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Alternative Funding Sources

20 Nov 2020 - 15:30 by millie.brown

Beyond Covid emergency response: planning for funding in 2021

Funding throughout 2020/21 has focused on emergency Covid-19 response. This has been welcomed and much needed. However, many organisations are now looking for longer-term funding opportunities to ensure they can continue operating for the sake of their users when the emergency funding ends. This is due to be exacerbated as local councils who have invested in the VCSE sector are forced to make unavoidable cuts. 

There’s a need to re-think income generation as resources diminish further during a possible recession. And as always, there is a strong need for funds that will cover core running costs. We've collated some links to current grant opportunities, a sense of what grant funders will be prioritising in future, and suggestions for other ways to generate income.

Trust and foundation trends

There are some key trends in grantmaking form trust and foundations that it’s important to be aware of, so you can plan your funding strategy accordingly.

  • There’s less money to give: larger budgets spent this year mean less for the future, less income from investments on endowments means around 50% of funders have less to give away and some funders are looking to ‘do more themselves’ to achieve their aims, meaning smaller grant-making budgets
  • Ringfencing is more common: many funders are focusing on diversity and having conversations around sources of wealth. Some are taking action in the form of targeted and ring-fenced programmes.
  • Transparency is improving: many funders now publish grant data on 360Giving and share success rates and rejection reasons. This is useful to see how you fit with their past giving and assess your chance of success before applying.
  • Core and unrestricted funding: Funders will continue to relax criteria and requirements as much as they can and more core and unrestricted funding is likely to be made available
  • Collaboration: since the crisis even more funders are either doing, or talking about, working together. The Funders Collaborative Hub has been created to support funders in these endeavors and you can visit the website to find out more about what they’re working on.

Funders’ future priorities 

Here is a brief summary of the future priorities of some national funders. Sign up to each funders’ mailing list to be informed of future funding opportunities.

The Esmee Fairbairn Foundation strategy focuses on three key areas: improving the natural world, tackling injustice to deliver a fairer future, and nurturing creative, confident communities. They will offer larger and longer-term grants as well as social investments. Funding can be used to cover core or project costs, including staff salaries. Read more here

Youth Endowment Fund will invest £200 million over ten years to find the most effective ways to prevent children and young people from becoming involved in violence. Read more here

The MSE charity will open in February 2021 and focus on financial capability projects which support young people under 25. Read more here

Charities Aid Foundation are discussing their strategy for supporting longer-term resilience of the sector which aims to address systemic issues in existing civil society infrastructure and the funding eco-system, and is likely to include core and multi-year funding. Read more here

The National Lottery Community Fund are currently looking at their future funding programmes and are likely to continue to fund flexibly, engaging and supporting new and established organisations with a straightforward application process. Read more here

Grants available now

Core and longer-term funding is available now from some funders. For a full list of current opportunities see Macc’s Funding Sources webpage. Funds that cover core and running costs are marked with #core. Funds which can be deployed beyond April 2021 are marked with #2021. Here are a couple of current examples: 

The Tudor Trust – an ongoing grant programme which covers core and multi-year funding with priority for organisations with an annual income of less than £1 million. There is no minimum or maximum grant level but awards are mostly over £10,000 and average £50-70,000. Of those who apply, around 12% get through the first stage and over 90% of those who reach second stage are funded. More information here

Marsh Christian Trust – unrestricted grants of £300 to £2,000 are available to small registered charities to help them to pay for running and core costs. Themes include literature, arts and heritage; social welfare; environmental causes and animal welfare; education and training; and healthcare. No deadlines. More information here

You can also visit the our Funding Portal to search and filter suitable grant funders.

Alternative ways to raise income

Whilst grants from local and national government, trusts and foundations will continue to be a core source of income for the sector, many organisations are increasingly looking at other ways to generate income. Traditional sources of funding aside from grants include regular giving, legacies, one-off donations and major gifts from individuals as well as community fundraising with individuals or small companies plus corporate partnerships. More information on all of these methods and more can be found at NCVO Knowhow

Virtual fundraising

Digital and online fundraising is set to grow. If you haven’t explored this before, it can seem daunting. It also requires a basic level of digital skills, some investment in time and most importantly a willingness to learn. In the way that so many services are now delivered online, this too can be mastered. Here are some steps to get you started:

  1. Increase your digital capacity: developing this income stream may involve upskilling ourselves, staff, volunteers and trustees, particularly where perceived or real lack of digital skills are seen to be a barrier. This can involve a shift in culture as well as Keep an eye on our training calendar for free and low-cost opportunities. If you can’t find what you’re looking for, let us know.
  2. Build your online community: just as face-to-face fundraising requires interaction with people and often a captive audience, online fundraising also requires a receptive audience with which to engage. Your community is no longer bound by geography which presents new opportunities for reaching those who support your mission. By creating online content you can build a relationship with your online community that benefits them as individuals as well as creating a warmer environment for future fundraising.  See Reason Digital guide on how to improve your online presence
  3. Develop one-off campaigns: changes in giving over recent years have shown an increase in one-off donations in comparison to regular giving. This is a generational shift in how people donate to charities. For more trends, download the Status of UK Fundraising Report 2020 here. Some recent online supporter challenges have been really successful. Visit the Charity Digital YouTube channel for tips and examples shared through webinars.
  4. Explore crowdfunding for projects: Crowdfunder offer a step-by-step guide in how to make your campaign engaging and compelling, useful for small charities with limited in-house expertise. Another option when it comes to online fundraising is The Big Give. This is a little more work than Crowdfunder as you need to have pledges lined up in advance.

Even more...

Reason Digital have come up with a helpful handbook called Digital Fundraising for small charities (in a hurry), which you can download here. Charity Digital have fantastic advice and resources for developing your virtual fundraising, such as this blog on creating interactive fundraising content.  And for further guidance visit The Fundraising Regulator website.


What else?

Source (more) in-kind support and share resources where possible

In a resource-scare environment, maximising this type of support should not be overlooked. You may be able to cover costs by thinking creatively about what you can share or source for free from your networks, supporters, partners and local businesses. See the Manchester Community Central directory

Demonstrate your impact

It is important to show potential supporters the value of your service by demonstrating your impact, as well as using the insights to make improvements to your practice. 

How and why impact measurement is crucial: this webinar from Moore Kingston Smith looks at why impact measurement is so important, particularly in a crisis.

Using digital for better impact reporting: Charity Digital have a simple guide on to how to report on your impact using digital technology and the data it provides on user behavior.

For more straightforward advice and guidance on demonstrating impact visit Inspiring Impact.


If you are managing a funding crisis and there is a threat to the overall sustainability of your organisation see our guidance on reviewing your options and do get in touch.

For help with any of the above, if you are voluntary or community organisation or social enterprise based in Manchester please contact our capacity building team on 0333 321 3021 or email: info@mcrcommunitycentral.org 

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