Oh, hey there!
Looks like you’re a savvy entrepreneur with a big heart and a big vision for how you’re going to do good. You’ve picked your team, formed your corporation, scored 501(c)(3) status, and applied for your license to legally fundraise. (If you haven’t done that yet, pump the brakes and check out our Beginner’s Guide to Starting a Nonprofit!)
What’s next? Well… Now you actually have to raise those funds.
Securing funding can be one of the most challenging parts of starting and keeping your nonprofit, and we’re here to help. We’re going to be delving into some of the most common funding sources for nonprofits, so you don’t have to face the hunt on your own.
This week, it’s all about grants. Stick with us as we explain types of grants and how to find them so you can set your nonprofit up for success. (For now, don’t worry about grant writing or the process of applying for one of these grants – that’s coming next week!)
Types of Grants
Before you can find what you need, you have to know what’s out there! Not every nonprofit grant is a good fit for your organization. Each grant proposal you write will have to be tailored to the application, so it behooves you to only apply for ones that you’ll be a good candidate for.
General Purpose/Operating Support Grants
A general purpose grant gives you complete control of the funds provided to you. This means the grant provider has put trust in you to use their money for good, and is looking to support your mission rather than a specific program.
Operating support is necessary to fund your day-to-day activities. For example, if you have a physical office, you’ll need to keep the lights on somehow! General purpose grants can help you do that.
Project Support Grants
As you can likely infer from the name, project support grants don’t provide the same flexibility as general purpose grants. These grants will come with a set of rules to fund specific initiatives driven by your mission, giving the grantmakers more control. We’ve listed three of the most common project support grants, but there are plenty out there to apply for!
- Startup Grants (“Seed Money”)
Money makes the world go round, and unfortunately your nonprofit can’t become a reality without it. While benevolent family and friends may be able to help you begin, you’ll eventually need to secure “seed money” in the form of a startup grant.
Private foundations typically provide these kinds of grants and are a great place to begin your search.
Don’t discount corporate philanthropy! It’s worth looking for a company that is aligned with your mission, as they may be willing to give through matching employee donations, volunteer grants, or other programs.
Check out the grants.gov database for federal nonprofit startup grant programs, and your state government’s website for state funding resources. These are big sources of support to take advantage of!
- Endowment Grants
Think of an endowment grant as your “rainy day fund.” These are designed to last forever, so you’ll only be able to access the dividends of a donor’s investment.
Endowment grants are one way to ensure the long-term financial health of your organization, and are appealing to donors who want to leave behind a lasting legacy.
Be warned: These grants can be frustrating! Endowment grants aren’t designed to address the pressing current needs of a nonprofit, so they can feel like they’re limiting the amount of good you’re able to do right now. But as a foundation for year-after-year stability, they can be a lifesaver.
Depending on the needs of your nonprofit, you may choose to solicit contributions rather than build an endowment.
- Planning Grants
Preparing for your nonprofit’s next initiative takes time and money. That’s where planning grants come in. These grants will cover everything that happens before your program proposal can be written.
These program-specific planning activities can be anything that supports the development of your plan. You’ll need to gather zip-code specific data and anecdotes to address any possible causes of the problem you intend to solve, data to properly define what the problem is, and consult with experts to build a clear path forward.
The primary requirement you’ll need to fulfill to take advantage of a planning grant is to… come up with a plan! While that’s certainly no easy feat, the support of this grant will help you make it happen.
Where do I hunt for these grants?
We’ve already mentioned grants.gov, but what are some of the other must-visit sites when beginning your search? We’ve listed three of our favorites to get you started!
Grantli is a free resource that offers educational courses to “demystify the grant seeking process to help you secure the funding you deserve.”
They also have a comprehensive list of state-by-state resources, including government agencies, office numbers, and the top grant-making foundations for each state.
You’ll need to pay for a subscription to Grantwatch to view all of their listings, but it’s more than worth it. The directory currently features “more than 28,164 current grants, funding opportunities, awards, and archived grants (that will soon be available again.)”
You must be based in the USA, U.S. Territories, or Canada to take advantage of this database.
- Google Ads
While this resource doesn’t offer any of the typical grants we’ve covered, Google Ad Grants help your organization to “raise awareness, attract donors, and recruit new volunteers using Google search ads.”
If you qualify, your nonprofit will be given $10,000 per month in Google search ads. That’s nothing to sneeze at!
The process of searching for and securing grant funding can sometimes be tough, but is always worthwhile. Stay tuned for next week’s blog on grant writing, and know that you can always reach out to KYN Accounting for expert nonprofit financial guidance.
We’ve listed a few of our favorite grant databases, but there are too many good ones out there for one blog post. If we left out one of your go-tos, let us know in the comments below!