Tips for Foundation Research for Nonprofit Funding

The actual writing of a grant proposal is only a small part of the work needed to receive a coveted grant award for nonprofit organizations. Finding foundation prospects precedes the program planning, budgeting, and writing. But if you skip this crucial step of background research, the chances of being successfully funded are significantly lower.

Once you have created a list of prospective funders, the following steps can help increase the odds of receiving a grant.

Find personal connections.

For family foundations, knowing someone on the family foundation board is vital to receiving funds and most large gifts are given on the basis of personal relationships. With corporations, getting the support of the local office or branch in the form of a letter or phone call can be the difference between receiving funding or not. Ask staff members, your Board, and significant supporters for help. Even current funders will sometimes provide an introduction to establish a relationship.

Read the foundation's Form 990.

The Form 990 is filed with the IRS every year by organizations exempt from paying federal income taxes. Get on GuideStar or Foundation Center and look at the organization's Form 990 for the past several years. This will give you an idea of who and what the foundation has funded in the past. In some instances, the 990 form will include brief guidelines or contact information.

Consider factors such as interest and location.

If the foundation is located in Minneapolis and its guidelines indicate it has national giving, but the vast majority of gifts are to nonprofit organizations in the Minneapolis area, then odds are great that new requests outside of the geographic location will likely be unsuccessful. Similarly, matching the area of interest is critical to grant writing success. For example, some foundation will consider after school programs to fall under "Education" while others consider it "Community Services." Cast a wide net and then read through individual guidelines.

Pick up the phone (or send an e-mail).

Sometimes directly ask questions of the foundation officer or corporate community contact is the best method to determine if your organization is a good fit to foundation interests. While this personal contact does not ensure a successful proposal, it increases the likelihood of answering questions the foundation hopes to see. This said, if the foundation explicitly discourages personal inquiries respect their wishes and, if available, read the Frequently Asked Questions (FAQs) instead.

Particularly in this tight economic market, background funder research is an essential element to a successful grant writing process for nonprofit organizations.