Angie Buckingham Melton, J.D.
Angie Buckingham Melton serves as a Vice-President for the firm’s Non-Profit Practice. She provides legislative and strategic advice to clients in health care and other non-profit areas that seek opportunities to enhance funding through congressional legislation and federal research and project grants.
Building a Smarter, More Sustainable Funding Strategy for Your Organization
Today, more than ever, Nonprofits are navigating an increasingly competitive and complex funding landscape. Relying too heavily on a single revenue stream, whether that be grants, donations, or program income, can leave organizations vulnerable to shifts in federal or state policy, economic downturns, or changing donor priorities. A diversified funding strategy is essential.
At the Nonprofit Fundraising Summit, our team introduced what we call the “Toy Box Approach” to funding diversification, which is a practical framework that encourages nonprofits to pursue multiple funding sources, each serving a unique purpose. Just like a well-stocked toy box, the goal is to have a variety of options available so you can choose the right one at the right time to support your mission.
What Is the Toy Box Approach?
The Toy Box Approach is centered on the idea that no single funding source can or should do all the heavy lifting. Instead, organizations should intentionally build a mix of revenue streams, such as:
- Program service revenue
- Congressionally directed spending (earmarks)
- Federal, state, and local grants
- Foundation funding
- Charitable contributions
Each of these funding streams comes with its own set of benefits, challenges, timelines, and strategic value. The key is understanding how they fit together to create a stable and scalable funding model.
Understanding Your Funding Tools
Not all funding sources are created equal. Federal grants often offer significant financial support, but they come with complex applications, strict compliance requirements, and longer timelines. They can be transformative but require strong internal capacity to manage effectively.
Alternatively, foundation grants are typically more accessible and easier to apply for. Personal connections help with foundation grants, and the initial awards are likely to be smaller. Nonetheless, they can be powerful entry points for building relationships that lead to larger, long-term investments.
Congressional earmarks present another unique opportunity. While they often involve shorter applications and more flexible project design, they are highly relationship-driven and require strong community support and demonstrated need.
By understanding these differences, nonprofits can make smarter decisions about where to invest their time and resources.
Finding the Right Fit
A successful funding strategy isn’t just about chasing opportunities; it’s about alignment. Before pursuing any grant or funding source, organizations should ask:
- Does this align with our strategic plan and core programs?
- Are we eligible and competitive?
- Who has been funded in the past?
- How many awards are contemplated?
Being selective and strategic increases the likelihood of success and ensures that funding supports your mission.
Start Small, Build Momentum
Diversification doesn’t happen overnight. In fact, some of the most effective strategies start with smaller, more accessible opportunities. Wins, like a foundation grant or a local funding partnership, can help build credibility, strengthen programs, and position your organization for larger, more competitive funding down the line.
Think of these as the building blocks that help you grow your toy box over time!
By building a diverse portfolio of funding sources and understanding how each one contributes to your mission, your organization can increase resilience and create more growth opportunities for your programming.
As you think about your own funding strategy, contact McAllister & Quinn so we can walk through your goals together and identify the right mix of funding opportunities to support your mission over time.