5 Steps to Designing a Successful Grants Program
1. Determine Your Grantmaking Priorities
With so many worthy causes, it can be tough to narrow down and decide who gets your grants funding. Start by thinking about initiatives that benefit your organization, your community, or simply your heart. A focus, or impact area, is a targeted field or cause that aligns with your grant program’s mission and goals. These can stem from local community needs, specific populations, or even the UN’s Sustainable Development Goals.
To define these areas, you can conduct a thorough needs assessment to understand pressing issues within the community or sector that you want to support. This can involve surveys, interviews, and data analysis to gather insights from stakeholders, including community members, experts, and potential grantees. Ensure that these identified focuses are in line with your organization’s broader strategic objectives as well.
Next, it’s important to evaluate the potential impact by considering factors like the scale of the problem, feasibility of interventions, and potential for measurable change. Prioritize areas where your resources can achieve the most significant and sustainable impact. It’s common to focus on three to four impact areas and narrow them down further into sub-impact areas. For example, within education, sub-focus areas might include early childhood education, STEM education, and vocational training.
2. Lay out Any Giving Restrictions
Setting up grant restrictions can make awarding funds smoother and more effective. Clearly outline what the grant will cover (e.g. research, program development, or buying equipment). If needed, limiting the grants to specific areas or communities can also help prioritize resources to maximize impact. Another key step is to define who can apply, such as nonprofits, schools, or individuals, and list any required qualifications. Specify what the budget can and can’t cover, like funding salaries but not overhead costs.
Detailing the reporting requirements, including the type and frequency of updates, is a great way to ensure accountability. Consider requiring applicants to secure additional funding from other sources to show their commitment and leverage more resources. Make sure all restrictions comply with relevant laws to avoid legal issues. While restrictions are important, leave some room for flexibility to encourage innovative ideas. Examples of restrictive categories include geographic considerations, eligible organization types (e.g. 501(c)(3) nonprofits in the US), organization size, prior recipient status, and whether the application is open to all or invite-only.
3. Establish a Grantmaking Timeline
To set up a grant cycle timeline, break it down into key stages: application, review, award, and reporting. Calculate how long each stage should be based on your team’s capacity and the complexity of the grants. For instance, reserve 1-2 months for applications, 2-3 months for review and selection, and set a clear period for project implementation and reporting. Sync the timeline with your fiscal year and consider holidays or major events. Make sure deadlines are clear to applicants and that your team is ready for each phase. Regularly reviewing and tweaking the timeline based on feedback will help to keep things running smoothly.
4. Define the Grant Application Content
Creating an application process can feel overwhelming. Once you’ve decided where your funds should go, you’ll still need to narrow down the number of organizations working in that area. Consider if there’s a specific population or geographic region that you want to support.
Before you start crafting your grant application, it’s essential to ask yourself two questions: “What information do we need to make a decision?” and “What information do we want for impact reporting?” If a question within the application doesn’t fit into these categories, you probably don’t need to ask it. This keeps your application focused and makes it easier for applicants to provide the right details. Here are some other examples to consider for getting the best possible information:
- Project Goals: “What are the main goals of your project, and how do they align with our mission?”
- Target Audience: “Who will benefit from your project, and how will it impact them?”
- Success Metrics: “How will you measure the success of your project? What metrics will you use?”
- Challenges and Risks: “What potential challenges or risks do you foresee, and how will you address them?”
- Sustainability Plan: “How will you sustain the project after the grant period ends?”
By putting the emphasis on these key areas, you can gather the most relevant details to make informed decisions and track the impact of your grants.
5. Consider Grant Size & Funding Frequency
When assessing whether to offer small grants or big, multi-year gifts, think about your organization’s goals, resources, and the impact you want to make. Match the grant size with your mission: small grants can support lots of different projects and reach more people, while large, multi-year grants can fund major, long-term initiatives. Check your budget – smaller grants need less money and can be spread out more, but bigger grants require a bigger financial commitment. Consider the type of impact you want as well as your community’s needs. Small grants can tackle immediate needs and test new ideas, while larger grants can support more comprehensive programs with lasting effects.
Depending on your team’s capacity, small grants might also need less oversight, but managing many can be time-consuming compared to bigger grants that need thorough monitoring but are fewer in number. Finally, think about the sustainability of funded projects; multi-year grants can provide stability and long-term support, helping projects succeed in the long run. By weighing these factors, your organization can make smart decisions about the size and duration of the grants you offer, ensuring they align with your mission and maximize impact.
Interested in learning more?
Download our full Corporate Grantmaking Program Guide or get in touch to hear how the YourCause GrantsConnect platform can help you improve your grants programs through automated workflows, the ability to manage multiple budgets and funding sources, language and currency conversion, communication tools, and so much more.