Now What? Six Tips for Growing After a Grant Loss
What do you do when an application for one of your key, ongoing programs is not funded? No one likes to hear bad news, especially after all the effort it takes to make nonprofit programs successful.
You spent months (maybe even years) building program elements and testing implementation methods. You staffed your program with qualified professionals. Your organization has been transparent and accountable. It has a good history of securing grant funding from multiple sources. Your consumers know about the program and use it successfully. You and your administrators think all is well.
Then you get a “sorry, but while we think your program is worthwhile, we are not funding it at this time” letter in the mail. At this point, some organizations go through the panic period where they (usually in a short timeframe and in a downward spiral):
- Scramble for donations,
- Feverishly submit “shotgun” grant proposals,
- Fire, lay off, or cut hours for staff, or even
- Close the program.
But you don’t need to panic. This is an opportune time to be creative and find new perspectives about your programs. Doing so will not be easy. However, you owe it to your organizations and the communities you serve to find new solutions to meet their needs.
After the Decline: Find New Solutions
If your key grant isn’t funded, stop, and breathe slowly. Do not make any decisions immediately. Instead, take up to a week to think deeply about what happened and why. Ask your leadership team and key stakeholders to do the same.
Then, come together as a group for a debriefing after your down time. Jointly, find your way forward. You will be less likely to make emotional decisions by taking time to reflect. Reflection can help any of us to learn from our experience and to use this self-awareness to make better decisions in the future.
Prioritize. Ask yourself, is this program essential? We often have emotional attachments to our “sacred cows.” Take the time to review your programs. Try to look from a new perspective. Review your priorities in relationship to your organization’s mission. Could it be that the funder did not see the program as vital to your mission?
To assist in your prioritization, I recommend that you use the MoSCoW technique your programs:
- M - Must have this program to meet the mission. They are non-negotiable and must be delivered to ensure your organization’s mission is achieved.
- S - Should have this program if possible, but successfully addressing your mission does not rely on it . You should strive to deliver as many of these programs as feasible to positively impact program success.
- C - Could have this program but the lack of it will not negatively affect your mission. These programs would be ‘nice to have’ but will be the first to go due to time constraints or budget pressures .
- W - Would like to have this program later, but it need not be delivered at this time .
Assess which programs made the top of the list and which did not. Where did your now unfunded program fall? If it fell in the “must” category, you may want to consider your options. You should consider collaborating or repurposing because closing it is not an option.
The MoSCoW technique can help you answer key questions. For example, ask yourself and your organization’s administrators the following questions. Can you repurpose this program using existing resources and still make a positive, meaningful impact? Could you collaborate with another organization to implement the program in a modified way? If the answer to either of these questions is “possibly,” you should delve further into the possibilities before you.
If your program is ranked as a “should have” program, consider cutting the number of sites served, or finding other nonprofits to implement portions of the program with you. For example, could you train interns, AmeriCorps workers, or volunteers in place of paid staff? Could part-time staff be successful? Would smaller-scale implementation still meet the needs of your most at-risk/highest-need constituents?
You and your organization should consider all your options before you make the decision to close any “should” programs. Therefore, take as much time as you need to ensure that you have explored a wide range of possibilities.
Forward Thinking: Planning for Success (and Failure)
If you rely on a single key grant or funder to operate a core or “must have” program, you are setting the stage for your own panic period which will quite possibly come just after you receive the dreaded “grant declined” letter in the mail. To avoid such panic periods, you must be forward thinking about how you will fund your “must have” and “should have” program. So you should develop a firm foundation for your success from the beginning—well aware that you may not get your desired response from the funder.
Make written plans. You know that you should never depend on any one single funding source for any vital program or services, right? Of course you do. But the question remains, how should you prepare?
The answer is simple. Plan for multiple eventualities. With your leadership team, complete the following sentences. Write your plans in a document you will revisit periodically and include them in the sustainability section of your proposal.
- Plan A – If this proposal is funded in full then…
- Plan B – If this proposal is partially funded then…
- Plan C – If this proposal is not funded then…
- Plan D – If this proposal is not funded and we do not realize our fundraising goal for this program then…
Then diversify your funding sources and develop a sustainability plan.Ask yourself several questions. Is your sustainability plan diverse or are there gaps in potential revenue lines? Do you have service-generated revenue? Special events? Major gifts? Planned giving?
A diverse plan should include these fundraising strategies and others. You need to show grant-makers that you are business-savvy and not dependent on a single revenue line or type of funding support.
Plan for what will happen if one of your support lines is less productive than anticipated or a complete loss.
For example, decide what your organization will do to compensate for losses due to declining donations or higher competition for grant awards in the current economic climate. Or you might even want to find out what nonprofits in Ohio had to do to compensate for lost revenue s from bingo halls because of new casinos that were approved by voters in 2010.
As professional fund developers know, there are five major categories of funding. You should consider all of them (and include current year goals for each) as you write your sustainability plan.
- Government grants and cooperative agreements (local, state, and federal)
- Service fees from programs, memberships, etc.
- Corporate funding through sponsorships, gifts in-kind, and grants
- Individual donations and major gifts
- Foundation grants
Cultivate and steward relationships with funders.Cultivation is essential in grant seeking, and appropriate cultivation and solicitation will affect a donor’s final decision. Do not underestimate its impact. Ensure everyone knows their roles and follows through on activities in your cultivation arch.
In my experience, the importance of cultivation is evident in the amount and diversity of grant awards received by an organization. Nonprofits that commit to cultivation at the board and executive level typically meet their grant goals. Those that don’t, do not.
Sometimes even when you do all the right things in cultivation and proposal preparation, you may still receive a grant rejection letter or have a donor decline to support your programs. I hope, however, that these tips help you avoid panic periods and help you best develop and find new solutions that ensure you can successfully meet your organization’s mission.
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