# The Fundraising Compass:
# Questions for Agile Strategic Planning in
# Fund Development
## by June Eastham
June@easthamconsulting.com
This manuscript is dedicated to the communities and the nonprofit sector
on the Central Coast of California and to fund development staff
.and nonprofit leadership across the United States.
© June Eastham, 2025
Distributed under CC BY-NC-ND license. (Creative Commons Attribution-
NonCommercial-NoDerivatives license)
In addition to all standard copyright law, including fair use, this license enables reusers to
copy and distribute the material in any medium or format in unadapted form only, for
noncommercial purposes only, and only so long as attribution is given to the creator.
CC BY-NC-ND includes the following elements:
BY: credit must be given to the creator.
NC: Only noncommercial uses of the work are permitted.
ND: No derivatives or adaptations of the work are permitted.
Please distribute this freely among nonprofit organizations in line with these terms.
See https://creativecommons.org/share-your-work/cclicenses/ for more information, or
message [june@easthamconsulting.com](mailto:june@easthamconsulting.com).
Changelog
v1.0 – (Unnumbered) Publicly released March 2025
v1.1 – Revised tables for layout and readability, March 2025.
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# Introduction and Purpose
Uncertainty at the federal level can send shockwaves through the nonprofit sector. While some organizations may adapt quickly, many find themselves scrambling to replace lost grants or navigate sudden policy shifts. This workbook has been created to help nonprofits thoughtfully respond to these challenges through proactive, agile planning—rather than mere crisis management.
Fundraisers often serve as a “blood-brain barrier” for their organizations. When we are doing our jobs well, we have a unique vantage point on the organization as a whole and can carry vital insights directly to organizational and departmental leadership. But the resources in this workbook are not for fundraisers alone; anyone involved in strategic planning—from executives and board members to program leaders—will find tools here for shaping resilient sustainability models during economically and politically unpredictable times. But I am writing as a fundraiser to fundraisers, knowing that we have the ability to build resilience within each of our organizations, thereby strengthening our community.
By working through the questions and worksheets provided, your organization can:
- Identify lessons learned from previous recessions and national
- Clarify funding dependencies and potential vulnerabilities
- Strengthen donor and community relationships through genuine engagement
- Explore new earned income or partnership opportunities
- Develop contingency plans that protect core services and minimize panic
- Look to your existing programs and services as the foundation for community support and inspiration for potential revenue streams
Above all, this workbook is designed to help you move beyond day-to-day fundraising and toward more sustainable fund development strategies. While there are no “easy answers,” community building and proactive knowledge-sharing have historically been critical for nonprofits and communities that are weathering turbulent times. By collaborating with peers, staying alert to changing conditions, and maintaining open communication with your stakeholders, you can position your organization to remain effective—even when the future feels uncertain.
# 1. Where Will the Money Go - Historical Perspective
_"Those who cannot remember the past are condemned to repeat it" -George Santayana_
This section helps you uncover critical lessons from past funding disruptions—both within your organization and in the nonprofit sector at large—so you can anticipate and respond more effectively to new challenges.
**Why Look Back?**
Many organizations experienced seismic shifts in funding between 2007 to 2009 during the Great social dis-ease in 2020 and stagnating wages and inflation growth, with 10% greater inflation experienced by low-income households, housing price hikes, from 2021–2024. Mid-2024, the National True Cost of Living Coalition reported that 65% of Americans were living paycheck to paycheck. Even among nonprofits that maintained steady income, many saw significant inreases in the demand for their services.
However, organizations sometimes lose the institutional memory of how they navigated (or failed to navigate) these disruptions—particularly if key staff have moved on or documentation wasn’t properly saved.
By stepping back to review these periods, we can:
- Identify funding patterns and predict which grants or revenue streams are most vulnerable.
- Pinpoint operational adjustments that either succeeded or flopped so we can replicate the successes and avoid repeating mistakes.
- Locate stakeholders with institutional memory—past staff, volunteers, board members, or community partners—who recall the strategies used and who have valuable insights to share.
**A Note on Lost Knowledge:**
If your organization can’t locate records, past staff, board members, etc. for a given period, reach out to fundraising peers and sector colleagues. Their recollections might help fill factual gaps and spark fresh thinking about historical events that both of your organizations endured.
**Key Timeframes to Explore**
Not all federal influences on the nonprofit sector are directly related to federal grants. Broader economic and social influences catalyzed by federal action can also affect the demand for services provided by nonprofits. Following are some overall factors from the current administration’s first term and from the democratic administration that followed.
1. **2017–2020 (First Term Disruptions)**
This era saw significant volatility in federal grant funding, with potential freezes or abrupt recalibrations in program priorities. While many changes attempted by the administration’s first term were defeated, rescinded, or struck down, many organizations experienced significant disruptions to their operational capacity and spikes for demands in services. The number of Americans without health insurance increased by 16%. Some nonprofits did endure severe cuts, with a 13% drop in Non-Defense Discretionary funding in 2018. Other nonprofits pivoted to new funding streams or restructured how they delivered services, with further restructuring necessitated in 2020.
2. **2021–2024 (Pandemic & Post-Pandemic Shifts)**
COVID-19 relief introduced temporary federal infusions, but as the public health crisis waned, newer policies reshaped how and to whom federal funds flowed. Some of these programs ended abruptly or were scaled down, triggering another round of uncertainty—especially for organizations dependent on renewed government support.
In 2021 Inflation Reduction Act (IRA) provided funding for environmental efforts, including $7B for electric vehicle charging, and health care and prescription drugs, and later that year the Infrastructure Investment and Jobs Act (IIJA) increased federal grant funding for technology, environmental efforts, climate adaption, workforce development, and community development. In 2022, the National institute of Health saw a significant increase in grant funding largely due to long-term efforts to address COVID.
Inflation hit a 40-year high of 9.1%. in 2022, average home prices were up 33% compared to 2020. That same year, federal grant funding increased for technology, environmental efforts, and the National institute of Health.
This is not the first time and will not be the last time that nonprofits have scrambled to adapt to sweeping federal changes. Confusion will be magnified by fast-moving executive orders and court responses at the federal level. A thoughtful look at these periods helps you avoid merely reacting to chaos.
It is hasty to believe that our organization will not be affected simply because it does not receive federal funding. Beyond potentially limiting a nonprofit’s potential growth, reduced federal funding leaves private sector grantors scrambling to fill gaps, and they will fill those gaps with funding that would have gone elsewhere. No matter our funding portfolio, this is the time to develop strategic plans that allow for agile responses.
**To Simplify Our Outlook**
This all comes down to three things.
1. Available grant funding and individual giving will increase or decrease.
2. Demand for our services, and therefore the demand on how much we accomplish through our financial resources, will increase or decrease.
3. All likely scenarios include delayed federal payments due to short staffing. With most federal grants being on a reimbursement basis, this will result in grantees covering even more reimbursable costs before payments arrive.
We must be prepared, however it works out.
Prior to proceeding through the following worksheets, refer to the ”Expanding Capacity for All This Work” section for a better understanding of how to utilize AI, and especially Perplexity.ai, to find needed big-picture information. Also, see:
1. The Foundation Center/Candid, [https://candid.org](https://candid.org/)
2. Giving USA, [https://givingusa.org/insights/](https://givingusa.org/insights/)
3. The Chronicle of Philanthropy, [https://www.philanthropy.com](https://www.philanthropy.com/)
4. Stanford Social Innovation Review (SSIR), [https://ssir.org](https://ssir.org/)
5. Center for Effective Philanthropy (CEP), [https://cep.org](https://cep.org/)
6. Bridgespan Group, [https://www.bridgespan.org](https://www.bridgespan.org/)
7. GuideStar/Candid, [https://www.guidestar.org](https://www.guidestar.org/)
8. National Center for Family Philanthropy, [https://www.ncfp.org](https://www.ncfp.org/)
9. The Philanthropy Roundtable, [https://www.philanthropyroundtable.org](https://www.philanthropyroundtable.org/)
10. Independent Sector, [https://independentsector.org](https://independentsector.org/)
11. Giving USA, [https://givingusa.org/insights/](https://givingusa.org/insights/)
**Linking History to Future Sections**
Keep the worksheets from this section handy—they will feed directly into:
- **Organizational Assessment**: Understanding how programs were impacted by past funding shortfalls will help you identify current vulnerabilities.
- **Resource Mapping**: Insights into where you found (or lost) alternative funding streams can guide your search for new alliances or donors.
- **Scenario Planning**: If prior attempts to pivot were too slow or messy, refining how you plan for multiple futures can ensure smoother responses this time.
Your organization carries hidden stories that can either weigh it down or illuminate its path. In turbulent times, knowledge truly is power. By capturing and learning from your organization’s unique history, you equip your team with the perspective and resilience needed to navigate uncertainty more effectively than ever.
**1.A Worksheet: Organizational Memory**
Use these prompts to capture or rediscover crucial lessons from 2017–2020 and 2021–2024. If organizational knowledge for either period is missing, interview seasoned peers or consult archived newsletters and blogs for additional clues.
1. **Funding Shifts**
1. Which major funding sources changed or disappeared?
2. Aside from those enacted by the CARES Act, were there any surprising new sources of revenue that appeared?
3. Where did surprising new sources of revenue come from, and what are the catalyzing organizations doing now?
4. How did your overall income change year over year?
1. 2018
2. 2019
3. 2020
4. 2021
5. 2022
6. 2023
7. 2024
5. Based on end of year actuals, how much or what percentage of your income came from each major funding category?
1. 2018
2. 2019
3. 2020
4. 2021
5. 2022
6. 2023
7. 2024
6. How much did your expenses change year over year?
1. 2018
2. 2019
3. 2020
4. 2021
5. 2022
6. 2023
7. 2024
7. Based on end of year actuals, how much or what percentage of your income came from each major funding category?
1. 2018
2. 2019
3. 2020
4. 2021
5. 2022
6. 2023
7. 2024
8. What spurred any significant changes in individual expense and/or funding categories from one year to the next? “COVID” is not a valid answer. What factors and client needs during COVID required the changes?
9. **Operational Adjustments**
10. What changes were made to staffing, service delivery, or internal systems?
11. Which changes proved beneficial, and which created new problems?
12. Which 2020 service model changes persisted after shelter-at-home ended, and how did they provide improvements?
13. What spurred demand for your services?
14. **Programmatic Wins & Losses**
15. Did any programs grow, merge, or dissolve due to funding changes?
16. Which programs turned out to be unexpectedly resilient, and why?
17. Where did your organization experience failures and setbacks during this time? From what did they stem?
18. **External Partnerships**
- Did you form or lose important collaborations in response to funding shifts or in ways that benefitted your funding?
- How did other nonprofits or community partners cope, and what did you learn from them?
5. **Communication & Morale**
- How was staff morale affected by funding changes and service demand increases?
- Did your organization communicate strategic updates clearly to funders and donors, or did you scramble?
**Tip:** For each question, note whether you have detailed documentation (board minutes, grant records, staff memos) or if you need to contact former team members or partner organizations for more complete accounts.
**1.B Worksheet: Failures & Lessons**
It’s often easier to celebrate successes than confront failures. Yet analyzing what went wrong provides some of the most powerful insights an organization can gain.
1. **Identify Failures**
- Which strategies or programs failed to deliver expected results?
- Did any key relationships (funders, board champions, partner agencies) deteriorate?
2. **Root Cause Analysis**
- Were these failures caused by policy shifts, internal disorganization, staff turnover, or lack of diversification?
- Could you have predicted or mitigated these failures with better data or communication?
3. **Adaptations**
- Which unsuccessful approaches were abandoned too late (or not at all)?
- Did any partial fixes show signs of promise but never got fully implemented?
- What was the effect on staff morale?
- Were any changes made to better support staff during times of change?
# 2. Organizational Assessment
_"If you don't know where you are, a map won't help." - Watts Humphrey_
This section focuses on taking a clear-eyed look at your organization’s funding dependencies, mission alignment, and programmatic strengths. By gathering data on your current situation, you can better identify vulnerabilities—and set the stage for strategic, forward-thinking resource management.
**Why an Assessment Matters**
Many nonprofits operate on assumptions about who they serve, how they’re funded, or what _really_ drives their impact. Shifts in the federal government’s priorities, combined with local economic pressures, can quickly expose the gaps in those assumptions. A thorough assessment helps you:
- Understand precisely how much of your budget depends on uncertain revenue—particularly federal funding.
- See where your programs are strongly aligned with mission and where they might need recalibration.
- Identify which services have already demonstrated resilience or adaptability in the recent past.
- Clarify whether you have the staff capacity, data systems, and organizational culture to handle sudden changes in revenue or policy.
**Remember**: If you already know this stuff but it isn’t well-documented, share your knowledge with colleagues, board members, and new hires. Part of resilience is ensuring that critical institutional memory isn’t lost.
**Reflection: Next Steps Toward Strategic Resilience**
By working through these questions and worksheets, you’re defining a transparent baseline for your organization. From here, you can begin creating meaningful contingency plans or diversifying revenue sources without guesswork. Indeed, many nonprofits drift into crisis mode _because_ they skip this self-audit, only discovering their vulnerabilities when a funding cut is already in progress.
Keep your findings visible and share them broadly. The better your entire team understands your data—especially any staff or board members who didn’t participate in pulling it together—the smoother your decision-making will be when sweeping policy changes or economic stressors arise.
**Looking Ahead**: In the next section, you’ll map out how your organization connects to the wider funding and resource ecosystem. This will help you identify where local partnerships, in-kind contributions, and emerging opportunities might offset any vulnerabilities you’ve uncovered here. Use what you learn in Section 2 to guide that exploration, keeping mission and financial sustainability at the forefront.
**2.A Worksheet**
**Mission Alignment: The Core Question**
At the heart of any assessment is your _mission_. If a program or strategy isn’t advancing that mission—especially during times of turbulence—it may drain resources without delivering enough impact.
Use these question prompts to gauge whether your current activities align with what you’ve set out to do:
1. **Program–Mission Fit**
- What is your mission statement?
- Do all programs directly fulfill our stated mission, and which are tangential?
- Are there programs that exist because we received specific grants—even if they don’t strongly align with our mission?
2. The Program Quadrant
- Do any programs have high mission impact and high profitability? Which ones?
- Do any programs have high mission impact and low profitability? Which ones?
- Do any programs have low mission impact but high profitability? Which ones?
Review the Income Streams section for potential program replacements if you have programs listed in the above.
- Do any programs have low mission impact and low profitability? Which ones?
3. **Community Need**
- Do we clearly understand our clients’ demographics and challenges (e.g., income ranges, local representation) in our service area right now?
- How do our program outcomes or milestones demonstrate that we’re meeting these needs?
4. **Staff & Board Perspective**
- If you asked each staff or board member individually to explain how each program advances the mission, would their responses align clearly and consistently with your formal mission statement?
- Have you explicitly discussed with staff and board members which programs are mission-critical versus supportive or peripheral?
- Do your staff and board regularly revisit and agree upon program priorities, or has mission creep introduced confusion?
- Have staff or board members expressed concerns about resource allocation to certain programs? What specific concerns were raised?
- How do you ensure that decisions around programs are transparent and broadly supported internally?
- What is your process for resolving internal disagreements about strategic priorities, and how effective is it?
**2.B Worksheet**
**Financial Reliance and Vulnerability**
A critical component of your assessment is understanding where your money comes from—and how stable those sources are likely to be. While this workbook spotlights federal funding vulnerability, _any_ overreliance on a single stream (be it one major donor, foundations, events, or program fees) can become risky in the face of economic and political changes.
1. **Federal Funding Snapshot**
- What percentage of our total budget relies on federal dollars?
- Which specific programs or staff positions are funded by federal grants?
- Do we operate on a reimbursement basis, or do we receive funds upfront?
2. **Other Income Streams**
- What is our revenue mix from foundations, individual donors, corporate sponsorships, events, and fee-for-service?
- Have any of these sources shown instability or major shifts in the past 3–5 years?
- Do we realistically expect certain streams (e.g., events) to be vulnerable in an economic downturn?
3. **Cash Flow & Reserves**
- How many months of operating reserves do we have?
- Which lines of credit or emergency funding options exist if revenue is delayed?
- How do we handle late payments from grants or reimbursements, and how work-intensive is that process?
2. **In-Kind & Community Resources**
- Are there local businesses or institutions (e.g., colleges, churches) that provide surplus goods or volunteer labor we could rely on more heavily?
- What partnerships might offset certain costs (shared facilities, administrative overhead, etc.)?
**Tip**: This information allows you to ask “What if we lost ___% of our _________ funding?” and see which programs are immediately threatened.
**2.C Worksheet**
**Internal Capacity and Data Tracking**
Even if the money situation looks uncertain, your internal capacity—staff expertise, data systems, and collaboration culture—can either magnify or mitigate potential disruptions.
1. **Staff Expertise**
- Who is responsible for monitoring funding changes or scanning policy updates?
- What systems do they have in place for monitoring and forecasting?
- Is their procedure and schedule for these tasks documented?
2. **Data and Metrics**
- How do we measure program impact, client demographics?
- How do we measure fund development performance?
- Are there metrics beyond dollars raised, such as partnerships catalyzed, regional demographic changes provided to organizational leadership, etc?
- Do we have the technology (CRMs, donor management systems) to segment donor data and track shifts in giving?
- What is the difference between budgeted and actual income and expenses over the past three years? This indicates how accurately you can forecast future revenue.
- Do you regularly integrate scenario planning, in terms of changes in demand for services and changes in income?
3. **Internal Communication**
- Does leadership maintain open channels where staff is actively encouraged to highlight emerging risks?
- Are fundraisers empowered to share feedback about donor or community sentiment with the board and executive team?
**Remember**: As fundraisers, you often stand at the crossroads of program realities and donor perceptions. Keeping leadership informed requires not just good data but also a culture that values timely, honest communication.
**2.D Worksheet**
**Putting It All on Paper**
Below are two worksheets you can adapt to your organization’s needs. They’re designed to prompt data-driven conversations among staff, executives, and board members.
**Worksheet A: Quick-Fire Funding Reliance**
|**Funding Source**|**Estimated Annual $**|**% of Total Budget**|**Key Programs/Staff Impacted**|**Vulnerability Level (High/Med/Low)**|
|---|---|---|---|---|
|Federal Grants|||||
|Foundation A|||||
|Individual Donors|||||
|Fee-for-Service or Earned Income|||||
|Other|||||
1. _Where is there potential overreliance on a single source?_
2. _Which sources have shown volatility in the past?_
3. _What contingency plans exist if one major source diminishes sharply?_
# 3. Networks of Support
_"Community is much more than belonging to something; it’s about doing something together that makes belonging matter." — Brian Solis_
In this section, you’ll discover new ways of seeing and tapping into local resources—whether they’re financial, in-kind, or relational. By expanding your perspective beyond traditional funding streams, you’ll not only reduce vulnerability to federal uncertainty but also develop deeper community ties that can sustain you.
