Getting Past the “Ick” to Build Powerful Funder Relationships

Building relationships with organizational funders who invest in your nonprofit is critical to a successful grant strategy – but it’s also tricky. You want to be authentic in your interactions, but the relationship is ostensibly transactional. How do you get beyond the sense that you’re just asking for money? Then, how do you stay engaged and keep your funder relationships organized? 

First, remember that you’re not asking for money. You’re representing your organization and its mission, stakeholders and constituents. It’s not personal if the funder doesn’t connect with your cause or see the alignment. We asked our team member, Vicki Northcutt, for her insight on this topic as a former Director of Development.

“Anybody who gives philanthropically, you can assume you’re not the only one asking them for funds. A lot of different organizations are courting them to fall in love with their mission. You’ve got to get to the point where you, as a development professional, realize that this is not personal – it’s about the mission. It’s not about whether or not the funder likes you. The funder really has to believe in your organization and find the connection with their own mission.” – Vicki Northcutt, Grant Strategy Manager, L Professional Writing

Second, make sure you have a system to track and manage your funder relationships. Many nonprofit organizations use a type of constituent relationship management (CRM) system and/or fundraising software to manage all aspects of their donor relationships. Examples include Bloomerang, Little Green Light, Salesforce Nonprofit Cloud or Salesforce Nonprofit Success Pack, Neon One, and Monday. These tools are not prohibitively expensive for most nonprofits (Salesforce and Monday even offer free seats/licenses) and are well worth the investment to keep organized. L Pro recently learned of an entirely free all-in-one fundraising platform called Zeffy.

However, if you’re not quite ready to make the leap from spreadsheets, Neon One has a guide for managing donor relationships in Excel or Google Sheets. 

Now, let’s get to the nitty gritty: How do you start cultivating great relationships with funders?

1. Vet the Alignment.

Before you approach a funder, you want to understand their goals and motivations, priorities, non-negotiables and desired impact. Learn what projects and organizations they’ve funded in the past and what they’re focusing on right now. Then, ask yourself if your organization’s work furthers the funder’s mission. And finally, confirm that your organization meets their funding requirements and will be able to manage their grants effectively. 

At L Professional Writing, when we start off a new client relationship, we create a custom grant research summary of prospective funders. We end up with a selection of clearly-aligned funders with the strongest potential, those with possible potential, and those funders that are not a good fit. 

2. Connect Appropriately.

In most cases, it is perfectly acceptable to reach out to a funder via email or phone if this contact information is available (via their website, 990 or a grant database). However, be mindful to look for the funder’s preferences and connect accordingly. Also keep in mind that the 990 contact information might not be the most reliable or provide a connection directly with the funder. Some funders stipulate “no phone calls,” in which case a phone call would be a fast way to get off on the wrong foot. This is an area where our research at L Professional Writing brings a ton of value for our clients. We’re often able to help identify the best approach based on our findings and existing relationships.

Some funders require that you connect before you apply. For example, the Colorado Springs Health Foundation has a timeframe for pre-application phone calls for each grant cycle. And the Colorado Springs Osteopathic Foundation requires organizations to call the Executive Director before applying. 

Many simply don’t have the resources, time, or staff to speak with every prospective applicant and prefer that organizations just go ahead and submit their LOI or proposal.

If you want to connect before you apply and really kick off a strong funder relationship, here are a few options:

• Ask for an introduction via someone in your network (a board member, volunteer, friend, member organization).  Connections are gold, and an introduction like this is the absolute best way to kick off a great funder relationship.
• Connect directly via email, phone or LinkedIn (if readily available).
• Attend their informational webinars and events.
• Engage with them at relevant industry events.

When you first connect, try not to make it about the money. Be curious about the funder. Ask about their goals and ambitions, the impact they want to have and their proudest accomplishments. Find the commonalities and celebrate each other as hard-working catalysts for change and advancement in your respective priority areas. 

“Frame the first outreach around shared values, not just a request for funding.” – Vicki Northcutt

3. Show Your Gratitude.

If you apply for a grant and the funder considers your proposal, be sure to thank them for their time and consideration – whether they fund you or not. Send a personalized “Thank You” letter via their preferred means of communication, and acknowledge their impact in the community. Invite them to stay connected and engaged, even if your missions don’t align. If you’ve been denied, you can take this opportunity to ask for feedback and recommendations on how to make future applications stronger. If they do fund you, be sure to have a system in place for officially thanking donors.

4. Maintain the Relationship.

This sounds simple, but there is so much nuance to maintaining funder relationships. The last thing you want to do is leave your funder feeling “ghosted.”

“If somebody gives you money and then they never hear from you again, that’s the biggest “no-no” of all.” – Vicki Northcutt

At the most basic level, you must: 

• Meet their expectations for managing their funds, such as using funds for the intended purpose, collecting data and providing reports.
• Comply with their requirements for using the funds, such as actively using a Homeless Management Information System (HMIS) if you’re awarded a U.S. Department of Housing and Urban Development (HUD) grant.
• Acknowledge them publicly as dictated in your grant agreement (if applicable).

If you encounter any challenges with these requirements, be open and transparent with the funder. Honesty helps build trust and credibility with funders, and it lets them know your intentions with their funds are pure. This is especially true if you missed a report deadline. Offer your apologies, not excuses, and an opportunity to submit it late. We have heard stories of a once-severed funder relationship being repaired by submitting a missed report years after the deadline. 

At the next level of relationship management, take opportunities to remain engaged. 

“Stewardship isn’t just about reports and updates. It’s about storytelling, connecting on a human level. Funders really want to hear the heart behind your work.” - Vicki Northcutt 

Here are a few ways to stay connected:

• Keep funders updated via newsletters, your website and social media.
• Invite them for a visit, especially if you’ve accomplished something new with their funding.
• Send them your annual report and relevant announcements.
• Engage with them on their social media and interact with materials they send you, such as their newsletter or annual report. 
• Inform them of important changes at your organization. For instance, if the primary contact or Executive Director changes, let your funders know and offer the opportunity for an introductory meeting.
• Continue to attend their webinars and events as you’re available.
• Reach out “just because,” such as by sending them a story or article that reminded you of them or celebrating their organization’s anniversary.

A CRM can be particularly helpful with these tasks. Such a tool can help you not only track gifts and reporting requirements, but also help you manage “thank you” notes, emails, newsletters and other touchpoints. This can be a life saver for busy development professionals – and especially for small nonprofit teams – who must also manage program delivery, outreach, fundraising, community events, and even social media. 

With that being said, we want to leave you with this advice from Vicki:

“Give yourself grace and mercy, especially if you’re a one-man team. You’re not going to be everything to all people. There are going to be times when you connect, and there are going to be times when you don’t. Set your priorities of what has to be accomplished and work towards those goals. As time opens up, work on some of those secondary goals. And just try to do your best. There are a lot of expectations on development professionals. You can feel like it all falls on your shoulders – but it doesn’t. There are board members, staff, volunteers, etc. At a nonprofit, everybody’s in marketing and everybody’s in development.” 

L Professional Writing is a professional grant writing agency located in the Pikes Peak region. We can help your organization identify prospective funders and vet them for alignment with your mission and values. We can also help facilitate the appropriate outreach, assess individual grant requirements to help ensure compliance, and assist with reporting and storytelling. For more advice like this, subscribe to our quarterly newsletter. If you’re curious about how we can help your organization, contact us at info@lprowriting.com for a one-hour fit call/consultation.