Top 5 Takeaways About Diverse Funding for Your Nonprofit

Every other week the Resilia team and community get together for Ask Us Anything - an open, informal conversation where our community members can do just that - ask us anything - about  their nonprofit journeys. Last week we had a fantastic session about why it’s so important for nonprofits to diversify their fundraising. Our nonprofit founders brought great energy and questions, and our team of nonprofit experts shared their expertise. If you missed it, no worries - we took notes for you! Here’s the top five takeaways from Ask Us Anything: Diverse Funding for Your Nonprofit. Until then, we can’t wait to see you at the next one!

What is diverse funding and why is it important to have?

There are two buckets when it comes to fundraising streams: contributed income, which include donations, grants, and funds donated through philanthropy, and earned income, which are sales, program fees, tuition payments, and costs that your organization charges for its’ services. Our chief of Staff Sarah Angello reminded our community that having different sources of income will make your nonprofit much stronger.

You want to ensure you have multiple funding streams so that if any one of them were to disappear tomorrow, you’d be able to replace it or keep things going while you’re working on replacing it, our nonprofit partnerships manager Amanda Kemp advised. Great gifts are wonderful, but lots of small gifts are really great to have too. You don’t want to have one grant or donor that your organization relies on. You want to make sure you are spread out across multiple avenues. Consider grants from different foundations, including government grants. And as you grow, you even want to look at investments that your organization can make. 

Engage with donors regularly and steward all donors.

Your fundraising efforts are only as strong as the relationships you nurture. Communicating regularly with donors without a philanthropic ask attached to it is critical to successfully fundraising. You should be able to share out either on a monthly or quarterly basis, stories from the field, quotes from students you’re working with, or a donor spotlight from someone else in the community. Being able to share things with donors from your mission on the ground in ways that feel tangible, obtainable, and interesting to your donor base keeps them engaged. Katie Branch, our philanthropic partnerships manager chimed in with a good practice to keep in mind - no matter what their contribution is, whether it be $5 or $50,000, you should stay engaged with your donors and inform them of the impact their gifts are making. 

Make your ask of funders clear. 

When engaging with potential donors or sponsors, you want to present them with options and offer them concrete ideas of how a partnership could work. Be clear about what you’re asking for. Be able to say: “this is what we’re doing, this is the impact of our nonprofit in the community. By partnering with us, X is what we can do together.” The more specific you can make it for a partner, the more likely they can say yes because they don’t have to do the work of imagining what a partnership could look like. Sarah shared some great examples with us on how to approach potential sponsors:

Do you want to make a sponsorship menu with options?

Do you want to sponsor an employee giving day?

Do you want to create volunteer opportunities for their team?

Do you want to put out a bowl at your favorite local vendor to ask for donations? 

Keep the end of year in sight for fundraising.

A significant amount of giving in the United States happens towards the end of the year between Thanksgiving and before new years. Some organizations have surplus funding at the end of the year. You have a window that is a great opportunity to make some asks. Can you start to build out and explain the gaps that funding can help you fill and create impact with? 

Work on a small campaign to tell your nonprofits’ story. You need to be able to tell a powerful story about the impact your nonprofit is making and be able to share that story out externally. Tell stories that are specific about a person that benefitted from your program. Stories that tell the experience of a person rather than a big statistic resonate more with people

As you’re building those stories, make sure you are leaning on your board members, partners, staff members, and activating your whole network. Sarah reminded us that fundraising is not an effort you should go at alone. You need an army and you should spend the rest of the year building that army and sharing that story to bring it home. Now is a great time to start building relationships for next year.

Be sure to budget properly when preparing to fundraise.

You need funding to go out and do the programming, but a lot of funders are hesitant to fund salaries. This is the struggle, right? Sarah cautioned to make sure you are being careful about what you are considering program support and what is administrative support. There’s a difference here with your budgets that you’re sending out for your grants. You want to make sure that your budget is breaking down what the direct costs of program delivery are versus what your overhead is.

Overhead refers to the costs that are separate from your program delivery. You want to make sure that you are not putting salary for people who are on parts of your team that aren’t 100% dedicated to program delivery. You don’t want to put their salaries in the program budget. You have to ensure that you’re allocating correctly. Nonprofits must keep indirect costs at 20% or less. A great resource to refer to is the Template Grant budget in your Resilia dashboard so you can make sure you’re allocating budgets directly. 

Good stuff right? If you missed this Ask Us Anything, join us at the next one, The Resilia Community Presents #AskUsAnything - Essential Advice for Executive Directors on Thursday, July 29 at 1 pm EST.

P.S. - We also reminded our nonprofit community about our Resilia Grant Opportunity that’s open now. You can visit Discover.Resilia.com/microgrant to apply for a $1,000 micro grant, with no strings attached. Five grant recipients will be selected. The deadline is Aug 16, and winners will be announced Aug. 23 with funds deployed immediately. Good luck!