What to do about demand
In this article, we’d like to take the opportunity to encourage grantmakers to think about ‘demand management’ or ‘application management’ as something that funders actually do have agency in designing and responding to, and that your choices about these should - as with everything else you do as a funder - be in line with your mission and organisational values.
How the wrong type of response to high demand could conflict with your mission and values
Whether you are an invite-only funder, or one who uses open calls, we understand that managing applications is tricky. It’s both an art and a science and sometimes feels like you need an in-house soothsayer on the books.
But often, approaches to coping with high demand are not designed in the same careful way that making a completely new programme is, and sometimes a funder’s response to high demand can be at odds with what their organisation nominally stands for.
Below we list a few examples of how funders in the UK, US and EU have responded to increases in funding applications. By citing these examples, we don't mean to malign funders who have chosen to take similar steps. But we do point out how certain ways of managing demand can potentially clash with values that many funders theoretically hold dear.
Some funders have:
Salami-sliced grants: This means awarding less money in a grant than the grantseeker originally asked for. This feels like an obvious way to spread the jam more thinly, but for any funder that promotes a trust-based approach, salami-slicing undermines the message that we trust grantees when they tell us what funding they need.
Operated a ‘first come, first serve’ approach: This can mean only assessing, for example, the first 100 applicants that submitted a proposal, before closing the programme. While this is very common for, say, selling festival tickets, it has an unfortunate equity implication in grantmaking: some people are more able to hit 'apply' at exactly the right moment than others are.
Paused making grants for a period of time: This period of time could be three or six months to possibly years, and it often accompanies a strategy refresh. However, of course, for any funder that decides to pause funding, there will be inevitable knock-on consequences for potential applicants, existing grantees and for other funders.
Tightened funding criteria or reduced eligibility: This can be done by ceasing to fund work done under certain themes or geographies, or by changing policy on what kind of organisation can apply for funding. The downside of this is that it leaves whole sectors cut off, while others still get funded.
Some ideas from further afield
So these tried and trusted approaches to coping with high demand all come with unfortunate side-effects, especially for less secure recipient organisations. Is anything better available?
Grantmaking is not the only sector that has to manage high demand. While we have been critical in previous newsletters about blithely assuming that beliefs and practices from other industries are always relevant to grantmaking, we’d still like to share a couple of ideas from out there that we think deserve more attention than they get:
Ballots for application opportunities: In situations where demand for something is going to be vastly more than availability, random ballots are often used to allocate that thing fairly. Some countries award visas like this, many universities allocate rooms this way, and Wimbledon has been disbursing tickets like this for decades. If you expect demand for a new funding programme to outstrip you capacity to assess, you could run a random ballot to give people the opportunity to apply. Those who don't get chosen in the ballot simply don't have to invest the time in proposal development. Those who do are given time to develop their idea and apply. Of course this doesn't solve all fairness problems: you need to consider how to market the ballot in an equitable way in the first place. Note: this kind of ballot is not the same as randomising grant decisions - here we’re talking about randomising the chance of applying, not winning.
Outsourcing: When demand outstrips an organisation’s ability to supply, lots of organisation in other sectors outsource parts of the process. This can also happen in grantmaking but usually for reasons other than sheer demand volume. Some funders choose to work with Community Foundations, for example, if they wish to award funding in specific locations but don’t have a local footprint. But perhaps it’s time for some funders to also consider this kind of approach as another way to deal with demand. Your organisation may not have the capacity process a certain number or type of grants but other funders may be in a (better) position to.
Partial spend down: Some funders with an endowment have chosen to partially spend their endowment in order to make more funding available, but without spending down entirely. The Ford Foundation
spent down 10% of its endowment to respond to a surge in demand when the Covid pandemic started. This is a way of managing more demand by providing more… supply!
How to question your approach to demand management
The world is changing and so the ways in which funders respond to things like demand also needs to flex. If you’re experiencing or forecasting major increases in applications, your organisation probably needs to reconceptualise demand management not as a problem to be fixed within existing rigid constraints but as a new reality to which you need to adapt.
If any of this article resonates, we suggest that you work internally to ask and answer the following questions:
If we have made any recent changes to help cope with demand, were these truly in line with our mission and values?
Do we have the right operational model e.g. number of staff, sets of skills required to help us to deliver, based on this new reality?
If we don’t have the right operational model and need to reimagine it, can we bring in more help to enable us to do this work while we continue to award funding?
We get that any notion of increasing grant and/or operational spend in some funders is either impossible or simply anathema. But if now is not the time to menace some seemingly sacred cows, then we don’t know when would be.
Latest Reading, Watching & Listening - Modern Grantmaking recommends
Following Trump’s reelection, the new administration has moved swiftly to enact a range of changes such as freezing USAID assistance, which threatens nonprofits, civil society and environmental movements, and the people they support, at home and internationally. In response, The Council on Foundations in the US released a statement that includes various specific recommendations. Some large foundations in the US look like they’ll be investigated for “illegal discrimination”, along with lots of other organisations that the new administration dislikes. Fenomenal Funds has
released a blog that delves into how funders can back transformative organizational development from an intersectional feminist perspective and offers practical steps on how to integrate this perspective into internal and grantmaking processes, such as, supporting care at the individual, organisational, and communal levels.
The Civic Power Fund is running two online events in February to unpick analysis of much UK grantmaking is going to work addressing injustice (spoiler - it’s over £900m). You can sign up for the first event here.
How about a new job or trustee role in grantmaking?
Oxfordshire Community Foundation (UK) is hiring for a Grants Officer. Salary is £28k full time. Deadline is 16 February 2025. Trust for London (UK) is hiring for a new trustee. Voluntary role. Deadline is 09.00, 19 February. Civitates (EU) is hiring for an Impact and Learning Manager. Salary is €53k-58k EUR full time. 18 month contract. Deadline is 28 February 2025. The Association of Charitable Foundations - ACF (UK) is recruiting for a new Chair. Voluntary role. Deadline is 10 March 2025.
Want to see your job ad in next month’s newsletter? Ping us, it’s free! Just… #ShowTheSalary
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Elon Musk.
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Who are we?
Gemma Bull and Tom Steinberg run Modern Grantmaking, and write this newsletter. We do consulting and training specifically for funders, and wrote a book on how to be a modern grantmaker, too.