**Better Together: Building Strategic Partnerships and Alliances**
I am putting this at the front of this section because it has the greatest potential to bring broad change to community services. If your organization is not part of a larger consortium, an organizational question should be “why not?” When nonprofits band together as a consortium, they open doors to opportunities often out of reach for solo organizations. Jointly publishing outcomes-based research, sharing technical expertise, and formally creating an inter-organizational collective can not only enhance the entire community, it is also what major funders look for. Formalizing partnerships, pooling data, and publication of advancing best practices is what opens doors to W.K. Kellogg, Robert Woods Johnson, Ford, and MacArtur.
San Luis Obispo sits at the in-between space of so many categories: urban and rural, retired and students, San Francisco and Los Angeles, wealthy and under-served, insured and uninsured. We are a county of extremes and an example of the mixing of opposite ends of the spectrum. This places us in a unique and valuable position in terms of advancing best practices across sectors in a way that that we have not leveraged nearly enough in terms of developing best practices and receiving high-dollar foundation and federal support.
**Why Consider a Consortium?**
1. **Access to Bigger Funding Pools:**
Major philanthropic institutions and corporate foundations frequently favor collaborative efforts. Consortiums that produce rigorous research and demonstrate shared best practices consistently attract larger grants and multi-year commitments.
2. **Shared Resources for Stronger Outcomes:**
Pooling talent to hire a dedicated grant writer or researcher reduces administrative burdens for individual members. This allows each partner to maintain quality programs while contributing valuable data for consortium-wide studies.
3. **Enhanced Credibility and Visibility:**
Publishing best-practice research under a collective name showcases diverse expertise and broad impact, opening doors of which we were not even aware. Funders, policymakers, and the media often pay extra attention to coordinated sector-wide initiatives, amplifying your organization’s voice.
4. **Community-Centered Solutions:**
A consortium unites organizations serving overlapping or complementary populations. Combining resources or staff can eliminate duplication, address service gaps more effectively, and present a holistic solution to community needs.
5. **Federal Grants**
Many federal grant require levels of cooperation that could easily constitute a consortium. Yet many organizations decide to dissolve the formal partnership when the grant is over. However, there is a strong case to be made for both the creation of consortiums prior to federal grant funding and the formal preservation of consortiums when the federal grant period ends. For the first, existing, formalized consortiums demonstrate a higher level of capacity for cooperation. For the second, higher levels of community outcomes are often possible when forms of cooperation between organizations are formalized and submerged within organizational operations.
**Key Elements of a Successful Consortium**
1. **Clear Purpose and Unified Goals:**
Define what you want to accomplish together, in what order. What do you need to do to build your knowledge base for your cause, design joint programs, and pursue large-scale funding.
2. **Transparent Governance Structure:**
Decide what sorts of decisions you will make together, how decisions are made, funds are allocated, and responsibilities are divided. Clarity around roles fosters trust among consortium members and reassures funders.
3. **Data Gathering and Reporting:**
Invest in systems for consistent data collection. Coordinated metrics and evaluation standards allow you to produce high-quality research—one of the biggest draws for major donors and foundations.
4. **Ongoing Communication:**
Regular updates, shared calendars, and collaborative online workspaces keep everyone aligned. This ensures synergy instead of competition among partner organizations.
5. **Sustainability Planning:**
While consortiums often form in response to funding crises, plan beyond the immediate grant opportunity. Long-term commitments and documented learning processes cement the group’s staying power.
**How Consortiums Drive Process Improvement**
1. **Standardizing Data Collection & Reporting**
- Shared research initiatives require standardized data tracking, helping individual nonprofits refine their internal measurement and evaluation processes.
- Organizations learn from each other’s reporting structures, improving efficiency and compliance with funder expectations.
2. **Operational Benchmarking**
- Comparing service models and workflows across consortium members helps identify inefficiencies and strengths.
- Consortium-wide evaluations can highlight successful strategies and allow struggling organizations to course-correct with peer support.
3. **Capacity Building & Cross-Training**
- Pooling resources provides access to higher-level training in grant writing, financial management, and impact evaluation.
- Smaller organizations benefit from exposure to the governance models and administrative systems of more established partners.
4. **Scalability & Replication of Best Practices**
- Pilot projects within a consortium provide real-world testing grounds, allowing programs to be refined before scaling up.
- Successful initiatives can be documented and adapted across different organizations, reducing trial-and-error inefficiencies.
5. **Strengthened Decision-Making Frameworks**
- Collaborative problem-solving within a consortium encourages structured, data-driven decision-making.
- Leadership teams refine internal governance processes to align with broader strategic objectives.
**Taking the First Steps**
- **Identify Potential Allies:** Compile a list of nonprofits that share or complement your mission, then start a conversation about collective goals.
- **Co-Design Projects:** Brainstorm consortium-wide projects that could benefit from shared resources—like a regional needs assessment or a joint pilot program.
- **Seek External Support:** If possible, engage a neutral facilitator (e.g., a community foundation or intermediary) to guide the initial consortium-building stages and mitigate any turf issues.
- **Create a Charter:** A formal agreement or MOU that spells out responsibilities, decision-making processes, and goals helps everyone commit to—and plan for—long-term collaboration.
**Remember:** Organizations that step beyond competition into collaboration can attract support that might otherwise be unattainable. By uniting expertise, data, and fundraising capacity, a consortium can publish groundbreaking research, push for system-wide reforms, and secure large-scale investments from funders who value comprehensive, evidence-based approaches. For nonprofits looking to “aim for the stars,” working together is often the surest route.
**Why Look Beyond Federal Dollars?**
In times of unpredictable federal support, it’s tempting to focus solely on replacing lost grants. However, innovations in partnership building and local resource-sharing can unlock new forms of support:
- **In-kind donations** reduce spending on everything from office supplies to program materials.
- **Local partnerships** can pool overhead costs and create joint grant applications.
- **Community resource analysis** (e.g., wealth shifts, growing industries, philanthropic trends) identifies where the money and goodwill are truly moving.
**Reality Check:** While no single local asset can fully replace a large federal grant, cultivating multiple smaller resource streams can stabilize your overall funding picture.
**Reflection: Expanding Beyond the Grant Mindset**
Resource mapping pushes you to see the broader ecosystem in which your nonprofit operates. Although federal grants are vital, they’re just one slice of a larger pie. Cultivating local businesses, forging cross-agency collaborations, and leveraging in-kind support can insulate you from national policy swings. Even better, it can weave your nonprofit more deeply into the fabric of the community it serves—building goodwill that outlasts any one funding cycle.
**Next Steps**: In the following section (Scenario Planning), you’ll explore how to integrate these newly mapped resources into concrete contingency plans—so if federal funds do shift, you’ll know exactly which local avenues to pursue and how.
**Worksheet 3.A**
**Mapping Financial Flows**
Even in small communities, money is always moving—through businesses, community foundations, and high-net-worth individuals. The key is understanding (and harnessing) these movements.
**Questions to guide your exploration:**
1. **Local Industries and Growth**
- Which business sectors are thriving in your region (tech, agriculture, healthcare, tourism)?
- Have new businesses recently opened or expanded?
- Is there a specific demographic (retirees, young professionals) with higher disposable income or philanthropic interest?
2. **Community Foundation and Donor-Advised Funds**
- Does your local community foundation have donor-advised funds that align with your mission?
- Can you connect with these donors in a meaningful way (site visits, special updates)?
3. **Existing Wealth and Shifts**
- How have local real estate values, tax revenues, or population demographics changed lately?
- Are there wealth transfers happening (e.g., aging donors passing on estates)?
- Which emerging donors (individuals or businesses) might be open to learning about your cause?
**Tip:** Tools like the U.S. Bureau of Labor Statistics or local business journals can reveal which industrial sectors are expanding—and which philanthropic interests they might support.
**Worksheet 3B**
**Identifying Non-Monetary Assets**
Resources aren’t limited to cash. Think about what your organization spends money on—or has trouble accessing—and see if there’s a creative swap or donation waiting in the community.
**Questions to prompt new in-kind and collaborative ideas:**
1. **Surplus Goods**
- Which companies in your area consistently discard or donate tangible goods (e.g., office furniture, leftover manufacturing materials, unsold merchandise)?
- Is there a formal system (e.g., local donation directory) for connecting nonprofits with corporate surpluses?
2. **Shared Facilities or Administrative Functions**
- Are there other nonprofits that could share office space, fleet vehicles, or cloud-based software costs?
- Could joint grant-writing or training events improve efficiency?
3. **Volunteer Expertise**
- Local universities, retiree communities, and professional associations often have experts willing to donate skills (IT, accounting, legal).
- What might you offer them in return (unique networking, special event passes, purposeful social interaction)?
4. **Community Networks**
- Do you regularly attend city council meetings, Chamber of Commerce events, or philanthropic roundtables?
- How else could you let people know of your needs and goals (local radio, newsletters, community calendars)?
**Reality Check:** Before you pursue in-kind support, remember the cost–benefit ratio. Free goods that your team spends hours collecting, storing, or transporting might not be worth it. Weigh the time investment against potential savings.
**Worksheet 3C**
**Partnership Opportunities**
Collaboration can be vital for nonprofits seeking to cushion the unpredictability of federal funding. Sharing risk—and resources—with peers can open doors to joint grants, expanded impact, and cost savings.
1. **Existing Nonprofit Partners**
- What alliances already exist in your service area (collaborative coalitions, health or education consortia)?
- Which programs have overlapping clients or complementary services that would strengthen grant proposals if combined?
2. **Potential Business or Civic Alliances**
- Does a local business group have an employee volunteer day that could match your needs?
- Have you approached civic clubs (Rotary, Kiwanis) to see if they’ll adopt a local program or fundraise on your behalf?
3. **Strategic “Umbrella” Groups**
- Are there membership associations or professional societies you can join for bulk discounts, advocacy, or training?
- Does your community have a nonprofit resource center or capacity-building hub that coordinates shared projects?
**Reality Check:** True collaboration requires give-and-take. Be ready to adapt your timelines, staff capacity, or even brand elements to maximize synergy with partners.
# 4. The Tools for Navigation
When uncertainty runs high—whether from shifting federal priorities, economic downturns, or sudden policy changes—_scenario planning_ helps nonprofits prepare for a range of possible futures. Instead of waiting for a crisis to unfold, scenario planning prompts you to imagine multiple outcomes and proactively design responses. This practice moves your organization from _reaction_ to _anticipation_.
**Why Scenario Planning Matters**
1. **Preemptive Problem-Solving**
Rather than scrambling when a grant falls through or a funding freeze hits, you’ll have thought through contingencies in advance. This cuts down on panic-driven decisions and positions you to pivot more smoothly.
2. **Avoiding “Shock and Awe” Paralysis**
As noted earlier, unpredictable political climates often create a “shock and awe” effect. Confusion is heightened by mixed messages and abrupt policy shifts. Scenario planning offers a roadmap through the fog, so you’re less likely to get disoriented when things change overnight.
3. **Engaging Stakeholders**
Collaborative scenario planning can bring together staff, board, donors, and partners. Each group gains clarity on how potential disruptions might affect them—and what role they can play in a coordinated response.
4. **Enhancing Fund Development**
Fund development is inherently future-focused. By exploring scenario approaches now, you’ll be more charismatic when talking to donors about your readiness plans, and more credible if severe cuts (or surprising new funds) materialize.
**Reality Check:**Scenario planning doesn’t mean you _know_ the future. It means you’ve prepped for an array of outcomes—mild, moderate, and severe—so your next steps are never dictated by pure panic.
**Defining Your Scenarios**
Design scenarios that reflect different levels of impact, from minor disruptions to worst-case collapses of your major funding source. You can customize scenario categories to fit your organization’s unique context (e.g., local, state, or federal policy changes), but here’s a simple template:
1. **Best-Case / Mild Slowdown**
- Federal funding remains mostly intact—or is cut only slightly.
- Economic conditions are stable, with only minor dips in donations.
- Foundation and corporate grants continue, but become slightly more competitive.
- You have enough reserves or alternative funding to handle short-term hiccups.
2. **Moderate Disruption**
- Certain federal grants freeze or shrink significantly.
- The local economy slows, causing a notable drop in individual donations.
- Foundations move to invite-only processes, increasing your challenges in applying for new grants.
- Your reserves absorb short-term damage, but you’ll need quick pivots to stay afloat.
3. **Severe / Worst-Case**
- Major federal funding cuts occur, halting critical programs or staff positions.
- A recession hits, dramatically reducing private and corporate giving.
- Foundations enact strict or slow disbursements, leading to a backlog of proposals.
- You must either scale back programs drastically or quickly secure alternative revenues (e.g., fee-for-service or new philanthropic partners).
**Bridging to the Next Sections**
Completing your scenario plans will help you to prepare for deepening donor engagement and finalize contingency planning in following sections. As you proceed:
- Keep scenarios visible: Post them where team members can see triggers and responsibilities.
- Stay nimble: Policy changes can come in waves. Regularly review whether you’re nearing a moderate or severe scenario.
- Lean on community: Check in with local fundraisers, partner agencies, and professional associations. Shared observations or real-time data can help everyone gauge when (and how) to activate contingency measures.
Above all, scenario planning is not a one-and-done exercise. Revisit your assumptions as new information arises. If your local economy shifts dramatically, or if federal policies are enacted differently than expected, update your scenarios accordingly. This rolling approach is what keeps your organization agile—and able to do the real, necessary work of supporting people and communities even in turbulent times.
**4A Worksheet**
**Key Elements to Consider in Each Scenario**
1. **Program Impact**
- Which programs would you scale back, merge, or suspend if specific grants disappeared or were delayed?
- Do you have a _bare minimum_ level of service identified for each critical program?
2. **Staffing and HR**
- If you face funding shortfalls, which positions must remain to serve clients or maintain regulatory compliance?
- Could you shift full-time staff to part-time or contract roles temporarily without losing institutional knowledge?
3. **Financial Controls and Liquidity**
- How quickly can you tap into reserves or lines of credit if reimbursements or grant payments are frozen?
- Which expenses could be reduced or deferred (rent negotiations, software subscriptions, travel, etc.)?
4. **Donor Relations**
- How will you communicate urgent needs to your donors if moderate or severe cuts happen?
- Could you segment donor appeals to highlight different scenario triggers (e.g., “Immediate Support Needed” vs. “Safeguarding Our Programs Long-Term”)?
5. **Partnerships and Community Support**
- Which local or regional coalitions could you rely on (shared office space, joint lobbying, cost-sharing) if your primary funds evaporate?
- Are there resources in your community (in-kind or volunteer-based) that would be critical under a worst-case scenario?
6. **Timeline and Decision Triggers**
- At what point (e.g., X% drop in monthly revenue) do you implement moderate vs. severe contingency measures?
- Who is authorized to decide on budget cuts, staff reassignments, or collaboration opportunities?
**Tip**: Refer to previous sections on _Organizational Assessment_ (Section 2) and _Resource Mapping_ (Section 3) to quickly see which revenue streams and partnerships you can activate during each scenario.
**4.B Worksheet: Scenario Planning Matrix**
Use the table below (or a similar framework) to envision multiple futures and define clear action steps. Adjust the example rows as needed.
|**Scenario**|**Trigger (When This Happens)**|**Immediate Actions (First 30 Days)**|**Moderate Actions (30–90 Days)**|**Long-Term Actions (90+ Days)**|
|---|---|---|---|---|
|Best-Case / Mild Slowdown|||||
|Moderate Disruption|||||
|Severe / Worst-Case|||||
**Questions for Each Scenario:**
1. _How will we know we’ve moved from mild to moderate disruption (or from moderate to severe)?_
2. _Who in the organization is responsible for monitoring these changes?_
3. _What communication plans do we have in place for donors, clients, and staff at each stage?_
4. _Which resources identified in Section 3 (Resource Mapping) and which vulnerabilities noted in Section 2 (Organizational Assessment) come into play under each scenario?_
# 4.1 Individual Giving: Donor Engagement Strategies
“_While panicked people can be inspired to give, someone who is panicking can, at best, only make people feel obligated to give.” – June Eastham_
Genuine connection and stable relationships with donors require confidence, foresight, and personal connection, especially in turbulent times. This section helps guide you in developing a deeper, more adaptive donor engagement strategy that accounts for shifting economic realities, while still telling a compelling story about your impact.
**Why Donor Engagement Matters More Now**
1. **Aligning with donors’ lived realities**Donors are not immune to economic anxiety—especially mid- and low-level donors. Some may experience financial strain, while others may benefit from market changes. By empathetically tracking _why_ and _how_ donors give, you can tailor appeals that resonate without sounding alarmist.
2. **Inviting donors to co-create solutions**
This is another area where fundraisers act as a blood-brain barrier. You receive vital signals from donors and the community and carry those to organizational leadership. By treating donors as collaborators, you can gather insights to shape stronger programs and funding models.
3. **This is the end of the road**
There is no completely replacing federal funding, and as larger private grantors move to fill holes in critical, missing funding, leaving holes mid-size and smaller grantors will feel obligated to fill, leaving gaps where those smaller funders were investing their grant funds. Individuals are the only group that has the potential to fill those gaps. We must ensure that we make them partners in our success rather than shaking them down and increasing their generalized anxiety.
**Donor Segmentation: Meeting Donors Where They Are**
Segmenting donors is not just about donation amounts; it’s about understanding their capacity, motivations, and potential barriers to giving. Start with basic categories, then refine as you learn more:
- **By Giving History**: monthly givers, annual donors, major patrons, event-only supporters)
- **By Economic Level**: low/mid/high net worth, retirees, business owners)
- **By Demographics or Interests**: young professionals, parents, philanthropic families, socially conscious millennials)
- **By Engagement**: active volunteers, occasional participants, “arm’s length” donors)
- **By Geographic Region:** If you operate across the county or across multiple counties, donors want to hear about successes you are having in their own back yard
- **By Sector Engagement:** Community members who are on other boards, who volunteer at other organizations, who are involved in community organizing, etc. are highlighting themselves as active and engaged community members
Money continues to move up the economic ladder, which suggests that while lower- and middle-income donors might reduce their gifts, they may still want to make sure that they are part of something bigger than themselves. Volunteering or provision of surprising resources can easily increase during difficult times, so stay creative around community and donor engagement. There is even the possibility, with the right forms of publicity, that high-net-worth or corporate donors might see and financially support this increased capacity.
