are your cover letter. It’s very obvious if you don't know anything about the company you're applying for.

Working with NonProfits – Large and Small

Exactly. What was it like transitioning from a very local nonprofit in Indiana to a much more you know national organizations like Friends of the Earth?

Well the scale was much different. Our annual budget at Women's Alternatives was about $160,000. I think at Friends of the Earth we were raising about ten times that much. When I left the Center on Budget and Policy Priorities, we were about $4 million annual budget. Now it's probably $40 million annual budget.

That’s a big jump. Did the work you did feel different with the scale being so much different – or did it feel kind of the same, just with different numbers?

It was definitely different at the Center on Budget. You're dealing with the big boys. We would be talking to the people at the Ford Foundation and the Rockefeller Foundation and the board of directors was, and still is, a nationally recognized board with really, really incredibly wonderful people on it. Not to knock Women's Alternatives, but the board there was nice local people who wanted to help these families. So, yes it was on a different level.

Building the Business – Bringing on Associates

Your business now has grown to include six other consultants. When did you start expanding, and what roles needed to be filled at the very beginning of that expansion?

When I started out in 2000 as a sole proprietorship, I had a few clients. My first client was the Center on Budget and Policy Priorities. I think it’s true for a lot of start ups that the first client of the consultancy is your former employer. I grew from there and I grew to the point where I really had more work than I could do myself.

I had a friend who was available, and it kind of fell into place. She's still one of my associates. The associates do primarily the grant writing and I'm doing more editing than writing, which is fine with me and it's fine with them. I have very strong writers on my team.

Occasionally my associates work directly with a client, but most of the time it comes through me. It’s still Saltzberg Consulting, and because my name is on it I keep pretty tight quality control on the finished product.

With grant writing there's quite a bit of research involved in drafting proposals, and those six consultants are doing that work as well, during that writing process?

We have a saying in the field, “If you've seen one foundation, you’ve seen one foundation.” Every foundation is different. They all have their own special challenges. For example, the majority of applications are now done through online portals, but they’re all different. Some of the formats are very tight – you might have 800 characters to write your mission statement, your vision statement, your organizational history, and what you're proposing to do now. Other ones are more open-ended and you can write as much as you want. Some foundations are still doing paper applications and want you to submit 11 copies, so that they can give them to their 11 board members. You have to make copies and bring them to the organization.

You have to give them what they want, and that's part of the deal. They're the ones with the money, and if they say they want 11 copies you have to make 11 copies. The part that’s a little bit frustrating is that they really want you to keep your administrative costs low – like zero –but these copies, which are part of administrative costs, are 15 cents a page!

Evolution of the Business

How has business changed since you began – is it just that you have more work and you’re editing instead of doing the original writing?

I'm still the one who has the primary contact with the clients. I usually have 10 to 12 clients going at a time. For some clients, I’m basically their development staff, and they just say, “You write it will sign it and they really just kind of let me do my thing. Other clients are much more hands-on. They want to see draft number 1, draft number 2, draft number 5, draft number 7, etc.

That's unusual. Most of the time when I give a draft to a client, it's a pretty solid close-to-final version. I’ll use little comment boxes in the margin or yellow highlighting to say, “Look at that section on page 3. That's the part that you really need to focus on.” That’s what they'll focus on and the rest of it they might look at it or they might not.

Finding the Right Clients

What kind of clients do you work with?

I have education, housing, community development, disabilities – just about every category out there I have in my portfolio. If I had to say what my sweet spot is, it's more based on their annual budget. Most of my clients are in the range of about a half a million up to about $4-5 million.

If they have a bigger budget than that, they don’t really need me, because they have their own development department. I do have some large clients that they use me when their own staff is at capacity and need extra help.

Clients who are smaller than about $500,000 a year annual budget may need my help, but they don't have money to pay me. And when you're going after Foundation grants or government grants, if you're a really small organization with one or two staff people the reality is that you're not going to be competitive with most grant applications.

Foundations want to see that you've got the infrastructure to do whatever it is that you're proposing to do. A lot of foundations are leery of going for a really small organization that just doesn't have the capacity or that's an all-volunteer organization.

When Potential Clients Aren’t a Good Fit

I was exploring your website and notice that you have this, "Are You Ready to Apply for a Grant?” page. Has that been a useful tool for gaining new business?

It is amazingly useful. It's not a tool for getting new clients. It’s a tool for not getting new clients.

So it's like a filter?

Exactly. If somebody calls me and I can tell within you know a 10 or 15 minutes phone call that they're not ready, what I’ll do is I'll send them to my website and have them go through that little checklist and come back when they are ready. It’s a waste of my time and their money if they really don't have the things in place that you need to apply to for grant funding, such as:

Do you have a program?
Do you have a way of measuring your outcomes?
Do you have a board of directors?
Do you have a 501(c)(3) designation?

By the way, if you don't have a 501(c)(3) you can always get a fiscal sponsor, so I don’t want to leave the impression that you’re not ready if you don't have a 501(c)(3), because that's not true. You do need to have a real program, and you really need to have a plan for operating your program and measuring your program’s impact. If you don't have all those things, it's just not going to be a good fit for you to go apply for grants.

Hard Lessons

Are there any hard lessons you learned in the first couple years – if you were doing again what would you do differently from day one?

Just to not bite off more than I can chew. At the beginning, I was very reluctant to bring in associates. I just wanted to do everything myself. I had this idea that it wasn't right to make money off of other people's labor. That’s the anti-capitalism part of me. In the first couple years that was definitely an issue for me.

Grant Research

Do you have any favorite tools you use in the grant writing process, whether it's research or the actual writing?

Well for the research, GuideStar is about the best thing out there. We look up 990s on GuideStar and see who’s on the board. We see who they're giving money to. We see what size of grants they're giving, and you can do a lot of good grant research from GuideStar.

Do you end up putting that information into some kind of repository – an application that organizes the information, so when you're actually doing the writing you can reference it more easily?

If I have a client who wants grant research, I usually give them the information in an Excel spreadsheet. It will have a series of columns. The information comes from GuideStar, the Foundation Center, or GrantStation, which are also excellent resources. The columns will show the name of the foundation, contact information, area of interest, and the types of grants they are interested in. For example, if the focus is education – are they K through 12? Are they focused on girls’ education? Are they focused on STEM education?

The spreadsheet also shows the range of grants that they give. For example, is this a $10,000 foundation, a $50,000 foundation, or a $500,000 foundation? We also include: how to apply; deadlines; whether they have an online application; if they want an LOI or a full proposal; and any other relevant information.

When I put together a spreadsheet like this for a client, there might be 25 or 30 different foundations, which is just too many to focus on at one time. We’ll pick out the top five or six and say, “Okay, these are going to be our priorities for this next six months.”

How we make that prioritization will depend sometimes on the deadlines. If there's one that's got a once a year deadline of March 1st and we’re in February that's the one we're going to be working on. Sometimes it'll be because there's a relationship; that funder is known to the client, or they look at the board list and say, “Oh I know so-and-so on the board. I can call him or I can call her right away. That one becomes a priority funder. Or it’s just a good match. You look at the what they say they want to fund, and that's what you want to do. That's golden. That's what you're really looking for is a good match between what the funder says they want to fund and what you're doing.

Lightning Round Q&A

Let's get to the lightning round – a series of quick questions and answers. What's the best piece of business advice you've ever received?

Rob Sheehan at University of Maryland talks about the VOCA world, which stands for, “Volatile, Uncertain, Complex, and Ambiguous.” This is the world that we live in. And this is what you have to think about all the time – how everything's changing. Everything's confusing. Everything's ambiguous. You have to be flexible and be able to deal with uncertainty and complexity. Sometimes it's hard.

What book would you recommend to those getting started in the consulting world?

Alan Weiss has written a bunch of books. One title is Million Dollar Consulting . Every page there's something that’s useful information for consultants. It’s been my bible, my go-to book.

Do you have a favorite personal productivity habit?

To figure out what time of the day is the best time for you. I'm most productive in the mornings, so I try and not schedule meetings in the mornings, because that's my work time. I’ll schedule a meeting for a lunch or in the afternoon, when I'm sort of fading. I can get my best work done from 7:00 a.m. till 10:30 or 11:00 in the morning. That’s my peaked productivity time.

Do you have a favorite subscription you're signed up for?

A blog called Nonprofit AF ( https://nonprofitaf.com/ ).

What's one of your most important passions outside of work?

My family, my kids are my first priority. And second is fundraising. I do a lot of volunteer fundraising in addition to work fundraising.

What’s the most common error you see nonprofits make?

It would be what we talked about earlier, just willy-nilly sending out grant proposals to everybody they can think of, without actually researching or trying to build a relationship first. It’s generally not going to be successful to randomly send out proposals.

