man studying a nonprofit grant proposalHow Much? Setting a Nonprofit Grant Request Size

Good news! You found a grant source. Even better news, their interests, and your needs match. Now you want to determine an amount to request from the donor.

Determining the size of a request can be a tricky business. If you ask too much, you might get nothing, be perceived as greedy, and even decrease your nonprofit’s hard-earned credibility. If you request too little, your money is left on the table, and your activities are underfunded.

Most people find it helpful to estimate a request size before they draft the proposal. If you can ask the donor for guidelines on a request amount, ask them.

How to Establish a Grant Request Size When You Can’t Ask the Funder

However, for many reasons, people often cannot comfortably request this information. In this case, use the five steps outlined below to establish a request size:

1. Research Long-Term Trends

Research the amounts funded by the group over the last several years. To start, check the donor’s website. Then, use the Nonprofit Explorer and other sites to read recent IRS reports. Finally, look up funded organization’s websites. Often these include press releases and lists that include donors by gift size.

2. Focus on Recent Year

Many grant funders change paths, and long-term trends need to be adjusted for new investments. So, calculate the average grant given by the donor last year. For a first grant, consider a request close to or just less than the average.

3. Pick Out Your Peers

Consider the amounts other groups in your specialty area received. Modify the estimate you made in step 2, if necessary, to fit within this range. For example, when arts groups received grants from $80,000-$100,000 and education groups received grants from $50,000-$70,000, adjust your estimate to fit into the range of your specialty.

4. Consider What’s Happened Big Picture

What’s been happening in the world?  Of course, you’ll adjust your estimate to reflect the impact of the current world, national, and local conditions. For example, you’ll want to adjust upward and downward based on a good or bad economy, social trends, such as diversity, equity, and inclusion, and the like.

5. Fine-Tune Based Your Request Based on What You Need to Do an Outstanding Job

Once you are satisfied with this estimate, draft the proposal. Fine-tune your estimate to reflect other funding sources impacting the project like earned income, your organization’s contributions, matching funds, or the gifts of collaborative partners. (Generally, the greater these other funding sources, the greater your request.) Your goal is to establish a specific dollar amount that offers sufficient but economic resources to complete quality activities, given the donor’s resources.

The Five Steps Applied to the Mythical Foundation

  • Long-term trends and last year: The Mythical Foundation’s funding for the last 3 years totaled $370,000, $422,500 and, $530,100.
  • You see grants ranging from $2,700-$25,000. You first ballpark your request at $14,500.
  • Of the 28 funded organizations funded by Mythical Foundation, children’s groups ranged between $10,000-$25,000, older adults $3,000-$10,000, and health organizations received $7,500-$15,000. As an older adult service organization, you adjust your estimate down to $7,000
  • An article in the local newspaper from a year ago states one of the Mythical family relatives died two years ago and left all of their assets to the Mythical Foundation. You revise your estimate up to $11,000.
  • At this point, you consider what your organization needs in this price range.
  • After writing the proposal, you conclude you need $12,511 to complete the proposed activity economically, and anything less will do poorly. To make everyone’s bookkeeping easier, you trim the budget to equal $12,500. You use this number in your proposal.

Establishing an appropriate request range is an important part of grant submission. As you see, you determine the final amount based on what the donor is likely to do based on their history balanced by the project’s needs. Using the steps above, you can establish a request helpful to your organization, those you serve and invites the donor to fund you.

More Resources to Help You Solve Your Nonprofits Challenges

Check out Karen’s CEO Solutions Library, a collection of resources for nonprofit CEOs and executive directors to answer your questions about nonprofit leadership issues.

For other sources of nonprofit income to augment your grant opportunities, read this article, Can Your Nonprofit Obtain More Income?

Want to learn more about nonprofit revenue? Watch Three Nonprofit Money Myths That Sink Organizations.

Get information on all seven nonprofit revenue sources, download a free chapter from 7 Nonprofit Income Streams.

Need more help with your nonprofit income development? Karen is available for a mini-consult or more to help. Click here to contact her via email or here to set up a time to chat.