Mar 02, 2010

Funder/Grantee Relationships: Or, What To Do After You Get That Check

Funder/Grantee Relationships: Or, What To Do After You Get That Check
Oz Spies, Amy Rosenblum & Lisa Fasolo Frishman

Some people view a relationship between a funder and a grantee as static.  There are set times to interact with a funder – when you apply for a grant, receive a grant award or declination, and when you report on that grant – and that’s it. 

There’s another way to look at it: receiving a grant check is an opportunity to build a relationship with a funder.  Long before you send in a grant report, you can interact with the funder and share both good news and challenges.  You have a chance to further engage a funder in your mission.

A relationship between any nonprofit and any funder will be unique.  A variety of factors will influence how you interact.  Small, all volunteer nonprofits will likely have different ways of connecting with funders than larger nonprofits with dedicated development staff.  Just as foundations have different grantmaking procedures and policies, they will have different approaches to funder/grantee relationships.  A large, national funder will have a different relationship with a nonprofit than a small, local foundation.  It’s a good idea to ask a funder how best to approach them with questions or concerns – some might prefer written communications while others might welcome phone calls.

Here are a few tips based on what’s worked for other nonprofit/foundation relationships:

Think about things you already do in which you can include funders.

• Add them to your newsletter and annual report lists
• Invite them to relevant events or fundraising dinners (but don’t be offended if they’re unable to come – some foundations have policies against attending certain types of events).
• Share exciting accomplishments, such as awards you have received
• Notify them about prominent media coverage

Think about new ways to connect with funders, beyond current activities.

• Be sure to thank them for your grant.  A hand-written thank-you note to a foundation staff member is appreciated and appropriate.
• Foundations connect with multiple nonprofits across the community and can sometimes serve as a sounding board for their grantees.  They might know of other organizations you could collaborate with, or organizations in other communities that have successfully dealt with challenges you are currently facing.  If you’re looking for nonprofits that have experienced a specific challenge, consider calling a funder to ask if they could help you connect with an appropriate nonprofit. 

If you experience major changes, good or bad, notify the funder.  A good motto: no surprises. 

• If you decide to make a course correction in the middle of a funding period, it is a good idea to give your funders a heads-up.  You should call your program officer at the foundation to let them know first.  Also, consider summarizing your conversation in an email or a memo so that the foundation has a hard copy to put into their file and you have confirmation that you have shared changes with the funder.  
• Any significant transition – turnover at the executive director level, financial challenges, newly launched programs – warrants communication with major funders. 
• If you’ve received a grant for a specific purpose but would like to use it for something else, you should contact the funder for their approval before diverting funds.  It’s important to follow grant agreement protocols.  Do the same if you’d like to request a grant extension, and the funder allows extensions. 
• Especially in the case of bad news, it’s best if it comes from you directly. You don’t want your funders to hear anything negative (for example, about a lawsuit, financial challenges, or if a staff person is in trouble with the law) from the media or through the nonprofit grapevine.  Proactively contact the funder and provide an honest assessment of the situation and what you’re doing to address it.  Funders will appreciate your forthrightness and will get more accurate information from you than they might get through gossip or a news story.   

Respect Your (and the Foundation’s) Resources

• Nonprofit staff are busy people.  You might have limited time to interact with your funders, and that is okay.  Doing the work of your mission is your priority.
• Exercise judgment with gifts and formal recognition.  Oftentimes gifts are unnecessary, and many funders have policies against accepting gifts. Most foundations expect that you use your limited resources on programs and operations.   However, there are other times when recognition – such as a plaque on a room supported by a capital contribution – is appropriate. 
• Foundation staff, too, have limited time and resources.  They may not be able to meet with you in person as often as you would like them to, or be able to attend all of your events. 
• Conduct communications professionally and in a timely manner. 
• Respect deadlines.  Be sure to turn in thorough grant reports on time.
• Listen to funders and respond accordingly.  If, for example, a funder has said that it is only interested in program support for your organization, be sure to apply for program support, rather than general operating funds.  If a funder has expressed a concern about an area of your work, proactively respond to that concern both verbally and in written format, such as your grant report or next grant application.
• Be proactive in handling potentially awkward situations.  If you have forgotten to submit a grant report on time or have had an unusually challenging year financially, contact the funder and offer an explanation.

Remember, you know your resources, funders, and relationships with them.  Trust your instincts as you navigate new and existing relationships with foundations.  If you’re not getting an encouraging response from your efforts, reconsider your approach and its relevance to a given funder.

Category: Fund Development