Competition for grants in the UK is becoming more intense. Sally Flood offers some guidelines for hopeful charities.
Three months, 15 applications and no grant awards. Does this sound familiar? Grant seeking can be a thankless task, especially for someone who is the sole employee of a charity, responsible for everything from fundraising to service delivery. Thankfully for the fundraiser in question, who did not want to be named, a cheque finally arrived in the fourth month.
The experience is not uncommon.
UK trusts and foundations donate about £2bn each year to charities, and roughly the same amount is awarded by the Government in grants, according to the Association of Charitable Foundations.
Winning this funding is becoming increasingly difficult, says Trevor Watkins, head of trusts at Leonard Cheshire. "It's not that the pie is getting smaller," he says. "It's that there are ever more charities looking for a slice of the funding."
It isn't unusual for a charity to apply for dozens of grants without success, adds Watkins. "For every 10 applications you make, eight of them won't even be acknowledged, and one will be rejected - but maybe one will succeed," he says.
Given these odds, some charities might be put off - but there are hundreds of grant-awarding bodies in the UK and there are ways to increase your chances of winning funding.
1Find the right funding The first step to securing a grant is to spend time researching the options thoroughly so you can identify the most suitable grant maker or award scheme.
The most common place to start looking for funding opportunities is one of the many directories, such as those published by Trust Monitor and the Directory for Social Change. Organisations such as the NCVO and the DSC will offer advice on finding and applying for grant funding, or you might want to work with a fundraising consultant. There may also be local agencies that offer support to local organisations seeking funding.
Many charities find the internet an invaluable research tool. The fundraising team at the National Deaf Children's Society subscribes to various online directories and subscription services, including alert services from relevant government departments. "We find the larger trusts have comprehensive websites," says Luci Jago, deputy director of fundraising at NDCS. "It's possible to subscribe to services that give you an early warning about funding opportunities."
Remember that grants advertised online could be seen by hundreds of other potential applicants. "There's nothing secret on the internet," says Watkins.
"There's a whole industry of people who make money telling charities what's out there."
In addition, not all grants will be publicised online. When Karl Hansen, director of The Living Rainforest, took on the role of fundraiser for the nature charity, he attended industry events to find potential donors.
"I went to a lot of conferences with agencies such as Defra and the European Commission to find out about grants and the politics of funding," he says.
This approach has paid dividends: The Living Rainforest received £1.5m from the EC in 2004 and an additional £880,000 from the Millennium Commission.
The money will pay for a new building and an exhibit at the charity's Berkshire headquarters exploring the impact that man has had on the world's rainforests.
2Do the groundwork Eric Grounds received 4,000 application letters last year requesting funding from his family's charitable trust. Many of the applications were completely unsuited to the aims of the trust and were rejected immediately. "Probably 70 per cent of those charities just stuck a finger in the air and thought 'wouldn't it be nice to have a million pounds'," says Grounds. "They had nothing cogent to say about why we should have given it to them."
Once you have identified potential sources of funding, the biggest mistake you can make is to rush into an application. "I would advise charities against adopting the blunderbuss approach," says Grounds, who is director of fundraising for Sue Ryder Care as well as administrator of his family's charitable trust. "A lot of people start blathering on about their inside leg measurement, or submit irrelevant, badly written applications to trusts that barely have the resources to handle all the applications they receive."
Before you apply for any funding, check that your charity and proposed project match the terms and conditions of the grant. Some trusts fund children's charities only, for example, and others will fund projects in a particular part of the world only. The more closely you meet the requirements, the better chance you have.
3Don't get distracted It can be tempting to apply for funding that almost fits in with your charity's aims. But beware - being diverted into new projects or directions just to win funding can actually cost you money.
"You can end up introducing new costs to the charity because you are inventing new projects that the grant only funds for one or two years," says Grounds.
Funding from a grant can be used only for the purpose for which it was awarded - you cannot use a grant to meet a shortfall in another area of your organisation's finances. This is extremely important - if you break the terms of a grant, you may well be expected to repay the money in full to the grant-awarding body.
If the initial documentation says that telephone enquiries are welcome, telephone the grant administrator directly to ensure you have all the relevant information before you complete the application form, and to confirm that you are eligible for the funding. "One of the most common mistakes charities make is to misunderstand what funders are looking for," says Phil Chamberlain, head of programme policy and development at the Big Lottery Fund.
