Newly formed nonprofit organizations are eager to apply for grants, but it's important to know that most grants go to well-established organizations.
Many funders are leery of giving grants to the new kid on the block -- because foundations like to play it safe (see point #3 here). They can't risk making a grant to an organization that won't be able to follow through with the proposed project, or, worse, closes its doors before the grant term ends.
Because it's tough for a new nonprofit to get grants, it usually works best to start with a base of support from individual donors, and branch out into grants as a supplemental source of revenue as you further establish your credibility.
To assess your organization's readiness to apply for grants, take this quiz!
1 - Do you have 501(c)3 status or a fiscal sponsorship agreement in place?
2- Do you have a compelling mission statement that explains why your organization exists?
3 - Do you have staff or volunteers who are clearly qualified to carry out your mission statement?
4 - Do you have an active board of directors?
5- Do you have the administrative and fiscal tools to financially manage and report on a grant?
6- Do you have the facilities (such as building, technology) you need to carry out your mission?
7 - Are you developing diverse funding streams other than grants (such as individual donations)?
8 - Has your organization filed Form 990s with the IRS every year it has been in operation and hired an auditing firm to do a professional audit?
Not quite ready?
No new nonprofit is perfect, and if you replied "no" to some of the questions above, don't despair! Just choose the three issues that are most important or urgent for you to address and decide on attainable action steps that you know you can take over the next few weeks to build your grant readiness.
For example --
If your weak point is that your organization lacks an active board of directors, you might commit to these three action steps:
- Call your super-connected friend to ask her for ideas of who could be asked to serve on board.
- Get book on how to develop a board of directors.
- Post board recruitment information on your website and through social media.
Need more help?
Check out these resources --
- Before You Seek a Grant: A Checklist for New Nonprofits (free webinar)
- Foundation Center's Nonprofit Startup Resources by State
- The Nonprofit Center at LaSalle University’s 7 Tips to Maintaining Your Tax-Exempt Status