Charity grant funding - trusts, foundations & more

Charity funding demystified

This post explains how your charity can grow by attracting funding. Grants for charities can come from many sources and this post will explain where to look. It will also briefly discuss other types of charity funding available and evaluate the pros and cons of each.


The post covers the following sources of charity funding:

  • Grants from trusts & foundations
  • Government funding from grants and contracts
  • Companies that fund community projects
  • Technology focused grants
  • Non-grant funding like donations and trading

Grants from trusts & foundations

According to the Directory of Social Change £4.4 billion worth of grants are available for UK charities available annually from trusts and foundations.

A charitable trust or foundation is a legal entity that is created to manage a pot of money and invest the proceeds in good causes. Trusts and foundations are usually set up with specific goals but rather than running their own activities they achieve their objectives by giving money to charities, which use the money to run charitable activities. Grants from trusts and foundations don’t need to be paid back unless they remain unspent. 

Pros Cons
  • Enable fast growth
  • Gain credibility
  • High competition
  • Long application processes 
  • Onerous reporting requirements

Top grant-making trusts

Grantmaking is concentrated among a small list of very large organisations. It, therefore, pays to familiarise yourself with the big players in the charity grant-making world. 

Here is a list of the top 20 grantmaking trusts courtesy of Civil Society Media:

Grantmaking trust Fund
  • Wellcome Trust
  • Children’s Investment Fund Foundation
  • Leverhulme Trust
  • Comic Relief
  • Garfield Weston Foundation
  • BBC Children in Need Appeal
  • Westminster Foundation
  • Gatsby Charitable Foundation
  • Esmée Fairbairn Foundation
  • Lloyd's Register Foundation
  • Monument Trust
  • Grace Trust
  • Henry Smith Charity
  • British Gas Energy Trust
  • Wolfson Foundation
  • Sigrid Rausing Trust
  • Arcadia
  • Ahmadiyya Muslim Jamaat International
  • Goldman Sachs Gives (UK
  • BHP Billiton Sustainable Communities
  • £711.7m
  • £148.9m
  • £107.2m
  • £102.4m
  • £58.4m
  • £53.7m
  • £41.9m
  • £41.5m
  • £34.8m
  • £31.9m
  • £30.1m
  • £29.7m
  • £28.7m
  • £28.6m
  • £27.5m
  • £26.6m
  • £25.3m
  • £23.9m
  • £22.8m
  • £22.5m

Where to search for grants from trusts and foundations


Government funding from grants and contracts

Another source of charity funding to consider is government grants and contracts. Government funding shares the pros and cons of grant funding from trusts and foundations but with these additional characteristics:

  • Money may come through a contract for services
  • There may be stricter requirements on the mode of delivery
  • Companies may also compete for the work
  • Funding may be withdrawn if government policy changes

Charities that rely heavily on government funding are often exposed to greater uncertainty and can find themselves drawn into political matters that undermine their independence.

Where to search for government funding


Companies that fund community projects

Many large companies like banks and supermarkets offer some form of community funding. These schemes are often much less bureaucratic than trusts and foundations or government contracts, though they also tend to award much smaller sums. This kind of funding can be a great way for small charities to get started. 

Here are a few examples of companies that provide grants for charities:

RBS Skills & Opportunities Fund

A £280,000 fund open to not-for-profit organisations with projects based in Scotland aimed at helping people to help themselves, in the areas of financial capability and enterprise.

Santander Discovery Grants

Discovery Grants of up to £5,000 are available to UK Registered Charities, Community Interest Companies and Credit Unions to fund small, local projects helping disadvantaged people.

Lloyds Bank Foundation 

Hundreds of grants made each year to small and local charities, investing in their work helping people overcome complex social issues across England and Wales.

Waitrose Community Matters

A scheme at local and national level that allows shoppers to direct Waitrose donations by deciding how to spend the token they receive at the end of their shop. Since its launch in 2008, the scheme has donated around £35 million to good causes in store and online. Each month every Waitrose branch donates £1,000 (£500 in Convenience shops) between 3 local good causes.

Sage Foundation Enterprise Fund

Each year the Sage Foundation creates an Enterprise Fund that awards around $500,000 to small non-profits around the world. 

Where to search for community project funding

Company Giving is a useful tool for exploring potential corporate partnerships.


Technology focused grants

A few organisations offer grants specifically for technology. These are often available ‘in kind’ through training, support or reduced fees on technology products. Be aware that this type of funding is, therefore, quite restricted.

Sometimes funding is available to cover upfront costs where there is then an obligation to pay an ongoing monthly fee thereafter.

CAST Digital Fellowship

The CAST Digital Fellowship is a comprehensive learning programme for nonprofit leaders. It aims to help senior staff develop a better understanding and use of tech and digital innovation, supporting them to become leaders of their organisation’s – and the sector’s – digital development.

Comic Relief & Paul Hamlin ‘Tech for Good’ program

This program offers cash grants to organisations with innovative and impactful projects that need cash to get them off the ground. The project offers the following support:

Grant funding of up to £47k over 9 months to develop digital products and services with a digital partner. 
Support from leading experts/advisors (both digital and in other fields) kicked off through a Boot Camp that introduces key digital concepts and mentors. 

Bringing together teams working on the digital products and services to share learning and provide mutual support.

White Fuse small charity grant

Small charities using White Fuse fundraising and membership software can apply for an ‘in kind’ grant to cover content strategy and website design services. Note the platform’s published fees from £65+VAT. 

Transform Foundation

The Transform foundation offers a grant to get a website through the Raising IT platform. It’s hard to know exactly what the relationship between the two organisations is but the Transform Foundation does not offer any other way to get a website and it is not a cash grant so there are significant restrictions. Monthly fees for the Raising IT platform are not publicly available but start at several hundred pounds per month and there is usually a 12 month minimum contract.

Google Grant

Registered charities can apply for free advertising credit to be spent on advertising through Google’s Adwords platform.

Free or discounted software for charities


Non-grant sources of charity funding

Donations

Compared with grants, donation funding has two obvious advantages:

  • Lack of formal reporting requirements
  • More diversified and reliable (not all your eggs are in one basket)

If you are pursuing a strategy of asking for donations you should familiarise yourself with the Fundraising Code that is published by the Fundraising Regulator.

Further reading on donation funding

Trading

As the funding climate has become more competitive, the social enterprise movement has gained traction and more charities are now generating income from trading. 

Further reading on trading as a charity

 

Date: 
17 September 2018
Andy Pearson