Where can people find more information about your services?

On my website, which is https://www.saltzbergconsulting.com/ . There's a phone number there as well, on the Contact page. I'm happy to talk to people on the phone.

I love talking about fundraising. It’s my favorite topic!

Fantastic. Thank you so much for your time today, Elise. It’s been great chatting with you.

Thank you.

The Wisdom of Experience: Patrice Hutton

Tue, 28 Aug 2018 22:10:41 GMT

Wise words from the Founder and Executive Director of Writers in Baltimore Schools

At Saltzberg Consulting we have the privilege of working with wonderful nonprofits that are making a positive difference.

Not only are they doing good work, they’re also excellent examples of how to start, grow, and manage viable organizations. In “The Wisdom of Experience” series, we’ve invited nonprofit leaders to share some of their experience and insights, with the hope that their hard-won wisdom will benefit others in the sector.

Nonprofit Leader: Patrice Hutton

Organization: Writers in Baltimore Schools

Role: Founder and Executive Director

Saltzberg Consulting (SC): Patrice, what was your motivation for starting Writers in Baltimore Schools?

Patrice: Creative writing has always been my passion. During college, I got to teach creative writing at one of Baltimore City’s most affluent public schools. I loved the program and wanted to share this kind of enrichment with less advantaged kids.

SC: What have been some of your biggest challenges?

Patrice: As you know, there’s a lot of pressure on nonprofits to operate like businesses and demonstrate constant growth.

This is particularly challenging for us, because we’ve focused our attention on creating a high-quality experience for a smaller number of kids, rather than reaching as many students as possible. For example, when our original cohort was graduating from middle school, we started a new program for them at the high school level – rather than expanding into more middle schools.

Working in the Baltimore City Public School system can also be challenging. But giving these kids a chance to find their voices and develop their passion really sustains me.

SC: In 2019, Writers in Baltimore Schools will celebrate its 10-year anniversary, which is impressive! Why do you think you’ve succeeded, when so many start-ups fail?

Patrice: When I got the idea for Writers in Baltimore schools, I applied for a Fellowship from the Open Society Institute (OSI). Receiving funding from OSI was huge, because it allowed me to focus on getting the program up and running, rather than needing to fundraise from day one.

I also think our summer camp has contributed to this success. In the beginning, camp was just two days and took place in Baltimore. But when we made the decision to turn it into a week-long, sleep-away camp--the Baltimore Young Writers’ Summer Studio—it became something extraordinary, which has impacted every other aspect of the program.

Some of our students haven’t spent a lot time outside Baltimore City. Camp is not only a chance to write, it introduces them to completely new experiences – like being in nature and seeing a sky full of stars that aren’t visible in the City. Camp is also an amazing bonding experience that brings everyone in the program closer.

Another important factor is our wonderful Advisory Board. Members are always happy to share their knowledge and brainstorm solutions. It’s much easier to sustain my energy and optimism because of the Board’s support.

SC: What advice to you have for people who want to start a nonprofit?

Patrice: First off, they need to realize that it’s infinitely exhausting and infinitely rewarding. They need to be completely committed and prepared to work incredibly hard.

And I think it’s important to be part of the community you are going to work with. For example, even though I come from a different background to the kids in the program, we share a passion for writing and self-expression.

I also would advise them to be careful about the rate at which they scale up. It’s essential to focus on building a strong infrastructure and creating a sound program, rather than rushing to increase the numbers served.

SC: Writers in Baltimore Schools is not a 501(c)(3) nonprofit. Instead you use a fiscal sponsor. How has that worked for you?

Patrice: We use Fusion Partnership [ http://www.fusiongroup.org ] as our fiscal sponsor, and I can’t sing their praises enough. Because they handle the administration, we can focus on the program.

In the past, funders were perhaps a bit wary of fiscal sponsors. But now it’s a common and accepted practice. Honestly, I can’t think of any downside.

SC: What have been some of your proudest moments since starting Writers in Baltimore Schools?

Patrice: There are so many. This spring I attended the high school graduation of a young man who started the program in the 5thgrade and came to summer camp every year. It was so moving to see him reach this milestone.

Another happened recently, during a middle school field trip. Three of our alumni, who are now in college, were chaperoning the trip. I overheard them lecturing the younger students, telling them that they needed to go to our summer camp, which made me very happy.

SC: You have certainly found a creative way to express your own passion. Is there anything you’d rather be doing than running Writers in Baltimore Schools?

Patrice: Other than being an Olympic ice dancer, I can’t think of anything! I’d also like to write some novels.

The photo at the top of the post is of three 7th graders from the Lillie May Carroll Jackson after-school writing club.

Below, the kids at microphone are from Calverton, performing at Writers in Baltimore Schools' 2017 showcase at Red Emma's Bookstore Coffeeshop.

The seated kids are from Writers in Baltimore Schools' JHU Fiction & Social Engagement class, cheering on their peers at a reading at Bird in Hand.

The Wisdom of Experience: Sarah Sorensen

Wed, 01 Aug 2018 00:00:00 GMT

Executive Director of Independence Now

At Saltzberg Consulting we have the privilege of working with wonderful nonprofits that are making a positive difference.

Nonprofit Leader: Sarah Sorensen

Organization: I ndependence Now

Role: Executive Director

Saltzberg Consulting (SC): You stepped into the role of Executive Director for an organization recovering from a crisis. Tell us what you encountered when you arrived.

SARAH: A couple of years earlier an employee had embezzled tens of thousands of dollars from Independence Now and stolen money from staff members. I came in at the time when funders didn't trust us anymore and the Board of Directors had lost many members because of the incident. It was particularly hard on the staff, who’d experienced such betrayal by an employee they knew and trusted.

About a month into the job, I shut my office door, broke down in tears and said, “Oh my goodness what have I done?”

SC: Now IN is thriving. How did you turn things around?

SARAH: It helped that I understood how nonprofits operate. I was very familiar with policies and procedures, which may not be sexy, but was just what IN needed.

The other piece was changing the culture. The staff were so beaten down and discouraged by the embezzlement and the fallout with funders. The organization was also very siloed – by which I mean, people were so focused on their own programs they’d almost forgotten that we all work for the same organization.

I spent a lot of time listening to individual staff members, to understand what they needed. We also worked with a consultant who helped us turn the culture around – to make it much more cooperative and inclusive. Now people from different projects have the chance to inspire and learn from each other.

SC: What kind of support has been most helpful?

SARAH : At the beginning I had monthly meetings with our Board’s Executive Committee. These were people who had been around the organization a long time. Many had been through the thick and thin and they were very committed to independent living, to our work and getting things right. Despite people leaving, the Board of Directors was and is very solid. I also have a great network of other Center for Independent Living Directors for peer support.

I've always used Maryland Nonprofits as a resource. I was involved with them before I came to Independence Now, and IN has been a member since its inception. I use them for things like personnel policy samples and sometimes legal things that I'm wondering about, and just general nonprofit related questions. I also belong to a similar, but more locally-focused organization in Montgomery County.

SC: What advice do you have for someone coming in from the outside to lead an established organization… whether they are in crisis or functioning well?

SARAH: I would say to anyone taking on an Executive Director position – particularly for an organization that’s been through difficult times and needs to be righted again – there's a lot of patience involved.

It’s also important to be fully engaged in the financial piece of the organization. That means you've got to understand budgets: You've got to know how to develop budgets or be willing to learn those skills. You need to always be watching your budgets, because ultimately you are responsible. Understanding the financial piece also leads to making better decisions, because you know what the organization really needs.

Again, I encourage patience, because understanding the financials takes time. For me, it took two years to really learn our budget. IN’s financial situation is very complex, with money coming from many sources. Even a simple budget will probably take a year to master, because you need to understand the full 12-month cycle.

SC: Thank you Sarah. Do you have anything else you’d like to share?

SARAH: I really believe that the success of an organization depends less on the work of the Executive Director and more on the people she hires – since they’re on the ground doing the work. That said, I am proud that I was able to turn a negative workplace into a positive environment where great things happen and we can help so many people.

Do Your Solicitation Letters Need a Boost?

Sun, 01 Jul 2018 00:00:00 GMT

So many nonprofits depend on individual donations to provide essential programs. But these days, it’s harder than ever to get people’s attention.

If your organization’s appeal letters could use a boost, check out this excellent post from GuideStar.

Here are some of the points they cover:

Put a human face to a larger problem: Tell your readers a moving story.
Make your appeals donor-centric, not just about your organization.
Tell your readers what you want them to do. Don’t assume they know what action to take.
Pay attention to formatting. A letter that’s hard to read will cost you donations.
Make it easy to donate. If donating is complicated or difficult, readers may toss the appeal.
Use interesting envelopes. Inspire your potential donors to see what’s inside.