A quick telephone enquiry should establish whether you are eligible, whether the grant is still available, when funding will be distributed and how long the application process will take. But be warned - some European grants have application processes lasting two years or more.
4Make the application Different grant applications take different forms, but some basic information will be needed in most cases. Take the time to assemble copies of key documents such as mission statements, annual reports and accounts - and make sure they are kept up to date. "It's easy to be knocked out of an application process because you don't have the right enclosures," says NDCS's Jago. "If you are a small charity, you should at least make a start on documents such as equal opportunities policies and child protection statements, because you'll need them."
Most grant applications will require you to produce a description of your charity and its aims, together with a detailed plan of the proposed project, including costs over the lifetime of the project. Some grant applications - such as those from the EC - will require a bank guarantee, or other legal guarantees showing how you will use the funding.
Once you have assembled the relevant information and identified a suitable funding opportunity, it's time to put pen to paper. "It's important to get the right person to write the document - and have someone else proof it and give you honest feedback," advises Grounds. "Don't be tempted to send off 24 pages of A4 paper filled with tiny print - if it doesn't fit on the application form, it probably won't be read at all."
Be clear about the objectives of the grant body and try to show how your proposals match those objectives and their impact on the wider community and the environment. Don't be afraid to make clear how much your charity needs the grant - this can often be a powerful tool in winning funding.
5Find match funding One of the most common reasons for a grant application being unsuccessful is the charity's failure to find extra funding to complete the project. Government grants will usually cover about 50 per cent of a project's costs, but private and research grants may cover only 15-50 per cent of them. Some general grants will also vary according to the needs of your organisation - some charities will receive thousands of pounds, others only a few hundred.
6Plan your cashflow It's important to remember that grants rarely arrive in one lump sum on the day your charity embarks on a venture. Some are paid in fixed instalments, some when the project is finished; others pay a percentage up front and the rest on completion. In this case, you'll need to show you have the funds necessary to complete the project, through either a loan, profits or other investors.
For example, The Living Rainforest has been awarded a grant of £1.5m from the EC, but will only receive 40 per cent of this up front (and even then, only on production of a bank guarantee). The remaining funding will be provided once the charity has completed the project and has an invoice proving how the money was spent, explains Hansen.
7Record how you spend the money For your own protection, it's important to keep careful records of how you spend any grant awarded to your charity.
Make sure you keep receipts for any materials purchased, and any other relevant paperwork.
Finally, don't forget to think about what you will do if you actually win an award. Charities funded by the Big Lottery Fund will often be visited by representatives from the fund, who will expect to visit sites and examine accounts and plans to make sure money is being used appropriately, says Chamberlain. "This can come as a bit of a shock to smaller charities," he says. "But we will expect to monitor funding as it is used."
- Go through your records to find out about trusts that funded you in the past and ask if they will consider funding you again - this can be a highly cost-effective method of fundraising
- Create a standard letter and application pack by all means, but only use it when applying for small grants and awards. Always write a fresh application for large funding opportunities
- Always check whether a trust will accept telephone enquiries before calling. If they do, many trusts will help you to phrase your application in a way that makes it more likely to succeed
- Consider using a specialist consultant to help draft applications for large grant awards - but negotiate on fees, because you will have to pay even if the application doesn't succeed
- Ensure that you have the institutional capacity to carry out a project before applying for funding - do you have the personnel, the skills and resources to follow through on your aims?
GRANT INFORMATION SOURCES
1. Publications such as those produced by the Directory for Social Change and Trust Monitor
2. Websites of larger trusts, such as the Wellcome Trust or Joseph Rowntree Foundation, have comprehensive information about awards, eligibility and online application forms
3. Subscription email services such as those offered by Funding Information and the Foundation Directory. There are also free services from the European Commission and most major UK government departments, through the www.governmentfunding.org.uk website
4. Courses run by voluntary sector agencies such as the NCVO can advise fundraisers on how to identify new and appropriate grant and trust funding opportunities
5. Smaller trusts and grants may not advertise online. Read trade publications and local newspapers for notices of smaller, local awards that are available.