Lesson #18 Types of Funders and Lesson #19 Finding Funding Sources

Greetings from GrantLessons

Lesson #18 – Types of Funders
There are three types of funders: public charities, public foundations, and corporations. GrantLessons: A Practical Guide does not cover national or state grants since they are complicated and have many reporting requirements.
Public Charities
Assistance League chapters are public charities. Public charities receive their support from the general public and private foundation grants. Public charities are organized to provide direct service or other tax-exempt activities. A public charity must have a diversified board of directors that do not have any private benefit and be at arms-length in their relationships. Public charities must be supported by the general public. For that to be true, a significant amount of revenue, at least 33%, must come from relatively small donors (those who give less than 2% of the organization’s income), from other public charities or the government. While that is significant, that leaves 67% to potentially come from other, less diverse sources. Public charities file Form 990.
Private Foundations
Private foundations make grants to public charities. Private foundations receive their support from a relatively small group, even one individual or family. Private foundations must meet an annual minimum asset distribution each year of 5%. Like public charities, private foundations are organized to provide charity. Private foundations file Form 990 PF.
Corporations
While a corporation has a mission to make a profit, they also want to be good citizens in the communities where they are located. Corporations participate in what is termed “corporate social responsibility”. Corporate social responsibility includes both volunteering and philanthropy done by corporations. Corporations make either grants or contributions to public charities. They do not file Form 990s.

Lesson #19 – Find Funding Sources
The committee needs to understand there are a myriad of ways that information about a funding source can be found. There may be an announcement in a newspaper. A potential funder may come to an Assistance League thrift shop. Someone in your organization may know someone who sits on a Board of Directors. You can do Internet searches to identify large corporations in your locality and then talk to the human resources staff to determine if they have any philanthropic programs.
There are databases where a member can search to determine if there is a match between the chapter program needs and the need for the private foundation or corporation to make a contribution or to support a grant proposal. The databases present a list of potential funder profiles. A profile is a collection of variables which provides information about a potential funder.

GuideStar
GuideStar is located at http://www.guidestar.org . Once a nonprofit organization obtains their GuideStar Exchange Gold Participant status, they will be able search the GuideStar Premium Subscription which is a database for names and addresses of potential funders. GuideStar provides this as a free benefit to those who have taken the time to complete their chapter’s GuideStar nonprofit profile. This is an annual subscription, you will need to update in order to maintain the search capacity.

GrantStation
GrantStation is located at http://www.grantstation.org . GrantStation is an independent database of profiles. National Assistance League offers a subscription to GrantStation for $47 per year.

Foundation Directory Online
Foundation Directory Online is located at http://www.fconline.foundationcenter.org . Foundation Directory Online is a proprietary database. Individual subscriptions range in price from $50 to $200 per month. One can purchase a month’s subscription and then stop the subscription immediately so that only one month’s charge is made. After purchasing send an email to
In summary, GuideStar requires a nonprofit to gain GuideStar Exchange Gold Participant status to be able to search their database. To use GrantStation, the nonprofit needs to gain a subscription, this is possible through the National Assistance League office. Foundation Directory Online requires the nonprofit to purchase a paid subscription.

Catch me when you can and I will catch up with you soon! Sandie

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