**When Donors Become Clients**
Some donors end up needing the very services they once helped fund. This often happens during recessions or personal crises. Respect donor/client confidentiality and, as development staff, let the donor take the lead on how they interact with you onsite.
**Messaging Adaptation: Tailoring Your Appeals**
Donor engagement thrives when your messages address real donor motivations and fears without descending into panic. Consider:
1. **Empathetic Acknowledgment:**
- Recognize that some donors might be downsizing or facing instability.
- Let them know you value them beyond their financial donations—ask about how they are doing, how they are being affected by the factors and challenges that your organization addresses.
2. **Positive Framing:**
- Emphasize resilience and the concrete ways your organization is succeeding.
- Share good news stories of program achievements, new collaborations, or thoughtful contingency plans, and especially, especially client success stories.
- Help donors to understand how their support is sustaining organizational success.
3. **Transparency & Honesty:**
- If federal funding cuts are imminent, be upfront about potential impacts to core services.
- Share organizational responses in a way that emphasizes how those changes are designed for organizational and program sustainability.
- Invite them to be part of your solutions, even when times are lean. You should not fake joy, but you must be confident in your work.
**Tip:** Customize these talking points with data from previous sections, such as program strengths, community resource mapping, new partnerships, and general information about contingency plants to show donors your proactive approach.
**Relationship-Building: Moving from Transactional to Transformational**
1. **Ongoing Communication:**
- We have relationships with our supporters, so remember the Gottman ratio of 5:1 for good to bad interactions between partners in successful relationships. Use newsletters, emails, and calls to share 85% good news about how you are changing lives, and up to 15% about how you are proactively preparing for crises and addressing challenges. This will establish and maintain your position as a sharer of good news. We all need good news very badly.
- Keep them informed about staff transitions, new strategic priorities, or vital cost-saving measures.
2. **Donor Involvement Opportunities:**
- **Site Visits & Virtual Tours**: Let donors see programs in action. If in-person visits are difficult, leverage virtual platforms to highlight staff, clients, and real-time impact.
- **Advisory Circles**: Invite committed donors to share thoughts on program expansions or contingency plans, especially when those things have components that are within their area of expertise. Their perspective can deepen their investment, and you can walk away with important perspectives.
- **Volunteer Engagement**: For mid- or lower-capacity donors, ask them directly why they appreciate the organization and what it is that holds their interst.
3. **Major Donor Cultivation:**
- Get the story about why your work is important to them.
- In times of federal uncertainty, present larger gifts as a core component of your organizational response, but not as the cure-all.
- Determine if they are interested in discussing models for establishing economic security and draw parallels between what they are expressing and your organizational strategy.
**Keeping an Eye on the Bigger Picture**
As you refine donor engagement strategies:
1. **Stay Alert to Local Indicators**
- Monitor local economic and population data.
- Maintain relationships with city officials, chambers of commerce, or business associations.
- Set your Google news filter to capture information or regularly check in via Perplexity.ai or other similar services. (See “Expanding Capacity for All This Work” for more information.)
2. **Collaborate with Fellow Fundraisers**
- Share best practices on how donors are responding to inflation, job losses, or policy shifts.
- Exchange leads on in-kind resources or corporate alliances that might benefit your community partnerships. We have the benefit of not playing a zero-sum game.
- Discuss fundraising best practices, ideas you had about another fundraiser’s organizational presentation, etc. Do it regularly. Have inter-organizational work friends.
3. **Champion Good News**
- In uncertain times, donors crave hope. Regularly highlight success stories, client achievements, or new resources discovered.
- Show supporters that despite challenges, your organization is moving forward with strategic resilience and community enhancement.
**Connection to Other Sections**:
- _Scenario Planning_ (Section 4) informs how you can tailor donor messaging to upcoming potential crises.
- _Resource Mapping_ (Section 3) can help you offer volunteer or partnership opportunities that go beyond financial gifts.
**Final Thoughts on Donor Engagement**
- **Lead with empathy**: Understand where donors are coming from, financially and emotionally.
- **Stay proactive**: Keep them updated with genuine stories of impact and need, rather than waiting for crises to appear.
- **Offer ways to help**: Sometimes donors can’t give money, but they can offer connections, expertise, or volunteer time.
- **Celebrate every form of support**: Even small gestures create bonds that can grow into something bigger when economic conditions improve.
**4.1A Worksheet**
**Donor Relations Analysis:
**
1. **Economic and Social Context**
- What economic factors currently influence our donors' ability or willingness to give (e.g., housing costs, inflation, job market volatility)?
- How do changes in donor demographics (e.g., aging donors, shifting population trends) impact our fundraising strategies?
2. **Donor Motivation & Engagement**
- What specific reasons motivate different donor segments to support us (emotional, social, personal values)?
- How clearly have we identified and responded to these motivations in our communications?
3. **Capacity and Giving Patterns**
- Do we track shifts in donor giving frequency and amounts relative to economic conditions or policy changes?
- Have we assessed how donors who paused or reduced giving during past economic downturns re-engaged afterward?
4. **Cultivation and Stewardship**
- How are we proactively deepening relationships with our most committed donors beyond financial giving (e.g., inviting them into strategic conversations, offering volunteer leadership roles)?
- Do we have clear indicators or "trigger points" that signal when a donor might be ready for an increased ask or alternative forms of engagement?
5. **Operational Readiness**
- Do we currently have the systems and staffing capacity to consistently personalize donor communications and engagement experiences?
- Are there systemic barriers (e.g., outdated donor databases, lack of staff training, inadequate internal communication) preventing effective donor stewardship?
6. **Risk & Opportunity Analysis**
- Which donor segments are most at risk of reduced giving during a recession or economic downturn, and how will we strategically address these risks?
- What donor segments or giving methods (e.g., planned giving, monthly donations, major gifts) present the greatest opportunities for growth or stability in turbulent times?
7. **Donor Clues**
- What characteristics about a donor are you able to pick up on that can provide clues about what motivates them to give and connects them to their community?
- How can you align what is important to different sorts of people with what is important to your organization?
- How do local or national economic trends affect each segment’s willingness or ability to give?
- Which outreach methods (in-person meetings, phone calls, newsletters, social media) are most effective for each segment?
- What forms of success should you be sharing with each segment?
- What are you doing to maintain relationships with donors who may temporarily be unable to give money?
**4.1B Worksheet Example**
**Donor Segmentation & Monitoring**
Use customized table or adapt it to your CRM system to track and revisit donor segments and organizationally-established pathways, noting where economic changes may affect each group and how those economic changes and challenges may necessitate changes to engagement strategies.
|**Donor Segment**|**Capacity Indicators**|**Engagement Level**|**Current Communication Focus**|**Potential Next Steps**|
|---|---|---|---|---|
|Example: Mid-Level Donor Retirees|Fixed incomes, always drinks plain coffee|Annual small gifts, occasional event attendance|Sharing success stories, emphasize return on community investment|Offer specialized volunteer opportunities|
|Example: High-Net-Worth|Business ownership, expensive cars|Attends fundraisers, opens e-newsletters|Personalized updates, site visits with leadership, learning about their community passions|Personalized experiences to demonstrate alignment with their community passions|
|Example: San Luis Obispo low-level recurring donors|Hospitality industry or medical administration work|Sporadic donations, social media followers|Show tangible, impact of services in their town, highlight how services uplift clients and change lives|Invite them to group tours, solicit insights about the community in regards to mission|
**4.1B Worksheet**
**Donor Segmentation & Monitoring**
|**Donor Segment**|**Capacity Indicators**|**Engagement Level**|**Current Communication Focus**|**Potential Next Steps**|
|---|---|---|---|---|
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**41.C Worksheet: Donor Stewardship & Upgrade Paths**
Use the following questions to develop a clear stewardship plan, ensuring each donor segment knows they are valued and has a reason to deepen their relationship with your organization.
1. **Current Stewardship Tactics**
- How do you typically thank donors (form letters, personal calls, public recognition)?
- What cues are you using to determine donor interests and priorities?
- Are you offering consistent, meaningful updates tied to each donor’s interests & location?
- How can you garner media attention for your work? (Compelling press releases can be very effective, and there are several smaller news outlets and even regional magazines.)
- What feedback loops exist so donors feel heard beyond their financial gift (mini-surveys via your texting system, roundtables, new-client referrals)?
2. **Upgrade Path Opportunities**
- What indicators do your donors present when they are interested in providing a higher level of support?
- How can you introduce the concept establishing a personal community legacy to donors who may develop interest in planned giving?
- How can you engage high-level donors to invest some level of personal effort in your organizational and/or fund development efforts?
- How can you retain the interest of first-time donors who give in response to a crisis?
3. **Enhancement Via Board Members**
- Were any of your board members introduced to the organization as donors? What inspired them to become donors, and what encouraged the growth of the relationship?
- How are individual board members interested in supporting fund development efforts?
- How can you cultivate a willingness among your board members to introduce you to people who are passionate about your sector?
4. **Measuring Success**
- What patterns do you see among your repeat/recurring donors, increased gift sizes, or newly referred donors?
- Do you regularly review open rates, email click-throughs, or event attendance for each segment, and if so, what patterns are you seeing?
- How much information do you have and how much have you been able to infer about donors that was not gleaned strictly from their donation data?
- How do/can you celebrate and acknowledge key donor milestones (like five years of consecutive giving)?
**4.1D Worksheet Example**
**Gift acknowledgement**
|**Donor/Segment**|**Stewardship Actions**|**Upgrade Path**|**Key Outcomes / Metrics**|
|---|---|---|---|
|Example: Repeat Donor (3-5 years)|Personal thank-you call from a board memberQuarterly program impact email|Introduce idea of planned giving or multi-year pledgeInvite to volunteer event|Donor renewals, gift size growthNumber of volunteer hours contributed|
|**Donor/Segment**|**Stewardship Actions**|**Upgrade Path**|**Key Outcomes / Metrics**|
|---|---|---|---|
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# 4.2 Private Foundations
**Why Focus on Private Foundations?**
Private foundations, whether family-led or institutionally structured, can offer more flexible support than government grants. Everyone working in development in 2020 witnessed this. Foundations also often have unique funding priorities based on their founders’ interests, geographic focus, or issue areas (e.g., education, health, environmental resilience). By cultivating relationships with private foundations, nonprofits can diversify their revenue streams and reduce the impact of volatility within government funding.
**Key Advantages:**
- **Flexibility**: Many private foundations can pivot quickly, adapting to regional needs in the nonprofit sector.
- **Mission Enhancement**: Foundations often have defined priority areas (e.g., arts, health, education) that match nonprofit missions more directly, and the are open to a wider variety of grantees, allowing mission enhancement rather than conforming to grant requirements. A well-informed private foundation application is designed to elicit program alignment with best practices. If you are new to grant funding, and you find yourself complaining about application requirements, there’s an excellent chance that you have gaps in your logic model.
- **Leverage**: Nothing attracts grant funding from any funder like pre-existing grant funding, and regional private foundations are where it starts.
**Challenges to Consider:**
- **Competitive Landscape**: Many nonprofits vie for a limited pool of foundation funding, and the competition will become more intense. How can you make your value proposition as compelling as possible within the context of your and the grantor’s field?
- **Funder and Potential Funder Requirements**: Some foundations have rigorous reporting or evaluation criteria; relationships can become transactional if not nurtured genuinely.
- **Do Not Be Lulled Into Complacency**: Application processes should be viewed as requiring meticulous responses, even when the application appears simple. Short character limits in application sections only increases this need. Demonstrate why your organization stands out in your sector and why your return on investment is so impressive.
**Best Practices and Strategies**
1. **Advance Research and Prioritization**
Identify foundations that explicitly align with your mission. Do your due diligence by reading the foundation’s 990-PF filings (available on sites like GuideStar or Candid) for clues on giving patterns, typical grant sizes, and board member affiliation. Review the board members profiles on LinkedIn or learn about their general interests via other online resources. Prioritize those that fund organizations in your geographical region or within your sector focus.
2. **Cultivate Personal Relationships**
Existing within the sector networking spaces and regional thought leadership spaces leads to organic personal relationships with foundation leadership. It can often be difficult to catalyze a relationship when you are strictly positioned as a potential-grantee/grantor, but if that is where you have to start, the only way to find out if you can start that relationship is to reach out. If that is what you end up doing, bring your A-game, and ask the smartest version of your questions that you can.
3. **Design Proposals to Demonstrate Impact**
Foundations increasingly lean on outcome data. Show how your strategies tackle root causes, fill gaps, or complement other community services. Incorporate “mission + sustainability” messaging, citing how your organization responds (or plans to respond) to federal funding hiccups. This transparency highlights your agility and commitment to lasting impact.
4. **Highlight Collaborative Efforts**
Foundations often look for synergy. If you collaborate with other nonprofits, mention these alliances. Foundations are likelier to invest in projects leveraging local networks—especially helpful when the aftermath of a federal grant pause calls for community-wide solutions.
5. **Present Tense**
Do not focus on what you will do. Discuss what you are doing right now, and highlight how it is an effective and fiscally conservative method in line with best practices and the highest level of client outcomes. Show them that you are already doing what their investment will support and only promise improvements that you are certain you can deliver.
6. **No Self-Judgement**
Keep value-laden adjectives and adverbs to an absolute minimum or eliminate them entirely. Use nouns and verbs that convey those values instead. This allows and encourages the reader to come to those value judgement themselves, which is far more impactful than proclaiming your own value.
7. **Keep it Organized**
Create an internal calendar for all major grant reports and applications, and share it with everyone involved internally. Work cross-departmentally to gather data on program successes, challenges, and external events such as COVID affected your work. We all need to be demonstrating that we are crisis resistant again.
8. **Maintain Clear, Transparent Communication.** Most funders want to know about program successes and setbacks, especially if they may impact outcomes. Inform them of major staff changes. Highlighting the lessons you’ve learned fosters trust, which could lead to multi-year or capacity-building grants. Do not expect them to provide solutions, but do value any insights that they provide. They may have a higher-level view than you.
**Risks and Concerns**
1. **Potentially Narrow Funding Priorities.** If a foundation’s interests shift away from your mission, funding may suddenly end. Mitigate this risk by nurturing a broad portfolio of foundation relationships and showing up in thought leadership spaces and in-person sector events.
2. **Reporting Burdens.** Foundations sometimes have very specific reporting requirements. Review these prior to submitting applications when that information is available, or when you receive your award notice. Make sure everyone who is responsible for reporting activities is made aware of all requirements. Document reporting requirements in a place accessible by everyone involved.
3. **Competition with Peers.** Foundations generally receive more qualified proposals than they can fund. Strengthening partnerships through clear alignment with foundation interests is crucial for standing out. Being known as stewards of community service enhancement in thought leadership spaces is even better.
**Opportunities for Future Readiness**
- **Scenario Planning for Foundation Shifts.** As foundations may change focus or leadership, keep lines of communication open, check their websites for changes as application windows approach. If you need to contact them about strategic changes, do it as soon as possible.
- **Co-Funding Collaborations.** Explore co-funding relationships where multiple foundations pool resources behind a common cause. This can offer a stable base of support less susceptible to a single opinion shift at the foundation level.
- **Pilot Funding.** Some foundations like to invest in pilot programs or innovative ideas. If federal grants are paused or threatened, a foundation might provide the seed capital to prove concept and scale. Review grants awarded on their PF990 or directly on Foundation Directory for a better understanding of their work. Be ready to publicize lessons learned after the pilot is over, in service of the sector.
**Possible Strategies**
- **Identify “Strategic Fit” Foundations.** Filter foundation prospects by alignment with your mission, geography, past funding history, and willingness to fund general operations. You should not have any reservations about being an appropriate fit. Foundations do not fund organizations that nearly meet their criteria.
- **Keep a Dynamic Application Library.** Calling it boilerplate is a disservice if you let it lull you into thinking that the language is static. Make sure you are keeping track of your best proposals and that you understand why they are good. If you never get so excited about a proposal that you send it to coworkers to help them with how they present the organization to the public, then is it realistic to think that funders are getting excited about your proposals?
- **Maintain Ongoing Stewardship.** Even when you’re not in an active grant cycle, keep foundations updated via newsletter, personal emails, or short one-page impact snapshots. Send thank you notes, even when you receive a denial. Using branded notecards or stationary is best.
- **Leverage Board Connections.** Ask board members if they can introduce you to foundation trustees or program officers. Authentic personal connections often expedite trust and collaboration with foundations.
**Organizational Landscape Analysis**
Which foundations currently fund our mission area? Are we effectively cultivating relationships with them?
1. Where are we showing up in the community to share best practices and success?
2. Where are we showing up and where are we displaying our work where investment stakeholders such as foundation board members are likely to visit?
**4.2A Worksheet**
**Interpreting a foundation’s 990**
Note that Community Foundations submit a different version of the 990, which is also available via Guidestar/Candid.
**Pivot Data Locations in the 990PF**
1. **Line 12 (Total Revenue)**
- **Amount:**
- Shows the year’s overall incoming funds. Comparing this with Line 18 (Expenses) reveals if the organization is operating in surplus or deficit.
2. **Line 18 (Total Expenses)**
- **Amount:**
- Summarizes spending across all functions. A jump in expenses relative to revenue may lower net assets (Line 22) or even create a deficit (Line 19).
3. **Line 19 (Revenue Less Expenses)**
- **Amount:**
- Indicates surplus (positive balance) or deficit (negative balance). This directly affects changes in net assets on Line 22.
4. **Line 22 (Net Assets or Fund Balances)**
- **Amount**
- Measures the nonprofit’s accumulated wealth. An increase or decrease here stems from how surplus/deficit (Line 19) adds to or drains overall resources.
5. **Part VII** **Section A, Line 2 (Compensation of Five Highest-Paid Employees)**
- Highlights leadership pay. Compare high salaries here with total expenses in Part I to see if compensation takes a disproportionate share of the budget.
6. **Part VIII** **Statement of Revenue**
- Breaks down the sources of the total revenue appearing on Part I, Line 12. A heavy reliance on a single source (e.g., grants) can pose risk if that source diminishes.
7. **Part IX** **Statement of Functional Expenses**
- Details how total expenses (Part I, Line 18) are allocated among program, management, and fundraising. A higher program spending ratio often signals mission-focused use of resources.
8. **Part X** **Balance Sheet**
- Corresponds to net assets from Part I, Line 22, by listing assets and liabilities. Indicates liquidity, debt, and overall financial health at year’s end.
9. **Part XII Financial Statements and Reporting –**
- If the organization uses accrual accounting (vs. cash basis), expenses, liabilities, and net assets in Part I and X may include amounts not yet paid or received, affecting how surpluses or deficits appear.
