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.
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:
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 organizations’ websites. Often these include press releases and lists that include donors by gift size.
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.
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.
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.
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 economical resources to complete quality activities, given the donor’s resources.
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 invite the donor to fund you.
Check out Karen’s Nonprofit CEO 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?
Get information on all seven nonprofit revenue sources, download a free chapter from 7 Nonprofit Income Streams.
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