Read the blog HERE .

The Wisdom of Experience: David Slomkowski, Founder and Executive Director of Athletes Service Athletes

Tue, 01 May 2018 00:00:00 GMT

At Saltzberg Consulting we have the privilege of working with wonderful nonprofits that are making a positive difference.

Nonprofit Leader: David Slomkowski

Organization: Athletes Serving Athletes

Role: Founder and Executive Director

Saltzberg Consulting (SC): David, what was your motivation for starting ASA?

David: I got involved with organized sports very young and played on teams until well after college. It was such a tremendous source of benefit in my life. As I got older and busier I gave up playing. At some point, I noticed that I was out of shape and starting to have aches and pains. I was also having pain in other areas of my life and feeling pretty low. One day I read an article about the Hoyts, a father and son racing team in Massachusetts. The son is confined to a wheelchair, and the father took up running, so they could do something special together.

I was so moved by their story that I literally started weeping. I also felt like this was something I was born to do. That was the spark for ASA.

SC: So, you decided to start your own nonprofit?

David: Not yet. A friend suggested that I take my idea to the William S. Baer School , a public school in Baltimore that serves children with multiple disabilities. I showed them a video of the Hoyts and they said, “We’ve got 200 kids, when do you want to start?”

My first race was with a Baer student named James Banks who also used a wheelchair. We did a 5K together and he loved it! I got a special running chair for James to sit in while I pushed. I found our first marathon particularly moving, because here was this young man who so little mobility racing alongside Olympic-caliber athletes. It was an experience that I wanted to share with even more kids.

SC: How did you go from volunteering at the Baer School to running your own nonprofit?

DAVID: It was about a year and a half from that first spark to buying, The Idiots Guide to Starting a Nonprofit . By then it felt like a choiceless situation. I knew I needed to do this for myself, and there was a real need for it.

SC: Money is always a big issue for nonprofits, especially at the beginning. How did you finance your start-up?

DAVID: I was so committed to making ASA work, that I sold a lot of my belongings, moved to a much smaller place, and organized my life so I could go two years without a paycheck.

SC: That’s remarkable. How did you know it would work out?

DAVID: I didn’t! But I had some advantages going in. I grew up in an entrepreneurial household, have a degree in business, and I’d started a for-profit business and run it for many years.

SC: ASA is certainly a success story. You’ve grown from nothing to an annual budget of close to half a million dollars. What advice do you have for someone who wants to start a nonprofit?

DAVID: I get asked that question a lot. What I say to people is this, “Write down your mission, vision, and values, then come talk to me.” Most of them don’t come back.

If they do come back, I tell them that they needto be dedicated to the practice of goal setting – weekly goals, monthly goals, yearly goals, etc. And they need to be consistent. Passion is important, but without goals and consistency, it probably won’t work out.

One reason ASA has thrived is that people really benefit from the program. Every year we serve well over 100 youth and adults with little or no mobility and have close to 800 volunteers working with us. Because we’re a big presence at over 100 mainstream races a year, we’re very visible. In the beginning, it was hard to get people involved. But we kept showing up again and again and again. Now people see us at races and want to help.

Fiscal discipline has also been a big part of our success. We’ve always spent less than we bring in. We adhere to basic accounting principles and have never taken on debt.

SC: David, thank you so much for you time. Do you have any final words of wisdom to share?

DAVID: I want to be honest and say that starting a nonprofit is hard and many fail. It can be done, but there has be a genuine need and real passion driving it.

The photo above is of David Slomkowski and his long-time racing partner James Banks. The man in the reflection is Patrick Crouse, who was the principal of the William S. Baer School and a huge, early supporter of ASA. The photo below is of David and James after they finished the 2017 Boulder Iron Man Triathlon.

Bill to Ensure Maryland State Grants Pay for Indirect Costs

Thu, 01 Mar 2018 00:00:00 GMT

Read Elise's testimony in support of the bill

One of the biggest challenges that nonprofit organizations face is raising funds to cover indirect costs. Generally speaking, funders prefer to support direct program costs – leaving nonprofits scrambling to cover essentials that are not directly related to delivering services, such as administrative support and organizational software.

A bill recently introducted in the Maryland State Senate seeks to provide relief to nonprofits awarded State money. The proposed bill includes the following text:

IF A NONPROFIT ORGANIZATION IS A DIRECT RECIPIENT OR SUBRECIPIENT OF A GRANT OR CONTRACT THAT IS FUNDED EITHER PARTIALLY OR WHOLLY WITH STATE FUNDS, THE TERMS OF THE GRANT OR CONTRACT SHALL ALLOW FOR REIMBURSEMENT OF INDIRECT COSTS... OF AT LEAST 10%.

Saltzberg Consulting Founder Elise Saltzberg provided the following written testimony in support of the bill:

Thank you for the opportunity to submit this testimony on behalf of my Maryland nonprofit clients. I have worked as a fundraising consultant to nonprofit organizations in Maryland since 2000. Most of my clients are small to medium-sized nonprofits, with annual budgets in the range of $400,000 to $4 million per year. They provide a range of vital services to their communities, including: healthcare; K-12 education and afterschool enrichment; services for people with disabilities; housing for the homeless; child care; arts education; economic development and community development; and environmental education and protection.

Most of the organizations that I work with – and most nonprofit organizations in general – are operating on very thin margins with tight cash flows. They may receive funding from a variety of sources including donations from individuals, foundation grants, corporate sponsorships, and other private sector funders. But often their primary source of revenue is government grants and contracts.

What the private sector and the public sector have in common is that neither seems to ever want to pay for indirect expenses. A foundation program officer only wants to support their specific program. A corporate sponsor just wants to maximize the marketing and publicity benefits for their company. And an individual donor might say, “I don’t want my money to go to keeping the lights on.” Well somebody has to pay to keep the lights on! In my opinion, government grants and contracts are that “somebody.” If the State wishes to see nonprofits deliver necessary services in an effective manner, it needs to recognize that there are costs associated with keeping the lights on, paying the rent, paying the telephone bill, etc. These “overhead” items are part of the costs of successfully fulfilling the nonprofits’ obligations to the State, and to their clients and constituents.

In the for-profit world, 40% to 45% overhead is considered acceptable. As long as the bottom line is healthy, business owners and investors are happy. Yet in the nonprofit sector, indirect costs are expected to stay well below these percentages. Two grant applications that I wrote recently on behalf of my clients are good examples. One allowed for only 3% for indirect costs. The other allowed for zero. Both grants were awarded, but for lower amounts than we had requested. So neither grant award covered anywhere close to the true costs of delivering the desired services.

Senate Bill 1045 would help to close the gap between grant awards and the true costs of delivering effective services. A modest floor of 10% for indirect costs would be an acknowledgement by the State of the reality that nonprofits incur expenses in delivering services, that these expenses are reasonable, and that they should be covered.

The full text of Maryland Senate Bill 1045 can be found here: http://mgaleg.maryland.gov/2018RS/bills/sb/sb1045F.pdf

Interest-Free, Micro Bridge Loans Now Available for Maryland Nonprofits!

Thu, 01 Feb 2018 00:00:00 GMT

Small nonprofits don't need to struggle while waiting for government funds

In March 2017, Saltzberg Consulting founder Elise Saltzberg testified in support of a bill to benefit the nonprofit sector with interest-free, micro bridge loans, which would provide funding while nonprofits waited (often for months) for government funding to be awarded. We are pleased to report that the bill has passed into law.

These micro bridge loans are now available, which is great news for nonprofits. If your organzation needs short-term financing support between the award date of a government contract and the actual receipt date of those awarded funds, we encourage you to take advantage of the Maryland Nonprofit Development Center Program and Fund - Nonprofit, Interest-Free, Micro Bridge Loan Account (NIMBL). Learn how to apply on the Maryland Department of Commerce website .

GrantAdvisor: Bridging Communication Between Foundations and Nonprofits

Mon, 01 Jan 2018 00:00:00 GMT

GrantAdvisor is like TripAdvisor for fundraisers

Grantmakers and nonprofits share a vision for improving their communities. Both are essential, yet there exists an underlying tension between the two. A lack of transparency in the funding process can be frustrating for nonprofits who waste precious resources pursuing mis-matched funders. And it’s challenging for funders when nonprofits don’t understand the best way to approach them. There is also a very real power differential that gives foundations and other big donors the ability to literally shape the future of the organizations they fund.

As a fundraising consultant, I work closely with amazing individuals at nonprofits and foundations and I’m well aware of the tensions that exist. That’s why I was excited to learn about an important new resource for the philanthropy sector called GrantAdvisor – which is improving communication between grantmakers and grantees and putting them on a more even footing.

