Correct & targeted promotion: More than just giving money!

Supporting foundations are in a pleasant situation. They have something that others want - money, contacts, infrastructure. And often more than plenty of all of this.

A proud 17 billion euros were spent last year in Germany, above all by grant-making foundations for statutory purposes and for the common good; non-monetary services are not even included.

  1. As impressive as this sum is, it says nothing about the nature of the support, its success or its impact. Because investing a lot does not automatically mean "promoting well". Not surprisingly, "promoting" is more than the mere sum of the grants.
  2. Rather, sponsorship is a process in which the foundation and the sponsored project work together to help target groups as much as possible and thereby generate added value for society. Ideally in equal partnership based on a modern understanding of relationships.

Organisations are not supplicants, but respectable partners* who bring the necessary professional know-how to convert the foundation's donations into social impact. At the same time, this new understanding also enhances the role of the funding foundations. They are no longer just passive, generous financiers, but active shapers of social change.

However, this presupposes that the foundation is set up and organised accordingly.

In the following, we will discuss which aspects are conducive to good support work and which adjustments can be made in order to achieve maximum success with minimum effort.

The basics: Identify needs and set the right focus

Freedom of foundation and individual creative will are undisputedly high goods. However, a foundation should also respond to real social needs.

"Real" means that the need was not identified at some point, but rather that it is checked both systematically and regularly to see whether it still exists, whether it has possibly changed and whether there are now other actors who are addressing it. Or to put it briefly: Do supply and demand still complement each other? Are adjustments necessary?

In addition to being demand-oriented, it is helpful to focus on certain issues, to identify a clearly defined playing field on which the foundation operates. Although this playing field is defined by the cornerstones of the foundation's purpose and social needs, this area is usually very large.

A foundation dedicated to climate protection, for example, can become involved globally, regionally or locally; it can promote projects that target disadvantaged families, schools or public administration; it can support prevention projects, launch energy-saving campaigns or engage in political lobbying. - This is where limitation is needed. In which niche is there the greatest need, who exactly are the target groups and what exactly is to be achieved with them?

It is more productive and effective to concentrate on selected topics than to want to help in all places at once. A positive side-effect is that those who specialise build up considerable knowledge of the respective area, which in turn makes it easier to assess potential projects for funding.

Orienting oneself to the needs of society and setting thematic priorities - these are the basic prerequisites for effective support. The decision for or against a funding application therefore begins with the strategic orientation of a foundation and its external image.

However, "promoting well" goes beyond these basics and means that a foundation also actively assumes responsibility. For itself and for the organisation it supports.

Often underestimated: active structural support!

Grant foundations tend to support project work exclusively. But high-quality project work also requires qualified personnel and effective, sustainable structures - and these are not available for free. This is why funding foundations should see themselves as responsible and seize the opportunity to provide their funding partners with structural support.

There are already a few foundations that invest in professional, long-term sustainable structures in organisations - capacity building -, advise them or involve them in their networks. This funding practice, which is derived from the venture philanthropy scene, is admittedly costly and means that a foundation can only maintain a few funding relationships. In return they promise a higher degree of effectiveness and sustainability.

Instead of projectitis: Proving staying power

Speaking of sustainability: ideally, projects whose social relevance and effectiveness have been proven will be financed on a long-term basis and disseminated beyond the respective model location. What sounds obvious is unfortunately different in reality. Even very successful projects are often discontinued after a few years.

And this is usually for two reasons:

  1. because the usual funding periods of three years are tight. Young projects alone take several years to build up structures, reach the target group or convince cooperation partners.
  2. Instead of continuing to support successful projects, new, "innovative" projects are initiated - out of a misunderstood desire for innovation, a desire for recognition, or both.

Both causes inevitably lead to the fact that the investments made so far in organizations are almost completely wasted. This is the dreaded "projectitis".

Responsible, good promotion, on the other hand, would mean consciously deciding whether to support young, innovative, high-risk projects or to promote and continue in the long term projects that have already proven their effectiveness.

Of course the non-profit sector needs innovation! But it also needs the willingness to support successful projects in the long term - and, if possible, to disseminate them.

The frequently expressed expectation that effective model projects would at some point be taken over and continued by the state after start-up financing is unfortunately often pure wishful thinking. A foundation that wants to ensure that a third party continues to support a project that has been launched would do well to seek out this third party as early as possible and involve them in the planning process.

But please with effect!

Making an impact, making a difference in society - this is in the self-interest of every foundation, regardless of its size or funding volume. Accordingly, foundations should approach the impact hype in a relaxed manner and above all consider the topic as an opportunity. After all, it is up to each foundation to decide what effect it wants to achieve, how it determines it and what conclusions it draws from it. In the sense of good promotion, it is above all important to think about impact.

