One of the first questions and sometimes most
confusing faced by new or small charities is...how do
we get money to do what we do. This is called
fundraising, but it has many options for raising those
funds. Each has advantages and disadvantages. This
article will BRIEFLY explore what your options are and
the major pro's and con's of each.
Service contracts/grants from government take many forms. Most major grants and contracts at the national and international level are usually out of range for small or newly established charities. Even if they were not, the application process is long and complex. It is much too complex without an experienced, full-time fundraiser. But local and sometimes regional funding is much more accessible to small organizations. BUT the major disadvantage to this fundraising stream is something called 'mission drift.' This refers to the tendency for an organization to do the projects and programs that will bring in the money; not necessarily those central to its mission. Even though these projects may be good; this can be a slippery slope for a small charity.
Large Trusts/Foundations, like government contracts, can sometimes be too difficult to access without a full-time fundraiser. Many of them offer small project funding as well, but the process and forms maybe daunting at first. With proper training and some practice these grants can be a valuable asset to your fundraising strategy.
Medium & Small Trusts/Foundations are often a great option, especially those with a local interest in the work you do. But in the US, because of the tight guidelines imposed by the IRS, you may need to have a more established track record as indicated by three or more years of tax returns and annual reports. This is though a source of income that you should always keep in mind.
Individuals are the major source of funds for most US charities and a growing section of charitable giving in the UK. In addition to one-time donations, charities should seek to grow regular/monthly donors...from the very beginning. Dedicated individual donors are your most secure income source. If properly treated, these donors will give up dinners out, the movies or numerous other extras in order to keep their commitment to you. And the best part...regular donors can one day become major (whatever that means to you) or legacy donors.
Corporate Partnerships may seem at first as complicated as government grants and contracts, but if you employee the proper strategy they can be a great source of not only cash, but the things you need most to run your organization. Computers are my favorite example of this. You could spend months futilely writing trust application after application to get the latest and greatest that will be out-of-date before you get it out of the store. Or you can network with and solicit local companies that may be switching their systems over. You could end up with several perfectly serviceable computers...and spend that time writing a grant for something else. Of course, with some effort and planning there are other more lucrative options with our corporate partners as well, such as Charity of the Year (CoY), Sponsorships/Branding and Employee Giving.
Events are my absolute favorite for several reasons. First of all, if you only need a small amount of money, this is the quickest and easiest way of getting the money you need. Whether it is a barbecue, bake sale or pub quiz, you can have the few hundred pounds or dollars you need quicker than any other option than a major donor. And if you don't have the time to do it yourself get volunteers to do it for you. Another reason I love this option is because it builds those dedicated individual donors, whether as volunteers or participants.
Income Generation is another option for getting the money you need. Of course the simplest option is fees for what you do already. This is particularly true for private schools and nurseries, which may get most of their money through student fees. Another option is selling things. This option has been a major part of the history of organizations such as Oxfam and the Salvation Army. But with the advent of the Internet and things like eBay, even the smallest charities can benefit from this source of funding.
Of course, the best organizations are those that combine all these different resources to create what is termed 'income diversity.' If your sources of income are diverse, then you will be less vulnerable to a change in any single area. It is an ideal I have never actually seen in practice though...not in a quarter of a century of professional and volunteer experience.
With over a quarter of a century of leadership and fundraising experience, Terri is passionate about helping small charities (those with less than 250K income) achieve big results. She is currently completing an e-course on leadership, management and fundraising for charities. By completing the course, charities will acquire all the basic tools and skills to improve their fundraising capacities, including trusts, major donors and corporate partnerships. To find out more about this e-course or to receive monthly newsletters, visit her blog BLISS-Charities. Please respect the intellectual rights of the author.
Article Source: http://EzineArticles.com/?expert=Terri_Porter_O'Neale
Service contracts/grants from government take many forms. Most major grants and contracts at the national and international level are usually out of range for small or newly established charities. Even if they were not, the application process is long and complex. It is much too complex without an experienced, full-time fundraiser. But local and sometimes regional funding is much more accessible to small organizations. BUT the major disadvantage to this fundraising stream is something called 'mission drift.' This refers to the tendency for an organization to do the projects and programs that will bring in the money; not necessarily those central to its mission. Even though these projects may be good; this can be a slippery slope for a small charity.
Large Trusts/Foundations, like government contracts, can sometimes be too difficult to access without a full-time fundraiser. Many of them offer small project funding as well, but the process and forms maybe daunting at first. With proper training and some practice these grants can be a valuable asset to your fundraising strategy.
Medium & Small Trusts/Foundations are often a great option, especially those with a local interest in the work you do. But in the US, because of the tight guidelines imposed by the IRS, you may need to have a more established track record as indicated by three or more years of tax returns and annual reports. This is though a source of income that you should always keep in mind.
Individuals are the major source of funds for most US charities and a growing section of charitable giving in the UK. In addition to one-time donations, charities should seek to grow regular/monthly donors...from the very beginning. Dedicated individual donors are your most secure income source. If properly treated, these donors will give up dinners out, the movies or numerous other extras in order to keep their commitment to you. And the best part...regular donors can one day become major (whatever that means to you) or legacy donors.
Corporate Partnerships may seem at first as complicated as government grants and contracts, but if you employee the proper strategy they can be a great source of not only cash, but the things you need most to run your organization. Computers are my favorite example of this. You could spend months futilely writing trust application after application to get the latest and greatest that will be out-of-date before you get it out of the store. Or you can network with and solicit local companies that may be switching their systems over. You could end up with several perfectly serviceable computers...and spend that time writing a grant for something else. Of course, with some effort and planning there are other more lucrative options with our corporate partners as well, such as Charity of the Year (CoY), Sponsorships/Branding and Employee Giving.
Events are my absolute favorite for several reasons. First of all, if you only need a small amount of money, this is the quickest and easiest way of getting the money you need. Whether it is a barbecue, bake sale or pub quiz, you can have the few hundred pounds or dollars you need quicker than any other option than a major donor. And if you don't have the time to do it yourself get volunteers to do it for you. Another reason I love this option is because it builds those dedicated individual donors, whether as volunteers or participants.
Income Generation is another option for getting the money you need. Of course the simplest option is fees for what you do already. This is particularly true for private schools and nurseries, which may get most of their money through student fees. Another option is selling things. This option has been a major part of the history of organizations such as Oxfam and the Salvation Army. But with the advent of the Internet and things like eBay, even the smallest charities can benefit from this source of funding.
Of course, the best organizations are those that combine all these different resources to create what is termed 'income diversity.' If your sources of income are diverse, then you will be less vulnerable to a change in any single area. It is an ideal I have never actually seen in practice though...not in a quarter of a century of professional and volunteer experience.
With over a quarter of a century of leadership and fundraising experience, Terri is passionate about helping small charities (those with less than 250K income) achieve big results. She is currently completing an e-course on leadership, management and fundraising for charities. By completing the course, charities will acquire all the basic tools and skills to improve their fundraising capacities, including trusts, major donors and corporate partnerships. To find out more about this e-course or to receive monthly newsletters, visit her blog BLISS-Charities. Please respect the intellectual rights of the author.
Article Source: http://EzineArticles.com/?expert=Terri_Porter_O'Neale
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