HOW GRANTADVISOR WORKS

Much like TripAdvisor, where people rate hotels and restaurants, GrantAdvisor reviewers anonymously share their experience of working with funders and include suggestions for how best to navigate each individual process. Before a comment is posted, the funder has the opportunity to write a response, which is published with the review.

To present a fair and well-rounded portrait of funders and avoid potential bias, GrantAdvisor waits until a foundation receives at least five reviews before they are posted. There are strict community guidelines in place to foster productive conversations, and a lot of work goes on behind the scenes to guarantee a safe space for constructive criticism. To date, 84% of reviewers have said they have a good relationship with the foundation they are reviewing. But negative reviews are welcome, as long as they are constructive. You can see some sample reviews at https://grantadvisor.org/funders.php

Many funders have welcomed this new avenue for communication. They appreciate the feedback and some even suggest to their grantees that they write reviews. Others were initially concerned that responding to reviews would be burdensome or feared unwanted negative publicity. But since GrantAdvisor has been up and running, most grantmakers have come to see the value of the site.

WHAT SETS GRANTADVISOR APART

Last month, I spoke with GrantAdvisor’s Coordinator Andrea Sanow and Development Manager Kari Aanestad, (both on staff at Minnesota Council of Nonprofits) to learn more about the organization.

The seed for GrantAdvisor was planted when the Executive Directors of three organization, – California Association of Nonprofits, Minnesota Council of Nonprofits, and GreatNonprofits – came up with the same idea around the same time, and agreed to work together to make it a reality.

In July 2017, GrantAdvisor initiated the “proof of concept” phase, to determine whether there would be sufficient interest for this service. They needed to meet year-end metrics in order to green light the project. When we spoke in December, Andrea told me that they had effectively reached their end-of-year goals. GrantAdvisor had received at least five reviews for 50 foundations, identified key contacts at 150 foundations, registered over 1,000 reviewers, received 950 reviews and had an average of 20,000 unique website page views per month. Project Coordinators in Minnesota and California read every review to ensure that it meets GrantAdvisor’s standards before it is published online.

The organization, which is currently funded by donations and maintained by staff from the founding organizations, will begin exploring income models in 2018, including paid advertising, membership levels, and subscriptions.

If you’re thinking that the sector already has many great resources, you’re right. But what GrantAdvisor offers is unique. GuideStar and similar service, provide a wealth of valuable information that the nonprofit sector relies on. However, this information is “static,” in the sense that it’s updated relatively infrequently.

By contrast, GrantAdvisor was created to be a dynamic resource that fosters on-going discourse between foundations and nonprofits. It improves communication and adds transparency to the funding process. I see it as a much-needed complement to existing resources.

HELP SPREAD THE WORD ABOUT GRANTADVISOR

I invite you to join me in spreading the word about GrantAdvisor – because the better known it becomes, the more reviews it will receive – and the more valuable this tool will be.

So far, most of the comments on the website are for funders in Minnesota and California, where the founding organizations are located. GrantAdvisor has received comments from reviewers in all 50 states, but won’t post comments on a funders until they have received at least five reviews of it.

I’ve written reviews of funders in Maryland and am encouraging other grantseekers to do the same. I believe that this a great tool for both nonprofits and grantmakers, so I’m doing my part to spread the word.

HERE’S HOW YOU CAN HELP:

- Visit the Website https://grantadvisor.org and read some of the posted reviews.

- Register as a reviewer at https://grantadvisor.org/register/reviewer.php You’ll need to provide your name and email, but this information is kept confidential. All your interactions on the site are posted anonymously.

- Write a Review of a foundation at https://grantadvisor.org/survey.php . The process is simple and the form is easy to follow. You can also write a review without registering.

- Become a GrantAdvisor Ambassador . If you really want to see GrantAdvisor grow, get your network involved. Introduce colleagues to GrantAdvisor and encourage them to write reviews. The easiest way to do that is to share this blog post!

- Follow GrantAdvisor on Twitter @Grant_Advisor

- Contact GrantAdvisor at team@grantadvisor.org to find out how you can get more involved.

To read more about GrantAdvisors, check out these articles on some of our favorite websites:

UPDATE February 2018 : We at Saltzberg Consulting want to congratulate GrantAdvisor on being included among Fast Company magazine’s Top 10 Most Innovative Companies (MIC) in Not-for-Profit for 2018. “This year’s MIC list is an inspiring and insightful window into how many companies have embraced innovation and are working to make meaningful change,” said Fast Company deputy editor David Lidsky, who oversaw the issue with senior editor Amy Farley. More than three dozen Fast Company editors, reporters, and contributors surveyed thousands of companies to create these lists.

We're also pleased that foundations are beginning to get on board with GrantAdvisors' approach. Sonja Merrild, Director of Grants at the Blandin Foundation, had this to say about the list, “It’s great to see Fast Company recognize philanthropy’s venture into public feedback and learning from customers – something the private sector of course thrives on. We hope this Fast Company recognition will help foundations see the potential this project has to benefit the whole field of philanthropy and nonprofits.”

How a Tour of Civil Rights Landmarks Reminded Me That We’re All in This Together

183:747132823 (Elise Saltzberg) — Thu, 01 Jun 2017 00:00:00 GMT

Reflecting on collaboration and community as the drivers of change

I recently participated in a tour of Civil Rights landmarks in the South. It got me thinking a lot: I mused about the positive changes that occurred and the challenges that still need to be addressed. I thought about all the brave people who risked their lives to make a difference. And I reflected on what it means to be part of a movement.

One of our tour stops was Montgomery, Alabama – where Rosa Parks’ refusal to give up her seat on a bus in 1955 sparked the Montgomery Bus Boycott, brought Dr. Martin Luther King to the fore, resulted in the U.S. Supreme Court ruling that segregation on public buses is unconstitutional, and served as one of the springboards for civil rights activities across the region.

If you aren’t familiar with the full Rosa Park’s story, here’s a quick recap. She is best known for refusing to give up her seat on a Montgomery bus. But Mrs. Parks’ decision was not just that of a tired woman who acted spontaneously. Her deeply-rooted commitment to fighting injustice, coupled with activist training at the Highlander Folk School a few months earlier, had prepared her to make history.

Another facet of the story that’s often overlooked is this: Rosa Parks wasn’t acting alone. Five years before her arrest, the Women’s Political Council (WPC) began advocating for bus integration. By 1955, there was widespread dissatisfaction with the bus system in the black community, and members of the WPC were already planning a boycott. Rosa Parks was a respected member of the NAACP and secretary for the local chapter. Her arrest galvanized the community, but it took the WPC and the NAACP joining forces to make the bus boycott possible and sustain it for more than a year.

In Montgomery and beyond, the ultimate success of the civil rights movement depended on collaboration and community. This movement was born and sustained in people’s kitchens, in churches, on the streets, and in corner shops. People were talking and listening to each other. And some, like Rosa Parks and Martin Luther King, recognized key opportunities and capitalized on them.

This need for collaboration and community involvement to move forward is as true today as it was during the civil rights movement. In some ways, it’s even more challenging today. Just about everyone in the nonprofit sector is stretched thin and a little too busy to foster new relationships within the sector and the community. But we should make the effort, because amazing seismic shifts can take place when passionate people combine their energy, talents, and ideas.

Forging innovative relationships can also pay off when it comes to fundraising.

With the demand for limited resources growing, funders want to see that nonprofits are working in concert to achieve common goals – rather than duplicating efforts. When organizations position themselves as part of a larger movement, there is a great deal of synergy that takes place. This can further the missions of all the collaborators and lead to increased resources for all.

Bringing about positive, lasting change has never been easy. But it’s a whole lot easier when we join forces. Because – ultimately – we’re all in this together.

Maryland's New Micro-Bridge Loan Program Is Good News for Nonprofits!

Mon, 01 May 2017 00:00:00 GMT

PHOTO: Maryland State Senator Cheryl Kagan (center) was the lead co-sponsor of SB 465. Elise is to Senator Kagan's left.

Elise was in Annapolis in February to give her testimony on SB 465 before the Senate Finance Committee. The bill, which ultimately passed and was signed into law, is a boon for nonprofits – especially smaller organizations with tight budgets.

As Elise made clear in her testimony, being awarded government funding has historically been both good news and bad news: “ The bad news is that from the time that the nonprofit organization receives the email saying, “Congratulations, your grant application has been approved” to the time that the organization actually receives a check can be many, many months. Often, the organization is expected to start delivering the services immediately – even though they don’t have a signed contract and they don’t have the funds in hand…. the organization is expected to expend the funds to operate the program, purchase program supplies, pay their staff, and then submit copies of invoices and canceled checks for reimbursement. These reimbursement requests can also take several months to be fulfilled.

