The Modern Robin Hood

Good news for innovative organizations that work for improved economic opportunity, youth development, and schools: the Social Innovation Fund (SIF) grants have just finished their first round of submissions in a competition which will award roughly $50 million in grants during the first year alone.  The SIF office, created courtesy of the Edward M. Kennedy Serve America Act, just announced that 260 organizations collaborated to submit 69 applications for funding.  This new initiative has been lightning quick from conception to delivery, and a first-hand account of the recent public information conference call indicates a transparency and inclusiveness of remarkable proportions for a broad government program.

I did say there was good news here, not just old news– although the applications deadline has passed for this year, funding is expected for five years, with an annual application phase.  In fact, the funding will increase each year, topping out at $100 million granted in 2014.  If your nonprofit missed out this year, there is plenty of time to plan a coalition for the future.

Along with the golden lure of funding, however, one thorny thing stood out to me when reading through the grant requirements.  The proposal must have a very significant cost-share of 3:1, with at least a 1:1 match of cash. Lead organizations not only have to commit to delivering a great program with measurable results, they also need to partner with private funders to win the award.  For SIF, it makes complete sense.  They are not just handing out money that will eventually have to dry up—they are creating coalitions of committed partners and LEVERAGING the money they invest.  This program intends to leverage hundreds of million dollars into over a billion.

For the little ol’ nonprofit looking to contribute to this program and maintain their bottom line while doing it… leveraging can be tough.  In fact, this can be a deal-breaker for smaller organizations looking to find a place in a larger program as a viable subcontractor.  There is no magic wand to make cost-shared money appear, unfortunately, but with almost a whole year to plot and plan, it should be possible for just about anyone.  Here are a couple of tips on how to start.

1. Connect with the “big dogs” in your area

Smaller nonprofits just aren’t going to have the capacity to manage a multi-million dollar grant.  That is the whole purpose of this grant– to allow for existing organizations to work together, build on their strengths, and collaborate rather than compete.

Yes, yes, it sounds like common sense.  But in practice, it may require a bit of pride swallowing.  I’ve worked at small nonprofits where the larger, shinier, richer nonprofit down the street doing similar work can seem like the enemy: getting funding, press, donors, and employees you want.  A general feeling of David versus Goliath, tortoise versus hare, Red Sox versus Yankees begins to build.   Take a deep breath, and try to forget all that baggage before you pick up the phone.  Because yes, you should pick up that phone.

Call their Development Director.  Be ready to let them know why you think they would benefit from having you as a partner on this grant.  Be ready to set up a meeting to discuss specific roles and strengths you will bring to the table.  By the time this is done, if your coalition takes advantage of the management strengths of the bigger organization and the niche strengths of the smaller ones, you will have a great shot at a funded proposal.

2. Approach committed partners early

There is nothing more impossible than coming up with cost share cash support when you are working with a teeny tiny deadline.  Start planning your approach early.  Figure out which of your bigger donors— people, corporations, or foundations—would agree to a matching donation for your organization.  If you strategize early and approach those with whom you already have a good relationship, this becomes an opportunity for them to invest in something big, and not a last-minute call for a big favor from the development office.

3. Pay for some of your own staff time

This is an in-kind cost share, meaning it will not qualify as part of the 1:1 cash cost share.  However, if you have staff members who will be putting time into this project you can consider making a portion of their time not part of the grant money requested.  Staff accountants, administrative support, the Executive Director, the VP overseeing the implementation of the grant– these are traditionally positions paid for wholly or partially out of non-grant general organizational dollars, and if you credit the percentage of time they spend on a new grant still paid out of the nonprofits general coffers, not by the grant, then you have the beginnings of some significant (and meaningful, in the reviewer’s eyes) cost sharing.

4. Get personal when getting donated items

For school programs, there are many physical items that may need to be purchased: books, videos, laptops, office supplies, etc.  If you can get local stores to agree to donate these supplies in return for a nice tax break and some well-placed program advertising, then you are increasing cost share and actually decreasing the cost to the grant.  A tip on approaching these businesses?  See if any Board members have existing working relationships with some, or if any of the school districts you work with already have an in-kind program with any business in particular.  Starting with an existing relationship can certainly increase your chances of hearing a “yes”!