How Should Your Foundation Take Action In Setting Parameters on Its Engagement?

Even when grantees recognize their own capacity building as important, it’s not the reason they exist. More pressing and operational concerns can pull focus from capacity building in nonprofits large and small. That means funders supporting capacity building must often play roles beyond grantmaker to help grantees juggle multiple responsibilities and organizational priorities alongside capacity building. Consider what roles you can realistically play, and that are appropriate to play, given limitations on your time. Then make sure you’re clear what roles you can commit to with grantees. For example, are you able to be, and should you be, a coach? A broker? An analyst?

Some foundations have explicit limitations on grant terms, such as annual grants or required “rests” before grantees can re-apply. Others have staff and boards with more or less tolerance for the time it takes to see results. Since capacity building often requires a longer-term financial investment to show impact, here’s another important consideration: What is your response when grantees come back for more? For example, if your foundation funds grantee strategic planning or organizational assessment activities, how will you manage the inevitable requests to implement certain organizational development needs that your foundation helped grantees uncover? If new capacity-building issues surface, will you fund them or help grantees connect to other funders who may be interested in building those particular capacities?

One point stressed by grantees: “If you do have strict limits on what and how long you can fund, how do you make sure grantees know about them?” For example, are there points in your interaction and communications, such as in the grant letter, as part of reporting documents, or during site visits, where you can discuss and document these limits? Grantees shared how they appreciate this clarity from funders, because one of their primary concerns about capacity building is how to sustain capacity built.

Takeaways are critical, bite-sized resources either excerpted from our guides or written by Candid Learning for Funders using the guide's research data or themes post-publication. Attribution is given if the takeaway is a quotation.

This takeaway was derived from Supporting Grantee Capacity.