The new law relieves this burden of having to pay for programs before funding is received. It allocates State funds to the Maryland Nonprofit Development Center Program Fund’s Nonprofit, Interest-Free, Micro Bridge Loan (NIMBL) program in order to: "foster, support, and assist the economic growth and revitalization of qualifying nonprofits.”

The wording of the law recognizes the importance of nonprofits in our community, stating: “The nonprofit sector provides vital services to our community and…. One in ten Maryland workers is employed by the nonprofit sector and…. 37 percent of nonprofit entities in the State saw an increased demand in their services and half of those nonprofit entities were unable to meet the increased demand.”

We at Saltzberg Consulting are extremely pleased that this bill has become law, and proud of the role that Elise played in the process.

To read Elise's full testimony, see the March 1st post. CLICK HERE for a video of the session. Elise's testimony begins at 3:04:11.

Elise Saltzberg Testifies Before the Maryland Senate Finance Committee

Wed, 01 Mar 2017 00:00:00 GMT

Elise Testifies in Support of the Nonprofit Development Center Bill

Elise was in Annapolis in February to give her testimony on SB 465 before the Senate Finance Committee. This bill would require 5% of video lottery terminal (slots) proceeds up to $1 million annually to be distributed to the Maryland Nonprofit Development Center Program Fund for bridge loans to nonprofits waiting to receive funding from government grants or contracts. Passage of this bill would greatly benefit smaller organizations, which often cannot afford to wait many months for a government award check to be issued. The bill passed the full Senate a few weeks later.

UPDATE (March 20, 2017): The bill has been voted out of committee in the House and now conforms to the Senate-passed bill. The next step is for either chamber to pass the other's bill. As the bills from the House and Senate are now identical, it should pass easily.

Elise's Testimony:

Mr. Chairman and Members of the Senate Finance Committee: Thank you for the opportunity to present this testimony on behalf of my Maryland nonprofit clients. My name is Elise Saltzberg and I have worked as a fundraising consultant to nonprofit organizations in Maryland since 2000. Most of my clients are smaller nonprofits, with budgets in the range of $300,000 to $2 million per year.

With my assistance, several of my clients have applied for and received grants and contracts from various Maryland State agencies and departments, ranging from $25,000 for a small community development technical assistance grant to $1.2 million over three years for an afterschool academic enrichment program for low-income students.

That’s the good news. The bad news is that from the time that the nonprofit organization receives the email saying, “Congratulations, your grant application has been approved” to the time that the organization actually receives a check can be many, many months. Often, the organization is expected to start delivering the services immediately – even though they don’t have a signed contract and they don’t have the funds in hand.

The procedure that we usually have to follow has a series of steps, each of which can take several weeks to several months. First, we have to finalize the details of the contract and get it signed by numerous people at the nonprofit and in the state agency. Then, the organization is allowed to submit a request for the first payment under the contract, usually up to 15 percent of the total grant award for the first year. Then we usually have to wait several weeks to several months for this first payment to appear.

After that, the organization is expected to expend the funds to operate the program, purchase program supplies, pay their staff, and then submit copies of invoices and canceled checks for reimbursement. These reimbursement requests can also take several months to be fulfilled.

Meanwhile, the organization is expected to continue operating the program and expending funds, with the mindset that, “well, we’re going to get reimbursed eventually…”

That works OK for organizations that have solid financial reserves and ample cash flow. But that doesn’t describe most of my nonprofit clients, or many other nonprofit organizations that I know about, either. Most are smaller organizations operating under extremely tight budgets with very limited cushions to cover their expenses. When it takes many weeks or months to receive money that has been committed to them by the State, it can put them over the edge. They simply do not have the capacity to absorb the delays in reimbursements that can last for many months. They have trouble making payroll or paying their vendors and sub-contractors, thereby diminishing the effectiveness of their services to needy Marylanders.

The loan fund that is described in SB 465 would be a godsend to these organizations. It would have helped one of my clients, who waited until December 2015 for first payment on a state contract that was awarded in August 2015 – a full four months earlier. It would have helped another client that received reimbursement just last week for funds that had been expended in the first, second, and third quarters of 2016.

A $25,000 loan would have gone a long way towards continuing and solidifying the important services that these and other similar organizations provide while they are waiting for payments that have been committed to them from various State government agencies.

Thank you again for the opportunity to present this testimony.

Elise Saltzberg Testifies Before the Maryland Senate Finance Committee

Wed, 01 Mar 2017 00:00:00 GMT

Read Elise's testimony in support of the the Nonprofit Development Center Bill

Elise's Testimony:

Meanwhile, the organization is expected to continue operating the program and expending funds, with the mindset that, “well, we’re going to get reimbursed eventually…”

Thank you again for the opportunity to present this testimony.

Check out our guest blogs for Maryland Nonprofits

Mon, 01 Aug 2016 00:00:00 GMT

August 2016: Are Your Fundraising Expectations Unrealistic?

http://marylandnonprofits.org/Articles/tabid/1110/ID/575/Are-Your-Fundraising-Expectations-Unrealistic.aspx

June 2016: A Message to Nonprofits: Stop Worrying So Much About Overhead Costs!

http://marylandnonprofits.org/Articles/tabid/1110/ID/554/A-Message-to-Nonprofits-Stop-Worrying-So-Much-About-Overhead-Costs.aspx

The Case for Productivity-Based Funding Models

183:747132823 (Elise Saltzberg) — Mon, 01 Feb 2016 00:00:00 GMT

A look at the difference between compliance and true productivity

Funders are demanding that nonprofits produce measurable results. Yet common funding models are more consistent with compliance than productivity .

In the January edition of NPQ ( Nonprofit Quarterly ), Claire Knowlton makes the case for funding models that pay full costs. In her excellent article, “Why Funding Overhead Is Not the Real Issue: The Case to Cover Full Costs” she points out that the current approach to funding can be counterproductive, as it sets up a cycle of failure and distrust. Existing models discourage nonprofits from requesting the full cost of delivering services, for fear of not being funded. When nonprofits start out underfunded, they are more likely to under-deliver and fall short of funders expectations.

To reach desired outcomes, organizations need capital to invest in staff capacity, equipment, and systems, and the flexibility to change course quickly, if necessary to meet the needs of those they serve. Compliance-driven decision making, constrained by rigid funding requirements, is at odds with this kind of flexibility.

Additionally, the ability to measure outcomes can be very expensive. Both nonprofits and funders need to understand the true costs associated with developing and testing programs and reporting outcomes. Funders must be willing to bear these costs if they expect nonprofits to deliver measurable impact.

Knowlton concludes with recommendations for both nonprofits and funders:

Nonprofits

1. Know your full costs.

2. Ask for your full costs.

3. Banish the overhead ratio.

4. Practice new ways to talk about administrative overhead.

Funders

1. Pay for full costs.

2. Create a safe space for nonprofits to ask for their full costs.

3. Banish the overhead ratio.

4. Directly support full costs through flexible funding or general operating support.

If your organization is challenged by these funding issues, I highly recommend that you read Claire Knowlton’s piece .

Yes, A Nonprofit Can (and Should) Advocate for Its Mission!

Tue, 01 Dec 2015 00:00:00 GMT

How nonprofits can lobby... legally

Most 501(c)(3) nonprofits shy away from lobbying and advocacy efforts that could result in government funding and important legislation that would benefit their clients. But according to the American Bar Association (ABA): “Getting involved in the legislative process and having a say in policy discussions is not just an appropriate role for nonprofits; it is vital . If nonprofits are not speaking on behalf of their often-vulnerable communities, chances are nobody else is either.

Understanding Lobbying

Lobbying is defined as an attempt to persuade members of a legislative body to propose, support, oppose, amend, or repeal legislation. Nonprofits are often nervous about lobbying because the IRS provides such vague guidelines. According to the legal site nolo.com , “ a nonprofit will qualify for tax-exempt status as long as no “substantial part” of its overall activities relates to influencing legislation or carrying on propaganda. Unfortunately, this has never been clearly defined.”

A few IRS test cases have indicated that devoting less than 5% of an organization’s efforts to lobbying is acceptable, but devoting more than 15-20% is not. While these figures are useful, they have no official sanction from the IRS. What may be more helpful, is to realize that the vast majority of nonprofits devote less than 2% of their budgets to lobbying . If this is the case with your organization, there may be room for more activity in this area.

Understanding Advocacy

The ABA points out that, “Lobbying is just one form of advocacy that an organization may engage in to achieve its particular goals and serve its constituencies. Other forms of advocacy include educating policymakers and the public about broad social issues, encouraging people to register to vote, organizing communities, educating voters about candidate positions, litigating, and many other activities.”

