Building Stronger Nonprofit Relationships with Donor-Advised Funds and Community Foundations
Donor-advised funds (DAFs) and local community foundations are becoming increasingly vital sources of funding for nonprofit organizations. As giving trends evolve, nonprofits that build meaningful relationships with these funders can unlock sustainable and significant financial support. Here’s how your nonprofit can effectively engage with DAFs and community foundations to maximize funding opportunities. Understanding DAFs and Community Foundations What Are Donor-Advised Funds (DAFs)? DAFs are charitable giving accounts established by individuals, families, or organizations that allow donors to contribute assets and recommend grants over time. These funds are managed by sponsoring organizations such as national financial institutions, community foundations, and nonprofit associations. Learn more about DAFs at Fidelity Charitable . What Are Community Foundations? Community foundations are nonprofit organizations that manage charitable funds dedicated to supporting local causes. They serve as a bridge between donors and community needs, offering grant opportunities for nonprofits working in various fields such as education, healthcare, and social services. Check out the Council on Foundations for more information on community foundations. Steps to Build Relationships with DAFs and Community Foundations
1. Identify and Research Potential Funders Start by identifying DAF sponsors and community foundations that align with your nonprofit’s mission. Research their giving history, funding priorities, and types of grants they support.
Use online databases like Candid (formerly GuideStar) and Foundation Directory Online . Visit the websites of community foundations to explore their grant guidelines and recent awards. Engage with local financial institutions that may sponsor DAFs.
2. Build Personal Connections with Donors and Fund Managers Establishing direct relationships with donors and fund administrators increases your chances of receiving grants.
Attend networking events, fundraisers, and donor-hosted gatherings. Connect with financial advisors who manage DAF accounts and discuss potential alignment with their clients’ philanthropic goals. Engage with community foundation staff to learn about their priorities and upcoming grant cycles.
3. Clearly Communicate Your Mission and Impact DAF donors and community foundations want to support organizations that create measurable impact.
Develop compelling storytelling techniques that showcase how your nonprofit makes a difference. Use data-driven reports, testimonials, and case studies to demonstrate the success of your programs. Offer personalized impact updates to donors who contribute through DAFs.
4. Encourage and Facilitate DAF Giving Many donors with DAFs may not be aware of your nonprofit or how to contribute. Make it easy for them to support you.
Include clear instructions on your website for DAF donors to recommend a grant. Provide sample grant request language for donors to use when making contributions. Regularly remind supporters that they can donate through their DAFs, especially during year-end giving campaigns. Explore resources from National Philanthropic Trust to understand how DAFs work.
5. Apply for Grants from Community Foundations Community foundations frequently offer competitive grant opportunities for local nonprofits.
Sign up for email alerts to stay informed about new grant cycles. Follow all application guidelines and submit strong proposals with clear objectives and measurable outcomes. Build relationships with program officers to better understand funding priorities. Visit the Community Foundation Locator to find foundations in your area.
6. Engage in Long-Term Stewardship After securing funding, continue to nurture relationships with donors and fund managers.
Send personalized thank-you notes and impact reports to donors who support your nonprofit through a DAF or community foundation grant. Offer opportunities for site visits or virtual meetings to showcase your work firsthand. Keep donors informed about upcoming projects and additional ways they can help.
Conclusion Building relationships with donor-advised funds and community foundations takes time and strategic effort, but the rewards can be substantial. By proactively identifying funders, establishing meaningful connections, and demonstrating the impact of your work, your nonprofit can create a strong foundation for long-term financial sustainability. Start today by reaching out, fostering relationships, and positioning your nonprofit as a trusted partner for philanthropic giving.
