Nonprofit Characteristics Foundations Seek Before Making Grants

Whether your nonprofit is a well-established, mature organization or a brand-new one trying to get off the ground, it’s always good to focus on the basics, especially in these trying economic times.

The competition for foundation grants is greater than ever with charitable service demand at an all-time high. So to ensure your organization is in position to grab the attention of grantmakers, make sure you're set up with the pre-grantseeking needs foundations look for.

In the webinar “Before Your Seek a Grant: A Checklist for New Nonprofits,” Caroline Herbert, manager of multimedia and on-demand training at the Foundation Center, laid out the characteristics of successful nonprofit organizations that foundations look for and the key elements to obtaining those characteristics.

Characteristics of successful nonprofits
“A fully functioning, effective nonprofit organization does not just appear out of thin air,” Herbert said, noting that there are different stages in the nonprofit life cycle: idea stage, startup stage, growth stage and mature stage.

“Ask yourself where you are in the lifecycle continuum” to determine where you are in the process, she advised. Don’t expect to be ready for a grant application if you’re early in the life cycle.

“Funders are looking for successful organizations. They’re looking at not just what’s your great idea, but what assurances can you give me to achieve your mission,” Herbert said.

The Grantmakers for Effective Organizations suggest that fundraisers ask themselves: Does your organization have the ability to fulfill its mission through a blend of sound management, strong governance and a persistent rededication to achieving results? To answer yes to that question, you must have:

• A compelling mission — a mission statement of needs and problems that your organization solves, something that differentiates you from the pack.
• Capable leadership — you must have an effective board and qualified staff.
• High-quality, well-regarded, relevant programs — “You want to build your reputation as a high-quality service provider,” Herbert said. “Foundations look to see what your reputation is, and it must be relevant. Why do we need another nonprofit addressing your issue?”
• Efficient operations and support systems — can you deliver on your promises?

Other characteristics of successful nonprofit organizations include:

• Regular organizational planning and evaluation.
• Adequate facilities — technological facilities, physical locations, etc.
• Solid finances with diverse revenue streams — “Fundraising will stay with you for the lifetime of your organization,” Herbert said. “You need to think about all the ways you’re going to bring in support. Foundations don’t like to see you rely on one or two sources.”
• Track record/history — a stumbling block for new organizations, Herbert said. If your organization is still relatively new or doesn’t have much of a track record, foundations may look to leadership of the organization: Who are the leaders? What kind of experience do they have? What are their track records? Planning can also help convince a funder that your cause is worthy as well when your history is brief.

Key elements of getting started