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  • Suzie Rees

Is your organisation ready to start fundraising from trusts and foundations?


Are you interested in starting to fundraise from trusts and foundations? Read on for some key pieces of information you need to understand before you get started. There are also some essential building blocks you need to have in place in order to be successful with this fundraising stream.


What is a trust or foundation?

A trust or foundation (also known as a grant funder) is an organisation set up specifically to award grants. Often, they are set up by a wealthy family, individual (either during their lifetime or left in their will) or sometimes a company. Sometimes a large chunk of money has been invested and the interest is given away each year as grants. Some have new income added regularly (e.g. donations from a company) which is then given away, others have one initial donation and plan to keep spending the money in the trust until it’s all gone. Decisions on who to fund are generally made by a board of trustees, although sometimes these decisions are delegated to a grants officer or lead trustee who then makes a recommendation to the rest of the board.


Restricted v unrestricted

Unlike community or events fundraising, individual donations or even corporate fundraising, grants from trusts and foundations are usually restricted for a specific project, activity, service or ‘thing’. You can’t just spend the grant on whatever you want! Occasionally unrestricted grants are available, but this is pretty rare especially when first starting out (sometimes funders will give unrestricted grants once they know and trust your organisation). You will need to evidence you have spent the funds in the way you said you would, and provide a report once the grants have been spent. How detailed the reporting needs to be will depend on the funder and how big the project is.


Timescales

It is important to know that trusts work very slowly and are not a quick win. So, it’s essential to build this into your planning. Once you start developing a trust fundraising programme, your trust fundraiser will need to spend a chunk of time doing prospect research to find what grants you can apply for. Once you know where you want to apply, depending on the potential size of grant and complexity of the application process, applications will take time to develop, especially when you’re first getting started. After an application is submitted it’s not unusual to have to wait 6 months or even longer to hear whether you’ve been successful or not. Some have several stages, and some trusts will require relationship building first.


Success rates

It’s worth knowing that trust fundraising is competitive, and has become increasingly so over the last few years, especially since the pandemic. Many charities turned to trust fundraising when other income streams dried up during lockdown (e.g. community or events fundraising), and trusts report they are receiving more and more applications. Trusts usually have only a set amount to give away each time the board meets, and with more and more applications, the very best application, project or fundraiser is not guaranteed to receive a grant.


This means that you have to expect some, if not most, of your applications to be rejected, especially at the beginning when you have no track record with trusts and no ‘warm’ previous funders to turn to. Pre-Covid, success rates for ‘cold’ applications were 1 in 12 (LarkOwl benchmarking, 2019); now some trusts are only funding 1 in 20 of the applications they receive (Steel Charitable Trust, 2023). This high rate of rejection is not a reflection on your charity or your trust fundraiser’s skill, but simply a fact to be built into your planning to ensure you submit enough applications to raise the amount you need to.


In this competitive climate, it’s essential you have the key building blocks in place to give your organisation the greatest chance of success with trust fundraising.


If you feel your organisation is ready to start fundraising from trusts, please get in touch for a chat!




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