FLEXIBLE FUNDING: UNLOCKING RESILIENCE FOR NONPROFITS

Learn about flexible funding and how to pursue it to gain greater control over your nonprofit’s financials.

BACKGROUND

Many nonprofits dedicate substantial time to securing project-based grants, which can lead to various challenges:

1. Restrictions on Fund Use
   • Grants are often tied to specific programs, making it difficult to cover operational costs like salaries, rent, or technology.
   • Spending restrictions limit the organization’s ability to address unforeseen challenges or capitalize on new opportunities.
2. Time-Intensive Application Processes
   • Preparing grant proposals is resource-intensive, particularly for smaller nonprofits.
   • The competitive nature of grants requires repeated applications with no guarantee of success.
3. Short-Term Funding Cycles
   • Grants typically have fixed durations, creating financial uncertainty.
   • Organizations risk facing a “funding cliff” if new grants are not secured, jeopardizing essential programs.
4. Mission Drift
   • To align with funder priorities, nonprofits may shift focus away from their core mission, diluting their impact.
   • Programs are sometimes pursued for funding reasons rather than community needs.

THE ALTERNATIVE: FLEXIBLE PHILANTHROPIC FUNDING

Flexible philanthropic funding, also referred to as unrestricted funding or core funding, offers a solution by providing long-term, unrestricted financial support. Its key characteristics include:

• Unrestricted Use: Funds can be allocated where they are most needed, such as for core operations, capacity building, or new opportunities.
• Autonomy and Adaptability: Nonprofits can quickly respond to changing circumstances or challenges.
• Long-Term Impact: Flexible funding strengthens organizational resilience through investments in infrastructure, staff development, and strategic initiatives.

Flexible funding is a cornerstone of trust-based philanthropy and is championed by progressive foundations.

BENEFITS OF WORKING WITH US

Transitioning from grant- or project-based to flexible funding requires significant changes in how nonprofits approach fundraising. These changes include:

• Fundraising Conversations: Shifting dialogues with philanthropic funders to emphasize trust and long-term impact.
• Organizational Presentation: Framing the organization as a whole, highlighting systemic impact over project-specific achievements.
• Internal Mindsets: Encouraging staff to view fundraising as a means to achieve mission resilience, not just project delivery.
• Fundraising Structures: Rethinking internal fundraising processes to prioritize unrestricted funding.

To navigate these shifts, nonprofits can benefit from capacity-building support before embarking on flexible funding strategies.

THE PROCESS: TAILORED GUIDANCE

We help nonprofit organisations explore and prepare for flexible funding through tailored process facilitation. Here is how we work:

• We begin by understanding where your organization currently stands and identifying its specific needs to prepare for success.
• Based on this, we design a customized process suited to your priorities and budget.

Depending on your organization’s context, the process may include:

• Understanding flexible funding and the conditions needed to pursue it.
• Preparing and organizing fundraising efforts focused on unrestricted funding.
• Identifying key areas of work to highlight to potential philanthropic donors.
• Aligning internal processes to attract and manage flexible funding.
• Developing tailored communications and positioning strategies.
• Supporting necessary mindset shifts among staff.
• Mapping and identifying suitable donors to approach.

Flexible funding offers nonprofits the opportunity to achieve greater financial stability, adaptability, and long-term impact. Through a carefully facilitated process, your organization can unlock its full potential and strengthen its mission-driven work.