Blog – Closing the ‘Great Divide’ – can grant-receiving and grant-making be more efficient in process?

Blog by Ed Gairdner – As I sat down to start writing this blog, the ‘Beast from the East’ had just met with its more refined cousin ‘Emma’ to create havoc across the country.  It made me reflect, as it has to many I am sure, on the homeless and those who facilitate many of the charities set up to help them.  It was only recently I saw for myself when visiting along with Oxfordshire Community Foundation, the incredible work Homeless Oxfordshire is undertaking.  The visit both highlighted and enabled me to fully understanding the continual struggle they, and the thousands of other charities are having to endure when seeking grant funding.

Grants are the very lifeblood of these small community-based charities and with regional and national government funding being squeezed, pressure on the Trusts/Foundations (Grant-Makers) has increased.  Yet when I speak to charities, it appears getting grants has become harder and harder and the phrase ‘blood from a stone’ is often used.  However, we need to be careful we do not chastise the grant-maker when they can only operate within the confines of their charitable articles.  But as the ‘chasm’ is widening and the charitable market is becoming ever more polarised, where is the silver bullet?

The table below [1] highlights the polarisation of the charitable sector in England and Wales. We should be concerned when 80.6% (or c160,000 charities) of the 167,000 charities based there are operating on an annual income of less than £250k p.a.  Any changes to the giving of grants which falls out of their control will mean many of these community charities will be forced to close.

The charitable sector’s income is £75bn so why does it still take just under 40+ applications to secure £30k of grant funding as one local charity mentioned to me recently?  How can it be effective when the success rate of a typical application ranges between 4% and 25%?  A recent survey undertaken in 2017 but reflecting on 2016 found that “‘Complex’ grant applications cost charities £100m a year in staff time[2]  This report also found that 99% of respondents wanted a standardised Stage 1 Application form.

As many charities can’t afford to hire a professional fundraiser and rely on their own resources to apply for grants whilst trying to deliver their charitable services, why does the grant application process continue to be so one-sided?

  • Where and how do you apply for a grant when the number of grant-makers registered with the Charity Commission numbers over 10,000 (and this is before corporates operating under their CSR banner get involved)?
  • All these grant-makers have money and want to give money but why is the divide becoming so great and the ability to secure this funding becoming more problematic and time consuming?

I heard the other day that one grant-giver that had money allocated for grants had to return it to the investment vehicle as they couldn’t find projects to support which matched their grant-giving criteria.  I was shocked to be told this and it made me further my resolve for the need for web-platforms such as The Good Exchange to transform the process from end-to end.

The market for grant-making is currently ‘reactive’ to the applications that a grant-maker receives, and it well-known that grant-makers are often inundated with applications.  In this situation, the grant-maker can only ‘react’ to the applications submitted.  This does not mean it always supports the most deserving of charities or those most in need – just those that have the time and resource to apply.

The grant-giving market needs to become more transparent and ‘proactive’ where it understands the gaps in its own giving trends and the needs of the wider market and looks to fill those gaps by identifying those charities in need.  Through open source data platforms such as 360 Giving’s GrantNav platform and the historical data from within CRM systems. these trends and gaps can be identified.  On-line matching platforms such as The Good Exchange then provide the ‘find’ function for grant-makers as they match charitable projects to registered grant-makers – a dating service for the charitable market.  This approach provides true transparency across the sector – which organisations have money to give and which charities and good causes need it most.

For the charity seeking grant funding, The Good Exchange increases the chances of success as it matches every charity to the various grant schemes in operation where there is commonality.  It’s not just those that have the ‘loudest voice’ or know where to get funding that succeed.  Further, a single dashboard where public donations, sponsored activities and grants can be managed in one place facilitates greater transparency and collaboration.

In short, a network of funders is linked together with complete clarity of who has short-listed and been matched to which charity; the grant offers that have been made and the money already raised by a charity.  The grant maker retains full control of how and when grants should be given and over the due diligence and grant-making process.  With the ability to offer match-funding grants a ‘reverse crowd-fund’ effect is generated, driving the grant to act as the catalyst for the public to support their local community project in return for a doubling of their contribution.

Having a single application process that reaches multiple funders will drive closure of the funding gap.  With technology-led progress, the market can become more proactive than reactive and the future of the 160,000 small charities can, and should become more assured.  Therefore, if the ‘Beast’ and ‘Emma’ should rear their heads once more, these charities will be in a better position to ensure the homeless are safe and warm in the sub-zero temperatures.

Yes change is daunting, but this simple step could drive the transformation that the industry needs.

[1]  http://secure.charityfinancials.com/PDF/report.pdf

[2] Charity Income Spotlight – January 2018 Report – www.charityfinancials.com,