**Relationally of Pivot Points**
1. **If Part I, line 12, Total Revenue, is less than line 18 ,Total Expenses,, then** line 19, Revenue Less Expenses, shows a deficit, meaning that they are having difficulty with their investments and/or they are investing a lot of grant funding.
2. **If line 19 is consistently negative, then** Part X (Balance Sheet) net assets shrink over time, hinting at financial strain.
3. **If Part VII, Section A, line 2 , Compensation of Five Highest-Paid Employees, is unusually high, then** someone is getting paid well to work there. They have a lot of influence. Do you have an organic connection to them? Their name is listed in the section where the foundation reports their five highest paid officers and employees.
4. **If Part VIII , Statement of Revenue, reveals dependency on a single source, then** fluctuations in that source can dramatically affect their financial health.
5. **If Part X , Balance Sheet, shows rising liabilities relative to assets, then** it is draining their ability to provide grant funding and negating the benefit of their investments.
| | |
|---|---|
|**4.2B Worksheet**
**Current Connections & Opportunity Development**| |
|||
|**1. Current Touchpoints**| |
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|**Goal:** Evaluate your existing relationships and professional overlaps to identify where you can strengthen or expand foundation engagement.| |
|||
|**Question/Prompt**|**Your Responses**|
|**Board Member Relationships**||
|Which board members have personal or professional connections with private foundations?|
|How can you leverage these connections to begin meaningful conversations?||
|**Professional Network Overlaps**||
|Do staff or leadership belong to associations or networks that include foundation staff or trustees?|
|Can you deepen these relationships through events or committee work?||
|**Previous Grant Partnerships**||
|Which foundations have funded you in the past, and what aspects of your project did they value?|
|How can you re-engage them for a new initiative or renewal?||
|**Shared Community Initiatives**||
|Are you collaborating on any local coalitions or working groups that a foundation is supporting?|
|How can you highlight these shared efforts to approach the foundation?||
|**2. Opportunity Development**| |
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|**Goal:** Identify fresh engagement points and venues to expand your visibility and reputation among private foundations.| |
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|**Opportunity**|**Potential Actions/Next Steps**|
|**Industry Conferences & Events**||
|Which upcoming events align with your mission focus or foundation interests?|
|**Local Philanthropic Gatherings**||
|Are there donor salons, regional gatherings, or philanthropic councils you can attend or speak at?|
|**Professional Association Meetings**||
|Which associations (e.g., state nonprofit associations, national fundraising groups) could connect you to key foundation contacts?|
|**Community Leadership Forums**||
|How can you participate or co-host to spotlight your mission among foundation leaders?|
|**Academic Partnerships**||
|Which university departments align with your service delivery focus?|
|Could publishing or collaborating with them raise your profile with foundations?||
|**Peer-Reviewed Journals / Media**||
|Where can you share new research, best practices, or innovative outcomes to position yourself as a field leader?|
| | | | | |
|---|---|---|---|---|
|**4.2C Worksheet**
**Strategic Communications & Implementation**| | | | |
||||||
|**3. Strategic Communications Framework**| | | | |
||||||
|**Goal:** Strengthen your thought leadership to create visibility among foundation audiences. Pick the communication channels and content formats most relevant to your organization.| | | | |
||||||
|**Content Type**|**Planned Topic/Theme**|**Target Audience/Channel**|**Lead/Owner**|**Timeline**|
|White Papers / Program Innovations|||||
|Case Studies / Impact Stories|||||
|Program Outcome Reports|||||
|Policy Briefs on Community Needs|||||
**Reflection Questions:**
1. Which content pieces do you already have that can be repurposed for foundation audiences?
2. Which topics are most compelling in light of current foundation priorities (e.g., equity, sustainability, innovation)?
| | | | | |
|---|---|---|---|---|
|**4.2D Media & Distribution Channels**| | | | |
||||||
|**Goal:** Map out high-level donor channels (including local media) where you’ll share your thought-leadership content.| | | | |
||||||
|**Channel**|**Target Audience**|**Key Message / Angle**|**Project Owner**|**Frequency/Trigger**|
|Industry Publications|||||
|Business Journals|||||
|Professional Association Newsletters|||||
|Social Media Platforms|||||
|Local News Outlets / Community Newsletters|||||
| | | | | | |
|---|---|---|---|---|---|
|**4.2E Timeline for Implementation**| | | | | |
|||||||
|**Goal:** Break down your plan into actionable phases, ensuring you steadily build visibility and relationships with foundations.| | | | | |
|**Phase & Timeframe**|**Timeframe**|**Key Actions**|**Project Owner**|**Goals & Milestones**|**Notes/Status**|
|- Assess current foundation relationships||||||
|- Map communication channels||||||
|- Begin monitoring 990s||||||
|- Document program outcomes||||||
|- Develop thought leadership content||||||
|- Strengthen existing relationships||||||
|- Identify new engagement opportunities||||||
|- Build media presence||||||
|- Establish regular communication presence||||||
|- Cultivate new foundation relationships||||||
|- Position for invite-only opportunities||||||
|- Build program sustainability evidence||||||
| | |
|---|---|
|**4.2E Worksheet**
**Worksheet A: Current Connections & Opportunity Development**| |
|||
|**1. Current Touchpoints**| |
|||
|**Goal:** Evaluate your existing relationships and professional overlaps to identify where you can strengthen or expand foundation engagement.| |
|||
|**Question/Prompt**|**Your Responses**|
|**Board Member Relationships**||
|Which board members have personal or professional connections with private foundations?|
|How can you leverage these connections to begin meaningful conversations?||
|**Professional Network Overlaps**||
|Do staff or leadership belong to associations or networks that include foundation staff or trustees?|
|Can you deepen these relationships through events or committee work?||
|**Previous Grant Partnerships**||
|Which foundations have funded you in the past, and what aspects of your project did they value?|
|How can you re-engage them for a new initiative or renewal?||
|**Shared Community Initiatives**||
|Are you collaborating on any local coalitions or working groups that a foundation is supporting?|
|How can you highlight these shared efforts to approach the foundation?||
**4.2F Worksheet**
| | |
|---|---|
|**2. Opportunity Development**| |
|||
|**Goal:** Identify fresh engagement points and venues to expand your visibility and reputation among private foundations.| |
|||
|**Opportunity**|**Potential Actions/Next Steps**|
|**Industry Conferences & Events**||
|Which upcoming events align with your mission focus or foundation interests?|
|**Local Philanthropic Gatherings**||
|Are there donor salons, regional gatherings, or philanthropic councils you can attend or speak at?|
|**Professional Association Meetings**||
|Which associations (e.g., state nonprofit associations, national fundraising groups) could connect you to key foundation contacts?|
|**Community Leadership Forums**||
|How can you participate or co-host to spotlight your mission among foundation leaders?|
|**Academic Partnerships**||
|Which university departments align with your service delivery focus?|
|Could publishing or collaborating with them raise your profile with foundations?||
|**Peer-Reviewed Journals / Media**||
|Where can you share new research, best practices, or innovative outcomes to position yourself as a field leader?|
# 4.3 Corporate Donors and Grantors
**Why Focus on Corporate Partnerships?**
Corporate donors and corporate foundations can be another powerful source of diversified funding. In addition to direct grants, businesses may provide in-kind donations of goods or services, sponsorships for events, pro bono expertise, and employee matching gift programs. During federal uncertainty, partnerships with socially responsible corporations can fill financial gaps and bring new audiences to your mission.
**Why Corporate Donors?**
Corporate grantors, corporate-sponsored foundations, and philanthropic arms can offer robust funding opportunities. Beyond straightforward donations, corporations may also provide in-kind gifts, volunteer support, and brand visibility. During periods of federal uncertainty, corporations often seek high-impact partnerships that showcase social responsibility—a chance for nonprofits to step forward with agile, mission-aligned initiatives.
**Key Advantages:**
- **Potential for Sponsorships**: Companies with marketing budgets can sponsor events, campaigns, or programs, giving them brand exposure while fueling your work.
- **Public-Private Partnerships**: Aligning with a corporation can open workforce development pathways, spark high-impact pilot projects, and provide larger sums of money for projects that may not be as appealing to private foundations.
- **Fabulous for Economic Development Projects**: Are you doing successful Economic Development Work? Congratuluations, every type of funder discussed in this text already loves you, especially corporate donors.
**Challenges to Consider:**
- **Brand Alignment**: Partnerships can raise ethical questions if a corporate sponsor’s track record conflicts with your mission or values.
- **Timing & Budget Cycles**: Corporations routinely plan philanthropic budgets 6-12 months in advance, so it may take time to secure large gifts or multi-year support.
- **Expectations of Visibility**: Corporations often expect recognition, media mentions, or event invitations; nonprofits must balance mission-forward storytelling with sponsor spotlights.
- **Actually Usually Donations**: Corporations typically award what is legally a corporate donation. If you cannot find their foundation listed on Candid/GuideStar, then they are not technically giving a grant, although the process is identical during the application process, and they may also expect the same forms of reporting.
- **Corporate Donations and Even Grants from Corporate-Subsidiary Foundations Operate Under Different Priorities:** Their top priority is, almost universally, to be seen as enhancing the public space in which the corporation does business. You will have the most success if you approach the proposal as a public relations project for them, and you must remain mission-focused for your own organization. Banks have a slightly different approach, as the Community Reinvestment Act (CRA) guidelines reward banks for funding local financial education and community and economic development projects.
**Best Practices and an Agile Framework**
1. **Align Missions and Brand Values.** Corporations look for nonprofit partners that align with their brands or resonate with their employees and customers. Demonstrate how your nonprofit’s impact serves the same communities or values that the corporation targets, but do not give in to the mission creep.
2. **Offer Multiple Engagement Pathways.** Beyond writing a “check,” many companies want staff volunteer opportunities, event sponsorships, or cause-marketing campaigns. Provide a menu of collaboration ideas—from co-hosted volunteer days to specialized program sponsorship.
3. **Focus on Relationship-Building, Not Just Transactions.** When a corporate partner feels appreciated, sees tangible impact, and they are funding a highly publicized or visible program there’s a higher likelihood of multi-year renewals. Give regular updates, invite corporate staff to site visits, and publicly acknowledge their contributions. The more your program is in the public eye, and theirs, the better.
4. **Stay Flexible to Corporate Timelines.** Corporate donations and grants are on timelines that vary as much as any foundation’s. If you are speaking with someone face to face for your solicitation, this can often mean you will get a faster decision. If you are completing an application, you are typically looking at a minimum three-month waiting period. One exception is event sponsorships, but let’s be honest, giving them more time for sponsorship decisions is best practice.
5. **Prepare for Shifts in Corporate Priorities.** Mergers, acquisitions, or changes in leadership can realign corporate giving priorities overnight. By cultivating a wide network of corporate partnerships and getting to know folks at their business besides the corporate community responsibility representative, you’ll be better prepared if that representative leaves or if their corporate community responsibility focus shifts.
**Best Practices and Strategies**
1. **Target Strategic Partnerships**
Seek corporations operating in your local region or industry sector with natural ties to your mission. For instance, a food bank might partner with grocery chains, while an environmental nonprofit could work with renewable energy companies, and a housing provider might work with banks and construction companies.
2. **Speak Their Language**
Highlight how the partnership can advance the corporation’s goals. What you do with the program they fund becomes a reflection of their values, so make sure that reflection will be seen by many. And make sure that there is genuine alignment between your mission and theirs—just like we do with individual donors’ personal motivations and or organization’s impact.
3. **Sustainability & Impact Emphasis**
As corporations are increasingly mindful of Environmental, Social, and Governance (ESG) factors, illustrate how your nonprofit meets ESG criteria. Show your programs’ measurable outcomes—like how many families you assist or how effectively you scale solutions if a federal funding freeze hits, and how you have community representation on your board.
4. **Offer Visibility While Preserving Mission Integrity**
Be transparent about how you’ll recognize corporate contributions. This might include featuring logos on your website, acknowledging the corporation at public events, or highlighting them in an annual report. Keep an internal policy on brand alignment so you don’t compromise your values or messaging, and also remember that the level of exposure you provide has added value due to “the halo effect.”
5. **Nurture Long-Term Relationships**
Before making a big corporate pitch, build rapport. If they see you in the community, it demonstrates that, at large, you are seen in the community. Highlight ways that you are promoting your work for public awareness. Discuss your organizational partnerships and highlight their value. Through corporate donations they are philosophically investing in a share of your reputation, which is, once again, “the halo effect.”
**Risks and Concerns**
1. **Reputational Misalignment.** Aligning with a corporation that doesn’t share your values can disappoint donors or staff, especially if controversy arises. Do your due diligence to ensure a values match, and use perplexity.ai to search “[business name] controversy.”
2. **Conditional or Restrictive Sponsorships.** Some corporations may want to shape your messaging or require frequent brand mentions or marketing tie-ins. Establish clear guidelines upfront to protect your nonprofit’s integrity, and recognize that the reach of every mention impacts the monetary value of what they are requesting and also ties your own reputation more closely to theirs.
3. **Short-Term Engagement.** Corporate giving is much like individual giving can sometimes be promotional or transactional—like a one-off event sponsorship. Unless cultivated further, it may not translate into a steady funding stream. No matter the form of giving, never forget that you are actually dealing with human at the other end.
**Opportunities for Future Readiness**
- **Employee Engagement Programs.** Many companies are open to matching gifts or volunteer hour matching. These require more work than one might expect, but it is also an opportunity to cultivate a whole pocket of individual donors.
- **Innovation or Technology Partnerships.** In a climate of decreasing federal grants, watch for shifting priorities among corporations at large and tech companies in particular. There will likely be brand new opportunities for in-kind donations, as businesses look for ways to be seen filling gaps from disappeared government funding with their surplus or stock.
- **Stay Open to Creative Ideas.** As longer-term corporate relationships are established, unique opportunities may arise. Ponder what your corporate representative tells you, and and be creative with your response.
**Landscape Position Assessment**
1. Which corporations—even local small businesses—naturally align with our mission or beneficiary community?
2. Do we have a clear corporate partnership package that reflects a corporate partnership policy that articulates engagement levels and benefits (e.g., volunteer day vs. annual sponsorship vs. licensing agreement)? You can ad hoc it for a bit, but if you have much success, you need to establish a policy.
3. Which staff or board contacts have strong ties to potential corporate partners? Are they willing to make introductions?
4. Is our organization equipped to track corporate gift restrictions, brand usage guidelines, or complex multi-year sponsorships?
**4.3A Worksheet**
**Corporate Sponsor Mapping**
1. **Industry Relevance**
- _Which local/national corporations have a natural synergy with your mission?_
- _Are there major employers in your community seeking staff engagement in social causes?_
2. **Value Proposition**
- _What can your nonprofit offer in terms of branding or volunteer engagements (mentoring, skill shares)?_
- _How do these align with the corporation’s stated philanthropic or marketing objectives?_
3. **Risk vs. Reward**
- _Does the corporation’s brand align comfortably with your core values?_
- _What public scrutiny might arise from this partnership? Are you prepared to address it?_
4. **Logistical Readiness**
- _Who on your team handles corporate relationship management?_
- _How will you track employee volunteer hours or in-kind product/service donations?_
Use this mapping to determine your top priority partners and plan a schedule for outreach, presentations, or relationship-building activities.
| | | | | | |
|---|---|---|---|---|---|
|**4.3B Worksheet**
**Corporate Sponsorship Action Steps**| | | | | |
|||||||
|**1. Create a Corporate Prospect List**| | ||||
|Provide a score of 1-10 for each| |||||
|**Company Name**|**Mission Alignment**|**Business Size/Value**|**Philanthropic Track Record**|**Total Score**|**Priority Ranking**|
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|**Notes on potential connections/existing relationships:**| | ||||
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|| | | | | |
**4.3C Worksheet**
| | | | | | |
|---|---|---|---|---|---|
|**2. Develop Tailored Proposals**| | | | | |
|For each priority company, brainstorm creative engagement opportunities.| | | |||
|**Company**|**Program of Interest**|**Mission Alignment Program Comonents**|**Existing Program Public Awareness Efforts to Highlight**|**Where Will You Interface with Rep**| |
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4.3D Worksheet
| | | | |
|---|---|---|---|
|**3. Set Clear Visibility Guidelines**| | | |
|Set a dollar amount that triggers each benefit. Ensur review by appropriate leadership.| | | |
|**Recognition Type**|**Social Media**|**Minimum Sponsorship Level**|**Special Considerations**|
|Logo on website||||
|Event signage & size||||
|Social media||||
|Press release||||
|Annual report||||
|Speaking opportunity||||
| | | | | |
|---|---|---|---|---|
|**4. Follow-Up & Stewardship Plan**| | | | |
|**Sponsor**|**Key Contact**|**Update Frequency**|**Communication Methods**|**Success Metrics to Share**|
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|**Contingency Planning:** What crises will trigger discussion of the challenge with corporate sponsors? (Delays in federal grant reimbursements, etc?)| | | | |
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# 4.4 Federal Grants
**We Don’t Know What We Don’t Know**
The federal funding landscape remains both essential and unpredictable. Although federal grants have historically provided vital resources for core, and it would be comforting if we could count on the federal government to continue supporting the core programs that are so heavily relied upon in the states where the current administration received voter support, we all know that anything can happen.
Given that sweeping changes have not historically been enacted by this administration through direct congressional action from 2017-2020, it is difficult to predict precisely how future funding decisions will unfold. We have a new congressional body providing higher levels of support to the administration, and so much will depend on congressional budget deliberations. Despite the unpredictability, nonprofits are wise to continue pursuing federal dollars: it is challenging to fully replace that scale of funding through private sources, no matter how diversified your portfolio.
**In the end, there are really three sets of possibilities for which one must prepare:**
1. **Demand for services will either go up or down.**
2. **Individual human services grant programs will increase, decrease, or disappear, triggering various responses from other private-sector funders.**
3. **Federal payments will either be delayed or miracles will happen.**
Generally, a grant program is generally funded by the federal government once the contract is executed, 2 CFR §200.340 provides legal grounds for discontinuation of a federal grant, assuming language supporting this federal right is included in the grant agreement:
_The Federal award may be terminated in part or its entirety as follows… By the Federal agency or pass-through entity pursuant to the terms and conditions of the Federal award, including, to the extent authorized by law, if an award no longer effectuates the program goals or agency priorities._
This provision would apply in situations where:
1. Program priorities have changed due to budget constraints
2. Funding has been reduced or eliminated for the program
3. The agency can no longer support the award financially
In this environment, nonprofits can adopt a cautious yet proactive approach. This section equips you to strengthen your internal capacity, submit strong proposals, manage federal grants effectively, and plan for sudden shifts in policy—whether they come from executive orders, administrative slowdown, agency-level changes, or disruptive political events.
