Silly Nonprofits: Nonprofits can be so shortsighted when it comes to funding

Just recently, I was discussing grant writing services with a potential client. When I told him how much he would need to invest in the first year he said, “if I had $10,000 I would not need grant funding.”

What a silly thing to say. That would be like an unemployed person saying, “if I had $10,000 I would not need a job.”

Of course he would still need a job and of course the struggling nonprofit would still need funding even if they had a little money in the bank.

What we are essentially referring to is cash-flow management. It is common sense that when expenses exceed income, an organization is going to find itself in trouble. Due to the nature of nonprofit revenue sources, however, even if income matches expenses, the cash may not arrive in time to pay the bills.

Similarly, I hear many nonprofits say, “we do not need grant funding right now, but when we do we will give you a call.”

Again, that is just silly!

The Alliance for Nonprofit Management website puts it this way: “a cash shortage can be very disruptive to your ability to carry out your mission. To avoid disruptions of business or to take advantage of temporary cash surpluses, cash flow can and should be projected, monitored, and controlled.”

Invariably, when they do give me call—once they are needy enough—they will say, “if I had $10,000 I would not need grant funding.”

Again, The Alliance for Nonprofit Management website says, “Careful management of short-term cash balances can add to an organization's current income and provide the basis for an investment program which will benefit the organization in the future.”

Grant writing is an investment of time, money, and resources. To anticipate less would be, well, silly. To be successful you will need to invest in the future of your organization and understand that this investment will not pay off in the short term, but is a long-term investment.

According to the National Center for Charitable Statistics, foundation giving exceeded $45 billion in 2008. The grant funds exist and they are out there but, like all forms of revenue, grant writing involves work.

For those nonprofits that think they do not need any new funding and will wait until they do need it before they try and find it… more silliness. The time to develop funding is not when the need is already there but when finances are stable. Make the investment when there are reserve funds to invest and when there is not a pressing need to have new funds NOW.

Don’t be one of those silly nonprofits, invest wisely, plan for the future, and see your organization grow in wisdom, influence, and impact.