4 reasons to pursue small grants

When a nonprofit organization first makes the leap into fundraising, its leaders tend to aim high. And that's wonderful: it means that these leaders really believe in their missions and feel that their work will resonate strongly with the charitably minded.

But smaller dollars are critical for nonprofits that

• are new to fundraising
• have a specific, new program or project in need of charitable funds.

I'd like to share four reasons why smaller grants from foundations and corporations are particularly critical for nonprofit organizations.

1. Build a funding track record. It's very rare that a nonprofit or a program with little funding will receive a significant gift early on. That's like going from 0 to 60 in zero seconds. Instead, focus on foundations and corporations that align with your mission and may be able to grant you $1K, $2K or perhaps even $5K. While monetarily small, these amounts will show larger funders that other donors already believe in your work.

2.  Forge relationships that may grow over time. Many funders view their grants as investments in your nonprofit. They want to aid your work but they also want to see results. A funder with no prior relationship to your nonprofit may feel more comfortable starting with a small grant, gauging the impact of those funds, and then continuing to make grants over the long term if they feel that your organization uses their dollars well. I recently worked with a client that was receiving $1K annually from a large Boston-based foundation for several years. This year, the foundation invited the nonprofit to apply for a $100K grant. We submitted the application--and we got the grant!

3. "Seed" new projects. You and your board may want to launch an entirely new project or program next year, but you may not have the funds available in-house to make it happen. Small grants are a great way to "seed," or launch, a new initiative, giving you the chance to establish its activities. This early work will serve as proof of principle, eventually attracting larger donors that are interested in helping you to expand and sustain the project.

4. Be careful what you wish for. Typically, larger grants call for more complex and time-consuming grant applications and reporting processes--including a detailed financial accounting of how the foundation's funds were spent. The funder's expectations tend to be much higher in terms of your nonprofit's performance and in your organization actually achieving all of the things it promised to achieve in the original grant submission. Smaller grants certainly also require your accountability, but they tend to offer you the opportunity to learn the foundation ropes and build up your fundraising program in a manageable fashion.

Do you think smaller charitable gifts are important? Why or why not?

Author: Sarah M. Jackson