Five years ago the challenge in trust fundraising was oftern writing stronger applications. Today, I’m not convinced that’s the biggest challenge anymore. Increasingly, success depends on something much simpler: finding the closest possible match between your organisation and the funder.

For more than five years I’ve been working with a small charity to support income generation, primarily from trusts and foundations. It’s been quite the journey. Within four years, trust income tripled to more than £200,000, in spite of extremely challenging funding environment.

Throughout this time, we have:

  • grown the portfolio of trusts through research and careful qualification of potential new funders – ensuring less time spent chasing opportunities that only half fit. Ruthless prioritisation and tight fit equals fewer but higher quality applications with increased chance of being funded.
  • focused on larger and multi-year applications – ensuring longer-term sustainability and security and frees up time to focus on whatever is most relevant for the clients, whether building new income streams or focussing on evidencing impact.
  • invested in building relationships with key funders and major prospects – ensuring the funder really gets to know the charity, its mission and the impact their gift will have on its beneficiares. Deeper relationships between people and organisation equals trust, more opportunities for funding, as well as collaboration, innovation and partnership.  With my small charity this has included being on funder recruitment panels and offering referrals to specialist education/employment pathways for beneficiaries.
  • sought unrestricted and core funding wherever possible – ensuring the organisation does not become fully dependent on project-based funding with no funding for central costs.

It has been a long-term, strategic approach rather than chasing quick wins.  For a small charity with very limited resource this has been crucial, but it’s also driven effective, sustainable fundraising strategy.

The changing reality of Trust Fundraising

Like many organisations, however, the last 18 months have been much more challenging. We saw our trust application success rate fall by around 8% last year, and the trend looks set to continue/deepen this year.

This reflects what many charities are experiencing across the sector. Trusts and foundations are facing unprecedented demand. Some have closed to applications, paused funding rounds or tightened their priorities. Others are receiving record numbers of applications, fuelled by increasing financial pressures on charities and the wider use of AI-generated funding bids. At the sam time, reductions in statutory funding, are placing even greater pressure on charitable trusts as organisations seek to replace lost income. As AI makes it easier to produce technically competent funding applications, the quality threshold is rising. Good writing is becoming less of a differentiator. Strategic judgement, knowing which opportunities to pursue, where to invest relationships, and when not to apply, is becoming even more valuable.

Recent sector insight from organisations including the Association of Charitable Foundations – for example https://acf.org.uk/acf/ACF/Research-and-resources/Research%20content/Research.aspx – Charity Excellence Framework and nfpResearch all point to a more competitive funding environment, where strong applications alone are no longer enough. Funders have more choice than ever before.

So, how can charities, often oeprating with very limtied fundraising resource continue to secure funding from trusts and foundations in this environment?

Go back to Funder Fit

For us, it has meant going back to the strategic basics.

The biggest lesson from the past five years is that the closest matches matter more than ever.

The decline in trust income we have experienced has not been across the board. Funders for whom the charity is a genuinely close fit — and with whom we have invested time in building relationships — have remained supportive. Those partnerships have proved far more resilient than more opportunistic applications. We are able to have honest conversations about funding and sustainability.

In today’s competitive funding climate, every application needs to be compelling, evidence-based and demonstrate value for money, measurable impact and long-term sustainability. That has always been true, but expectations are undoubtedly higher than they were five years ago.

During the stronger funding years, we successfully secured grants from a wider range of trusts by being able to meet a broad range of funder priorities — youth, mental health, disability and community wellbeing, for example. Those applications were successful because there was sufficient overlap between the charity’s work and the funders’ objectives.

Today, many of those same funders are under much greater pressure. Faced with significantly more applications, they can afford to be more selective. Inevitably, they are prioritising organisations whose mission most closely aligns with their own funding objectives.

Back to the strategic basics

As I was discussing recently with the charity’s CEO, it’s about returning to the principles we established at the start of our journey together: ensuring every trust application is carefully researched, properly qualified and genuinely targeted towards funders where there is the strongest strategic fit.

It also means being honest. Sometimes the best decision is to take a trust off the prospect list altogether. If the fit is weak or the likelihood of success has significantly reduced, it’s better to focus time and resources elsewhere than continue submitting applications that are unlikely to succeed.  Saying no to an opportunity, regardless of fit, can attract scrutiny and intense pressure from the board and service delivery teams.  I have been able to do so with my client because I’ve established internal understanding and trust direct with senior leadership.

For us, Funder Fit has become the guiding principle once again. Rather than asking, “Can we make ourselves fit this funder?” the better question is, “Is this funder genuinely one of our closest matches?”

In an increasingly competitive market, that distinction matters.

The funding environment has changed, but the fundamentals of successful trust fundraising have not. Careful research, strong relationships and focusing on the closest matches remain the foundations of long-term success.

Questions to ask yourself to determine Funder Fit:

  • Does our mission sit at the heart of the funder’s priorites?
  • Can we demosntrate meaningful impact in the areas they care about?
  • Is there genuine relationship potential?
  • Would we still pursue this funder if funding became even more competitive?

Looking beyond trust funding

Equally important is asking a more fundamental question about reliance on trust income.

For many charities, trust fundraising has become increasingly competitive and unpredictable. While trusts and foundations will continue to play a vital role, organisations should also be considering how they diversify income over the longer term.

That may not be easy, and the returns are rarely immediate, but it’s worth exploring other sources of sustainable income. A good place to start is often with those already closest to the organisation — beneficiaries, volunteers, trustees and long-standing supporters. From there, opportunities may exist to develop major donor programmes, legacy giving or other forms of philanthropic support that complement trust fundraising rather than depend upon it.

Want help with your trust fundraising or to diversify your income? 

Get in touch today to explore how we can support you. 

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