Funds for NGOs – How Easy – How Difficult?

Sameer Zuhad is the Founder and CEO of FundsforNGOs. Sameer’s experiences working with grassroots-oriented community organizations in India, Kenya, USA and Nepal as well as international agencies, including the United Nations, drives his desire to work for sustainable civil society development. He has trained, educated, and digitally empowered thousands of NGOs at all levels using innovative online technologies in over 150 countries. 

Here he shares his thoughts with Meher Billimoria of CAP. 

CAP: You have experience over different countries & continents. What are the trends you see within NGO & Sustainability here In India and overseas?

Sameer: The situation of NGOs in India and other developing countries is quite similar. The sector seems to be unorganized and there is lack of support from the government in addition to the poor sustainability practices undertaken by NGOs. However, in developed societies, NGOs play an essential role; they are known and respected by the public and the government gives them full responsibilities to manage and lead welfare services and help develop policies. For example in the Netherlands, the Dutch NGO Coalition for Children’s Rights is actively consulted by its government for addressing issues related to child rights. Developed country NGOs also have well planned, fund-raising strategies that help them ensure sustainability in the long-term. Fund-raising is mostly a separate department amongst such organizations and their fund-raising staff is regularly trained in creating strategies, mapping donors, developing prospects, identifying opportunities and more.

CAP: In your opinion, what are the 3 quick fixes that any NGO should focus on for sustainability and what do they tend to overlook?  

Sameer: The first and foremost point for all NGOs to understand is that there is a severe crisis and limitation in the availability of institutional funding resources. They cannot be available permanently nor can they be distributed widely. Therefore, the high dependency on donor agency funding has to be reduced. Although for most NGOs, it may be difficult in the short-term to mobilize non-institutional grants, they can start by reducing costs.

Innovation is the key to sustainability. NGOs need to innovate if they wish to survive in the long-term and gather new skills for creatively addressing issues. Even donor agencies easily fund innovative concepts rather than conventional methods. Ideally, the innovation should be tested at small-scale using low costs but should be able to scale up for larger impact. Donors love this type of a concept and are willing to invest in such projects.

Most NGOs tend to outsource their fund-raising efforts. It may be easier to hire consultants to do the complicated work but it is not a healthy sign for long-term sustainability. NGOs should seek to acquire fund-raising skills and try to work on their own to raise funds. Hiring external fundraisers is not only costly but also risky as chances of grant success are low and the trend is not good for the sustainability of the organization.

The potentiality of Internet technology is one of the main areas that NGOs overlook. It can be used not only for raising funds but also the enormous free content available can be used for building their own capacity.  Other areas NGOs tend to ignore are: Networking to lobby for a strong position with the government and working towards building a positive public image.

CAP:  When should NGOs start thinking about sustainability & how should they build it into their plan? Who should be responsible - board or management?

Sameer: I strongly believe that sustainability should be the first thing NGOs should think about. We know very well that most projects and organizations have failed because there has been no sustainability. The board is primarily responsible for building the strategic vision of the organization and sustainability should be part of that vision. The management can develop the sustainability plans through brainstorming, research, networking and exchange.

CAP: Many donors want NGOs to focus on sustainability but don't want to donate towards corpus. Hence they spend a lot of time FR each year rather than the programme. Your thoughts on this.

Samir: Donors do not want to donate towards corpus funding because they think NGOs are not their responsibilities, only projects are. Also donors do not want to spend resources directly on institutions – there are political, economic and social consequences because of which they want to avoid it.

In an NGO where resources and staff are limited, it may be difficult to separate fund-raisingand programme management. But for every funding programme, there is usually 5-10% admin budget that is given to organizations by donors to cover overheads. A portion of this budget can be used to build the corpus in the long-term. Nevertheless, fund-raisingis a continuous process and NGOs need to remain alert and active throughout the year to respond to market opportunities.

CAP: Does a grant-maker's  perspective of sustainability differ from that of the recipient NGO? If yes, why and in what manner? If we can crack this question it could help bridge the gap to an extent.

Sameer: As mentioned before, the grant-maker is mostly interested in seeing his project succeed rather than worrying about NGO sustainability. Even NGOs tend to think little about long-term sustainability when they receive a huge grant. It is important for the NGO to negotiate with the donor agency to ensure that the project funding ‘also’ contributes towards the sustainability of the implementing NGO.

Both the donor agency and the NGO should look beyond the project period and the latter should convince the former that if the NGO is sustainable it could do more with the same budget after the project ends. It can scale up its operations, replicate successes and help the donor get some footing outside of the project period. However, this type of negotiation requires tremendous strategic and budgetary work. NGOs need to undertake proper homework before building a case for this.

CAP: Everyone's idea & perception of sustainability is different. The donor, the recipient and beneficiary. Would you consider it desirable to standardize it?

Sameer: Yes. Standardization is the need of the hour – not only in terms of sustainability but also in other areas such as NGO governance, management, implementation etc. 

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