Where to Turn for Guidance

In Maryland, where I live, our state association of nonprofit organizations (Maryland Nonprofits) offers a day-long legislative preview before each General Assembly session — to familiarize nonprofits with upcoming issues and key figures in each debate. They also offer free information about advocacy, and paid consultants who can help nonprofits navigate these issues. Most other state nonprofit associations offer similar resources.

The National Council of Nonprofits has free “Everyday Advocacy” resources to help train your staff and board members to be more pro-active advocates for your organization’s mission. (You’ll find the link in the Resources section below.)

Another great resource is Stand for Your Mission, which educates nonprofits about how to create positive change through Board of Directors advocacy (see the Resource section for their link).

If You Aren’t Part of the Legislative Discussion – You’re Missing Out

Regardless of your organization’s mission, there are likely to be legislative and funding decisions being made by elected officials that affect your constituents. Be part of the conversation, advocate for your organization and your clients at the local, state, and federal levels.

RESOURCES

American Bar Association: http://apps.americanbar.org/buslaw/blt/2009-03-04/mehta.shtml

NOLO: http://www.nolo.com/legal-encyclopedia/how-much-lobbying-can-nonprofit-do.html

Council for Nonprofits: https://www.councilofnonprofits.org/everyday-advocacy

Stand for Your Mission: http://standforyourmission.org

You Have My Complete Attention

Sun, 01 Nov 2015 00:00:00 GMT

By Deborah Grayson Riegel

This article was original published October 22, 2015 and reprinted here with permission of Deborah Grayson Riegel .

One of my favorite rituals when my twins were babies was to give them their nightly bath. I loved the one-on-one (-on-one) time with them, playing and splashing and just being together. Over time, they advanced from baths to showers, and from needing my help to wanting complete privacy, thank you very much!

But one bath-time ritual that my daughter Sophie didn’t seem to outgrow during her tween years was keeping me company in the bathroom when I took a shower. Each evening after work, I would hop in the shower and pull the curtain closed, and then hear Sophie sneak into the bathroom, close the lid of the toilet, sit down and say, “So let’s talk.”

I was torn: I missed the privacy of being alone with my thoughts and my loofah, and I also appreciated the opportunity to have some deep conversations with my growing girl. But one day, my curiosity got the best of me and I asked her,

“Sophie, why do you always want to talk to me when I’m in the shower?”

Her answer caught me with my pants down:

“Because it’s the only time I know you won’t check your phone while you’re talking to me. It’s the only time I have your complete attention.”

There was no shower long enough or hot enough to wash off the sting of that pointed and painful observation.

Ever since then, I’ve started: Paying a lot more attention to paying attention!

I realized that I did it consistently with my clients (who pay for my complete attention), but I didn’t do it consistently for my family, who are, in fact, the reason that I even have clients. And it’s still hard – every day. There are a million things competing for my attention, between emails, calls, dinner, errands, the expected and the unexpected interruptions. But I am well aware that because of how hard it is to give someone your complete attention these days, it is a more precious gift to give and to receive than ever before.

In a recent New York Times article, “ Stop Googling. Let’s Talk. ” the author cites that the costs of dividing your attention with people you care about include empathy, connection, and trust. And while technology is surely a factor in what makes this challenging, what is also a factor is our willingness to settle for less than someone’s complete and undivided attention. We need to learn to ask for what we need from others in our personal and workplace relationships to feel heard, connected and respected and we need to stop making excuses for ourselves for why it’s ok to not be fully present for another human being with real and immediate needs and challenges.

In the 7th and 8th cohorts of the Jewish Coaching Academy that I facilitated last week ( email me for 2016 dates), we discussed 10 behaviors that let someone know that you were committed to being fully present for them. They include:

Close the door.
Turn off all electronic distractions.
Put your cell phone completely outside of your line of vision.
Let other people know that you’re going to be occupied, and for how long.
Put a “Do Not Disturb” sign up and honor it.
Create a time buffer before your conversation so you can clear your head from your previous work or interaction.
Make a list of what you need to do after this conversation so that you can be fully present now.
Notice when distracting thoughts come into your head, and then send them away without judgment.
Let the other person know if something is interfering with your ability to be fully present, and then do your best anyway.
Tell the other person “You have my complete attention.”

How do I know these work? Because I use them with my clients, my friends and my family and they thank me for not just being there for them, but for really, fully being there for them. And I also know these work because I now, blissfully, shower alone.

State of Grantseeking Report - 2015

Mon, 01 Jun 2015 00:00:00 GMT

A "must have" resource for fundraisers

The State of Grantseeking Report™ is a fantastic resource for fundraisers. For those of you who haven’t gotten your copy of the Spring 2015 edition, I wanted to share this message from Cynthia Adams, President & CEO of GrantStation.com, Inc. – Elise Saltzberg

The Spring 2015 State of Grantseeking™ Report

GrantStation is pleased to announce the release of the Spring 2015 State of Grantseeking™ Report.

This report looks at sources of grant funding in several ways: any funder, the largest source of total funding, and the funder of the largest individual award. In addition, the median value of the largest individual award, in total and by various subcategories, is provided as a benchmark figure throughout the report. We hope that the information and benchmarks in the report will assist you in your good work.

In addition, we have released Fact Sheets by annual budget range, mission focus, and a comparison by funder type. Check back regularly at the GrantStation State of Grantseeking™ webpage – we will be adding more Fact Sheets in the days to come.

The Spring 2015 State of Grantseeking™ Report is made possible by the participation of the respondents, the support of our underwriters (the Grant Professionals Association and PhilanTrack, an Altum Company) and the collaboration of our partners and advocates.

My best,

Cynthia Adams

President & CEO | GrantStation.com, Inc.

(p) 877-784-7268 | (f) 815-301-8188

Caring for Donors: From 7 Touches to Full Concierge Service

183:747132823 (Elise Saltzberg) — Wed, 01 Apr 2015 00:00:00 GMT

Donor attrition is directly related to how well you care for your donors

Most nonprofits rely on individual donors to fund at least some of their activities. And it is far more expedient to care for and cultivate current donors than to acquire new ones. Donor retention was a dominant theme at the Association of Fundraising Professionals annual international conference, which took place in Baltimore this year.

Cost of Fundraising Rises with Rate of Donor Attrition

According to research by the Urban Institute [http://www.urban.org/research/publication/donor-retention-matters], many nonprofits experience, “very high turnover rates in their donor rolls. This pattern leads to high costs of fundraising for some organizations. Other groups, though, see much higher rates of retention year after year, suggesting that it is possible for more organizations to trim costly acquisition campaigns and the loss of potential long-term supporters .”

New Donors Have Higher Rates of Attrition than Repeat Donors

Adding to the importance of retaining current donors are studies that indicate repeat donors have a much lower rate of attrition compared to new donors. Data from firespring.org indicates that new donor retention averages less than 25%, compared to repeat donor retention of 64%. Retention is also higher for donors giving larger gifts ($250+), presumably because they feel more invested in the organization.

According to fundraising expert Dr. Adrian Sergeant, [http://www.studyfundraising.com/about-us/professor-adrian-sargeant/] improving retention by 10% can double the lifetime value of an organization’s donor database.

Causes of donor attrition

There are many reasons that donors do not continue to give, which range from no longer being able to afford a donation to feeling that the organization asked for inappropriate amounts.

But among the biggest reasons are four that organizations can readily address:

• The don’t feel connected to the organization

• They don’t remember that they have given in the past

• They don’t know how their donation was used

• They were not reminded to give again

Best Practices for Donor Retention

How a nonprofit cares for current donors depends on the resources of the nonprofit and the expectations of the donors. But at the heart of all donor relationships is good communication.

Here are a few ways that organizations can show donors how much they are valued.

The 7 Touches

The 7 Touches approach, which originated in marketing circles, is based on the premise that someone needs to be “touched” at least seven times a year to feel connected to an organization and want to continue giving. (Because of the overwhelming number of communications people are exposed to everyday, some experts say the number should be closer to 13.) These 7 Touches include communication that does not include a request for another donation.

Regardless of the exact number of touches an organization chooses, the key is to communicate regularly, to keep donors informed and the organization fresh in their minds.

Here are examples of appropriate, donor-centered “touches” that build strong relationships and lead to greater retention

• Prompt thank you letter or phone call – within 48 hours for most donors

• Regular newsletter (monthly or quarterly)

• Birthday/holiday cards

• Invitations to events

• Surveys

• Annual Reports

• Public acknowledgement of donors via website, newsletter, social media, annual report, etc.

• Volunteer recognition cards (i.e. thank you cards sent to volunteers)

Donors want to know where their money is going and feel that their contribution is making a genuine impact. Newsletters, solicitations, and other communication tools should share stories that illustrate the impact that donors have had in the past and can have in the future.