**Pre-Submission Readiness**
Strong federal grant applications rarely happen by accident. They require internal alignment, capacity building, and a clear view of mission fit. While we can’t eliminate all uncertainties surrounding federal dollars, we can shape the way we approach them.
_Building Internal Capacity_
Every federal funding opportunity comes with detailed compliance requirements and a layered application process. Your organization will need to identify a staff member with the authority to allocate pre-award work. If you lack in-house expertise, you may consider hiring a grant writer or collaborating with a consultant, but this also indicates that you should stop and carefully consider whether you are prepared for federal award management, including a review of your data collection and data storage systems.
_**Federal Grant Seeking Beginner’s Pipeline**_
1. SAM.gov (UEI assignment)
2. Ensure completion of annual SAM renewal, and put it on your grants calendar
3. Grants.gov registration and role assignments
4. Grants.gov award notification sign-up and filter setup
5. Research compliance requirements for your aligned federal agencies
6. If you feel certain that you will receive federal funding, it can be worth your time to pursue an indirect cost rate agreement _from the agency that you are certain will initially provide you with the most federal funding_ before receiving an award. Otherwise, you will be stuck with the currently 10-15% de minimis rate for the first 4-6 months of the award while your indirect rate is negotiated. With the average indirect rate at about 28%, and with a modest federal award of $300,000 per year, a new grantee could lose out on $13,000 to $19,500 waiting 4 to 6 months for the finalization of their indirect rate, and it takes an estimated 60-120 person hours to complete the process.
7. Research historical grant mechanisms at [https://sam.gov/assistance-listings](https://sam.gov/assistance-listings), find potential funding mechanisms, utilize perplexity.ai to determine whether this was a one-time program. (See “Expanding capacity for All This Work” section for information about language AI systems such as Perplexity.) After the next federal budget is signed, review funding for your prospective grants agencies and/or contact grant representatives to find out if funding was renewed for the program. If it was, watch and wait for the funding announcement while you extensively research the previous NOFA.
_Cross-Department Collaboration_
Federal grant proposals bring together program developers, finance personnel, leadership, and even community partners. An internal grant-readiness discussion is key, as federal funding will impact everyone from the ED to the administration team. Does your finance staff have experience and capacity for dealing with cost-reimbursement contracts and indirect cost rates? Can your program team capture and articulate outcomes in language aligned with federal priorities? Ensuring each department understands its role early, thanks to your in-depth historical NOFA research in point 7, above, reduces last-minute chaos, improves overall compliance, and results in more compelling and accurate proposals.
_Partnering for Stronger Applications_
Complex, large-scale federal initiatives often favor or require collaborations among multiple agencies. Joint projects may demonstrate greater community impact and cost-effectiveness, which are vital components in many federal grant programs. Partnerships with other nonprofits, universities, or local government agencies can also distribute workload and broaden your program’s reach. When done well, these collaborations highlight a unified effort to address community problems, offering a powerful narrative to federal reviewers and a powerful network for local systems change. See the subsection on consortiums in the “Networks of Support” section to see information that highlights the levels of coordination that can be required under federal grants.
**Reflection Questions:**
- What internal resources are dedicated to federal grants, and how can you expand or strengthen them should compliance become more complex?
- In what ways can different departments collaborate improve collaboration?
- Are there natural partners whose missions align closely with yours and who could help you meet federal grant requirements? Do you already have strong inter-organizational relationships?
**Proposal Fine Points**
Being fully prepared for a federal grant proposal process as varied as the proposals themselves. We are not capable of providing a full breakdown of federal proposal preparation here any more than a book will give a full and complete accounting of securities investments forecasting. However, we will cover some of the finer but more critical points below.
For individual federal grants, utilization of AI Large Language Models (LLMs) is highly recommended as it will save tens of hours of staff time. Request breakdowns of the NFOA one section at a time, not all at once. As of this writing, ChatGPT o1, which is only available to paid subscribers, or DeepSeek services, with DeepSeek only available for free and only suitable for public and non-proprietary information processing, are the recommended LLMs for large-document review. Do not enter confidential or private information into AI systems at large.
_The Devil is In the Formatting and Application Portal Details_
Federal agencies impose strict rules about proposal length, font size, submission portals, submission portal registration requirements, content organization and much more. You will need to create a list of these requirement for seemingly trivial aspects of application formatting and submission.
_Aligning with Federal Priorities_
Every federal grant announcement reflects the agency’s strategic goals, but even more so the authorizing legislation. They also typically link to a glossary or some form of terminology list. Just as we must include the exact language of job ads in resumes, we must use the glossary terminology in federal proposals. What’s more, we must adhere strictly to the definitions set out for the glossary terminology in our proposal. Prepare a visual logic model, complete with any required evidence of best practices, at the beginning of the program design process.
_Budget Structures & Match Requirements_
Federal agencies are meticulous about budgets. If a person is not qualified to confidently assemble a budget, then it is a disservice to the organization for them to assemble a federal proposal budget. If contracting services must be sought out for federal application completion, then it is likely necessary to retain contracting services for the duration of any grant period for the execution of grant management. If that is the case, you must secure MOUs beforehand or else take on the risk of the organization having to cover a portion of contracting costs itself if budget estimates fall short of actual costs.
_Common Pitfalls_
Many federal proposals become tangled by overcomplicating the project scope or service model, providing insufficient data or references, or ignoring specific formatting requirements. If you are severely altering program models for a proposal, everyone involved should think deeply about how it will affect capacity, mission attainment/creep.
**Reflection Questions:**
How can your narrative balance compelling storytelling that engages reviewers with the evidence-driven focus that federal agencies require? Do you have a process to carefully check for compliance in the grant management phase? Is your logic model clear to everyone involved, and does it address the specifics of how you will accomplish the funding agency’s goals using evidence-based best practices?
**Navigating Uncertainty & Policy Shifts**
Although federal court rulings have checked certain executive orders and administrative memos, nonprofits remain susceptible to pauses, delays, or sudden changes in disbursement schedules. Planning ahead mitigates the damage that such disruptions can cause.
_Contingency Planning_
Ask what would happen if a major federal grant were frozen or delayed. Would your program’s services be forced to pause, or do you have sufficient reserves or bridging funds to weather short-term gaps? Proactively exploring short-term financing (like a line of credit) or philanthropic emergency funds can help you ride out unexpected storms. Have internal “trigger points” that signal when you need to shift from normal operations to emergency measures.
_Legal Protections_
Federal funding uncertainty can stem from unilateral executive action or from new administrative guidance that places a hold on certain program areas. You can consult legal experts or nonprofit coalitions if you observe valid contractual breaches or potential infringements on congressional appropriations authority. Coalitions acting collectively may file injunctions if they see an overreach—just as some did to challenge the funding freeze. Often, robust partnerships amplify your organizational power to speak up or seek legal recourse when necessary.
_Adapting or Repurposing Programs_
When the environment shifts, you might repurpose resources to maintain core services. That might mean limiting certain peripheral activities while focusing on high-priority elements of your mission. Keeping donors, partners, and constituents informed of such actions can generate greater community support during turbulent times.
**Reflection Questions:**
What reserves or alternative funds could be activated if a major federal grant paused tomorrow? Do you have established relationships with legal advisors or networks of nonprofits that could respond collectively to challenges? Are there ways to re-scope your funded programs so they remain viable should funds abruptly decline?
**Putting It All Together**
While federal grants are not the only piece of a sustainability puzzle, they often provide substantial, mission-critical funding that can stabilize or expand core programs. Maintaining a strategic, proactive approach that accounts for payment delays is critical for being a part of federal funding right now, as is a high level of risk that your program may lose the majority of its funding next year. You can integrate your federal grants plan with your approach to individual donors, private foundations, and corporate sponsors—ensuring you don’t place all your eggs in one basket. If the federal environment shifts, a well-diversified mix of support can help you adjust your programs without compromising your mission.
Building the capacity to handle the complexity of federal dollars also pushes your organization to new levels of professionalism. Each compliance lesson, each collaboration, and each funding cycle helps hone your strategic focus. Even amid the uncertainty of changing administrations and potential legal battles over funding freezes, nonprofits that stay prepared—legally, financially, and operationally—can pivot faster and continue meeting vital community needs.
**4.4 A Worksheet**
Evaluating Potential Federal Funding for Organizations Not Yet Receiving Federal Funding
| | |
|---|---|
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|**Purpose:** Help you decide whether seeking federal dollars is worth the effort, given your mission, capacity, and risk tolerance.| |
|||
|**A. Mission & Strategic Fit**| |
|**Question**|**Your Notes / Responses**|
|1. Which of our programs align strongly with federal priorities (e.g., health, education)?||
|2. If we secured federal funds, how would this deepen or distract from our core mission?||
|3. Are there federal agencies or programs (e.g., USDA, HUD, HHS) that naturally support work like ours? List them here.||
|4. When these federal agencies release NOFAs, does the NOFA list scoring and eligibility criteria for which we are competitively positioned? (Are they looking for direct service providers, looking for organizations with reach that aligns with your own, etc.) See "Expanding Capacity for All This Work" for information on expediting historical NOFA summaries via AI."||
**4.4B Worksheet**
**For Organization Not Yet Receiving Federal Funding**
| | |
|---|---|
|**B. Internal Capacity & Readiness for Initiating Federal Grant Searches**| |
|**Question**|**Your Notes / Responses**|
|1. Do we have (or can we build) the expertise to handle the complexity of federal grants?||
|2. Who on staff can lead compliance (OMB Uniform Guidance, cost principles) and reporting?||
|3. Do our data collection and financial systems track outcomes and restricted funds properly?||
|4. In what ways are we capable of formally collaborating with experienced partners (e.g., another nonprofit, consultant) who are capable of maintaining federal grant reporting requirements?||
|5. Do we have access to or are we in posession of resources to address the challenge of inevitable funding reimbursement delays, and if so what are they? (Lines of credit, operating reserve, etc.)||
**4.4C Worksheet**
**For Organization Not Yet Receiving Federal Funding**
| | |
|---|---|
|**C. Financial Impact & Match Requirements**| |
|**Question**|**Your Notes / Responses**|
|1. How large a percentage of our overall budget would federal grants realistically cover?||
|2. Is there a matching funds requirement, and can we reliably provide the match (cash or in-kind)?||
|3. If reimbursable, do we have reserves or lines of credit to cover cash flow gaps?||
|4. Which existing revenue streams might be at risk if we shift focus to a federal project (donor fatigue, mission drift)?||
**4.4D Worksheet**
**Not Yet Receiving Federal Funding**
| | |
|---|---|
|**D. Risk & Opportunity Analysis**| |
|||
|**Question**|**Your Notes / Responses**|
|1. Have we reviewed the volatility of this particular grant program in past years (e.g., abrupt freezes)?||
|2. If federal priorities shift mid-grant, how quickly can we pivot or absorb cuts?||
|3. Does the program require a multi-year commitment that could strain our resources?||
|4. Are there other local nonprofits or agencies we could partner with to share risk and strengthen our bid?||
**4.4E Worksheet**
**Not Yet Receiving Federal Funding**
| | |
|---|---|
|**E. Decision Point & Next Steps**| |
|**Question**|**Answer / Action Item**|
|1. Based on all factors, do we want to begin pursuing federal funding this year?|Yes / No / Revisit|
|2. If we decide **not** to pursue federal grants, how else might we strengthen and diversify our funding?||
|3. Which departments/staff must be looped in immediately if we move forward?||
|4. Are there specific deadlines or RFPs we should start tracking right away?||
**4.4E Worksheet**
**For Orgs Already Receiving Federal Funding**
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|---|---|---|---|---|---|
|**Purpose:** Provide a clear compliance, risk, and scenario-planning checklist so you stay ready for policy shifts or potential cutbacks.| | | | | |
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|**A. Current Federal Awards Overview**| | | |||
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|**Grant / Agency**|**Award Amount**|**Program Funded**| |**Contract Type (Reimb. / Upfront)**|**Expiration / Renewal Date**|
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|**Key Questions:**| |||||
|1. Which awards are up for renewal this year?| | || | |
|2. What is current federal rhetoric around the funding agency?| | || | |
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|3. What is our plan in the event of delayed payments and reimbursements?| | || | |
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|4. What does our grant agreement and federal legislation say about delayed reimbursements?| | || | |
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**4.4F Worksheet**
**For Orgs Already Receiving Federal Funding**
| | | | |
|---|---|---|---|
|**C. Risk Assessment for Each Federal Grant**| | | |
|||||
|**Potential Disruption**|**Likelihood (Low/Med/High)**|**Impact/Outcome**|**Responsive action**|
|1. Funding freeze or delay||||
|2. Policy change affecting eligibility||||
|3. New matching requirement introduced||||
|4. Agency staff turnover causing slow reviews||||
|How close are we to coverage failure if reimbursements stall?| || |
|| |
|Are certain programs more vulnerable than others?| || |
|| |
**4.4G Worksheet**
**For Orgs Already Receiving Federal Funding**
| | | | | |
|---|---|---|---|---|
|**D. Ongoing Scenario Planning**| | |||
||||||
|**Scenario**|**Trigger, Threshold***|**Immediate Response (0–30 Days)**|**Longer-Term Action (30+ Days)****||
|Mild Slowdown|||||
|Moderate Disruption|||||
|Severe / Worst-Case|||||
||||||
||||||
||||||
|**Key Questions:**|||||
|Which grants are largest, and how do we respond if they’re cut by 25%, 50%, or more?| | | ||
|Who triggers each scenario level (mild, moderate, severe)?| | | ||
|* Primary examples include various periods of delayed payments and cessation of future, previously forecasted grant cycles.| | | ||
||
|** Do not rule out the possibility of seeking large-scale funding from responsive, well-positioned private funders, but also position your organizational culture now for large-funder awards as in the section on private funders.| | | ||
||
||
**4.4H Worksheet**
**For Orgs Already Receiving Federal Funding**
| | |
|---|---|
|**D. Ongoing Scenario Planning**||
| | | | | |
|---|---|---|---|---|
|**E. Continuous Improvement**| | | | |
|**Grant Management Component**|**Success or Challenge**|**Adjustment or Next Step**|**Responsible Party**|**Deadline**|
|Compliance & Reporting|||||
|Program Design & Execution|||||
|Financial Management|||||
|Collaboration & Partnerships|||||
|**Key Questions:**|||||
|1. Which compliance or program lessons from prior grants can we apply to new opportunities?| || | |
|| | |
|2. Do we have a system for regularly updating board/staff on compliance changes?| || | |
|| | |
# 4.5 State Funding
Much like the federal level, state governments offer grants, contract opportunities, and budget allocations that can help stabilize your organization—especially when federal funds stall or fail to renew. Yet state funding can also be unpredictable, and even more so when federal funding reduces or disappears entirely. The cause and effect is obvious when state funding has come through from a federal source that has dried up, but in the mid-term, it is probable that states will reallocate non-federal dollars to fill gaps left by disappeared federal funding. This would reduce the financial resources available elsewhere, including full state-funded grant programs. The last California State budget cycle provided a clear demonstration of what can happen when a state budget falls short, when years of efforts to reduce homelessness in the state were dropped without much fuss in order to pass a functional budget.
However, committed state funds likely have more protection around their sustainability compared to federal funds, with state leaders less likely to end funding for committed programs.
**Please note that what applies to federal grants, typically applies to California grants as well, but with slightly less stringency—with the exception of indirect rates. Most California state grants announce a** _**fixed maximum indirect cost rate in the NOFA or RFP,**_ **typically 10%.**
**Why State Funding Matters**
1. **Closer Alignment to Local Needs:** State-funded programs often address regional or statewide concerns—healthcare, education, housing—that closely match local community issues. This alignment can increase your chances of securing grants or contracts that directly benefit your constituents.
2. **Bridge for Federal Gaps:** When federal dollars shrink or pause, state grants can serve as a critical backstop for essential services. They are unlikely to replace federal awards but can reduce vulnerability.
3. **Political Realities:** While federal funding looks like it could change abruptly, especially from one federal budget to the next, states are also capable of pivoting significantly in an election cycle.
“**Slightly Less Stringency”**
California state grant proposals have fewer separate components that require duplicative proof of duplicative information. There are fewer components that require outrageously detailed information about your own nonprofit that are only available via governmental website that you have never in your life heard about. While a list of application components for a federal and a comparative California grant may look very similar, you will sleep much better at night when working on a state grant.
**Requirements for State Grant and Contract Applicants**
To apply for California state grant and contract funding, organizations must typically provide the following as attachments with their proposals:
1. State Registration: Nonprofits must be registered with the California Department of Justice's Attorney General’s Registry of Charitable Trusts, and new nonprofits must initially register within 30 days of receiving charitable assets.
2. Annual Renewal: Organizations must renew their registration annually with the Registry of Charitable Trusts.
3. Letter of Determination: Have a copy of their Determination Letter" issued by the California Franchise Tax Board (FTB) ready to submit with a proposal.
4. Corporate Status: The nonprofit should be incorporated as a legal entity in California and the county and/or municipality in which it is providing services, must sometimes provide a copy of their business license, registered in the region in which grant-funded services will be provided.
5. Articles of Incorporation and Bylaws: Must typically have Articles of Incorporation and Bylaws on hand to submit with a copy of the state proposal.
6. Program-specific Requirements: Some grants may have additional eligibility criteria related to the nonprofit's mission, service area, or specific program requirements.
**Types of State Funding Opportunities**
1. **Direct State Grants:**
- Typically offered through departments (e.g., Department of Public Health, Department of Education).
- Frequently competitive, requiring well-crafted proposals tied to official state goals.
2. **Block Grant Sub-Awards:**
- It should be noted that these are actually federal dollars, allocated to states, with the right to make award decisions given to counties and municipalities.
3. **Contracted Services:**
- Some nonprofits become “vendors” for state-run programs, delivering specific services under contract. The distinction between a state grant and a state contract often comes down more to legalities than practicalities.
4. **Some States, and California is Not Included, Have Legislative Earmarks or Allocations:**
- In some states, legislators can direct funds to nonprofits in their districts. These opportunities rely heavily on personal relationships and advocacy.
**Challenges and Considerations**
1. **Still a Complex Application Processes:**
- It’s more difficult than most private foundation proposals, but unless you are brand new to this, you will probably be okay.
2. **Tight Timelines:**
- State budget decisions often occur late in the fiscal year, leading to rapid application and spending windows. You need a system for quick proposal turnarounds, so it pays to do your research ahead of time.
