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Ellen Mowrer, GrantStation

Recent Posts by Ellen Mowrer, GrantStation:

Organizational Sustainability, Capacity, and Growth: Not Just for the Big Guys!

I recently had the opportunity to meet with a small, grassroots nonprofit organization that was justifiably proud of its growth. It had proven organizational sustainability by reaching the 10-year milestone and had proven capacity by quintupling its annual budget since its inception. And, the organization had a current grants strategy that was for a larger amount than the entire annual budget during its first years. However, it still operates on an annual budget of less than $500,000—not one of the “big guys,” but still quite successful.

This got me thinking about the fine line between success and failure for small nonprofit organizations.


And the Greatest Challenge for Nonprofits Is: A Lack of Time and Staff

We at GrantStation are writing and publishing the results of our most recent survey, the Spring 2018 State of Grantseeking Report series. Over the years, the most frequent response to the survey question “What, in your opinion, is the greatest challenge to successful grantseeking?” has remained the same. This spring, 21 percent of our nearly 5,000 respondents told us that grantseeking’s greatest challenges stem from the lack of time and staff for grantseeking activities.


In Grantseeking Your Budget Does Matter

GrantStation is currently in the midst of its Spring 2018 State of Grantseeking Survey, and as you can imagine with an expected 3,500 to 4,000 nonprofit respondents, I receive feedback early and often.

One gentleman from a small nonprofit organization told me, “We were not eligible for the award because the funder required a paid executive director of $125,000 for two years, and a budget of $500,000 or more. Of course, if we had that kind of money there would be no need for a grant.”

And I understand his point, as I am sure that you do, too—grantmakers generally like to see capacity, as defined by organizational budget size, organizational age, and scope of services. But there are grantmakers who will fund organizations with smaller budgets, or all-volunteer organizations, or newer organizations, and those three things often go hand in hand.


The State of Grantseeking

We recently kicked-off GrantStation’s Fall 2017 State of Grantseeking™ Survey. And, yes, I’d would be most appreciative if you would participate. But more importantly, I’d like to share some of the results from the reports of the prior survey, results that reflect trends that have immediate real-world implications.


Is Your Nonprofit Planning to Fail?

GrantStation conducts a semi-annual survey on the State of Grantseeking™, with responses ranging from 2,900 to 3,300 nonprofit organizations, educational institutions, and government entities. Based on these response rates (and as always, a heartfelt thank-you to the participants) I have confidence that the data is a fair reflection of trends at the grassroots level.


THE STATE OF GRANT SEEKING: DATA FOR THE REAL WORLD

Twice a year, every year, we at GrantStation survey individuals associated with grant seeking in nonprofit organizations, educational institutions, government entities, and independent grant-writing shops, to quantify early trends in the world of funding. The most recent data reflects activity from July to December 2014, and the resulting reports, and the benchmarks contained within, can assist you as you navigate the increasingly bumpy waters of grant seeking.


Does Organizational Staff Size Affect Grant Activity?

After a recent State of GrantseekingTM webinar, an attendee asked about differences in grant awards and grantseeking styles, based not on annual budget but on organizational size when measured by number of employees. It was a good question because we know that a lack of time and staff is the most frequent impediment to successful grantseeking, regardless of organization size. The following is a synopsis of grant activity as defined by number of employees: all volunteer, 1 to 5 staff members, 6 to 10 staff members, and, as a counterpoint, more than 200 employees. Here is what we've learned. ...

Let's start with some basic, and unsurprising, demographics: to state the obvious, organizational age and budget size increased in conjunction with staff size.

Staff Organization Age Budget Mission Focus
All volunteer <5 years (37%) <$50,000 (60%) Arts, Culture, Humanities (15%)
1-5 people 10-25 years (38%) <$500,000 (59%) Arts, Culture, Humanities (19%)
6-19 people 10-25 years (40%) <$5,000,000 (81%) Human Services (18%)
200+ people >100 years (42%) >$25,000,000 (62%) Education (33%)

It takes time to grow an annual budget, and that budget is what enables increased staff.

The question, however, was, "Does staff size affect grantseeking activities and success?" The short answer is "yes," but let's looks at some of the data that are available.

Because all-volunteer organizations usually lack personnel dedicated to grantseeking, it becomes a less consistent, ad hoc affair, resulting in few awards. Moving an organization from all volunteer to having 1 to 5 employees increases the likelihood of grant funding; moving the organization to 6 to 10 employees increases that possibility even more. Organizations with more than 200 employees rely less on grant funding because they have other revenue streams, including tuition and donations.

In addition, organizational size is affected by mission focus, or vice versa. According to the Spring 2014 State of GrantseekingTM Report, the median largest grant award for Arts, Culture, and Humanities organizations was $20,000, for Human Services organizations it was $50,000, and for Educational Institutions it was $200,000.

Median largest award size also increased with larger staff size:

Organizations that employed 1 to 5 people reported a median largest award of $24,000—nearly five times larger than the $5,000 received by all-volunteer organizations. Organizations that employed 6 to 10 people reported a median largest award 10 times larger than that of all-volunteer organizations, and over double that of organizations employing 1 to 5 people. And organizations that employ more than 200 people reported a median largest award of $375,000.

Does staff size affect grantseeking activities and success? Without a doubt, and there are two main change points. When an organizations moves from all volunteer to having employees, the consistent focus on the organization's mission and budgetary needs results in more dedication of time to grantseeking and larger grant awards. And when an organization moves beyond five employees, grantseeking becomes more than a filler task, resulting in even larger and more frequent awards.

Ellen Mowrer, GrantStation
© 2014, GrantStation

Ellen Mowrer is director of business and marketing for GrantStation, a premiere online fundraising resource that provides information on more than 6,500 funders accepting inquiries.