Impact-oriented work makes it possible to determine whether the desired goals have been achieved. In this way, impact-oriented work points out undesirable developments and enables early countermeasures to be taken. The critical examination of the results achieved leads to the further development of a foundation. Focusing on impact objectives can also help to motivate staff and project partners to work with greater motivation.

It should not be concealed that the effects and success of charitable work are often difficult to measure. Because this is the case, some foundations succumb to the temptation to design pseudo-indicators that can be easily checked and lead to quickly visible results. This in turn is fatal, because false indicators create false incentives. In extreme cases, the foundation's work is then only concerned with publicity and reputation effects. Or it can lead to competition with other donors*.

To avoid this, impact orientation must be integrated into the entire project management. In this context, good support means that at the beginning of a partnership, the foundation and its partners agree on concrete goals - what should be achieved, when, where and how, and at what cost. - and jointly define milestones for each individual project phase.

Whether and to what extent (interim) goals have been achieved and how any problems are to be addressed is provided by the funded organisation. It is important that both sides communicate regularly with each other and not only selectively or only after the project has been completed. So much for the theory.

In reality, there is often no adequate evaluation of the impacts. Either because no impact indicators have been developed in advance, or because there is simply a lack of competence, or because scientific evaluations appear too costly. For whatever reasons it is not carried out: Without appropriate evaluation of projects, valuable knowledge about potential for improvement is lost.

Conceivable solution: Instead of completely dispensing with evaluation, the Foundation could weight the data to be collected. If the project is large and the budget small, it may make sense to evaluate a small but relevant part of a funded project well rather than to collect data for the entire project and have to accept qualitative compromises. After all, it is not about calculating every single effect to the decimal point.

In smaller projects, initial insights into the impact achieved can also be gained with little effort - for example, through regular surveys of project participants and stakeholders. Large-scale, scientific studies are therefore by no means always necessary. Joint reflection in learning rounds about which goals have been achieved and which have not is already a first step that even small foundations can take.

Guarantee transparency! Funding guidelines and application procedures

The success of a funding programme depends on the funding partner. In order to identify competent organisations, it is therefore advisable to formulate clear funding guidelines. Internally, they serve as a catalogue of criteria and justification for the selection of funding applications. And when communicated externally, they can prevent unsuitable organisations from applying or receiving blind applications in large numbers.

Every unsuitable application causes additional work, not only for applicants, but above all for the foundation. By the way: an offensive communication of the foundation's own funding guidelines also sharpens the foundation's profile. In this context, good sponsorship means providing transparent and proactive information, but also adhering to your own criteria.

Funding guidelines should be easy to find and appropriately precise. Appropriately precise means that, beyond the foundation's purpose, other priorities and restrictions are mentioned, such as a negative list. Ideally, all of this should be coherently linked to the vision and strategy of the foundation, so that even organisations that do not apply can gain a professional impression.

In the application process, in addition to the usual key figures, essential aspects of impact orientation should also be queried, e.g. the social needs, precise activities, expected effects, etc. This not only reduces the number of unsolicited applications. Rather, those organisations can already be identified at this point that are professionally positioned and know exactly what they are doing. The Social Reporting Standard provides a detailed and coherent list of useful aspects for the application process.

The overall scope of the application process should be based on what is appropriate for the foundation and the applicants. There is no blueprint.

Demonstrate professionalism, internally and externally

Supporting foundations choose project partners who can professionally implement the goals and ideas of the foundation. The resulting constellation - here the generous donor, there the grateful recipient - bears the danger that the special position of the foundation's employees compared to the financially dependent and sometimes less professional recipients may make the relationship less partnership-oriented. Power games, offensive interventions in project design or opaque decision-making processes occur regularly.

Funding foundations should therefore strive to establish a relationship with their funding recipients that is based on partnership. Viewed soberly, an equal exchange of services takes place: the foundation gives the funds, the recipient organisation pays them back with successful project work.

The ability of a foundation to select reputable project partners, to cooperate actively with them and to communicate in a courteous manner therefore contributes significantly to the fulfilment of its strategic goals. In this context, funding foundations should also examine whether and how they can also receive undisguised critical feedback from their funding recipients - an effective means of preventing self-referentiality and promoting qualitative development!

Good promotion!

Of course, the above-mentioned aspects of good sponsorship offer no guarantee that a foundation will actually achieve success or that a sponsorship relationship will be profitable per se. But they do form the breeding ground from which successful and effective foundation work can grow in the first place. In many aspects, there is no clear right or wrong - what is important is to understand sponsorship as a process that goes far beyond simply giving money.