Article In Brief:
- The Problem: Grant writing is a time and resource consuming activity that saps nonprofit productive capacity.
- Why it Happens: Nonprofits rely on grants as the single revenue source to fully fund their operations.
- The Solution: Diversity funding streams by fully integrating all services offered into a closed loop nonprofit funding model.
The process of grant writing can suck the life out of any nonprofit!
You have to spend an enormous amount of time and resources preparing grant proposals and going through the selection processes, knowing that you may not be awarded the grant at the end of the whole ordeal. If you do get the grant, great! But grant money often comes with strings attached—like targets or deadlines to meet, as well as stipulations on how and where you can spend the money. It’s a constraining process that can eat up your productive capacity.
As mission-driven entities, nonprofits can’t afford to waste time on anything that takes away from the ability to meet their missions, serve target communities, and deliver on goals. But how can you fully fund your nonprofit organization without relying on the onerous process of grant writing?
The answer may be simpler than you think. Essentially, you must fully integrate all of the services you offer. You have to allow value-driven funding streams to facilitate your other services, thereby making all aspects of your nonprofit mutually beneficial and reinforcing. That’s what we’ve been able to do at my nonprofit, IPaintMyMind.
Get Art, Give Back: Creating a Closed Loop Nonprofit Funding Model
At IpaintMyMind (IPMM), our circular Get Art, Give Back model is a closed loop that keeps funds within the organization and allows us to remain independent of the traditional nonprofit funding ecosystem. It’s the result of hyper-intentional choices, long-term visionary strategy, and a keen eye for business on the part of our founder, Evan La Ruffa.
Within this closed-loop system, IPMM purchases art prints from working artists all over Chicago and the world, paying a full and fair price to support our creative community. We frame the prints and rent them out to corporate spaces, offices, and retail stores who are mission-aligned and searching for flexible art solutions. We also work with our featured artists to provide custom mural services and art consultant services to our corporate clients, offering yet another way to keep our artist community involved and activated. The funding from our art rentals, custom murals, and art consulting services goes right back into providing accessible arts programming to local schools. We install art galleries at our school partners, provide resources and a comprehensive Art Education Curriculum, and bring in artists for hands-on workshops throughout the year.
All of our funding streams are integrated, feeding into each other and ensuring that we don’t have to look outside of the nonprofit for money! In fact, we operate at over 90% earned income, keeping us totally independent. It’s an almost unheard-of practice in the world of nonprofits, but we’ve found ways to make it work for us and, more importantly, for the communities we serve.
Think Smart Now and Save Big Later
Our closed-loop funding model is animated by the core values of sustainability, mission and value, and efficiency. As we all know, nonprofits must be very intentional about spending and earning. It’s tough to balance our budgets, and we often operate on the tightest of margins. Similarly, while many nonprofit leaders have amazing drive and vision as well as pursue worthwhile goals through their organization’s work, not all nonprofit leaders are known for their business acumen.
At first glance it might not make sense. Why would a nonprofit leader have to be a business expert? But business expertise makes a huge difference in the long-term sustainability of any nonprofit organization. Here are some things we’ve thought about that might help any not-necessarily-business-savvy nonprofit leader to create a more closed-loop funding model:
1. Continually analyze your funding model.
At the outset, it’s critical to think hard about your funding model. Every year, reassess your model to analyze what’s working and what isn’t. When nonprofits don’t have thoughtful funding models, the efficacy of their ability to serve their communities and deliver on their mission is diluted.
When you have limited operating funds, how you choose to spend is critical. These days unintentional content marketing and sloppy website design can mean a nonprofit is leaving funding on the table.
Similarly, nonprofits must ensure that any services or programming is optimized and efficient. Don’t waste time on structures that aren’t working. When you realize that something could be done better, don’t push it off to the future. Consistent iterations of new and better processes ensure your organization isn’t getting bogged down.
Sustainability is key. If you can set yourself up for long-term sustainable success, you free up productive capacity for years to come, allowing your organization a chance to grow.
2. Think about how to integrate funding streams
Of course, what’s worked for us won’t translate perfectly onto other organizations. However, the essential message of integrating funding streams is universal. The simple takeaway is this: How can you offer mission-aligned services to your supporters or local community to generate revenue?
Art rentals make sense for us because there are lots of businesses out there looking for creative ways to give back. They can feel good about making an impact while receiving rotating artwork for their spaces. Plus, there are opportunities for businesses and teams to volunteer with us at later dates, completing a full cycle of involvement!
We’ve also tapped into corporate social responsibility efforts and the growing ranks of value-driven companies to help compound our impact. We like to offer touchpoint of engagement for our corporate clients, keeping them engaged with what we’re up to and interested in renewing their services for another year.
To translate this for other nonprofits with different missions and values, think: Who are your biggest supporters? Identify them and the kinds of services or features that they might be likely to engage with.
3. Make everything your organization does mission-driven.
Our mission is fundamentally about connecting people through art, so whether it’s a custom mural at PepsiCo, art rentals at Adidas, or Chicago Public School (CPS) art programming, we’re living true to our values. When we consider adding a new program, we make sure that it furthers our mission and values. Nothing we do at IPMM is disconnected from what we believe.
Similarly, when we offer client services to businesses, it brings art and creativity to offices and workspaces, connecting teams through art to each other and the broader community. By using the same framed artwork from our collection of working artists in offices and CPS schools, we’re able to both simplify our programming and foster a deeper connection between our business partners and the CPS classrooms that they are supporting. We can also connect businesses to local working artists, deepening their roots in the community that they work in.
In order to be mission-driven within your own nonprofit, work to create networks throughout the community.
4. Come up with your version of client services.
For example, an environmentally-focused nonprofit could offer consultations to businesses or private homeowners, providing customized recommendations for weatherizing and decarbonizing buildings. They could also offer paid workshops to corporate teams for team-building or retreat opportunities, teaching them how to plant a native garden or create their own compost systems.
An animal rescue nonprofit might offer de-stressing puppy or kitten circles where co-workers can play with animals as a trust-building community activity. A food bank or community garden could offer quarterly supporter dinners where members of the community pay for a delicious meal and get to know each other, with the money going right back into the organization!
These ideas are just meant to get you thinking. What client services fit your unique strengths and skills, while intentionally serving your supporters and potential clients?
Liberation from Grant Writing
Grant writing can be useful, but it shouldn’t eat up too much of your organization’s time or resources. What capacity might be freed up if you were liberated from grant writing? Imagine a version of your nonprofit that is mission-aligned, sustainable, efficient, and free to pursue whatever ideas strike you. That’s the organizational future that we believe integrated funding streams can provide. It’s worked for us, and it can work for you too!
At IPMM, we believe that it’s critical that nonprofits are just as intentional, efficient, and aligned with their finances as so-called market leaders. It’s a tougher world out there for nonprofits, so we have to be smarter and more creative than the for-profit side of things.
Luckily, as nonprofits we’re inherently creative, passionate, and committed folks who have something for-profit businesses don’t — mission and vision. When you allow the mission to lead, your funding and finances are better off for it!
About the Author
Lillie Therieau is the Editor and Head Writer at Chicago-based arts nonprofit IpaintMyMind. She is a Chicago Public Schools graduate who is passionate about access to arts education for all.
Articles on Blue Avocado do not provide legal representation or legal advice and should not be used as a substitute for advice or legal counsel. Blue Avocado provides space for the nonprofit sector to express new ideas. Views represented in Blue Avocado do not necessarily express the opinion of the publication or its publisher.