Define the need for funding for your organization.
Identify and research all possible funding sources.
Contact and gain the interest of appropriate potential funders.
Note: BIAs are not eligible for charitable status. You may consider working in partnership with an organization that has charitable status.
In fundraising, strategy means developing a comprehensive financial plan for raising the funds needed to achieve the organizational objectives, and using the necessary resources to achieve the objective. This is the responsibility of the Board of Management.
Establish Fundraising Goals and Objectives
Before approaching potential funders, you must agree on the following:
how much funding is needed
the type of funding which is required and
a desired financial and organizational target
This is done during your budget process. Your committee must then decide on the type of funding which will assist the organization to provide its programs and services. For example, some organizations may want to target only the private sector or government.
Your organization should obtain the most diverse funding base as possible. Funders generally like to contribute towards services where there are other interested funders. Your organization should attempt to obtain a good mix of private, public and foundation funds for your initiative.
Another possible goal for your committee is to raise funds internally (for example: internal fundraising such as special events, and donations). This can be done using staff and volunteers. When a funder sees that your organization and the community are committed to supporting your services, they are better convinced that your organization is stable and your services are needed.
Fundraising is an ongoing and often frustrating process; more proposals will be written than funds received. A commitment to a regular and annual fundraising process will help to ensure a secure funding base for your project. Long-term and short-term objectives for fundraising should be established.
Define the Funding Needs of Your Organization
Once your Board and committee have agreed upon the goals and objectives of your fundraising approach, it is essential to target the areas where funding is needed. This will assist you in identifying possible funding sources. It is critical that you document the need for funding. Conveying a strong need for your service may aid in expressing a convincing argument for funding consideration. Documentation can include statistics, needs assessments, and other supporting documents.
Identify and Research All Possible Funding Sources
Five elements are essential for developing and implementing an effective fundraising strategy:
Identify potential donors.
Research potential donors.
Gain the interest of potential donors.
Involve them in your program.
Get them to invest in your organization.
Identifying potential donors means looking for any and all conceivable funders who are likely to have an interest in funding your program. Donors could include:
public sector
large corporations
small businesses
charitable foundations
Organizations should determine the priorities of potential funders. This means that they should obtain program descriptions, eligibility criteria, application forms and submission deadlines. Identify a key contact person working for each potential funder who is knowledgeable about the application process, the funding priorities and the kind of information being sought from applicants.
Contact and Gain the Interest of Appropriate Potential Funders
Let the appropriate funders know about your organization and try to catch their interest by doing the following:
Ask a lot of questions about the way the funding process works and invite your contact to learn more about your organization.
Invite funders to special events such and to meet with volunteers and staff at general board meetings.
Your ultimate goal is to get the potential funder to actually invest in your organization. This can be achieved through:
a donation or grant for specified operating and/or capital projects
goods in-kind (e.g., provision of office equipment and supplies, free publicity about your services, assistance in coordinating a public relations strategy, and staff to assist your organization).
Incorporation and Charitable Status Information
A BIA Board of Management is a corporation consisting of directors established by the municipality. Most funders require that agencies be incorporated. An incorporated organization has legal status and gains some liability protection. Incorporation is a legal process, which requires an organization to develop a constitution and by-laws. Goals and objectives also have to be established.
As well, the incorporated organization must have a Board of Management representative of the community in terms of age, gender, sexual orientation, ethnicity and socioeconomic status.
A BIA is not a non-profit organization nor can it obtain charitable status. It is best to inform potential funders of the BIA status and confirm your eligibility before preparing your funding request.
In some cases funders will allow existing incorporated organizations to act as a trustee for developing organizations not yet ready for incorporation. This arrangement allows new organizations to develop under the guidance of an experienced organization and to eventually become an independent entity later.
Fundraising Applications: How to Write Effective Funding Submissions
Funding Proposals - Critical Areas
10 Steps to a Comprehensive Funding Proposal
Summary Sheet
Demonstration of the Organization's Credibility
Define Needs
Identification Objectives and Evaluation Process
Description of Programs
Sound Financial Management
Your application is your opportunity to prove and demonstrate the uniqueness, efficiency, effectiveness, credibility and dependability of your organization. You are selling your idea or service to the funder and it's important that the need for funding and the ability of the agency to deliver the service comes across strongly, concisely and clearly.
