Incorporating challenge grants into fundraising efforts

June 23, 2014

Incorporating challenge grants into fundraising efforts

An effective fundraising strategy helps nonprofit groups raise the money they need to not only continue current operations, but begin new initiatives and expand the scope of their missions as well. The growth of digital giving has placed much of the discussion of attracting contributors around optimizing websites and creating easy paths to online donations. Charitable groups need to consider all their options, however, to make sure that a potentially strong donation channel isn't being overlooked. One such area, challenge and matching grants, can help some organizations create a significant, long-term boost to specific campaigns as well as general giving.

While challenge grants carry the risk of not being met by donations from other sources, they can also serve as an incredibly useful method for creating a sense of healthy competition and attracting the attention of new and returning contributors. Matching grants can be approached in a similar fashion, by highlighting the fact that any amount given will be doubled by the grant. Nonprofit Quarterly points out the value of these grants are two-fold: they create a great environment for encouraging gifts and help identify new donors for future outreach efforts.

Finding challenge and matching grant providers
Identifying businesses and foundations, and even individuals, to commit to a matching grant can be difficult. Nonprofits need sufficient funds in place, as these contributions are often at the five- or six-figure level, and the potential donor needs to feel some connection to the overall mission or specific campaign. suggests drawing on the higher-level connections of the board of trustees or directors to find qualified prospects. This approach will also make it easier down the line to convince the board to accept such a gift, especially with challenge grants where the contribution isn't guaranteed.

When trying to convince a prospect that a challenge or matching grant is better than a regular contribution, the person or group pitching the idea need to take time to explain the effects outlined above. If a donor is used to making regular contributions, or is uneasy about the idea of using a challenge grant because the donation isn't guaranteed, then care should be taken to explain the positive influence that this approach has on overall efforts.

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