Foundation Source notes that two-thirds of foundations are small family foundations with less than $1 million in assets. And even though a foundation legally only has to give 5% of their assets away each year, many give far more – especially the smaller ones. They balance the account by adding more assets to it. And…those smaller foundations might be more likely to offer unrestricted funding to help a nonprofit, especially in tough economic times.
Finding and appealing to these generous and civic-minded foundations comes down to research…and networking.
Here’s six tips to get you started.
Find the Contact Person (Which Might be the Hardest Part!)
Cannot find a website? Not even really sure how to reach the family foundation a friend told you about? The foundation may not have paid staff, and they might prefer a low profile. You might find out about a funder from a colleague at a partner agency, another funder in the same field, or from perusing annual reports for a similar cause.
The foundation may be administered by a trust officer at a wealth management company, or perhaps by family members. You might use a reverse phone number lookup to figure out who is answering the phone, and/or the name of the trust company. The trust officer may prefer email or even snail mail…or you might be able to just cold call them. Just be sure you have researched prior grants enough to know that they might like to hear from you.
Now that so much information is available online, including the 990 forms filed with the IRS, donors really prefer anonymity. They may want to keep their level of giving on the down-low, so that they will not be flooded with grant and donation requests. This is understandable, so you will want to explore your opportunities discretely, and follow their press release preferences to the letter.
GuideStar can be pretty helpful if the small foundation you find is listed and has officers or previous grantees. You can get a list of local foundations with a general idea of their assets. You might even discover some potential non-profit partners to approach. But just remember that many family foundations are not 100% pleased that this information is so easy to find.
Check out your local community foundation
Some donors looking for ways to give anonymously use a community foundation. There are over 750 community foundations in America and even overseas. (Here is a locator tool from the Council on Foundations.) These organizations provide a variety of services to donors, including the ability to create a donor-advised fund or a private foundation. Many also offer a slate of grant opportunities to local non-profits based on shared assets and community giving priorities. And, you can also find out if your cause is listed among those who receive support from general community foundation programs.
Read newsletters intended to solicit new donors—they usually profile current donors and articulate community funding priorities. Familiarize yourself with the people involved and consider an introduction call to the lead grant making staff member if you do not already know this person. Attend information events and participate in resource offerings as you are able.
Network. Network. Network.
Competent fundraisers know that you must show up and connect with others to find the donors for your cause. Know your fellow fundraisers. Read their annual reports. Even send donors their way who are a better fit for their organization. They will share the golden information you need if you are a trusted friend. So, be a trusted friend. Sometimes, you might be one of the first to know that a family is looking to increase their giving and in need of planned gift advice…and you can refer that person to another of YOUR trusted friends.
Teach Your Board to Network
Board members do not always know how they can help you fundraise. So, spend a little time on education at board meetings. Share facts they might not know and teach them little tricks to identify and qualify donors. Explain the terminology. Emphasize confidentiality and respect…as well as telling the story of your non-profit mission.
Use peer-to-peer contacts with your board members to find and cultivate members of the family involved in a family foundation. Pay attention to their interests and note what other organizations get funding. The best information will be from informal sources. Resist the urge to gossip but ask colleagues what they know that can help you.
When You Find One, Keep the Letter of Inquiry Short
Don’t send too much information – remember there may be no staff. Just a short email asking for more information and summarizing a potential ask that matches what you know about their funding interests is much better. A “mom-n-pop” foundation may look unfavorably on a slick production with extensive graphics. Just the facts…and a simple presentation will help the funder know if they want more information.
You also might decide to begin the cultivation process with a small, simple ask. Identify potential family funders and provide ‘no pressure’ opportunities for them to learn your mission. Ask for a basket donation for a gala fundraiser or invite them to volunteer for a service project. Invest for the long term – and then ask for more information as you become a trusted friend.
Need some help finding the right family foundations for your nonprofit? Check out our grant finding services for more details.