3. **Payment Delays:**
- Late reimbursements from state agencies are not unusual common. A lack of cash reserves can create a short-term cash crunch just like federal funding, and the resulting fallout requires the same sorts of solutions.
4. **Political Shifts:**
- Election outcomes can alter priorities—funding that flourishes under one administration might vanish with the next.
5. **Compliance Burden:**
- State-funded programs can demand rigorous reporting, auditing, and matching funds. Ensure you have the administrative capacity before applying.
**Action Steps for Securing State Funding**
1. **Track Legislative Calendars:** Know when your state legislature convenes, which committees handle funding for your program area, and how to comment on relevant bills.
2. **Connect with State Agencies:** Attend public forums, request informational meetings, and learn about each agency’s strategic plan. Building rapport early can set you apart in competitive grant cycles.
3. **Coalition Building:** Partner with other nonprofits to apply for larger, collaborative state grants. Legislators often favor broad-impact proposals.
4. **Stay Visible:** If possible, invite local representatives to see your programs in action. Shared success stories can resonate more powerfully than a dense grant application.
5. **Plan for Delays:** Have a short-term financing strategy—such as lines of credit or philanthropic “bridge” grants—to cover any lag between contract award and payment.
**4.5A Worksheet**
| | |
|---|---|
|**Assessing Your Readiness for State Funding**| |
|||
|**Question**|**Notes / Action Steps**|
|**1. Alignment**||
|Which state departments’ missions most closely align with our programs?|
|**2. Timelines**||
|How quickly can we respond to sudden RFP releases? Do we have a grant writing process in place, or would we need to hire someone?|
|**3. Reserves**||
|Can we handle potential delays in state payments without jeopardizing cash flow?|
|**4. Relationships**||
|Do we have any ongoing partnerships with state agencies or officials, or with organizations that will write a letter of recommendation, if we are given the opportunity to submit one? Who can help champion our cause?|
|**5. Compliance**||
|Are we equipped for any additional reporting, data collection, or audits?|
|**6. Political Factors**||
|What upcoming state elections or legislative sessions might influence our funding?|
# 4.6: Earned Income
To navigate uncertain times, nonprofits must do more than chase new grants. Earned income streams can be one of the most reliable long-term solutions, but turning a profit as a nonprofit has more pitfalls than most forms of grants and donations. Mission Creep can be especially insidious from the start. So memorize your mission statement before you get started. This section outlines how to start thinking about revenue pathways so you can move beyond relying on one or two major funding sources that are external to your organization.
**Why Explore Earned Income Streams?**
1. **Risk Mitigation:** Multiple revenue channels can blunt the impact if one source shrinks or disappears, and nonprofit supporters typically like to see an organization with so much initiative around sustainability.
2. **Mission-Driven Sustainability:** If you offer services or products aligned with your mission, you can generate income while expanding impact.
3. **Community Engagement:** Earned income ventures help you engage new audiences, broadening awareness and potentially growing support. Attaching an income-producing venture to your nonprofit also increases public awareness of when services and goods are low quality, so there is more on the line than with a typical for-profit venture.
**Revenue-Producing Models to Get You Thinking**
**Mission-Aligned Business Models**
- Fee-for-Service Programs: Review gaps in community service and see where those exist. Look for gaps that can be addressed by the services that you already provide, and especially any service gaps that contribute to the community challenges your org is already trying to alleviate.
- Mission-Aligned Businesses: Especially those that are already within your wheelhouse. For instance, a nonprofit that hires therapists may consider providing therapy services to the community at large.
- Software, App, or Software as a Service (SaaS) Development: Create tech solutions addressing problems in your field, or enhancing education related to the challenges your organization addresses. Or if you are in need of a bespoke database for your organization, contract to have it made for you, and host it on the internet for other organizations in your field via a subscription model.
**Membership and Subscription Models**
- Tiered Memberships: Offer different levels of benefits at various price points for services or a growing body of knowledge. Thois could include benefits like event access, newsletters with practical and usable insights, or exclusive content to encourage ongoing supporter loyalty.
- Subscription Services: For organizations with specialized expertise, such as professional education or research.
**Cause-Related Marketing and Partnerships**
- Retail Partnerships: Collaborate with a local business or national retailer to produce branded items.
- Licensing Content: If your team develops curricula, publications, or art, license those assets to third-party groups such as schools, corporations, or other nonprofits. Organizational resources could provide passive income.
**Consulting and Training**
- Paid Expertise: Package your knowledge as workshops, coaching, or technical assistance for peers in your field. Examples include program evaluation, fundraising strategy, or volunteer management training.
- Consulting Services: Leverage the skills in which your organization thrives advising others in your field.
**Space and Asset Rental**
- Event Space Rental: Lease your facility during off-hours for events.
- Equipment Lending: Rent specialized equipment your nonprofit owns (vehicles, production equipment, technology).
- Co-working or Dedicated Office Space: Offer unused office space to aligned organizations or social entrepreneurs.
**Educational Offerings**
- Certification Programs: Develop industry-recognized credentials related to your expertise, even offer continuing education credits through partnerships and certifications from industry authorities.
- Youth Programs/Camps: Structured programs using your organization's unique resources and knowledge.
- Workshops and Webinars: Offer paid training sessions showcasing your organization's expertise. Record them and provide access to recordings for a fee.
**Publication and Media**
- Publishing: Create books, guides, or journals relevant to your sector.
- Paid Online Content: Develop premium content with paywalls or sponsor-supported media. Research “online coaches” for more information around this very trending industry niche.
- Database or Data Access: Monetize unique research or specialized information you collect, or leverage your organization's data collection to provide insights.
- Product Sales: Sell mission-related merchandise, publications, or other items.
**Community Service Extensions**
- Corporate Social Responsibility Partnerships: Design capacity- or team-building programs for businesses.
- Incubator/Accelerator Programs: Support emerging leaders or organizations in your field through paid programs.
- Speaking Engagements: Book organizational leaders as paid speakers at conferences or events. See the sections on Telling Our Stories and the subsection on showing up in thought leadership spaces in the Private Foundations section for inspiration on how to reach the levels of notoriety that can facilitate a business model like this.
**Key Considerations**
**Financial Planning**
- Realistic Start-Up Costs: Determine up-front needs (equipment, staff hours, marketing) to avoid underestimating financial or operational investments.
- Consistent Cash Flow: Earned income can provide more predictable revenue than grants or donations.
- Pricing Strategy: Ensure pricing remains equitable to not exclude beneficiaries while covering costs.
- Are you thinking of a thrift store? Thrift stores are messy, a lot of work, and can take a long time to produce a reasonable profit. Why do you believe that yours would be particularly profitable?
**Operational Impacts**
- Specialized Staffing: Some services may require dedicated personnel with specific expertise, but the best business models are those that have little difference compared to what your organization already offers.
- Resource Allocation: Events and member programs can be labor-intensive and require ongoing staff time. It is typically unrealistic to assume that for-profit ventures will not require additional staff time.
- Business Acumen: Social enterprises and other business ventures require market knowledge and competitive strategies.
**Mission Alignment**
- Purpose Alignment: Any revenue stream—especially a business venture—should complement your existing purpose instead of distracting from it. Look for service gaps that exacerbate the challenges your organization addresses, and consider how for-profit ventures could address those gaps. If those gaps can be addressed through services that are part of your existing operations, so much the better.
- Cultural Fit: Business ventures must align with your values; poorly aligned ventures will produce mission drift.
- Stakeholder Buy-in: You have the opportunity to provide exposure for your nonprofit through your business ventures. Step carefully to ensure it is positive exposure.
**Governance and Structure**
- Scalability and Oversight: As revenue grows, keep clear processes for tracking finances, measuring impact, and ensuring the venture stays mission-focused.
- Transparency: Ensure clarity about how funds are raised and used for both donors and customers.
- Legal Structure: If liability is too much of an issue, you may need to set up a separate legal entity to conduct business. The simplest route to prevent conflict between leadership of two legal entities is to create infrastructure that makes the board members of your nonprofit the board members of the separate business entity, with no more and no less board members on either.
For more insights on brainstorming revenue-producing projects, see the “Expanding Capacity for All This Work” section’s information on AI usage.
**Overcoming Common Pitfalls**
1. **Mission Misalignment:** A new revenue venture must support your core work. Shifting time and energy is a zero-sum game, and board members, organizational leaders, and employees have not tolerated the challenges of nonprofit work just to find themselves trying to turn a quick profit in work that does not enhance the community. Carefully assess how any opportunity could lead to “mission drift” and brainstorm policies, procedures, and above all, onboarding documentation that helps prevent drift from happening.
2. **Underestimating Costs:** Earned income can require investments in marketing, new staff, infrastructure, and possibly founding a secondary legal entity.
3. **Inadequate Market Research:** If launching a social enterprise or fee-based service, utilize all of the typical tools, including a business plan, and confirm that there is sufficient demand. Pilot testing before rolling out at scale. Talk to folks who have successfully leveraged fee-for-service at their nonprofit.
4. **Donor Confusion:** While it is highly unlikely that fee-for-service will ever fully support a nonprofit, but if donors think you are now “self-sustaining,” you might lose philanthropic gifts. Keep your optics aligned: earned revenue enhances sustainability but it can never replace the community partnering in organizational success. On the flip side, providing value-added products or services that are accompanied by genuine care aligned with your organizational mission, you have an opportunity educate your paying customers about the importance of your organization’s work and how they can further partner with you in success.
**Reflection: Building Resilience Through Diversification**
No single new income strategy will eliminate funding uncertainty. However, a thoughtful mix of earned revenue, corporate sponsorships, membership models, and other streams can bolster your financial base. Cultivating a diverse funding portfolio requires planning and experimentation but often yields a more resilient organization—one better prepared for the next abrupt policy shift or economic downturn.
**46.A Worksheet**
**Mapping Potential Income Streams
**
| |
|---|
|**Worksheet: Forecasted Earned Income Project Goals & Requirements**|
|**Project Description**|
||
|**Mission Fit Description**|
||
|**Needed Investment (Staff, Tech, Etc.)**|
||
|**Goal Revenue for Business Plan Forecast**|
||
|**Risks/ Unknowns**|
||
|**Timeline & Milestones from Concept to Opening**|
||
|**Scalability Potential**|
||
|**Legal and Compliance Considerations**|
||
|**Market Differentiation**|
||
|**Operational Impact**|
||
|**Stakeholder Roles and Responsibilities**|
||
|**Evaluation Metrics for Success**|
||
|**Community Feedback Integration**|
||
|**Metrics Signaling Discontinuation or Modification**|
||
|**Impact on Existing Fundraising Efforts**|
||
**4.6B Worksheet**
| | | |
|---|---|---|
|**Worksheet: Planning Next Steps for Nonprofit Fee-for-Service/Product Venture**| | |
|**1. Feasibility Study**| | |
|Identify potential market demand:|||
||||
||||
|Estimate start-up costs:|||
||||
||||
|Research potential competitors:|||
||||
||||
|Identify pilot opportunities:|||
||||
**4.6C Worksheet**
| | | |
|---|---|---|
|**2. Alignment with Mission and Capacity**|||
|How does this income stream support our mission?| ||
||||
||||
|Does this venture complement existing programming?| ||
||||
||||
|Do we need external expertise (e.g., marketing, finance)? If yes, specify and budget:| | |
||||
||||
**4.6D Worksheet**
| | | |
|---|---|---|
|**3. Business Plan Development**| | |
|Goals for the new venture:|||
||||
||||
|Target customers:|||
||||
||||
|Promotional channels and strategies:|||
||||
||||
|Revenue projections (short-term and long-term):| ||
||||
**4.6E Worksheet**
| | | |
|---|---|---|
|**4. Testing and Iteration**| | |
|Initial small-scale launch date:|||
||||
||||
|Metrics for evaluating pilot success:|||
||||
||||
|Planned refinement strategies:|||
||||
||||
**4.6F Worksheet**
| | | |
|---|---|---|
|**5. Stakeholder Communication**| | |
|Key messages explaining the importance of the new revenue approach:| | |
||||
||||
|Methods for communicating with donors, volunteers, and community partners:| | |
||||
||||
# 4.7 Programs
A robust program strategy ensures that your nonprofit not only delivers meaningful services but also documents, shares, and scales the transformative stories that emerge. Having a high level view of programs, coupled with a detailed understanding of their operations and outcomes is the responsibility of every fund development professional. This telescoping understanding of services and operations is what allows us to talk to donor about every aspect of our organization while approaching leadership with emerging evidence-based best practices. Complete the following to deepen your cohesive understanding of why your services and outcomes stand out.
**Introduction and Purpose**
**Contextual Overview**Nonprofits exist to address unmet community needs. Over time, it’s easy to lose focus. Programs can become routine, and staff may overlook how service recipients’ lives are transformed. This section helps center your efforts on creating, documenting, and sharing **genuine stories** of change, fueled by continuous learning and strategic resource management.
- **We Are Protectors of Programs**: By safeguarding program quality and alignment, your organization maintains its credibility in both the community and donor world.
- **Passing On Best Practices**: Being open to evolving research, technology, and partner insights keeps your services from stagnating.
- **Seeking Truth and Transformation**: The deepest measure of success lies in making real-life improvements—turning potential stories into lived reality that beneficiaries can share in their own words.
This section consists almost entirely of worksheets. While is valuable to seek out other viewpoints to deepen your understanding of programs, outcomes, and history, ultimately these worksheets are designed to help fundraisers and organizational leaders to enhance their personal appreciation and comprehension in order to better communicate impact and community relevance. Worksheets are broken out into small pieces in order to facilitate completing them a bit at a time. You will likely have better insights if you do not try to complete all of these at once.
But have no fear! To balance it out, there are no worksheets in the next section.
