The economic downturn has reduced foundation assets, forcing funders to cut expenses and limit grantmaking. Foundations suffered a 22 percent reduction in assets in late 2008, fairing much better than the overall market in general. As a result, 2009 witnessed the sharpest decline in grantmaking in decades. The 2010 outlook is much more promising as many foundations have recovered the majority of the lost assets since the market low point 1 year ago. Since then, the S&P 500 Index has rallied by 68%, representing the strongest one-year recovery since the Great Depression and leading to many foundations surpassing gaining in wealth.
However, it is not all good news and grantmaking will never go back to the way it was before the market dropped. Foundations have learned valuable lessons through this process making them more strategic and demanding greater accountability. But there are plenty of things you can do to attract funding for your ministry.
Christian ministries and churches want to know if the economic recovery we're seeing will facilitate more grantmaking in 2010. The only way to answer that question is to turn to funders themselves. They do not speak with one voice. Their answers differ, which is not surprising considering the unknowns of the recovery and diversity of the foundations themselves. They are, however, as a whole, much more optimistic than they were a year ago, according to the findings of a Dini Partners' poll of the nation's leading foundation leaders.
In its Dini Partners Giving in 2010 survey, Dini Partners polled a select group of philanthropists to get their views on the recovery and the future of grantmaking.
Forty percent of the poll respondents expect to see renewed economic growth or believe the economy will continue to improve throughout 2010 and greatly stabilize by the end of the year. Twenty-seven percent expect to return to their high prerecession giving levels of 2008. An astounding 70% said they will give more than they did in the depressed giving year of 2009, 13% said their giving will depend on how well the stock market does, and 23% said they will give less than in previous years. Fourteen percent said they will give the same or slightly less than in 2009.
These findings, though mixed, reflect growing optimism. A year ago 62 percent of respondents said they would reduce giving in 2009 while only five percent said they would give more.
The Foundation Giving Forecast Survey by the Foundation Center queried over 500 foundations in September 2009, including 429 independent foundations, 110 community foundations, and 54 corporate foundations.
Fifty-four percent of the respondents said they will either match their 2009 level of giving in 2010 (39.4 percent) or increase it (14.1 percent). Smaller foundations which are more likely to be supportive of Christian ministries and churches are twice as likely as large foundations to give more in 2010. (Large foundations are those that give at least $10 million annually). About one in five foundations expect to give less in 2010 and 26% are uncertain how much they'll give.
Even a continued economic recovery this year wouldn't increase giving much by the largest foundations as grant budgets depend on rolling asset value averages from the two previous years.
All things considered, foundation giving likely will grow somewhat in 2010 and may see a strong resurgence in 2011. Optimism is on the upswing, opportunities for this year do exist, and 2010 is the right time for Christian ministries and churches to develop a strong grant development foundation for 2011.
Steps to making your Christian ministry fundable
The economic downturn is forcing funders to give strategically. More than ever, they must ensure that the funds they provide yield results. This means that you too must act strategically. More than ever, you need to give foundations what they want and heed grantmaking trends.
Foundations are increasingly interested in funding outcomes and causes rather than particular organizations. The answer is not to adapt your mission to each foundation, becoming everything to everyone. Your ministry will become much more fundable in these times by becoming known for staying true to its mission.
Development experts have other ideas as we transition from the harsh funding environment of last year to the better days ahead. Below is the Here-4-You Christian Grant Consulting version of the "Be Attitudes" for laying a strong foundation for grant development in 2010 and 2011.
Be Measured: Your "goals will be measured against your mission, tested against anticipated outcomes and community impact, and aligned with the specific collaborative input of donors."
Be Realistic: This means, "Do not return to the goals and high expectations of 2006 and 2007; at the same time do not remain mired in the anguish of 2009."
Be Intentional: "We are now going to be even more intentional, deliberate, and purposeful in our decision-making process." Funders want you to do the same in your grant proposal-preparation process.
Be Creative: In today's grantmaking environment, this means "moving away from a 'reaction phase' to an 'action phase.'"
Be Strategic: "It is these plans that will express the measured, realistic, intentional, and creative underpinning of campaign and fundraising objectives and goals."
Be Communicative: This means cultivate close personal relationships with both prospective gift donors and current ones. "This continues to be a period in which the close personal stewardship of relationships is paramount."
Be Appealing: "In a surprising shift away from traditional thinking, the merits of the appeal - its mission alignment, precision of statement, and clarity of presentation - far surpass the importance of the person asking for the gift."
Be Selective: Funders recommend that you "sustain and further develop annual fund support, along with welcoming select capital initiatives and campaigns...and rebuild endowment values through highly selective fundraising efforts, provided the endowment is guided by conservative and very deliberate investment policies and management."
Be Stronger: "Given the time that has passed since the beginning of the recession, there is an expectation that most institutions have made adjustments to programming and expense management that would move them away from rescue fundraising for the operating budget."
Be Collaborative: Seek out collaboration - foundations are urging likeminded organizations to fuse their resources to combat problems, enabling you to achieve more together than you ever could apart.
Be Sustainable: Demonstrate sustainability - credibly explain how you'll fund your program once the grant period ends.
Be Transparent: Transparency means providing easy access to financial information, mission and vision, programming plans, projects, and financial data.
Conclusion
In an environment in which more and more organizations battle for fewer and fewer grants, one funder in the Foundation Center poll spoke for the many by saying, "The long-term impact of the economic crisis on the nonprofit sector will be that only the strongest, smartest, and most strategic will survive." Ensuring that your ministry is strong, smart, and strategic in its grant development approach is crucial to your funding success and to your long-term viability.
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