Nonprofits are stepping up their grantseeking efforts, and although a majority see no rise in grant awards, there is collective optimism that the outlook will improve over the next six months, a new study says.
Seventy-eight percent of the 928 nonprofits responding to an online survey say they applied for more grants in the first six months of 2011 than in the same period last year, says the report from GrantStation and PhilanTECH.
Yet only 26 percent of respondents reported receiving a larger number of grant awards, while 37 percent received the same number and 37 percent received fewer.
At the same time, the average grant award remained stagnant or fell for three-quarters of respondents in the first half of this year, and the median grant size dropped to $39,000 from $50,000 in the first half of last year.
And the number of organizations receiving no grants grew 17 percent from 2010 to 2011.
Despite those grim results, 81 percent of respondents say they expect to receive either the same amount or more in grant funding over the next six months.
“Nonprofits continue to struggle in their institutional fundraising efforts,” says the report, The State of Grantmaking – Fall 2011. “Government grants are increasingly harder to secure and recent reports…indicate that while fundraising efforts are yielding greater returns when compared to the previous year, they are not increasing at nearly the same rate as they have in times of greater economic prosperity.”
Researching grants and finding funders with the appropriate “fit” with the nonprofits’ mission was cited as the primary barrier by 31 percent of respondents.
More than half of the respondents cited the lackluster economy as a significant reason for funding challenges, with 23 percent citing competition and reduced funding as the primary challenge, 20 percent blaming a lack of time and fewer staff, and 7 percent citing the economy in general.
Other barriers cited by nonprofits included writing “winning” proposals, internal organizational issues, and funders’ requirements, expectations and deadlines.
Roughly 72 percent of nonprofits assign the task of grantwriting to staff members, while 7 percent hire a grantwriter or consultant, 7 percent use volunteers and 10 percent use board members.
Of those strategies, using staff members was the most fruitful, with 87 percent of organizations winning at least one grant.
For the 57 percent of nonprofits that use volunteers as the primary source for grantwriting, no grants were received, the report says, and the 50 percent of groups that used board members also won no grants.