Continuing Funding

Ironically, it's often easier to secure funding to set up something new than it is to continue that work once you've proved its worth. There are several reasons why funders may prefer new projects:-

• Their own funding is time-limited, so they're unable to fund long-term.
• Their funds are already oversubscribed; if they tie up most of their money in long-term grants, there's very little left for new applicants.
• Where salaries are concerned, they don't want to be seen to be making people redundant when the funding ends. If they describe a grant at the outset as short-term project funding, there's less danger of this.
• Some like to see themselves as supporting innovation and taking risks, so new projects are a priority for them.

Usually they ask about your exit strategy (see Exit Strategy Information Sheet) when you apply. You probably said either It is hoped the project will become self-sustaining or We will seek further grant aid from other sources.

The self-sustaining route

This is popular with funders - they get long-term benefits from a short-term injection of cash. However, it may not be right for you, as it depends on:-

• A demand for your product or service from people who can pay enough to cover the costs
• The level of competition from other suppliers
• Skills in marketing and cashflow forecasting
• Reserves or loans to cover gaps in cashflow, low take-up and bad debts
• Agreement from the committee, staff, volunteers, service users and other supporters that this is an appropriate direction for the organisation to take

See Diversification information sheet for where to find help with all the above.

Further grant aid

To convince funders to support an existing project, you will need to demonstrate that it will develop the work you've done already and that you've learned from that. This may seem frustrating if it's already working well, but there is always room for improvement. You could look at:-

• Expanding it to serve more people
• Making access easier through, eg, outreach services
• Improving quality - either informally through your own ideas, or by going for a recognised quality mark
• Sharing good practice with similar organisations in other areas
• Using IT more, to reach more people more efficiently

This can be an opportunity to explore new ideas at the same time as continuing with what works well.

Of course, you will also have to show that it does work well. This could be done through:-

• Monitoring information (numbers of users, take-up of different services, success in involving hard-to-reach groups, success in managing money)
• Evaluation (by service users, self-evaluation by the organisation, third party feedback [eg referring agencies], external observers [eg other funders])
• Coverage in the press or other people's research
• Meeting quality systems requirements (eg PQASSO, Investors in People: see Quality Systems Information Sheet)

You could also try to calculate the impact of your service coming to an end - on the users themselves, and also on other agencies (if possible, the agency you are approaching for funds). For instance, if you run a lunch club for older people, mainly using volunteers, what would be the cost to Social Services of having to provide Meals on Wheels to all your users? And what would be the cost to those older people in terms of isolation if they lost the chance to meet together every week?

Contracts

If your service is providing something valued by Social Services (or another Council department, or the Primary Care Trust) you could look into tendering for a contract. In this case, the funder acts as the commissioning body.

With a contract, you don't have to make the case for how important your user group is, because the commissioning body has already identified them as a priority. They set the targets (and sometimes the amount of money available); you have to show how you would deliver the contract, to a high standard. Contracts can be renewed, so potentially they can be a source of long-term income (as long as you keep meeting the targets and no-one else puts in a better - or cheaper - bid when they come up for renewal). On the other hand:-

• You need to be clear that the commissioning body's priorities match yours - otherwise, they could divert you from your own aims
• The financial risk is higher than with grants - if you don't meet the targets, the commissioning body can sue you, with unlimited liability (not just the amount of the contract)
• You can find yourselves competing with larger organisations with more resources

Plan D

If none of the above works, but continuing this work is a high priority, it may be possible to move money around within the organisation to subsidise it. If you have any unrestricted funds (in other words, not restricted by a funder or donor for a specific purpose), you could allocate them to this project. If you had planned to use your unrestricted funds to buy equipment, it might be easier to put in a funding bid for that. You could also run a fundraising appeal to the general public - unlike more formal funders, they don't have a problem with giving towards general running costs, and they often prefer to support what's tried and tested.

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