Friday, February 13, 2009

Foundation funding: what the hell’s that all about anyway?

That’s pretty much what I used to ask myself.

I knew it played a really important role in the sector, certainly where I’ve worked, but I didn’t have a real sense of the nuts and bolts of how it worked, what funders were looking for, what turns them off etc.

Until yesterday.

You see, last year in the midst of meeting literally hundreds of Canadian charities, it became apparent to me that not only was that in area that was not given adequate attention, but there seemed to be a real lack of support, particularly for small to medium size charities and fundraising teams.

Enter my colleague James Huitson, Pareto Fundraising’s Regional Director in South East Asia.

An ‘unrepentant Brit’ (his words, not mine), James background is the antithesis of mine. Until 12 months ago he has always worked for charities. I’ve always worked in agencies (although mostly with charities). He’s primarily focused his work on seeking institutional funding, me on individuals.

And with ten plus years in this area boasting an incredibly successful record of soliciting statutory and foundation funding (with organizations in the UK such as Mind and Turning Point), I figured it was worth getting him out here to impart his knowledge on my fellow Canadian fundraisers.

Fast forward to yesterday and we ran a session entitled Trusts and Foundations: So what are they looking for and how can I make the most of my programme?

Something that James said to me last year about operating in different markets has stuck with me. "Everything is different but everything is the same". And for me this really rings true when you take an area like foundation funding versus raising money from individuals.

Like individuals, money from foundations doesn’t appear magically overnight. It’s about quality in applications, not quantity (think acquisition, same logic). And there certainly are some of the similar principles you must apply in terms of thanking, feeding back and relationship building. All fairly intuitive stuff, but incredibly important all the same.

On the flip side, there are some nuances. The biggest one is this: foundations exist to give you money, individuals don’t. In some countries there are statutory requirements to ensure that foundations give away a proportion of their money every year (in Canada it’s around 3.5% of its assets every 2 years and 80% of its receipted donations from the previous year).

The other big difference is that receiving funding from a grant making foundation won’t get you out of a cash flow pickle. Unlike going to someone really rich next week and asking for $200,000, foundation funding is long term, sometimes laborious and I imagine sometimes incredibly frustrating.

Like other sources of funding, raising money from foundations has its role. For some organizations it will play a significant part. For others it won’t: either because it doesn’t fit well within the type of work you do or the way you work, or because you have made a strategic decision not to spend your time in this area.

I’m just glad I now know what the hell they’re all about anyway.

If you want any more info in this area, contact our man on the ground James Huitson. He can be reached at

He’ll be happy to help.


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