Grants are a big subject for nonprofits. They are touted as free and easy money by some but what exactly are they and how do we make the most of grant money? We’re tackling this topic in this installment of What Is…?
Definition
Grants are money given by Foundations, Federated Funds, and Government Entities that, if the terms of the grant are met, do not have to be paid back.
Why We Use Grants
Grants, as part of a funding strategy, help fund or partially fund projects, aspects of programs, the organization’s general operating budget, or building capacity, among other things. Grant funding can range from a couple hundred dollars for smaller nonprofits to a few million for large organizations. Grant funders often provide awards for projects that can be harder to fund with other strategies, making them a good option in the right circumstances. Grants can be a great way to boost funding in order to get projects done or expand programming.
When Grants Are Used
Grants are used as part of an overall funding strategy as one of the income streams. The Fundraising Strategy Hierarchy includes individual donors; companies, churches, and denominations; and grants to name a few. Combining any of these strategies into a cohesive plan allows organizations to bring in more funding.
Let’s Sum It Up
Grants are money given and, if the terms of the grant are met, are not required to be paid back by the nonprofit. They are part of a funding strategy that can fund or partially fund projects, an organization’s general operating budget, or building capacity, among other things. Grants are one part of an overall funding strategy.
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