Lysa Ralph and Philip Goodwin: Institutional Funding
Transcript of Lysa Ralph and Philip Goodwin: Institutional Funding
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Institutional Funding in tough timesA practitioner’s guide
Lysa Ralph, Head of High Value Giving, British Red Cross Philip Goodwin, Chief Executive, Tree Aid
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Session overview> Clarification and definition > Outlook for general fundraising > Institutional donor trends / features > Savvy INGO’s – commonalities & success rates> INGO growth 2008-12> Tree Aid’s approach > Last thoughts > Useful sites / resources> Questions
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Point of clarification…
Money is not a dirty word!!
Fundraising, funding co-ordination, resource mobilisation…
…essentials and disciplines are the same
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Definition of Institutional Funding
Funding from governmental donors plus those whose assessment
methodology / priorities share the characteristics and requirements -
i.e. project cycle management - of governmental donors:
UK government streams – e.g. DFID, Island donors eg Jersey
Overseas Aid, Scottish Government International Funds
European Commission – ECHO / DEVCO
Other countries government funding streams e.g. USAID
‘Foundations’ sharing those behaviours - Comic Relief, Big Lottery
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Outlook for general fundraising
> Supplier capacity
> Increased competition
> Demands for donor engagement
> Social media creating closer relationships
> Potential to flatline ??
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Trends – Institutional income
> Between 2006-11, despite the economic outlook, increase in state funding to the voluntary sector of 4%, plus ringfenced Int’l Aid
> EC budget reduced for first time, down 1.5% for 2014-2020 €960bn, from €975 bn 2007-2013
> DFID’s ringfencing / commitment to 0.7 GDP may not last beyond 2015
State Funding of Voluntary Sector (£bn)
11.3
11.9
12.8 12.8
11.9 11.8
10
11
12
13
14
2006 2007 2008 2009 2010 2011
£ b
n Public Funding ofVoluntary Sector
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> Shift away from grants to contracts: > 2001 grants worth £4.6 billion, contracts £3.8 billion> By 2008, grants worth £3.7 billion, £9.1 billion worth of
contracts
> Full cost recovery principles widely accepted, set margins
> Increase in ‘payment by results’; Social Return on Investment / Social Impact Bonds
> Polarisation of the sector, consortia development> Need to evidence outcomes / impact> Increase in competition > Introduction of private sector, new landscape
Trends – IF features
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Donor trends / savvy INGO’s
> Decentralised operations / decision making
> Preference to reduce admin costs / deal with consortia lead /
Int’l orgs / input to central funds eg Global Fund
> Assessment via programme cycle management methodology:
‘theory of change’
> Ownership by local actors
> Shared policy environment / MDG’s etc
> Value for Money / having policies around this
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Return on investment, success rates
> High return on investment: IoF Fundraising Index 2012 - £16:1
> BRCS success rates:– EC 1:5 rising to 1:3 where closest to core mission
= ECHO. – Lottery 85% against a sector average of 15%
> Tree Aid: 1:3 success rate by number of submissions, 1:4 by project value
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INGO’s ranked by institutional income (2012)Rank Total income Institutional funding
1 Oxfam 367.90 162.10
2 Save the Children 283.75 150.66
3 Merlin 60.86 54.88
4 CARE International 43.68 31.98
5 Christian Aid 95.45 27.44
6 British Red Cross 200.10 21.40
7 World Vision 68.79 21.06
8 Plan 54.25 20.06
9 Islamic Relief 100.37 19.47
10 Tearfund 60.05 18.56
11 Action Aid 59.45 15.33
12 CAFOD 48.80 11.11
13 Concern Worldwide 14.62 6.79
14 UNICEF 62.33 3.99
15 MSF 23.89 0.00
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1299.776 1,337.97
1,544.791,694.56
1,544.28
409.25 425.57535.47
638.18564.84
0
200
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2008 2009 2010 2011 2012
Inco
me
(£m
illio
ns)
Total income
IF income
Total income and IF income, 15 INGO’s 2008-12
> Many grew their Institutional income quite dramatically, avg +38%
- British Red Cross, + 570% 2008-11
- Tree Aid, £195k to £1.1m and growing, doubled since 2011
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IF income of charities (2008 - 2012)
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80.00
100.00
120.00
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200.00
British RedCross
CAREInternational
Christian Aid Merlin Oxfam Plan Save theChildren
World Vision
Inco
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(£m
illio
ns) 2008
2009
2010
2011
2012
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Institutional funding as a proportion of total income
0.00
50.00
100.00
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British RedCross
CAREInternational
Christian Aid Merlin Oxfam Plan Save theChildren
World Vision
To
tal i
nco
me
(£m
illio
ns)
Other income
Inst. Funding
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Tree Aid - Key Principles
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Key Principles for Institutional Fundraising
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Building Capacity to Attract Funding
1. Building strategic relationships
2. Understanding the "market"
3. Building credibility and track record
4. Increasing visibility and evidence of impact
5. Resources
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1. Building strategic relationships
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• Technical knowledge
• Policy insight and influence
• Intelligence on funding
opportunitiesNetworks
• Technical insights• Field knowledge• Impact on the
ground• Policy influence
• NetworksInfluenceScale
Credibility
IMPACT
Strategic Partners
TREE AID
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2. Understanding the market
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3. Building credibility
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4. Increasing visibility & evidence of impact
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5. Resources / tools to pursue funding
> Fundraisers = highly valuable assets = not cheap> Interpretation – EC, DFID, Lottery
– Experience: programme management, track record fundraising success, building / monitoring complex budgets
– Knowledge : technical donor knowledge (<ECHO / DEVCO)– Skills: relationship building; communication; negotiation,
financial, creativity, research, statistical analysis– Characteristics: resilience, patience and ….Zen!
> Investment of staff time– In-house teams – How they are constructed– Use of external support
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Last thoughts
> Match - European Commission: co-financing – from 15% International to 50% domestic - can include cash and / or in kind match
> Stewardship – Trusts approach to Inst Funding > Know your place / added value in your sphere> Be nimble, react to trends / corporate dfid wash> Understand risks / resources needed & investment /
don’t just follow the money> Know your theory / story of change …can you hook
them emotionally?
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Useful sites
EuropeAid / Search – ‘calls for proposals’
http://ec.europa.eu/europeaid/index_en.htm
Local, regional, national and European sources
http://www.governmentfunding.org.uk/default.aspx
fundsforngos.org http://www.inprogressweb.com/
http://www.trustfunding.org.uk/default.aspx
http://www.biglotteryfund.org.uk/funding