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Secret Paths to Getting Corporate Funding

November 17, 2009

Photo credit: AMagill via Flickr

Okay, here we go, the blog post that could get me into trouble. I’m about to divulge some secrets about getting corporate funding.

When I was a corporate philanthropist, there were several to get funding from my company that few people seemed to know about. Naturally, I had the lion’s share of funds that were set aside for charitable purposes, but there are many ways a nonprofit could create a financial relationship with a large company.

This is the third article in a five-part series dealing with obtaining corporate funding. Be sure to check out the other articles:

Here are some not-so-secret- and secret-ways you could get funding.

The first go-to choices:

Most, if not all, FORTUNE 500 companies have formalized giving programs with two primary sources of funding: corporate giving programs and foundation giving. Many people assume they are one and the same, but for various reasons they’re different.

  • Corporate giving – the funds available for nonprofits sit in a corporate budget that is administered by an individual or groups of individuals (depending upon the size of the giving program). These funds are to go to charities that fit the corporate giving criteria and can and should (as appropriate) subsequently credit the company for making the donation to the charity. To get these funds, nonprofits should look on the company’s web site for giving criteria and application process.
  • Foundation giving – some companies set aside funds to be administered by an independent nonprofit charitable foundation. This foundation can be classified as either a public charity or a private foundation – a legal distinction that means very little to the supplicant, but the latter involves more paperwork for the administrators.  The funds available for this kind of giving come from large donations made by the company, vendors, and fundraisers such as charitable golf outings.Many people, both inside and outside the company, assume that foundation giving and corporate giving are the same.  To the extent that the giving criteria are the same, they are. But there are important differences. Legally, an independent foundation cannot make grants / donations to charities that provide a direct benefit to the company – e.g. marketing efforts that directly lead to more customers.  So for example, if you get funding from a corporate foundation, you should disclose to the public that it is the “Company X Foundation” that supported you, not “Company X.” To get these funds, check out the company’s web site to see if they mention a foundation and have giving criteria and processes identified. You can also plug in search terms in services such as Guidestar to try to find the foundation’s IRS 990 forms.

Team work through Vice-Presidents

While every company is different, generally Vice Presidents of large companies tend to have an operational budget of their own. These budgets may or may not (most likely not) include a charitable giving line item. But, VPs usually have a team and if your nonprofit has a team building exercise (such as cancer walks, Habitat builds, food pantry packaging, etc.) that will involve this VP’s employees, sometimes you can request a low amount of funds from the company as a token sign of support. Additionally, if you’re putting on a conference and you want an additional low-level sponsor, sometimes finding a like-minded VP in a company is a great way to get sponsors at the $500 – $2,500 level – especially if you don’t think you can get a sponsorship through the company’s marketing arm. Sometimes this is a great way to create a relationship with a company. If you play your cards right, you can either maintain that relationship over time for consistent funding or grow it to larger funding.  You should also consider trying to get such senior people on your board of directors (more on that later).

Marketing & Sponsorships

Speaking of marketing, can something you’re doing be considered marketing? If you’re putting on a large conference or you have a large volunteer event – sell it that way. Look at what real benefits you can provide a company to help boost its image and especially so if your constituents fit right in with the company’s key customers.  Be careful though, saying you’re going to put the company’s logo on program booklets is not enough of a benefit to cut it. You need to quantify the exposure you’ll offer and give an indication of how it fits in with the company’s strategy.

Volunteerism

Many companies look to see who volunteers with your nonprofit. Look through your volunteer roster – can you make any connections through people who have a passion for you? That will make things much easier.

Cause-marketing

Are you in a position to reach out to a broad number of key customers for the company?  For example, many companies are really focusing on trying to address the needs of the female customer. Can you help them do that? Consider approaching the company to work with you on developing a cause-marketing product that could be sold to benefit your nonprofit. The marker company Expo (owned by Sanford) just launched a new program, complete with commercials, for the Kids in Need Foundation. To be frank, sometimes companies may be more able and willing to steer their customers’ money through a cause-product than they would be to part with a large sum of their own money.  It’s best to approach companies with a proposal such as this if you already have a relationship and, again, you fit into the company’s strategy.

What the CEO says, goes

It’s simply a fact, whatever the CEO says, goes.  If your nonprofit doesn’t fit within the company’s giving criteria, sometimes the CEO can simply just make it happen. Sometimes the funds will come out of her budget, or sometimes she can just force it through the corporate giving program.

Annual giving

Many companies have annual employee giving campaigns. For many reasons, many justified & many not so, some employees are averse to giving to the usual annual giving charity: the United Way. If you have a relationship with a big company, see if you can augment your funding with being selected as one of the company’s charitable partners.

Board of Directors

Many companies need and want to place current and future senior leaders on the boards of nonprofits.  If you’re a large nonprofit with a dynamic board – look to take advantage of this and pitch your board as a great business networking tool. If you’re a smaller nonprofit with not a lot of heavy hitters on your board, see if you can place a few “rising stars” from companies on your board. If these individuals are truly rising stars, they could provide a good boost to your board and may eventually become the next executive or maybe even the CEO.

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The writer is the editor of CitizenPolity.com —  You can contact him at JamesERatcitizenpolitydotcom or follow him on Twitter:http://twitter.com/jepsteinreeves

Copyright 2009 – CitizenPolity & James Epstein-Reeves – Not to be used without the written permission of CitizenPolity or the author.

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