Building Relationships with Funders: Tips from Switzer Fellows in Philanthropy Panel

In November 2021, the Switzer Network held a panel to bring together grant-seeking and grant-making Switzer Fellows to demystify philanthropy, network and learn from each other. Ten Switzer Fellows with experience working in philanthropy shared their advice and perspectives. A panel introduced environmental philanthropy and best practices for building relationships with funders. Breakout sessions offered the chance to network and ask questions in small groups on topics such as getting a job in philanthropy, fundraising and networking, and philanthropy's relationship with other organizations.

Here are a few of the best practices for building relationships with funders that Roger Perez and Jen Sokolove shared during the event.

What’s your number one tip for building relationships with funders?

Jen:  Think about it in the same way you would think about making a new friend. Be ready for it to take time. Learning a new person/institution is a process. It’s very rarely just a phone call. You’ll likely need an 18-month to 2-year time frame to cultivate a new donor, just like you would with a new friend.

It’s important to note the social reality that it’s easier to make a new friend who is really similar to you. This is why questions around justice, equity, and inclusion really matter for the field, and for who sits in those philanthropic seats.

Also, don’t forget that they need you too. No matter how “strategic” their philanthropy or how big their budgets, they accomplish nothing if they can’t move those resources to partners who can have impact on the ground.

Roger: Ask yourself: are you building relationships with your current funders? Make an intentional effort to reach out to current funders in a non-funding aspect, such as brainstorming, connecting, inviting to events, etc. Why? Because your funders know other funders who may be a good connection or ideas that they have, and also to build relationship of course!

What is your advice for someone just getting started on how to break into foundation funding?

Jen: Do your research, start early, and be prepared to think creatively about how you can help a funder do their work better and how they might be able to help you do your work better, beyond or instead of, the exchange of cash.

It is true that you sometimes CAN just send a cold proposal, and some foundations might send a check. This is often true for a “request for proposals” or RFP. But for many foundations, they are mapping out a portfolio of grants (often early in the year) and managing their grants budget, their strategic goals, and the potential partners they might support.

Doing good grant making relies on understanding who those potential partners are, so, they have an interest in learning the ecosystem of potential partners. You can help them by introducing yourself if your work does have some overlap with what they do.

You need to do your research and think about how your work solves a problem for that funder. What goals of theirs can be accomplished what you’re already doing (or what you want to do next)? The more you find yourself thinking about what they ‘should’ be doing, honestly, the less likely you are to find a match. What are they doing now, and how might you help? If you’re not a slam dunk, be thoughtful about whether it’s a waste of your time to try to connect with them, or whether it’s worth thinking about how to organize them toward your direction over time.

If you get on a first introductory call, a good funder will know they should share about their work first, because that gives you the opportunity to speak to what resonates most when you describe your priorities and the opportunity to partner. If they don’t suggest that, you should feel free to request it!

Can you share your perspective on the growing focus on equity and justice in the philanthropic sector?

Roger: We have come a long way, and the events over recent years have helped push that conversation. However, when it comes to actual funding, we are still lacking. In 2020, the corporate side committed $50 billion in support, much of it loans. Of the $4.2 billion in grants, no one is holding them accountable to see if dollars are disbursed, and few are analyzing what they are doing. The Philanthropic side is equally disheartening, with less than 5% of overall funding going toward BIPOC led/serving organizations. Things may have improved since last data was pulled, but it is still lacking. On the environmental justice side, the trend mirrors giving for equity. Few dollars are allocated toward environmental and environmental justice.

Not to be all doom and gloom, there are good examples we can move forward from. Mackenzie Scott, Justice 40 initiative, philanthropies like the Solutions Project, Marguerite Casey, and Borealis Philanthropy seem to be taking a charge on not only funding racial equity, but pushing for policy and systems change.

Funding for racial equity can vary depending where you are in the U.S. in abroad. If you know that a particular foundation is not up to date, you can explore if there is a way that you can craft a compelling proposal that will advance racial equity as well as the foundation’s priorities.

What do you recommend that grant-seekers look for in order to determine if their organization or program is a good fit for a foundation?

Roger: First, take a look at what you do. What do you do, what is your aim, how do you do it? If you have a good sense of this, you will be on a good path for identifying funders. If not, take a second to reflect to see your strengths so you’re prepared to look for alignment.

For example, if you are a research organization in the Midwest and are applying to our foundation, you most likely won’t get a grant, because we mainly focus on grassroots organizing and power building in Los Angeles. This is an obvious example, but do your due diligence.

After that, take a minute to read public information to see what your target foundations do - do their past grants, strategic plan, data from their 990s, and others line up with your program? If not, is there a way that you can articulate how your program and/or organization intersects with their direction? Also make sure the foundation supports your activity – 501c4, 501c3, policy, etc.

If available to you, use online programs to find foundations - Guidestar, Foundation Center, Inside Philanthropy, etc.

Finally, Ask! Leverage your network to see if folks know about a particular foundation or staff member. When I am looking for nonprofit organizations, I often turn to other foundations, the Switzer Network, and other connections to see who is working in the field or area that I am looking for -  this can also be done vice versa.

How does someone go about making a first introduction to a funder?

Jen: This goes back to my advice to treat them like a new friend. Remember that funders are just normal people. You don’t need to be overly obsequious or careful or quote their website back to them to prove you’ve done your homework.

Keep it short and sweet. If you’re sending an email, make your case in a paragraph, or maybe two. Keep it light and let them request more info if it’s a match, or let them know that you’ll follow up with a call in the coming weeks.

If they say it’s not a match, respect that. They’re doing you a favor and helping to make sure you don’t waste your time. If you still want to grow the relationship and can offer some other knowledge or connections, you can explore connecting about those, but take a hard look at whether that is worth your time. Sometimes repeated inquiries after I told someone they’re not a match can get me on the phone, but I can only think of one case in the almost 20 years I’ve been doing this where it got someone a grant.

It can also be helpful to have one-pagers about your work on hand to reference in your conversation or give to the funder if it’s in person.

Can you briefly describe the differences among different types of funders?

Jen: There are private foundations and public foundations (charities). Both are 501c3, but with slightly different structures and rules. A private foundation is a nonprofit charitable entity, which is generally created by a single benefactor, usually an individual or business. A public charity uses publicly-collected funds to directly support its initiatives. Corporate giving can happen through corporate foundations or directly from the business itself.

Private foundations generally (but not always) make use of grants to individuals or other charities, as opposed to direct funding of their own programs. A public charity, in contrast, tends to carry out some kind of direct activity.

The chief criticism of private foundations comes from their operational independence. Their private funding source allows them to ignore public opinion and possibly support socially contentious projects, even though they are getting a tax break to serve a public purpose. Private foundations have to distribute a minimum of 5% of their assets per year.

Private foundations cannot lobby. Public foundations (charities) can engage in and support lobbying like any other 501c3 institution. Neither can engage in electioneering, “participating in, or intervening in, any political campaign on behalf of (or in opposition to) any candidate for elective public office.” Visit Bolder Advocacy for more detail on permitted activities for various types of organizations and foundations.

Donor advised funds, or DAFs, are charitable investment accounts, often housed at a bank or community foundation. DAF donors get a tax donation when they establish the fund, and, over time, can instruct whoever is holding the funds to make donations from it. There is no annual payout requirement or timeline.

A lot of giving happens from individual checkbooks. Individual donations far exceed any corporate/foundation giving.