Concierge Stewardship for Wealthiest Philanthropists

All donors are important and should be treated this way. But when an organization works with very large donors, the organization must take the time to understand how very wealthy donors expect to be treated.

Robert E. Wahlers, CFRE [https://www.linkedin.com/pub/robert-wahlers-ms-cfre/9/89/521], of Meridian Health Affiliated Foundations and an Adjunct Professor at Columbia University Masters of Fundraising Management Program, offered advice on how to provide concierge stewardship to the highest level donors.

• Wealthy philanthropists expect organization to “go above and beyond.” Wealthy donors are treated like VIP’s in other aspects of their lives, and they expect no less from the nonprofit organizations they interact with.

• The nonprofit needs to understand each donor’s specific interests in the organization.

• Donations must be acknowledged within 24 hours (rather than standard 48).

• Personal phone calls and visits are expected when asking for gifts.

• 2% of the gift is industry standard for special recognition treatment.

• Understand donor expectations and behavior based on generation cohorts (see below).

Generation Cohorts

Traditionalists – Born before 1946.

• Trust Charities

• Have significant resources

• Interested in: Bequests, Current Gifts, Gift Annuities, Naming Opportunities

Leading Boomers – Born 1946-1954

• Less trusting (need to see proof of impact)

• Low savings

• Most generous of all cohorts

• Interested in: Social Justice with an emphasis on “What’s in it for me?” (i.e., how will helping the cause also benefit their lives)

Trailing Boomers – Born 1955 – 1964

• Cynical, competitive, control freaks, lack trust

• Interested in: Tangible proof of impact, charities that make it easy to give, visual presentations

Gen X – Born 1965-1976

• Self-interested, value work-life balance, entrepreneurial, less likely to marry, trust friends and peers above others, don’t like traditional stewardship events, lack brand loyalty.

• Interested in: Meaningful involvement. The more involved they are, the more likely they are to give

Millennials – Born 1977-1984

• Don’t trust authority, hopeful, idealistic, have more traditional values than parents

• Interested in: Social justice, with an emphasis on Peak Experiences (i.e. memorial events, such as meeting VIPs)

As with a hotel concierge, the stewardship provided by nonprofits to high-level philanthropists is tailored to the needs and expectations of the donor. Mr. Wahlers shared a story that highlighted the difference between very wealthy donors and most others: One of the largest benefactors of a hospital needed emergency health care for a family member. Rather than heading for the emergency room or calling an ambulance, the donor contacted the hospital’s Director of Development, who arranged for the donor to bypass all standard protocols and be seen immediately.

Bottom Line:

Nonprofits that enjoy the benefits of having very wealthy donors should be prepared to go the extra mile to keep these donors connected and happy.

Tips and Tools for Negotiating Major Gifts

183:747132823 (Elise Saltzberg) — Sun, 01 Mar 2015 00:00:00 GMT

How major gifts can provide significant income for your nonprofits

This spring I attended the Association of Fundraising Professionals annual conference in Baltimore, Maryland. One of the highlights of the event was a workshop led by Shaun G. Lynch, CFRE, President of Adventum Philantropic Marketing, entitled “Become a Better Major Gift Negotiator.” Here is a summary of Lynch’s main points:

Major gifts from individual donors are a significant source of funding for many nonprofit organizations. Not only do big gifts provide financial support, they are a tangible demonstration of the value of the cause.

Through this lively presentation, Lynch demonstrated how standard negotiating techniques can be applied to major donor fundraising.

Key elements of successful negotiations:

• Taking the time to cultivate and understand the needs of each prospective donor

• Understanding negotiating techniques

• Appreciating the psychology that underlies giving

Tools for securing major gifts:

Ethical Persuasion

• Cultivate a friendly relationship with potential donors by establishing shared interests – everything from sports teams to hobbies to business concerns.

• Invite potential donors to express what they like about the organization. This is a two-way conversation between peers.

• In cases where a donor has directly benefited from the organization, as with school alumni, describe future support as payback for what the organization has already given.

• Solicit for more than you think a donor will give, then lower the ask.

• If applicable, create a sense of scarcity. For example, the donor may be motivated by an exclusive naming opportunity.

• Position yourself and your organization to be authorities in your field. People tend to rely on trusted authorities to streamline decision making.

• Once someone makes a public commitment he or she will feel internal and external pressure to follow through: Invite board members and other prospects to declare their giving intensions publicly.

Power, Process, and Appreciative “Moves”

When negotiating for Major Gifts, it’s important to understand where things stand and respond appropriately.

Mr. Lynch introduced three types of “moves” and explained how to use each appropriately:

1 When a potential donor sees no need to negotiate – Respond with “Power Moves”

2 To prevent the solicitation process from impeding the negotiation – Use “Process Moves”

3 When talks stall because the prospect feels pushed or misunderstood – Respond with “Appreciation Moves”

Power Moves

When a prospect is showing no willingness to engage, use power moves to rouse the prospect’s interest in negotiating. Even if you don’t anticipate needing them, always be prepared to use one or two power moves.

1 Offer High Value Incentives

– Naming opportunities

– Governance opportunities

– Opportunities to meet people of interest, such as an author or artist

– Opportunities for influence, such as 1-to-1 progress meetings with the CEO

2 Use negative incentives

– Point out the negative consequences of not completing the project

– Indicate that other major donors are considering opportunities above

3 Bring in VIP Support  – Enlist a negotiator the prospect can’t refuse, such as the CEO or a senior volunteer

Process Moves

Poor negotiation techniques can cause a solicitation to stall. Process moves are designed to create clear, open communication with a prospective donor. This allows for the content of the conversation to be the focal point, not the process itself.

1 Be Proactive, before a solicitation or campaign begins

– Plant seeds for solicitation early, so a donor isn’t caught off guard

– Plan on long cultivation time, don’t expect a rapid response

2 Focus on meeting the prospect’s objectives (not the organization’s)

3 Build consensus

– Make the prospect a partner in planning and executing

– Include people in the discussion who are key influencers of the prospect

Appreciative Moves

It is essential to keep the negotiation focused on the prospect. In most cases a prospective donor has no obligation to make a contribution, and wants to feel that the organization will truly appreciate the gift. Appreciation moves are designed to build trust and elicit the prospect’s perspectives, opinions, and ideas.

1 Have an open dialog regarding the request

– Let the prospect know how this amount falls in relation to others’ gifts

– Let the prospect choose from recognition alternatives

– Understand what impact the donation will have on the donor

2 Don’t rush the process

– Take the time to discuss a prospect’s concerns

– ALLOW PROSPECTS TO TALK THEMSELVES INTO THE GIFT

3 If negotiations stall, ask the prospect to suggest an alternative approach

Donor Psychology

Each donor is unique. However, a good negotiator will keep the following in mind:

– Donors don’t want to feel pushed, cornered or caught off guard

– Giving a major gift can be a stressful process

– Procrastination is often more comfortable than making a decision

– Ambivalence toward making a gift may reflect a fear of making the wrong decision

– Clear, genuine deadlines can make it easier to come to a decision

BOTTOM LINE:

A good negotiator will exercise patience, and use the tools above to help donors make a good decision, with no regrets.

Join Me for the 2015 Association of Fundraising Professional (AFP) International Conference in Baltimore

183:747132823 (Elise Saltzberg) — Wed, 01 Oct 2014 00:00:00 GMT

You don't want to miss this!

The AFP Annual Conference is an essential event for everyone involved with fundraising. I’m so excited that Baltimore will once again be hosting the annual conference, and proud to be a featured advocate. Scroll down to see my testimonial at the bottom of the announcement.

If you are planning to attend, take advantage of the early-bird registration through October 31 and consider applying for the a Diverse Community Scholarship .

See you at the conference!

Are Funders Saying “Yes” to Your Proposals?

