Whether you’re a nonprofit raising money or a grantmaker seeking expanded impact, the following are six lessons for better funding alliances.
1. Clear goals & metrics. It may seem obvious, but it’s really important to have goal congruence among funders of a project. Unresolved goal conflicts will resurface in grantmaking, advocacy and outreach, and evaluation.
Funding alliances are executed more easily around narrow goals (e.g. improve charter sector quality) than broad goals (make DC highest performing urban system in country), added Marino.
2. Know thy partners. Funding alliances are often as much about the message as the money. Make sure you know what kind of advocacy has and will accompany the grantmaking.
3. Grantmaking: combined or aligned? There are advantages to contributing to a single grantmaking fund but it requires strong goal agreement (#1), a capable lead grantmaker (#4) and may produce unanticipated consequences (like jeopardizing the tax status of a nonprofit by inadvertently turning it into a supporting organization).
The alternative to one pot is coordinated grantmaking. This also has the added benefit of allowing foundations to take on unique aspects of a project (e.g., hardware, capacity building, advocacy) aligned with their mission.
4. Grantmaking: experience matters. Some alliances turn local nonprofits into grantmaking organizations but they may not have the operational, financial, or systems capacity to take on such an important role.
5. Matching might make sense. Requiring a local match can extend impact and improve the local IQ of a funding alliance. In some geographies it can be hard to find.
For more, see Good & Bad Marriages: Philanthropic Partnerships
Thanks to Maura Marino, NewSchools Venture Fund, for help with this post.
Mind Research Institute is a Getting Smart Advocacy Partner.