This is the sixth of eight chapters on building donor loyalty. The Table of Contents below will take you to additional chapters.

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Chapter 6

Stewards of Other People’s Money

When it comes to raising money from foundations and corporations, cultivating relationships with them, and turning them into loyal donors, there are three key elements we need to remember.

  1. Most importantly, the decision to award a grant is made by people. That means most of what we do to court individual donors works just as well with foundation and corporate decision makers. But there is a difference, and that difference is the second most important thing to remember.
  2. The money they give away is not theirs. Except in the case of a tightly controlled family foundation, those people are stewards of other people’s money.
  3. When it comes to cultivating foundations and corporations and turning them into loyal donors, you need to respond to each foundation and corporation as you would to an individual donor.

A few words about that third point: It needs to be done with active cultivation, careful consideration, and respectful appreciation.

Active cultivation means you continuously work to cultivate relationships with the people at a foundation or corporation who award or influence the award of grants.

Careful consideration means understanding how each foundation and corporation operates and work within its parameters. In donor cultivation terms that means figure out whom you need to befriend, and be careful about stepping on toes. When grant seekers write to the chairperson of one foundation I know, they get back a letter from the program officer beginning, “Our president has forwarded your request to me because, as you “should” know, it is my responsibility to review all proposals.” That’s not the way I’d want to start a relationship.

And finally, respectful appreciation means that thanks need to be expressed to the foundation or corporation both as an organization and to the individuals responsible for awarding a grant. A foundation or corporation should be recognized prominently and often for its donations, and the people who did the work evaluating need to know just how much you appreciate their efforts.

Proof Over Passion

How you go about building donor loyalty with foundations and corporations and cultivating relationships with those who are stewards of other people’s money differs in two important aspects from the way you approach these issues for individual donors.

First, for stewards of other people’s money, the relationship with an organization is always at its core, a professional one. Individual donors are far more likely to form personal relationships with the organizations they give to. After all, they are giving their money presumably to support things they feel strongly about.

Secondly, the process of awarding funds to an organization by a steward will be almost entirely logic based. For individual donors a strong, perhaps even the dominant, component of an organization’s attractiveness is likely to be emotive. Individual donors give based in large part on how they “feel” about an organization. Stewards must base their gifts almost entirely on logic and the value proposition placed before them. They are going to feel less comfortable making a judgment call, and are more likely to feel compelled to rely upon the reassurance of sound numbers.

When approaching corporations and foundations, you can be even more tenacious than you might with an individual donor. Unless it tells you that grants are simply not made in your area, you should never give up on working a foundation or corporation.

Whenever you get a negative response to a grant request, remember it is to the project or program, not necessarily to the organization. Foundations in particular pick projects to support more than they choose organizations. Also, keep in mind that foundations and corporations have other organizational imperatives driving their grant awards, and that those imperatives can and do change. Keep the process of cultivation going with the people within a foundation or corporation.

I’d like to make three final points about dealing with foundations and corporations and their stewards of other people’s money.

Foundations and corporations are organizations themselves. They very often have a need for the public to be made aware of their good works. This is particularly true for community foundations. Look for public ways to recognize their contributions made to you. If they support a specific project, always include a note recognizing that support in your communication with the media. If appropriate, include program officers, contribution managers, and foundation or corporation leaders in events such as ground-breaking or dedication ceremonies.

Personally thank the individuals at the foundation or corporation who helped you. It isn’t enough to send a letter to the top official. Reach out to all the people who worked on your grant request.

And finally, say thanks even when you don’t get the grant. It takes as much work on the part of a prospective funding source and its staff to say no as it does to say yes. Thank them for that work. The head of a foundation from which I have repeatedly solicited gifts—sometimes successfully and sometimes not—once told me how much he appreciated that I always thanked him, even when a grant was not awarded. He went on to say that fewer than one in four of the organizations that had grant proposals rejected ever bothered to thank him for reviewing their proposals. This head of a major foundation said, “Why do you suppose they would want to break off their contact with us and burn their bridges behind them?” Point well taken.

Building Donor Loyalty
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