No Time’s a Good Time to Lose Funding…Take a Deep Breath

Dear Kim,

I am writing from a NGO in South Africa. We were established in 1995 and since our startup we were very secure in sponsorships and contracts. Fundraising and grantwriting was not a very high priority. Unexpectedly earlier this year our main sponsors had some policy changes and most of our contracts and sponsorships were cancelled.

We find ourselves in a very unfortunate situation at this stage (NO MONEY) and a very inexperienced “I” must start to save the day!!!!! Where do I start to do this ‘SMART’ and what is the right way??? Please any help will do.
—Priority Shift

Dear Readers,

The above letter is representative of a slew of letters I have gotten on this topic from all over the United States, and from various countries around the world. They all follow the same outline: we had funding and now we’ve lost it, and so what do we do?

I cannot provide a complete answer in a column like this. For more information, go to the Grassroots Fundraising Journal website at http://www.grassrootsfundraising.org and check out the article “Fundraising in Times of Crisis.” You could also go to the library and check out my book, “Fundraising for Social Change,” (Jossey-Bass Publishers). The book provides a full explanation about what to do when you are staring down the no-funding road, and you can order it from Jossey-Bass right now. In the meantime, here are some suggestions.

I may be too late on my first piece of advice, which is “Don’t Panic.” Take a deep breath and sit still for a minute. Remember that many organizations have lived through what your NGO is going through. To be truthful, many haven’t, but yours might as well be in the survivor cohort.

Second: Act as if fundraising is your only option. Do not think about cutting programs or cutting your staff. You may have to do that, but exhaust your other options first.

Now, follow these steps to get started:

1) Figure out how much money you need to get through the next one or two months. You’re probably used to having money in the pipeline for six months to a year ahead. Those days are gone. Now, your organization will operate much more like a working person-you will have enough money to get you through the end of the month, or maybe a little bit into next month. You will need to get comfortable sustaining yourself closer to the edge.

2) Create a cash flow chart and see if there are expenses that can be postponed for a month or two, such as rent. Do you have any cash reserves, and under what circumstance could you borrow from them? Get the clearest picture you can of your fundraising needs for the next several months.

3) Create a committee of people whose sole job is to help you raise money for your organization. They may or may not be board members. They will work for two or three months to get your fundraising program set up and running.

4) Use this group, as well as staff and board, to create a list of people who really like what you do. They believe in it, they would be very sad if your NGO closed, they think your work is important. This group of people will be offered the opportunity to help your organization through this crisis, and then to become ongoing supporters.

5) Set that list aside for the moment, and decide what you are going to tell people you approach for money. Just saying, “We have lost our other sources and are now forced to go to the likes of you,” is not appealing. “We need money and hope you have some,” is equally ineffective. Focus on the work of your group. Do you save the environment? Teach? Organize? End racism? Focus on the values and commitments your potential donors have, and what your program does that promotes what the prospects believe in. “With your help, we can continue our projects which demonstrate how a community can create jobs and save habitat at the same time” or “You can help make it possible for a low-income family to buy a house and begin building equity.”

6) Take your message and your list, and begin to work with it. Put the prospects in order or MOST LIKELY TO SAY YES to LEAST LIKELY TO SAY YES. Start with the easiest person first. Tell them your fundraising goal for the next two months, and the various sizes of gifts you need. If you can, ask them for a specific amount. If you don’t know, ask for a gift in a certain range. If they are receptive to your request, ask whom else they know that you should be asking.

7) Ask those people. Ask personally (face-to-face or by phone, or a letter with phone follow-up) as much as you can. Know that fully half of the people you ask won’t give you any money. Experience being turned down is a sign that you are that much closer to a gift.

8) Once you get some cash coming in, examine your other income stream possibilities and begin working with them.

Following these steps will get you started and will buy you the time to learn what the next steps are. Good luck to you.
—Kim