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Grant Hooper, Manager Grants Program Equity Trustees

The Changing Funder Landscape:Do you know your audience?

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• The Equity Trustees Experience

• The Changing Operating Context

• It’s Time to RETHINK Funding

• Attracting Philanthropic Funding

• Keeping Your Audience Warm

• Where Does Your Board Fit?

• How Can Structured Giving Help You?

• Questions

Agenda

The Equity Trustees Experience

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The Equity Trustees Experience

>450Trusts

>2,000 Grants

Close to $100m

Annually

EXPERIENCE INSIGHT

The Changing Operating Context

• Employing around 1 million people

• 6.1 million volunteers

Growth in income over last 7 years consistently around 5%

• Total income around $100bBillion

− ~ 30% government funded

− ~ 30% service provision (not govt.)

− ~ 30% philanthropy and fund raising

• Many NFPs facing increased demand for their services

The Not-For-Profit Landscape

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The Government Landscape

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• Demand for services increasing while revenue base is stalling e.g. GST and stamp duty

The Government Landscape cont’d

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• Increasingly seeking to leverage investment in social issues (Initiatives being lead by State Governments, particularly Queensland, ACT and NSW):− Payment by outcomes

e.g. outcomes-based contracting arrangements

− Place-based, sustainable, outcome-driven, ‘return on investment’ type approaches are increasing

− Social Impact Investment e.g. Social Investment Bonds e.g. Social Enterprise Development Investment Funds to help

take success to scale

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The Philanthropy Landscape

• Total foundations estimated to be ~ 5,000 – each as individual as the donor that established them

• Total annual giving around $0.4 billion

• Growth in the number of Private Ancillary Funds (PAFs):

− more than 1,000 established since June 2001

− Cumulative donations into PAFs expected to have reached $4 billion in FY2013-14

− Cumulative distributions from PAFs expected to have reached a $1.5 billion in FY2013-14

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• State and Federal governments cutting back funding and increasing focus on outcomes

• Diverse and growing philanthropic sector

− Bigger but not necessarily easier to reach

− Consolidation of Trustee companies

− Trusts implementing more targeted grant making strategies. Increasingly looking for impact.

• Emergence of ‘mega-gifts’ e.g.

− Andrew & Nicola Forrest - $65 million foundation to fund research in WA

− Packer family & Crown resorts - $200 million fund for the arts and other causes

− Paul Ramsay – bequest of $3 billion to his foundation

The Changing Funder Landscape

It’s time to RETHINK funding

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• It’s time for Boards and executives to re-examine their traditional funding bases and their approaches to fundraising in order to ensure their future sustainability

• Now take 5 minutes and do the following:

− Breakdown your organisation’s requirements

− Tick the box or write a dollar amount

− Apply a percentage allocation to each

• Where are your gaps?

It’s time to RETHINK funding

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It’s time to RETHINK funding cont’d

Is philanthropy right for your organisation? Some things to consider:

• The work your organisation does / the main beneficiaries

• Your organisation’s legal structure and tax status

• The resources that will be required to attract philanthropic support vs other types of funding and how well set up your organisation is to do this

• Are you measuring and evaluating your impact and are you good at communicating this?

Attracting Philanthropic Funding

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Attracting Philanthropic Funding

Attracting Funding

Track record &

Sustainability

Evidence base

Resources & Locations

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Application forms and processes

• Most foundations will have a formal process they use for choosing grant recipients – many of them will require you to submit an application.

− Note: Sometimes this means quite long lead times between application and decision.

• Whilst the questions they ask may vary, grantmakers typically want to know that an organisation can demonstrate the following:

− Experienced and capable leadership

− It has vision and a desire to take a long-term view

− It has integrity to remain true to the core purpose and mission

− Actively seeks to understand, measure and communicate its impact

− Works in partnership with others

− Commitment to dissemination of lessons learned through the appropriate networks in order to inform practice in the field

− Designs of realistic budgets and creatively and sparingly uses resources

Keeping Your Audience Warm

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Keeping Your Audience Warm

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Keeping Your Audience Warm

• Current individual donors, ad hoc and major donors

− Thank them for donations

− Keep them informed about how funds were spent

− Ask for future donations

− Implement major donor programs

− Ask for referrals to other giving individuals

− Inform them of your bequest program (make it easy)

• Trustee companies

− Received a grant? Keep them informed about outcomes

− Update on key developments.

− Signpost future opportunities.

− Apply for further grants

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Keeping Your Audience Warm

• Private Ancillary Funds

− Board networks

− High Net Worth Individuals

− Research opportunities

• Accountants & Lawyers

− Board networks

− Research opportunities

− Inform them of your bequest program (make it easy)

• Website and Social Media

− Do you have clear content?

− Do you distribute content regularly?

− Is your call to action clear and enticing?

Where Does Your Board Fit?

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Where Does Your Board Fit?

• Governance and retaining a commitment to the purpose and fundamental values of the organisation

− However, can’t only be interested in your organisation’s charitable work

− Need to ensure that the organisation is focusing on strengthening its clients / beneficiaries and your organisation Evaluation and reporting of impact

Funding strategy (linked to organisation strategy) in place and monitored

− Need to be advocates for your organisation and its purpose Refer to funding strategy and support through the use of networks

Support the work of the fundraising team, don’t just delegate

How Can Structured Giving Help You?

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How Can Structured Giving Help You?

• Understand the benefit structured giving plays in funding

• Inform your supporters of the benefits of structured giving and their ability to leave a legacy to you

• Encourage your supporters to consider a structure and make you beneficiary of their foundations

− Individual donations at risk from death, cognitive decline and challenges to wills

− Secure donations into perpetuity via a foundation

• Generate your own goodwill

− 90% of Equity Trustees’ trusts are Victoria only, therefore you need to be proactive in building awareness of philanthropic options

− Guide your supporters on the benefits of supporting your organisation, your cause, your community and of supporting this through structured giving

Questions

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Contacts

David Stewart

Phone: (02) 9458 5524

Mobile: 0422 003 247

Email: dstewart@eqt.com.au

Grant Hooper

Phone: (03) 8623 5134

Email: ghooper@eqt.com.au

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Thank you

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Where are your CURRENT funding sources?

Investment Income Government PAFs, PuAFs &

Major donorsOther

foundations

Other fundraising e.g. events, raffles etc.

Earned Revenue

e.g. Fee for Service or

Social Enterprise

Core Costs

Programs

Innovation/ New

%

WORKSHEET 1

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It’s time to RETHINK funding

Not-For-Profit Org

DGR1

YES

RegisteredCharity

Yes

Individual Donors, PAFs, PuAFsCharitable Will

Trusts, Bequests

No

Charitable Purposes

Yes

Some Will Trusts

No

Bequests Only

NO

RegisteredCharity

Yes

Charitable Will Trusts

No

Charitable Purposes

Yes

Some Will Trusts

No

Bequests Only

WORKSHEET 2

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Attracting Philanthropic Funding

Local State National

Location/s of implementation

No Yes Details

Partnering with Third Parties

New/pilot Post-pilot Existing

History of program

Small Moderate Large

Funding required

No Maybe Yes

Future funding available (sustainability)

WORKSHEET 3What is the need you are seeking to address?

What is your proposed solution?

What’s your rationale / evidence base for this solution and why your organisation?

What will it cost? Is this reasonable?

What could be the impact of your proposed solution? How does this compare with cost?

How well does the cause / solution align with the foundation you wish to approach?