**Conclusion**
By shaping each program around authentic outcomes and carefully documenting those transformations, your organization builds genuine trust and a track record of success. These stories engage funders, volunteers, and the public in ways that purely numerical data cannot. Supported by thorough budgeting, smart risk management, and a passion for continuous improvement, your programs become the gateway to a **stronger, more equitable community—and a future where more and more lives are changed for the better.**
**4.7A Worksheet**
| | |
|---|---|
|**Defining Your Programs**||
|Program Name & Brief Description|Summarize purpose and scope.|
|||
|||
|Duration|Ongoing, seasonal, pilot, or short-term. Include how long it has had its current goals.|
|||
|||
|Primary Funding Sources|E.g., federal grants, private donors, fee-for-service, etc.|
|||
|||
|Target Demographics|Who receives these services, and where?|
|||
|||
|Key Observations|Any special notes, challenges, or strengths.|
|||
|||
**4.7B Worksheet**
| | |
|---|---|
|**Mission Alignment**||
|Program Name|Name of the program/service.|
|||
|||
|Alignment (High/Med/Low)|How closely it matches core mission.|
|||
|||
|Rationale|Brief reasoning for the alignment rating.|
|Strengths & Weaknesses|What are your top outcomes, where are operational & outcome bottlenecks?|
|||
|||
**4.7C Worksheet**
| | |
|---|---|
|**Historical Lessons & Patterns**||
|Program Name|Name of the program/service.|
|||
|||
|Past Funding Challenges|Notable obstacles (e.g., 2017–2020 or 2021–2024).|
|||
|||
|Adaptive Capacity|How effectively the program pivoted in uncertain times.|
|||
|||
|Stories of Success|Significant transformations or achievements that strengthened support.|
|||
|||
|Lessons Learned|Key takeaways to guide current and future planning.|
|||
|||
**4.7D Worksheet**
| | |
|---|---|
|**Needs Assessment**||
|How do you collect evidence of outcomes, and what does it say?|How outcomes are tracked (tools, frequency).|
|||
|||
|What data could you be collecting, and what other mission-relevant outcomes could you be recording?||
|||
|||
|Additional Data to Gather|Potential new metrics or outcomes to record.|
|||
|||
|Staff/Volunteer Insights|Observations from frontline staff/volunteers.|
|||
|||
|Action Items|Steps for improving data collection or addressing newly identified needs.|
|||
|||
**4.7E Worksheet**
| | |
|---|---|
|**Outcome-Centered Design**||
|Desired Outcome|Concrete result (e.g., job placements, improved attendance).|
|||
|||
|Program/Initiative|Which specific program addresses this outcome.|
|||
|||
|Measurement Method|Pre/post tests, surveys, interviews, etc.|
|||
|||
|Impact on Beneficiaries|Direct effect on participants or the broader community.|
|||
|||
|Adjustments Needed|Next steps to refine the program for greater impact.|
|||
|||
**4.7F Worksheet**
| | |
|---|---|
|**Equity, Access, and Cultural Competence**||
|Identified Barrier|Language, disability access, cultural norms, or other obstacles to participation.|
|||
|||
|Proposed Solutions|Strategies to remove barriers (translations, accommodations, outreach).|
|||
|||
|Implementation Steps|Actions to put solutions in place.|
|||
|||
|Monitoring Approach|How you’ll assess whether solutions are effective.|
|||
|||
**4.7G Worksheet**
| | |
|---|---|
|**Program-Specific Budgets**||
|Program Name|Which program or service the budget applies to.|
|||
|||
|Salaries|Include key roles and costs.|
|||
|||
|Operational & Overhead|Office space, insurance, tech, etc.|
|||
|||
|Total Projected Cost|Sum of all relevant expenses.|
|||
|||
|Funding Source(s)|Potential or confirmed (grants, donors, earned income).|
|||
|||
|Notes|Any special budget considerations or constraints.|
|||
|||
**4.7H Worksheet**
| | |
|---|---|
|**Cost Analysis and ROI**||
|Program Name|Identify the program.|
|||
|||
|Cost per Participant|Calculate total cost ÷ number of participants served.|
|||
|||
|Outcome Effectiveness|Briefly note key results achieved (e.g., improved housing stability).|
|||
|||
|Mission ROI|Qualitative measure of how deeply the outcomes advance your mission.|
|||
|||
|Recommended Adjustments|Reallocate resources, refine approach, or continue as is.|
|||
|||
**4.7I Worksheet**
| | |
|---|---|
|**Funding & Sustainability**||
|Program Name|Identify which initiative needs funding.|
|||
|||
|Federal/State Synergy|Potential alignment with local/state priorities, RFPs, or government plans.|
|||
|||
|Private Funders|Foundations, corporate partners, philanthropic interests.|
|||
|||
|Income-Generating Possibilities|Fee-for-service, social enterprises, memberships.|
|||
|||
|Next Steps|Immediate actions (research grants, develop pitch, etc.).|
|||
|||
**4.7J Worksheet**
| | |
|---|---|
|**Program Partnerships & Community Engagement**| |
|Collaborative Partner or Group|Organizations or agencies you plan to work with.|
|||
|||
|Shared Program or Joint Grant|Describe any co-developed initiative or application.|
|||
|||
|Beneficiary Feedback Mechanisms|How participants’ insights are included.|
|||
|||
|Engagement Strategies|Approaches for building strong community ownership.|
|||
|||
|MOU/Agreements|Status of written partnership terms, if applicable.|
|||
|||
**4.7K Worksheet**
| | |
|---|---|
|**Staffing & Expertise**||
|Program/Initiative|Identify where staff or volunteers are assigned.|
|||
|||
|Role Needed|E.g., social worker, marketer, volunteer coordinator.|
|||
|||
|Skill Requirements|Specific qualifications or competencies.|
|||
|||
|Current Staff Coverage|Existing personnel available.|
|||
|||
|Gaps/Next Hire|Needed roles or training.|
|||
|||
**4.7L Worksheet**
| | |
|---|---|
|**Infrastructure and Systems**||
|System/Tool Needed|CRM, data management platform, cybersecurity software, etc.|
|||
|||
|Purpose|How it supports program delivery or accountability.|
|||
|||
|Implementation Cost|Budget for software, licenses, or staff training.|
|||
|||
|Timeline|Dates or milestones to have this infrastructure in place.|
|||
|||
**4.7M Worksheet**
| | |
|---|---|
|**Key Performance Indicators (KPIs)**||
|Program Name|Which initiative these KPIs apply to.|
|||
|||
|Quantitative KPIs|Job placement rates, recidivism, attendance, etc.|
|||
|||
|Qualitative KPIs|Observations, interviews, or focus group data.|
|||
|||
|Data Collection Tools|Surveys, databases, staff logs, etc.|
|||
|||
|Review Frequency|Monthly, quarterly, annually, etc.|
|||
|||
**4.7N Worksheet**
| | |
|---|---|
|**Data Collection and Reporting**||
|Program Name|Identify the relevant service.|
|||
|||
|Methods|Surveys, pre/post tests, focus groups, interviews.|
|||
|||
|Privacy Measures|Consent forms, data protection protocols, anonymity for sensitive stories.|
|||
|||
|Reporting Format|How data is shared internally/externally (dashboards, annual report, etc.).|
|||
|||
|||
**4.7O Worksheet**
| | |
|---|---|
|**Continuous Improvement Loop**||
|Assessment Phase|Data/feedback gathered, including stories.|
|||
|||
|Implementation|Specific changes you tried based on that data.|
|||
|||
|Measurement|Results of your changes (positive or negative).|
|||
|||
|Adjustment|Next pivot or refinement.|
|||
|||
**4.7P Worksheet**
| | |
|---|---|
|**Scenario Planning**||
|Potential Disruption|Funding freeze, policy shift, disaster scenario, etc.|
|||
|||
|Impact on Programs|Which services would be most affected?|
|||
|||
|Contingency Plan|Steps to mitigate disruptions (alternate revenue, scaled-back services, etc.).|
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|Resources Needed|Funding, staff, communication channels.|
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**4.7Q Worksheet**
| | |
|---|---|
|**Program Sunset Planning**||
|Program Name|Identify any programs recently discussed for closing.|
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|Transition Steps|Referrals, staff reassignments, resource redistribution.|
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|Communications|How to inform participants, donors, and partners.|
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|Lessons Learned|Document final outcomes, feedback, and data for future reference.|
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**4.7R Worksheet**
| | |
|---|---|
|**Program Stories & Engagement**||
|Program/Story Focus|Identify the participant or outcome showcased.|
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|Main Transformation Points|Highlights of personal growth, success metrics, or key milestones in the story.|
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|Voice of Participant|How participants share their perspective (quotes, interviews, recordings).|
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|Engagement Objective|Desired response (volunteer sign-ups, donations, policy influence).|
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|Dignity & Accuracy Checks|Methods for respecting privacy, obtaining consent, and ensuring the story is genuine.|
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**4.7S Worksheet**
| | |
|---|---|
|**Program Assessment**||
|Program Name|Name of the service or initiative.|
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|Mission Alignment (H/M/L)|Rate alignment with core purpose.|
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|Financial Viability|Stable, moderate, or uncertain.|
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|Outcome Effectiveness|Brief KPI results (e.g., improved housing, job placements).|
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|Potential for Growth|Low, medium, or high demand.|
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|Stories/Transformations|Key narratives that illustrate impact.|
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**4.7T Worksheet**
| | |
|---|---|
|**Impact-Funding Alignment Grid**||
|Program Name|Identify your program.|
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|Short-Term Funding|Possible 1-year solutions (local grants, appeals).|
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|Mid-Term Funding|2–3 year approaches (foundation grants, sponsorships).|
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|Long-Term Funding|3+ year strategies (endowment, major gifts, social enterprise).|
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|Narrative Approach|Key stories or data used to appeal to funders.|
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**4.7U Worksheet**
| | |
|---|---|
|**Reflection and Next Steps**||
|Major Wins|Successes or strengths from recent assessments.|
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|Ongoing Gaps|Unresolved challenges or barriers.|
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|Timeline for Review|When the next assessment or adaptation cycle will happen.|
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|Capacity Building Needs|Staff, training, infrastructure—anything necessary to sustain growth.|
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# 5. Telling Our Stories: Shaping Life’s Narrative and Retelling It Authentically
Nonprofits do more than provide services—they actively **change narratives**. Each program, partnership, and conversation sets the stage for new personal and community stories to emerge. This section explores the dual process of **making those stories true**—through transformative work—and **telling them** in a way that galvanizes broader support, challenges biases, and fosters meaningful change.
This section contains no worksheets because storytelling is an enormous subject, and an even bigger subject within the context of nonprofit work. These are not fill-in-the blank concepts that help us plan our work so much as a philosophy that we must continuously bring to our work. The question of how we tell the story of our organization is one that is presented to us as fundraisers day in and day out. We can continuously find new ways to answer the question, or we can be left telling stale stories as we try to build community support.
**The Power of Stories in Nonprofit Work**
Stories have a **unique capacity** to connect people on an emotional level. While statistics or reports might momentarily catch attention, an authentic personal narrative can reshape hearts and minds. By highlighting real individuals overcoming barriers, nonprofits underscore the tangible results of their initiatives—**and the shared humanity** behind every data point.
**Why Stories Are Essential**
- **Humanize Community Needs**: Stories offer a close-up view of challenges that might otherwise remain abstract, motivating donors, volunteers, and partners to get involved.
- **Build Empathy and Understanding**: A well-told narrative can dismantle stereotypes, replacing indifference with compassion.
- **Promote Systemic Change**: Personal accounts remind policymakers and funders that behind every policy decision lies a real person’s future—and entire communities shaped by those decisions.
**Making Stories True: Creating Conditions for Real Transformation**
Before a nonprofit can tell a story, it must first **enable** that story to unfold in reality. Transformation is more than a marketing angle; it’s the **lifeblood** of nonprofit missions.
**Designing for Transformation**
- **Identify Root Causes**: Sustainable change arises from addressing underlying issues (like housing insecurity or educational inequality), not merely treating symptoms.
- **Facilitate Real Change**: Programs that tackle challenges holistically—mental health, job training, supportive housing—can dramatically alter a person’s trajectory.
- **Document the Evidence**: Qualitative success (a family stabilized in permanent housing) and quantitative metrics (graduation rates improved by 20%) combine to form the foundation of your story.
**Creating Opportunities**
- **Customized Services**: Tailor programs to unique community needs. This fosters ownership and ensures deeper, more lasting results.
- **Engaging Participants**: Real stories emerge when participants are **active agents**, choosing to shape their own paths with the nonprofit’s support.
- **Measuring Impact**: Collect robust data—both numbers and narratives—to illustrate the breadth and depth of transformations.
**Becoming Storytellers: Amplifying Authentic Voices**
Once transformation occurs, nonprofits step in as **storytellers**—not to fabricate narratives but to **amplify** those already unfolding.
**Finding the Stories**
- **Listen First**: Staff and volunteers on the front lines often encounter profound personal stories. Create intentional spaces—focus groups, personal interviews—to hear participants’ perspectives.
- **Invite Self-Representation**: Whenever possible, let people tell their own stories in their own words. Their lived experiences resonate far more than any scripted testimonial.
**Shaping the Narrative**
- **Contextualizing Individual Journeys**: Show how one person’s story reflects a larger societal issue—affordable housing, mental health stigma, educational inequities—giving audiences a tangible way to grasp systemic challenges.
- **Connecting to Mission**: Each story should link back to **why** your organization exists, illuminating how your mission propels real-life outcomes.
- **Storytelling Tools**: Photographs, short videos, quotes, or case studies can make stories more accessible and compelling. Animated GIFs, music overlays and multi-image capabilities in social media posts, web links are storytelling tools. Consider the tools at your disposal.
**Attracting Like-Minded Support: Stories as a Catalyst for Action**
True stories draw in those who share your vision. Compelling narratives can spark donations, volunteer commitments, policy changes, and deeper community engagement.
**Building Community**
- **Emotional Connection**: Stories remind supporters that behind every program statistic is a person with hopes, fears, and dreams. This human touch encourages ongoing, loyal engagement.
- **Volunteer and Partner Recruitment**: Illustrating the difference volunteers or allies make—via personal accounts from participants—often inspires others to join the cause.
- **Media Outreach**: Powerful stories can capture the attention of local or national media, offering broader visibility and legitimizing your work in the public eye.
**Securing Resources**
- **Fundraising**: Donors invest in people. Hearing about a single mother who secured stable housing and overcame adversity can open wallets more effectively than any volume of numbers alone.
- **Grant Applications**: Foundations increasingly seek evidence of **real** life change. Clear narratives supported by credible data strengthen your case for funding.
- **Corporate Sponsorships**: Companies often look to invest in causes where they see immediate, relatable impact.
**The Ethical Dimensions of Nonprofit Storytelling**
Stories wield influence and must be told **ethically**—with dignity, honesty, and care for participants’ well-being.
**Respecting Dignity**
- **Informed Consent**: Always secure permission to share personal details, clarifying where and how the story will appear.
- **Avoid Exploitation**: Portray beneficiaries as **co-creators** of their progress, not helpless recipients of charity.
- **Honoring Complexity**: Resist oversimplifying. If the journey is still unfolding or fraught with setbacks, acknowledge those realities.
**Balancing Hope and Reality**
- **Accurate Representation**: Don’t inflate progress or paint overly grim pictures for shock value. Both extremes can undermine trust.
- **Credit Where It’s Due**: Celebrate the combined efforts of participants, staff, volunteers, donors, and broader community networks.
**Sharing Credit**
- **Collaboration Over Ownership**: Emphasize that meaningful transformations often involve multiple agencies, civic partners, or community members, and of course, always, the clients.
- **Fostering Mutual Respect**: Show that the participants’ own resilience and efforts are as vital as the nonprofit’s programs.
**Changing Public Perception and Policy**
Through authentic storytelling, nonprofits can reframe broader conversations around social challenges, shaping how the public and decision-makers understand—and respond to—key issues.
**Challenging Stereotypes**
- **Myth-Busting**: Stories of resilience can dismantle harmful societal narratives (e.g., about homelessness or addiction), revealing the real factors behind these struggles.
- **Elevating Underrepresented Voices**: Feature stories that reflect the diversity of your client base—older adults, refugees, LGBTQ+ youth, individuals with disabilities—so the community sees everyone’s humanity and contributions.
**Influencing Systems**
- **Advocacy**: By highlighting recurring themes in participant stories (lack of affordable childcare, scarce mental health resources), nonprofits can spotlight policy gaps and call for systemic reforms.
- **Coalitions and Campaigns**: Collective storytelling—pooling stories across organizations—demonstrates the scale of an issue and unifies partners behind shared goals.
**Practical Steps for Story Gathering and Sharing**
1. **Develop Clear Guidelines**: Create a written policy explaining how you gather participant stories, ensuring consistency and ethical safeguards.
2. **Train Staff and Volunteers**: Teach empathetic interviewing techniques, respecting privacy boundaries, and the power of open-ended questions.
3. **Maintain a Story Bank**: Store narratives (videos, transcripts, written testimonies) in a secure database, tagged by theme, program, or impact area—making them easy to locate for grant proposals or media outreach.
4. **Ask Permission Often**: Even if a participant agreed to share their story in a specific use case last year, re-check before using it again in a new campaign or a more public forum. If you are asking for permission to use it multiple times or in perpetuity, be very clear about that. Recognize that stories are a form of social currency, and we are asking our clients to lend us a portion of their value.
5. **Choose the Right Medium**: Some stories shine in long-form articles; others suit short social media posts or short documentaries. Adapt the format to the story’s nuance and participant comfort.
**Building a Culture of Curiosity and Truth**
At the heart of compelling stories lies a **culture of inquiry**:
- **Seek Out Hard Questions**: Encourage staff and board members to challenge assumptions—"Why is this outcome happening? Could we have done more?"
- **Pursue Evidence-Based Answers**: Combine on-the-ground observations with formal evaluations or academic research.
- **Commit to Continual Learning**: Stories improve over time as your organization becomes more transparent, reflective, and responsive.
Through curiosity and truth-seeking, nonprofits not only discover hidden obstacles or new approaches—they also find **fresh narrative angles** that keep supporters engaged and demonstrate a commitment to honesty.
**The Cycle of Transformation**
Ultimately, storytelling in nonprofits forms a **virtuous cycle**:
1. **Identify Need**: Acknowledge the gap or challenge in your community.
2. **Intervene**: Provide services that address root causes, facilitating real change.
3. **Document**: Gather data, personal testimonies, and evidence of improvement.
4. **Share**: Communicate the story widely—grant proposals, social media, events—while respecting ethical boundaries.
5. **Attract Support**: Donors, partners, and volunteers deepen their commitment, fueling the nonprofit’s capacity to create **more** transformative stories.
This cycle continually expands your impact, forging momentum that can reshape public perception and community expectations of what’s possible.
**Conclusion: Stories as Bridges to a Better Future**
Nonprofit storytelling is more than a communications tactic—it’s **an ongoing responsibility**. By creating conditions for genuine transformation, ethically amplifying participants’ voices, and connecting individual journeys to broader social narratives, your organization nurtures empathy, mobilizes resources, and rallies entire communities. In these stories, we see not only the hardships of the present but also the **unbounded potential** of tomorrow—a future shaped by compassion, resilience, and collaborative action.
# 6. Contingency Plan Starter Pack
Listen, I did not even plan to put this section in the book. I only wanted to ask you the questions that would provide the answers that would help you let you develop agile plans while the federal government is embracing chaos. But having gotten this far with you, I feel would feel a bit guilty if I just stopped. So I am going to put a bit of a framework together so you can have some structure as we close out. But this is not the end of the process. We still have to get up every day and help ensure the sustainability of the community services that we foster. There are neighbors who we do not even know who are counting on us.
As you take some fresh insights back to your work, I hope that you will reach out to me at some point. I would genuinely like to know how you are doing, how your work goes. I am wishing you all the luck.
**6.1 Why a Contingency Plan?**
1. **Minimizes Disruption**
A clearly outlined response plan helps maintain core services and donor confidence, even when a main grant evaporates or a major fundraising push fails to meet its goal.
2. **Boosts Stakeholder Confidence**
Board members, donors, and staff are reassured when they see a proactive plan. It shows you’ve anticipated adverse scenarios and stand ready to adapt without losing momentum.
3. **Hastens Recovery**
The faster you can respond to a funding gap—whether it’s a 30% grant cut, a delayed government contract, or a shortfall in a critical campaign—the faster you can stabilize your budget, reorient priorities, and keep building donor goodwill.
**Reality Check:** Without a contingency plan, sudden shocks can throw you into panic mode, leading to rushed decisions that alienate donors or seriously harm your programs.
**6.2 Multi-Tiered Fallback Strategies**
A multi-tiered plan outlines specific responses based on how severe the shortfall is. From a fundraiser’s standpoint, these tiers help clarify when to escalate fundraising appeals, shift tactics, or diversify revenue sources.
- **Tier 1: Minor Disruptions**
A small cut to a grant or unexpected slowdown in donations. Short-term cost-saving measures or a modest new donor appeal may be all you need.
- **Tier 2: Moderate Disruptions**
A significant grant is delayed or reduced. You might need to quickly tap reserves, increase emergency donor outreach, or reorganize some operations to conserve funds.
- **Tier 3: Severe Shocks**
Large federal or state support dries up, or the broader economy takes a big hit. In this situation, organizations often face a critical restructuring, major layoffs, or aggressive campaigns to bring in new sources of revenue.
**Tip:** Align your tiers with best-case, moderate, and worst-case scenarios from your earlier planning, so you know exactly who to alert and what steps to take at each severity level.
**6.3 Step-by-Step Approach to Contingency Planning**
Because this workbook is designed to elicit information needed for agile planning, it should be understood that the following templates are not designed to be a complete system that helps one to the other side of disaster. These contingency plans templates are designed to get you, the fundraiser, through the first few days or weeks of crisis, until you can work with organizational leadership to establish mid-term responses.
**Recognize that this contingency plan is a starting point.**
**Contingency plans should be as diverse as the organizations that adopt them.**
**While this provides a very functional example, this format is not complete without your consideration of organizational needs and potential responses.**
**What will you do if revenue goes down?**
**What will you do when demand for services goes up?**
**What will you do when state and federal payments are late?**
1. **Identify Triggers and Thresholds**
- Determine what signals a Tier 1, 2, or 3 disruption. For instance:
- Tier 1: 10% cut to a vital grant.
- Tier 2: Major state contract delayed beyond 60 days.
- Tier 3: Loss of over half of your government funding or a severe drop in recurring donations.
- Determine who already monitors these triggers (e.g., Development Director, CFO) and how frequently.
2. **Draft Immediate Action Steps for Yourself**
- Within 48 hours of a crisis, some fundraisers will launch a special appeal or notify major donors. Others might request a board-led giving challenge.
- Keep these initial steps concise and accessible so you are able to communicate them if the time comes and so that they remain flexible.
3. **Outline Intermediate Actions**
- If funding doesn’t rebound quickly, be have an outline of a plan, but be ready to reorient yourself in real time as the situation unfolds
**Reality Check:** Yes, contingency planning requires unpleasant effort. But having pre-defined strategies, talking points, and donor appeals convepts ready to go can save enormous time and keep donor trust intact when a crisis hits.
**6.4 Communicating in a Crisis**
1. **Consistency is Key**
Mixed messages undermine donor confidence. A unified front with shared talking points keeps your team aligned and donors informed.
