Searching for potential funding to support your organization can be a tiresome process; it is not easy to find a funder that fits perfectly with your organization’s needs. So, when you do find funding that seems like the right fit, understandably, you’re pretty excited. But have you really checked if it is the right fit? While funding may seem obvious on the surface, there are a lot of hidden requirements that you may not be aware of. It’s important to make sure your organization is aware of all of these requirements before exhausting all of your resources with a funder that may not quite fit the bill.
Foundations can be especially tricky. Many foundations provide funding to non-profits only. While this may seem simple, these funders often have more criteria to receive funding than simply being a non-profit. Something that you should watch out for is whether a funder requires 990 forms. If this is the case, then your organization would have to file a U.S. tax return and hold tax exempt status from the IRS. This also means that a funder with these requirements would not fund organizations with a fiscal sponsorship.
Another requirement that some foundations have for funding is having audited financials. Having these documents can act as an insurance policy for the foundation, ensuring that their funds are going to a reputable organization. However, if you are a new start-up organization, you may not yet have audited financials. If this is the case, then the funder may not be the best fit for your organization.
On the other hand, if your business is for-profit, and you are looking for a government or research grant, it is important to note that receipt of some grants is contingent on having support from a research university, which, similar to foundations, provides a type of insurance policy for the funder. For both non-profit and for-profit organizations, some grants cannot be used for building on existing programs, and instead, must be used for new projects. In these situations, you will more than likely be required in your grant application to include a project proposal and budget.
While looking for all of these funding details can be a tedious and at times frustrating process, it’s important to be sure your organization is fully aware of all of the necessary qualifications before pursuing funding, in order to ensure your resources are being allocated towards the right efforts. By being diligent about your selection process, you’ll be one step closer to finding the perfect funding you need to help your business thrive.
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This post was written by Lindsay Robbins. She is currently an undergraduate senior at Towson University majoring in International Studies and Economics. At Towson University she has held several leadership positions including working with Model United Nations and as a Writing Tutor. She has also spent time studying and working in youth development organizations in Honduras and Peru. See more about Lindsay here.