It’s the most wonderful time of the year! The fall funding binge, be it grants or loans being cut, is an exciting time of promise…whether a biofuel scale-up, youth mental health charity or, as was the case this week, an affordable First Nations housing project.
It’s also a time when some ask, “Why that project?”
Scandals can add to the angst. Case in point: the recent federal grant to an organization to build an anti-racism strategy for Canadian broadcasting. Turns out the consultant that was hired to run the project has a history of racist tweets. Oh dear.
In my recent letter published in the Globe and Mail (Aug 29) I assured readers that there are no shortage of hoops that organizations need to jump through to secure the coveted pot of gold. Since that letter, as a grantor, angel investor and fundraiser myself, I’ve been asked to expand on that, and provide my theory for how bad grants occasionally happen.
For starters there are three best-practice steps when raising money for a start-up or non-profit:
- Get clear on what we are doing and what we need. All good fundraising starts with a plan and an all-in budget.
- Do the homework. Research prospects and make friends. It’s been proven that funders give to people, not organizations.
- Be thorough when making the ask. Most applications or proposals require the proponent to supply the basics on the initiative, critical path, anticipated outcomes, detailed budgets, but also mountains of governance info, audited financials, board materials, and biographies on key personnel.
It’s rigorous for a reason: both funders and proponents need to know what they’re getting themselves into.
But it only works if the rigour is followed on both sides. Funding arrangements can go awry for various reasons:
- The proponent wasn’t truthful or thorough. For example, zest to get the money can sometimes compel proponents to be overly conservative when budgeting.
- The grantor didn’t follow the process, either fast-tracking a politically-charged project through the system… or just not reviewing the material to the level of detail needed.
- The initiative changed mid-way. This happens, but requires the proponent to inform the grantor.
In summary, really, there’s no excuse for bad funding. Mistakes can happen, but political miscalculations or cutting corners in the vetting process needs to stop. If it’s not your money, grant or loan it like it is.
Comfortably Unsettled 