Although applying for federal grants may be tempting, they are definitely not for every nonprofit organization. Winning grants for nonprofits offered by government agencies do take time. When done right, the benefits for the local communities are priceless. Here are six clear signs that federal grants may not be for you - at least for now, anyway.
1. You may have a hard time meeting the reporting requirements.
Reporting requirements for federal and some government grants require the right people and systems for proper grant management. If you drop the ball on your reporting, that funder may never fund you again. We talk more about this and the related consequences here.
Some may require developing a logic model, which is even more difficult.
2. Raising the match may be a challenge.
Not all federal grants require a match. Those that require a match do spell out the match requirements in the RFP or funding opportunity. Many applications require proof of the match if they need a match. Proof can be a letter from the organization that matches donations, the value of donated items, and other information.
3. You haven't even begun the grants.gov registration process.
In the United States, grants.gov is the portal to find and apply for federal grants. Many nonprofits, small businesses, and even faith-based organizations are eligible to apply for federal grants on grants.gov. Registering can take several weeks. Because of the timeline, never start registering on grants.gov within 2-3 weeks before a grant deadline. Some organizations will take the risk and hope for approval before submission. Unfortunately, this is rarely the case. The result is that the weeks spent composing an application have gone to waste because there will be no way to apply if your registration isn't approved.
If you're wondering if contacting grants.gov by phone or email to ask for a faster registration or exemption would help, don't get your hopes up. Unfortunately, there is little they can do to speed up the process.
4. You are self-funding your nonprofit.
If you fund your organization as a Founder or Board member, you should not apply for federal grants. Emerging nonprofits may find federal grants appealing because of the substantial grant funding they offer. However, it is a long-term process. Many organizations often struggle while waiting for the grant money to arrive long after the grant writing process is over. This waiting period to receive the grant can last several months. Sometimes, this can happen after the initial investment of engaging grant writers, which is even worse.
5. You have zero experience winning or managing any grant.
Bad enough that you have never won or managed a federal grant before. Even worse when you are so new to the game that you have never won or managed any grant, including foundation grants or grants from local governments.
Some federal funders will inquire about projects you have managed with federal grant support. This speaks to your capacity and capability to run a federally funded project. If you don't have any federal grants to speak of, you may not score highly in this particular section.
6. You have to hire to complete the project.
Federal agencies hate to see you hire a bunch of people to run your program and have to lay these people off because you couldn't get additional funding. It makes it look like because they did not renew your proposal or lend a helping hand, they let the organization down, and, in response, people were unfortunately laid off. It's terrible PR and doesn't support running a sustainable organization.
What are some other signs that an organization is not ready to apply for federal grants?