The following Ten Steps to a Comprehensive Funding Proposal outline the major areas which should be included in a detailed funding proposal. Please note, some funders do not require all of these items, others require items that are not included. It's always important to ensure that all of the funders' questions are answered before providing supplementary information. Funders do not judge submissions on the quantity of information, but on the quality of the required information.
Funding Proposals - Critical Areas
Areas of the funding proposal that warrant particular attention are the following:
Summary sheet
Introduction
Define the needs addressed by your organization
Clearly identify organizational objectives
Describe the programs/services delivered
Demonstrate your Board's ability to provide sound financial management.
Ten Steps to a Comprehensive Funding Proposal
Identify the specific project or services for which the organization is seeking financial support through this funding submission.
Include a table of contents that indicates the sections and sub-sections of the proposal, with page references.
Spend whatever time is necessary to write an interesting and easily readable summary sheet.
Prepare an introduction that conveys the credibility of the organization in a compelling manner.
Describe the identified need(s) this particular proposal will address.
State the short and long-term objectives to be achieved by the proposed project.
Described the programs /services to be delivered in order to achieve the objectives.
Build in an evaluation component that will demonstrate the degree to which the method of service delivery is achieving the objectives.
Describe the organization's system of financial management that discusses the methods of financial accounting, financial control and financial reporting. Be sure to outline a plan for fundraising that extends beyond the grant period currently being pursued. If possible, attach a copy of the audited financial statement for the previous fiscal year at the end of the funding proposal.
Provide a proposed budget that focuses on the specific project or services for which funds are being sought, and indicate clearly the total amount of money being requested.
Summary Sheet
Include a one-page synopsis of your proposal at the very beginning of your submission. This is sometimes done through a covering letter to the funder. The summary sheet should refer briefly to each of the following items:
Organization name and address.
Statement about organizational objectives.
Achievements which demonstrate the credibility of the organization and what has been accomplished to date.
Identify the needs the organization addresses.
State the activities or programs provided.
The scope of the program for which funds are being sought.
A clear statement about the total projected cost of the proposal, any funds already received from other sources and the exact amount being requested in this funding submission.
How your request fits into the priorities of the funder.
Spend the time necessary to make this an interesting and easily readable summary, as this will encourage the funder to read the whole proposal.
Demonstration of the Organization's Credibility
Fundraising experts tend to agree on one item:
The most critical goal to be achieved in preparing a funding proposal is to demonstrate the organization's credibility.
The groundwork for achieving credibility is laid out in the introduction of your funding proposal. The introduction should include:
A brief history on how, why and when the organization got started.
Mission statement, goals and objectives and general philosophy of the organization.
If your group is legally incorporated as a non-profit organization, state the year of incorporation and your charitable number. Note: Most funders require that recipients of their grants be legally incorporated.
Identify the needs to be addressed, describe the client group to be served and how your program can meet those needs.
Outline current programs and services that address the identified needs.
Clearly state where you think your organization is now in terms of its development and where it is headed in the future (i.e. short and long-term goals).
Provide a chart that clearly outlines the structure of your organization (i.e. describe the Board of Directors or steering committee and its relation to standing committees, as well as staffing qualifications and descriptions).
List the Board of Directors. Note: The make-up of the board should reflect a variety of interests and skills within the community and ensure it is representative of the community served (e.g. ethno-racial, aboriginal, linguistic, people with disabilities etc.)
Demonstrate community participation at both the board and service delivery levels.
Define Needs
The funding proposal must clearly document the need for your organization and your services. Your funding proposal should:
Describe the area geographically, economically, socially and demographically.
State the findings of a relatively recent needs assessment done by your own, or another organization which demonstrate the needs for services.
Demonstrate that your organization's activities will not duplicate the activities of other organizations serving the same client group.
Provide letters of support for your proposal from other agencies and well known members of your community (attach to application).
Clearly Identify Objectives and Evaluation Process
Once the need for service has been established, your group's fundraising efforts depend upon your ability to describe your objectives clearly. Objectives are what your group wants to achieve or change in the community. Objectives are the foundation of the organization and the eventual outcome of the service or program. This section should:
Ensure that objectives are realistic and measurable.
Describe both the short-term and long-term objectives for the project for which you are seeking funds.
Include a description of how each objective will be achieved and how successes or failures will be evaluated and measured.
A time-frame for the implementation of the evaluation should be included.
Example
The following example may help you when identifying your program's objectives and evaluation processes.
