Small Checks Packing a Big Wallop
By Emily West, Executive Director of The West Foundation
In recent weeks, a New York Times article from October 2018 floated across my radar. It pertained to how small foundations can achieve greater impact, despite being of small stature, corpus-wise. Reading it left me feeling vaguely uneasy for a couple of reasons. 1) The main focus of the article was a $10 million family foundation, and many family foundations are significantly smaller than that—including my own, which hovers around the $5 million mark. 2) The impact was gained by making a single large grant of $340,000 (the foundation’s entire gift budget for its fiscal year) toward creating a documentary later shown on PBS and through other venues to inform the public on a single topic.
That’s certainly a valid use of grant money, and the foundation involved was very pleased with the results, as many thousands of people saw the film. But smaller foundations may not have the capability to take on a large-scale project due either to lack of funds or the organizational capacity required to seek out one big, mission-driven venture.
My family foundation—The West Foundation—still thinks that small can be beautiful, partly out of principle and partly out of necessity.
We believe the following methodologies have allowed us to create impact with small gifts in the $10-20,000 range:
- Stay in for the long haul. Some projects need multi-year funding to come to fruition, yet donors are notoriously fickle, often requiring grantees to give them a new project each year or pulling funds after a couple years’ funding. Longer-term projects are often the ones that prove hardest to find funding for, so pledge monies over multiple cycles. We too have experienced donor fatigue (a grassroots healthcare manual we supported took seven years to complete), but ultimately, the results made us glad that we’d hung in until the end.
- Provide strategic administrative project funding. Often, a nonprofit has a special in-house project it needs to complete that could save office time, reduce costs, or provide training to employees that directly improves program delivery. These are usually projects that can be done for a smaller amount of money but get left on the sidelines for years at a time because funding for them would have to be taken from undesignated gifts. Some projects we have funded include transitioning multiple offices to a single accounting system, providing new printed program materials following a re-branding campaign, incorporating a new HR system to assist employees in setting and achieving program goals, and the purchase of a software platform to better communications with a volunteer force.
- Take risks on emerging nonprofits. Very few small foundations fund younger organizations due to thinking that an older, more established organization will automatically spend monies more wisely and be much less likely to have a project—or even the entire program—fail. However, by providing fledgling organizations with their first gift of $10,000 or more, small foundations open the door for larger foundations to consider gifting at the $30,000 to $50,000 level. This creates a niche for small foundations that very large institutions simply cannot fill because they must give away too much money annually to make donations in such small increments. To do so would bury them under an avalanche of bureaucratic paperwork. So, small foundations have a key role to play in the development of emerging nonprofits. And even if a project or program does not succeed, it will still have added to the body of knowledge in its service sector, as we often learn more from our failures than our successes. The West Foundation has a nearly 100% success rate with such “risky” gifts and now has a dedicated funding stream for these grants.
None of the examples mentioned above are as sexy as making a movie. However, each one allows donors to significantly impact the organizations they support, packing a big wallop with a small check.