Fri, 01 Aug 2014 00:00:00 GMT

Inspiration from 2014 AFP Fund Raising Day

I was fortunate to attend the 2014 AFP Fund Raising Day in New York City. The whole day was inspiring, but I found one session particularly compelling. The title was “Getting to Yes: The Role of Outcomes Assessment and Evaluation in Preparing Winning Proposals.” Its purpose was to help nonprofits better understand how to evaluate program outcomes, and communicate meaningful data to foundations and individual philanthropists. The presenters represented both the nonprofit and foundation sectors:

• Benjamin Kim, Public Health Solutions

• Dr. Ruth Finkelstein, Columbia Aging Center

• Dr. Andrew Grant, Hebrew Union College – Jewish Institute of Religion (moderator)

• Sarah Winters, Alfred P. Sloan Foundation

How the Nonprofit Community Views Outcomes Assessment and Evaluation –

Over the past 30 years funders have become increasingly focused on measurable outcomes. Dr. Grant’s opinion (shared by many nonprofits) is that funders are now “outcome-obsessed.” This emphasis on outcome assessment and evaluation is rooted in the “Venture Philanthropy” movement. Venture Philanthropists, like Venture Capitalists, invest in programs with the hopes of seeing significant returns on their investment. In the case of Venture Philanthropy, the anticipated returns are social benefits. The funders’ logic is understandable: “Without assessment, how do you know if the program was/is successful?” However problems arise when time horizons are mismatched. Businesses evaluate success quarter by quarter and year over year. But for nonprofits, meaningful results may take decades to achieve, and interim reporting doesn’t always reflect the actual success of a program. Specific Concerns about the Outcome Assessment and Evaluation Model Expense – Outside evaluation is expensive and time consuming. It pulls resources away from programming and operations. Increases Proposal Complexity – Proposals generally require that nonprofits include an evaluation design. To achieve this, the nonprofit may need to invest in evaluation design, before a program is even funded. This may mean finding outside evaluation consultants who can write the evaluation section of the grant. Grant Periods Aren’t Long Enough for Meaningful Evaluation – It can take five years to see real, measurable results for a new program. It’s difficult (some would say impossible) to get meaningful, measurable outcomes in a 1-year grant period. Working with these Concerns While the emphasis on Outcome Assessment and Evaluation presents a real challenge, there are ways for nonprofits to work successfully with this model. Keep it Simple – Evaluations do not need to be overly complex. Nonprofits should keep the evaluation process as simple as possible, while meeting funder requirements. Use Existing Tools – Many evaluation tools already exist. It’s not necessary to reinvent the wheel. An online search will turn up a wealth of information. For example, the Kellogg Foundation ( www.wkkf.org ) website has good information on logic models and evaluation methods (see Resources below). There are many Logic Models available, which help map out the progression from Input to Outcome. (Keep in mind that a Logic Model is a living document, as inputs, outputs and outcomes will change over time.)

Include Evaluation Costs in Program Budget – Assume that program evaluation will be 5-10% of direct program costs, and budget accordingly. Take a Creative Approach to Evaluation Design – Evaluation consultants can be expensive, but there are approaches that can lower or defer the costs. Some nonprofits enlist university faculty (or grad students) to design the evaluation.

The Funder’s Perspective

Sarah Winters of Alfred P. Sloan ( www.sloan.org ) acknowledged that her Foundation is very outcome oriented, and offered this perspective: Funder’s View of Evaluation Design

• Grant funding is the R&D money of the nonprofit world

• R&D always assumes there will be many failures along the way

• Success doesn’t mean meeting every goal

• Grantors want to see that nonprofits are taking a thoughtful approach

• Trustees’ Bottom Line: “Did you do what you said you would do?”

• Learning curve: “If you were to do it again, how would you do things differently?”

Advice for Nonprofits Ms. Winters emphasized that funders want nonprofits to be successful and she encouraged organizations to work closely with them after they receive a grant. She offered the following words of wisdom: Indirect Costs – Nonprofits should understand that most foundations don’t fund indirect program costs. Sloan’s guidelines allow for some indirect costs, but recognize that the amount may not cover everything. Formative Evaluations – Formative evaluations are made over the course of the program. It’s usually acceptable to make mid-course corrections. But it’s essential to let funders know about desired changes and ask permission before making them. Summative Evaluation – The summative evaluation is the final report. It should spell out exactly what happened, supported by measurable results. There should not be any surprises for the funder. Proxy Variables – For programs where long-term outcomes can’t be measured, it’s acceptable to use proxy variables, which stand in for the actual variables that you can’t measure.

A Grantee’s Perspective

Dr. Ruth Finkelstein represented one of the Alfred P. Sloan Foundation’s grantees. She offered these highlights from her experience.

• The Columbia Aging Center uses sophisticated evaluation designs, which are then shared with other nonprofits.

• She suggests a “What do I need to know at what standard of convincingness?” approach to evaluation design.

• Reality is infinite. You can’t measure everything

• Set reasonable standards. Evaluation goals need to be meaningful, but not so high they can’t be reached.

• Types of Evaluations:

Feasibility : New, truly innovative projects should begin with a feasibility evaluation, which includes a cost evaluation that provides a baseline for measuring future cost effectiveness. Process – It’s important to state whether or not the organization did what it said it would do. Outcome – This is where measurable results are particularly useful: Who was involved; how were they affected? Impact – This is a long-term evaluation, which can’t be measured within one grant cycle. Dr. Finkelstein calls this “the holy grail.” ROI – Return on investment is assessed based on how much improvement is gained for each dollar spent. Dr. Finkelstein pointed out that once an award is given, the relationship with the funder changes. The Program Officer becomes much more available and the nonprofit should take advantage of this. Find out exactly what kind of assessment and evaluation the funder wants. A grantor may also be willing and able to help the nonprofit build relationships with other foundations. As a Resource Development Consultant, I write grants on behalf of many organizations and have personally witnessed this shift in emphasis to measurable outcome assessment and evaluation. At times I do find it challenging to meet funders requirements and am not always convinced that this is the best approach to philanthropy. As Albert Einstein famously said, “Not everything that can be counted counts, and not everything that counts can be counted.” I valued the balanced views presented during this session and want to share what I learned with others in the grant-seeking community.

Resources W.K. Kellogg Foundation Logic Model Development Guide Alfred P. Sloan Foundation Grant Application Guidelines

Funders Demand Results: Can Nonprofits Meet the Challenge?

Tue, 01 Jul 2014 00:00:00 GMT

Why Younger Donors Are Driving the Emphasis on Result

All of us who write grants know that funders now demand measurable results as a condition for support. But this hasn’t always been the case. At a recent workshop led by Dr. Susan Raymond and sponsored by the Chesapeake Planned Giving Council, I learned more about how this shift came about.

What’s Driving this Emphasis on Results?

Competition – The rate of growth in the nonprofit sector has greatly outpaced giving. In recent years the number of organizations has increased by 70%, while giving has grown by only 30%.

Younger Donors– Among wealthy donors, the prevailing sentiment for generations has been one of “giving back.” But younger donors are setting a different tone. They view their gifts as “investments” in the future and want to see a return on those investments. This change probably stems from the fact that only 8% of this group inherited their wealth, while 92% earned it.

Philanthropy vs Problem Solving – Younger donors aren’t interested in the traditional model of philanthropy. They see problems and want to fix them. They don’t care if the solution comes from a nonprofit or a for-profit company. Younger donors often apply business models to their giving philosophy: They are interested in “social enterprises,” “social franchising” and “social ventures.” Examples of this are bonds for vaccinations in Africa, and the Global Health Fund at J.P. Morgan, which is guaranteed by the Gates Foundation.

Donor Involvement – Younger donors are eager to do more than give money. They want to be directly involved in affecting social change, and they want a degree of control. Bringing a business-oriented focus to grant making gives donors a greater sense of engagement.

What Does this Mean for Nonprofits?

This approach to funding presents significant challenges. Complex social issues are generally not fully understood and don’t lend themselves to quick fixes. What are the long-term implications for the nonprofit community? Here are a few possibilities:

Risk Aversion – The emphasis on objectives and results leads to nonprofits becoming risk adverse, more likely to run programs with predictable outcomes than ones with enormous potential.

Fear of Failure – Failure regularly precedes important breakthroughs. But with greater risk aversion comes greater fear of failure. If nonprofits can’t risk failure, they limit their potential for success. (It can take a decade or more of consistent failure before a breakthrough happens.)

Changing Social Contract – Traditionally the “deal” in civil society has been that philanthropy tackles the biggest social problems, working to create opportunities for people to better their situations over the course of years, and even generations. The new focus on short-term, measurable results has the potential to undermine long-term success.

How Nonprofits Can Succeed in this Funding Environment

Nonprofits are adjusting successfully to the new funding guidelines. Here are a few tips for fulfilling an organization’s mission, while giving funders what they ask for:

Articulate Objectives – This is an opportunity for nonprofits to take a fresh look at their mission and actually articulate short term and long-term goals and objectives. (If organizations aren’t clear about their objectives, funders are likely to set the agenda for them.)

Determine What Can Be Measured – What results are genuinely important and can be measured? Long-term goals often do have short-term, measurable outcomes that will satisfy funders.

Tear Down the Walls – Funders and nonprofits share the same ultimate goals, even if they may disagree about how to achieve them. Nonprofits and funders need to have an open dialog about taking on risk together and embracing bold ideas.

Encourage the 10% Solution – Granters should be encouraged to set aside 10% of their funds for high-risk projects. (This is consistent with the way “Angel” investors invest in start-up businesses.)

The reality is that money is tighter than it used to be and nonprofits have to be more strategic than ever. But if nonprofits and funders can work together, it’s possible for both grantors and grantees to get what they need.