If your organization's mission is to provide social/recreational programs for senior citizens, especially those who are isolated and living by themselves in the community your official Program Objective could be to:
Provide social/recreational programs for senior citizens, especially targeting isolated single seniors. The process to achieve this objective can include intensive advertising, outreach, recruitment and orientation of seniors and eventually the participation of clients in programs such as arts and crafts, card games and bus trips.
Process
Advertising
Outreach
Orientation
Participation
Programs
One criterion to measure the degree to which the objective is or is not achieved through this process is a comparison of the frequency and length of stay in hospital of the isolated single seniors before and after their involvement with the social/recreational programs. (The theory traditionally being that seniors who are active are healthier.)
Describe Programs and Services
The programs and services are actually the methods for the organization to meet its objectives. This section should include:
A clear, understandable description of the specific programs/services of the organization.
Emphasize the reason why these activities were chosen and how they meet your objectives.
A description of your paid staffing complement and program volunteers (e.g. volunteers engaged in service delivery, client group served or involved, and your service boundaries).
Discuss the methodology which will be used to measure and evaluate the effectiveness of the program(s) (e.g. keep statistics on such things as number of client visits, volunteer hours, and services provided; and develop other evaluation systems such as record sheets, surveys, group feedback, consultation and evaluation forms etc.)
Outline who will do the evaluation: in-house staff or an outside consultant, and how it will be done, how the records will be kept and how often the evaluation will take place.
Show that the organization is closely monitoring the services it provides and that it is open to making improvements where needed.
Clearly identify which activity or activities will be funded by this particular proposal and the timeframe for which funding is requested.
Sound Financial Management
Your organization must convey sound financial management to any potential funder. Financial management entails three essential ingredients:
Financial accounting
Budget setting
Financial controls
Financial Accounting
The financial statement warrants particular discussion. This includes an itemized listing that clearly shows your revenues (actual and projected) and expenditures (actual and projected) for the year in which funds are being sought. If your group already has received previous financing, the financial statement should include an itemized statement of expenditures and revenues for your previous fiscal year (See Section E: Creating a Business Plan and Budget for examples).
Most funders require an audited statement by a recognized chartered accounting firm so that the agency is accountable for the funds received.
Budget Setting
To a funder the budget is an especially important element. The budget is an estimation of the income and expenditures for a future time period. This is used as a management tool, as the planning of services and programs of any organization should include reference to the budget.
When an organization has been in operation for several years, past financial statements can be used as a basis to develop the budget. Estimations for the future can then be made more accurately. When a new organization is preparing a budget for the first time it is impossible to have the first budget on past records. It is therefore necessary to rely on the judgment of the board or budgets from other similar organizations. The goal of organizations when budgeting is that the expenses should not exceed the income or vice versa. BIAs are required to have a balanced budget.
The budget clearly delineates costs to be incurred by the various sources of funding.
It is useful to compare a previous year's budget to a current year's projections. This allows funders to easily identify where new projected services will impact the budget expenditures and income.
The budget is your tool to justify your request for funding. The budget should tell the same story as the proposal and should be adequate to perform the proposed services.
This Sample Budget Sheet (PDF) includes the type of financial information potential funders need to see in a proposed budget.
When setting your budget it may be necessary to transcribe your BIA's annual budget to this simplified form as most funders are not familiar with BIA zero-based budgeting, its process and associated forms.
Financial Controls
Controlling the financial operations is the responsibility of the Board. It should ensure that funds are appropriately applied to the uses for which they were approved. A mechanism should be in place for the financial control and accounting of funds. Boards often have an appointed treasurer who works with a bookkeeper if the organization can afford to have one.
To gain the funder's respect and potential investment, it is important to present a balanced, realistic budget rather than a "wish list". Some organizations inflate their budgets beyond their true needs with the expectation that funders will respond more positively to their recommendations. Often this proves to be an unsuccessful strategy as funders will view the request as being less viable than a budget that accurately reflects the needs of the agency and the community.
It is often a good idea to ask new funders about the range of their funding allocations so a more accurate budget request can be prepared. When writing about financial management, be sure to outline a plan for fundraising (both short-range and long-range).
Your plan should extend beyond the current grant period and include a strategy for approaching other potential funders. Let the reader know that you have a plan of action and that you do not intend to "put all your eggs in one basket". By doing this you are able to show your knowledge about other potential sources of funds for your organization.