2. **Transparency with Donors**
Don’t hide large funding losses. A frank explanation of the situation—paired with a clear plan to maintain mission impact—earns respect and can even spur urgent gifts.
3. **Empathy for Staff and Clients**
Staff may fear layoffs or cutbacks, and clients might worry about service interruptions. Clearly outline changes and listen to concerns so the team feels supported.
4. **Maintain Community Trust**
In a downturn, many donors look to nonprofits for stability. Show leadership by calmly executing your plan, reporting real-time changes, and highlighting positive outcomes. Credibility can grow in tough times if handled with composure.
**Final Reflections**
When you create a thoughtful backup plan with predetermined metrics triggering specific responses, you are protecting both your organization and the community members who you serve from an outward-facing crisis reaction. We all know how stress and worry can cloud our thinking. It can prevent us from making our best decisions, and the calmest of us risk rush into familiar solutions even if they are not ideal, or we might oversimplify complex problems just to feel like we are taking action.
By planning ahead, you give yourself and your team the gift of prior proper planning when challenges arise. This means your programs can remain steadier and more reliable for your community, even during uncertain times. Your mission stays front and center, rather than getting lost in the shuffle of emergency reactions. It is the gift of having already responded rather than being forced to react to crisis.
**6A Worksheet**
| | | |
|---|---|---|
|**Tiered Disruption Triggers**| ||
|**Tier 1 - Minor Crises**| | |
|**Component**|**Example**|**Triggers**|
|**Trigger /Threshold**|Specific event signaling the tier: e.g., a 10% grant cut, a 30% shortfall in a critical campaign, etc.||
|**Person Monitoring**|Who watches for this trigger (CFO, Development Director, etc.).||
|**Monitoring Frequency**|Weekly, monthly, or ongoing.||
|**Action Summary**|Brief note on the main action items for each tier.||
**6B Worksheet**
| | | |
|---|---|---|
|**Tier 2 - Moderate Crises**| | |
|**Component**|**Example**|**Triggers**|
|**Trigger /Threshold**|Specific event signaling the tier: e.g., a 10% grant cut, a 30% shortfall in a critical campaign, etc.||
|**Person Monitoring**|Who watches for this trigger (CFO, Development Director, etc.).||
|**Monitoring Frequency**|Weekly, monthly, or ongoing.||
|**Action Summary**|Brief note on the main action items for each tier.||
**6C Worksheet**
| | | |
|---|---|---|
|**Tier 3 -Severe Crises**| | |
|**Component**|**Example**|**Triggers**|
|**Trigger /Threshold**|Specific event signaling the tier: e.g., a 10% grant cut, a 30% shortfall in a critical campaign, etc.||
|**Person Monitoring**|Who watches for this trigger (CFO, Development Director, etc.).||
|**Monitoring Frequency**|Weekly, monthly, or ongoing.||
|**Action Summary**|Brief note on the main action items for each tier.||
**6D Worksheet**
| | | | | |
|---|---|---|---|---|
|**Roles and Responsibilities**| | |||
|**Response Role**|**Key Person**|**Primary Tasks**|**Primarily & Secondarily Responsible**|**Notes**|
|Contingency Coordinator|Oversees plan activation|Triggers next tier, orchestrates communications, notifies board||Typically Exec Director or Ops Director|
|Finance Lead|Manages budget shortfalls|Calculates immediate adjustments, manages cash flow or credit lines||Usually CFO or Senior Accountant|
|Development/Comms Lead|Donor & media messaging|Drafts key updates, donor appeals, press statements||Development Dir, PR Manager, or Comms Specialist|
|Program Leads|Service continuity|Evaluate daily program impact, reassign staff if needed||Dept. Heads or Program Managers|
|Board Liaison|Board contact|Updates board members, gathers board support for urgent fundraising||Could be Board Chair or designated board contact|
**6E Worksheet**
| | | | | | |
|---|---|---|---|---|---|
|**Tiered Responses - Example**| | ||||
|**Tier**|**Potential Actions**|**Timeline**|**Dependencies**|**Measurement**||
|Tier 1|Increase mid-level donor outreach (phone calls, personal emails)|Weeks 2–4|Donor contact info, segmentation data|# of calls completed, $ raised, donor feedback notes||
|This matrix is intended to map out near-term responses, to take you to the point of additional agile planning in cooperation with organizational leadership| | | | ||
||
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|**Tiered Responses**| |||||
|**Tier**|**Potential Actions**|**Timeline**|**Dependencies**|**Measurement**||
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**6F Worksheet**
| | | | | | |
|---|---|---|---|---|---|
|**Communication Flows & Templates - Example**| | | |||
|**Audience**|**Primary Message**|**Frequency / Trigger**|**Delivery Method**|**Owner**|**Notes**|
|Major Donors|Personalized appeals, concrete impact of crisis on programs|Tier 1–3 triggers, monthly check-ins|Personal calls, emails|Dev/Comms Lead|Emphasize how additional gifts can help preserve mission-critical services|
| | | | | | |
|---|---|---|---|---|---|
|Communication Flows & Templates| | ||||
|Audience|Primary Message|Frequency / Trigger|Delivery Method|Owner|Notes|
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# 7. Expanding Capacity for All This Work
As nonprofits navigate new challenges—ranging from shifting funding sources to increasing workloads—expanding organizational capacity becomes vital. This section provides guidance on **collaborative strategies**, **managing personal overwhelm**, and **incorporating AI tools** ethically and effectively. Through mindful collaboration and responsible technology use, nonprofits can continue delivering impactful services to their communities.
**5.1 Collaboration and Community Engagement**
**Consortia and Joint Ventures**
1. **Shared SaaS Access**
- **Pooling Resources**: Collaborate with nonprofits of similar size to share licenses
- **Cost Benefits**: Splitting software costs can free up funds for direct program expenses.
- **Technical Support**: Larger groups can negotiate better service or training from vendors.
2. **Emerging Trends & Best Practices**
- **Peer Roundtables**: Set up recurring calls or forums where organizations discuss newly encountered techniques or policy updates.
- **Slack or Email Groups**: Continuous knowledge-sharing helps teams stay informed about sector developments, avoiding duplication of effort.
- **Discussion Boards**: Simple online boards or Google Groups can host Q&A threads on anything from legal compliance to donor relations.
3. **Mutual Support Agreements**
- **MOUs for Funding Opportunities**: Draft brief memoranda of understanding that allow partners to quickly respond to new grants or local emergencies.
- **Consortium Options**: Treat these agreements as stepping stones toward full-fledged consortiums; with enough success, you may formalize the partnership.
4. **Proactive Knowledge-Sharing**
- **Sector Updates**: Forward relevant articles, philanthropic updates, or technology breakthroughs to partner organizations.
- **AI Breakthroughs**: Share new AI tools, successful pilot strategies, and recommended ethical guidelines.
**Managing Overwhelm**
1. **Recognize News Overload**
- **Setting Boundaries**: Be mindful when consuming sector and political news begins to affect your personal and professional productivity
- **Balancing Awareness**: Stay informed about funding and policy changes without letting continuous updates derail progress on core tasks.
2. **Use Technology to Filter News**
- **Google News Filters**: Set up alerts that capture **only** sector-relevant topics, such as pertinent legislative updates, philanthropic trends, or new regulations in your field.
- **AI-Assisted Searches**: Tools like Perplexity.ai can streamline discovery of credible articles or policy briefs, reducing the time you spend sifting through irrelevant material.
3. **Use Technology to For Automated Information Sharing**
- **Grant Scheduling:** If you have ongoing work, such as grants, where information is being shared ad-hoc between individuals, using something as simple as an Outlook Calendar can keep everyone on the same page and working together. Actually, a simple system is better until you reach a critical point of growth and capacity.
- **High-level Automation:** MS Power Automate, MS Azure, even linking your Excel spreadsheets for automatic updates can reduce staff time dedicated to manually transferring data that could be transferring itself.
**Integrating AI: When, Why, and How**
AI can alleviate certain administrative loads and spark new ideas, but it must be used carefully and in alignment with your organization’s privacy policies.
**AI as a Brainstorming Partner**
1. **Scenario Planning & Ideation**
- **Fundraising Plans**: Ask AI for fresh angles on event themes or donor outreach.
- **Crisis Response**: Generate ideas on how to mitigate service interruptions if grants are delayed or canceled.
- **Best Practice Adoption**: Inquire about recognized industry standards for volunteer recruitment or donor recognition.
2. **Best-Practice Queries**
- **Quick References**: Get AI-generated overviews of nonprofit management tips, strategic planning frameworks, or outreach approaches.
- **Verification**: Always double-check any AI-provided “facts,” as the tool may produce incomplete or incorrect information.
**Summaries and Longer Text Analysis**
1. **Document Summaries**
- **Complex Reports**: Condense lengthy grant guidelines or legislative proposals.
- **Policy Documents**: Identify relevant sections of governmental policies for program compliance.
- **Meeting Transcripts**: If your privacy policy allows, feed transcripts from Teams, Slack, or phone-based transcription apps into AI for quick meeting notes.
2. **Targeted Searching**
- **Finding Specific Clauses**: Direct AI to locate passages on eligibility or reporting requirements within big documents.
- **Relevant Data**: AI can highlight philanthropic research or demographic stats pertinent to your funding proposals.
**Practical Recommendations**
1. **Donor Communication Examples**
- **Draft Emails or Letters**: Let AI propose structure and tone, then refine with personal anecdotes or organizational branding.
- **Event Invitations**: Quickly produce multiple versions of invites or follow-up messages.
2. **Event Brainstorming**
- **Themes & Engagement**: Generate creative approaches to galas, online fundraisers, or “friend-raiser” events.
- **Partner Ideas**: Seek fresh prospects for sponsorship or collaborative marketing tactics.
**Understanding Privacy Policies and Data Handling**
AI usage requires clarity about what data is safe to share and under what conditions.
**Not All Data Is Equal Under Privacy Policies**
1. **Organizational Confidentiality**
- **CRM and Board Docs**: Many default AI privacy policies do not guarantee protection for sensitive internal information (like donor financial data or client case files).
- **Read Terms Thoroughly**: Confirm if your plan is free or paid—terms often differ. Paid tiers may have distinct data-retention rules.
- **Never Share Partner Data Without Consent**: If a partner entrusts you with proprietary data, do not input it into AI tools without their explicit permission.
| | | | | | |
|---|---|---|---|---|---|
|**Free LLM Usage Limits**| | | | ||
|**AI Model**|**Context Limit (Message + Research + Response)**|**Prompt/Message Daily Usage Limit**|**File Upload Limit**|**Recommended Use Cases**||
|ChatGPT-3.5|~6 dense pages|Varies|20MB/file, no limit on number of files|Out of data rations elsewhere||
|DeepSeek|~200 dense pages|No limit|100MB/file, 100 files|Document & text processing||
|Perplexity.ai|Not specified|Unlimited Quick Searches, 5 Pro Searches/Hour|25MB/file, 3 files/day|Questions that are difficult to research||
|Claude.ai|Varies based on demand|~50 messages (can vary)|Varies, but not impressive|Human-sounding text production||
|All models||||Brainstorming ideas||
|||||||
|**Paid LLM Comparison**| | | | ||
|**Paid tiers**|**Drawbacks***| |**Recommended Use Cases**| ||
|ChatGPT 4.0|Computer-like responses, not great at interpreting nuance| |Heavy daily use, mid-size document review| ||
|ChatGPT o1|Computer-like responses, can get off-track with responses| |Large document review, nuanced analysis| ||
|Perplexity.ai|Highly analytical for creative use| |Analysis, best-practice development, research, technical writing| ||
|Claude.ai|Lowest usage limits, ~2.5 hours/day during office hours| |Human-sounding responses, especially with quality reference documents| ||
|*All GPTs have limited response length on individual responses, and require scaffolded inquiries for longer text production| | | | ||
|All basic subscription plans are $20/month| | | | ||
|DeepSeek is not available as a paid service at this time unless you're a programmer| | | | ||
|ChatGPT 4.0 & o1 are both available to all paid users| | | | ||
|ChatGPT requires all users including paid users must actively opt out if they do not want their data used for training.| | | | ||
|[https://privacy.openai.com/policies?modal=take-control](https://privacy.openai.com/policies?modal=take-control)| | | | ||
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|Abacus.ai is in a class by itself. Abacus contracts to provide all of the above AI models and more for $10/month via their ChatLLM, and provides HIPPA-compliant privacy. Drawbacks of Abacus' ChatLLM is that they have monthly data limits and some LLMs use your data ration faster than others. Major benefits include being able to switch LLMs in middle of a conversation, getting to sample most major LLMs, and there are a lot more technical features that let you design your own chatbots if you are feeling brave and have a lot of time on your hands.| | | | ||
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|[https://abacus.ai/static/security/AbacusSecurityPaper.pdf](https://abacus.ai/static/security/AbacusSecurityPaper.pdf)| | | | ||
|[https://abacus.ai/security](https://abacus.ai/security)| | | | ||
|[https://abacus.ai/help/howTo/chatllm/faqs/security_privacy](https://abacus.ai/help/howTo/chatllm/faqs/security_privacy)| | | | ||
**Browser Extensions and Internal Tools**
1. **Risk of Unauthorized Access**
- **Extensions & Plugins**: AI-powered browser add-ons might access everything on your screen—posing potential confidentiality breaches.
- **Email & Calendar**: Inadvertently exposing schedules or personal details can compromise trust or violate contract terms.
**Abacus.ai and Security Standards**
1. **Certified Security System**
- **Robust Security Policy**: Abacus.ai stands out with a certified approach that meets higher compliance standards, suitable for HIPAA-level or financial data.
- **When to Consider**: If you regularly handle extremely sensitive data (e.g., health records, critical donor info), an AI solution with enterprise-grade security may be needed.
2. **ChatGPT Model Training and Opt-Out**
- **Paid User Policies**: Even ChatGPT premium subscribers must opt out of data usage for model training if they want guaranteed confidentiality.
- **Opt-Out Link**: [https://privacy.openai.com/policies?modal=take-control](https://privacy.openai.com/policies?modal=take-control)
- **Implications**: Failing to opt out means the AI model may incorporate your proprietary details into its future outputs.
**Perplexity.ai for Research**
1. **Legitimate Data Sources**
- **Citation-Backed Summaries**: Perplexity.ai displays references, allowing you to confirm facts’ accuracy.
- **Scoping Data**: Perfect for discovering philanthropic trends, new legislation, or population analytics relevant to your nonprofit.
2. **Ethical and Transparent**
- **Source Verification**: In reading the original references, you can ensure the AI’s summary is accurate.
- **Confidentiality**: Since you only query publicly available info, you’re less likely to violate internal privacy.
**Basic AI Tool Comparison**
**Free vs. Paid Models**
1. **Feature Sets**
- **Usage Limits**: Paid plans often allow lengthier prompts, advanced functions (code interpretation, plugin integration), and faster response times.
- **User Experience**: Premium tiers typically provide better reliability and fewer lags.
2. **Privacy Levels**
- **Read the Policies**: Tools vary in how they store or train on user data.
- **Organizational AI Usage Policy**: Know your own nonprofit’s rules—particularly regarding client or donor data.
**Specific Use Cases That Do Not Typically Violate Privacy Policies**
1. **Fundraising Brainstorms**: Quick theme ideas or new donor outreach angles.
2. **Scenario Review**: Testing “what-ifs” for budget or policy shifts.
3. **Deep Document Summaries**: Very helpful if staff parse extensive technical or compliance documents from funders
**Potential Limitations**
1. **Hallucinations / “AI Lies”**
- **Risk**: AI might produce incorrect “facts” when it extrapolates beyond its training.
- **Solution**: Verify any claims or references through credible sources.
2. **Data Staleness**
- **Knowledge Cut-Off**: Some models don’t update in real time. Always ask or check the model’s knowledge date.
- **Workaround**: Supplement with live research (e.g., Perplexity.ai) to confirm the most recent data.
3. **Context Gaps**
- **Organizational History**: AI lacks institutional memory unless you provide context.
- **Prompt Clarity**: Supply relevant details or documents within your policy parameters to generate more accurate results.
**AI Safety and Responsible Usage**
**Use Cases That Don’t Violate Privacy**
1. **Generic Brainstorming**: E.g., “Suggest ways to structure a silent auction.”
2. **Policy Summaries**: Summarizing publicly available legislation or official documents.
3. **Academic or Published Research**: Reviewing publicly sourced materials, including population data or program evaluations.
**Potential Steps to Secure Organizational Data (As Approved by Leadership)**
1. **Redaction**: Omit names, personal details, exact donor figures, and personal details when seeking AI summaries.
2. **Consent**: If sharing personal stories or donor info, obtain explicit.
3. **Leadership-Approved Protocols**: If your organization has an AI usage policy, follow it closely—including limiting usage to approved tools or organizatonal guidelines on what data can be shared.
**Example Prompts for AI-Assisted Tasks**
Below are sample prompts that illustrate how you might ask an AI to support various nonprofit activities:
**Fundraising-Related Brainstorming**
1. “If federal reimbursements are delayed due to staffing shortages, what options could be available to a grantee to ensure continued operation of the grant program?”
2. “Review my attached top twenty most interacted with social media posts for my org as well as the attached .csv file with recent program outcomes and help me brainstorm how I can increase program donations online.” (Make sure data is redacted or authorized before attaching.)
**Scenario Review / Crisis Contingency**
1. “Ask me questions to determine what immediate steps might be taken to preserve core services if a 20% budget cut hits our adult literacy program?”
2. “What are some steps that could be taken to maintain staff morale when external funding fluctuates?”
**Analyzing Large Documents**
1. “Summarize the key points of [specific legislation or foundation’s guidelines] focusing on sections relevant to youth mental health funding.”
2. “Highlight potential red flags or unusual requirements in the 2025 RFP from the Department of _____________.”
**Closing Thoughts on Responsible AI Integration**
1. **Balanced Adoption**
- AI can substantially reduce workload—generating quick outlines or scenario reviews—but be fully aware how data policies affect your internal information sharing.
2. **Consistent Review**
- Treat AI outputs as **draft concepts**, verifying references against official documents or known organizational context.
3. **Community of Practice**
- Connect with nonprofits that have successfully used AI within privacy and ethics guidelines. Their experiences provide valuable real-world cautionary tales, recommended tools, and best practices.
**Final Note**
Expanding nonprofit capacity involves **shared strategies**, **healthy boundaries with news consumption**, and smart integration of AI. By forming supportive relationships with peers, safeguarding data, and carefully selecting use cases for AI, your organization can preserve its mission integrity, promote collaboration, and keep pace with rapidly evolving sector demands.