May 24, 2019
As part of developing your organization’s funding strategy, you’re going to want to research funders to confirm that they are reasonable prospects. This is where a funder landscape analysis comes into play. A landscape analysis involves an in-depth review of a specific group or class of funders to identify funding trends and programmatic priorities. After you complete this in-depth research, you’ll be in a better position to decide which funders (specific funders or class of funders) to keep on your list and which ones to drop. Additionally, the analysis may suggest ways your organization can position itself to respond to both the current and forecasted funding environment.
Below, we outline the basic process for conducting a landscape analysis. We also provide a summary of what to expect from the process, including actionable next steps.
Before we start, we want to underscore that conducting a landscape analysis requires a significant investment of time and resources. Because of this, it’s not worth undertaking if your organization is unlikely to change its funding strategy regardless of what you discover through your analysis.
A landscape analysis may reveal some truths that your organization’s leadership would rather not hear. Through your research, you may discover that the government agency your organization relies on for the bulk of its funding will be phasing out the program you apply to each year. You may uncover information that suggests that a foundation your organization’s executive director is excited about applying to is not going to be a viable option after all. You may, in other words, have to deliver bad news. However, if your organization’s leadership is willing to act on your findings, ultimately you’ll end up with a stronger, more realistic strategic plan after conducting the landscape analysis.
What a Landscape Analysis Can Tell You
An in-depth look at a single funder or a group of funders can reveal several things, such as whether:
A funder's average grant size is increasing or decreasing over time (in general, or in a specific programmatic area).
A funder is increasing or decreasing the number of grants it is awarding each year.
A funder funds all of its program areas equally, or funds some areas more aggressively (e.g., making larger, more frequent awards in one program area than in the others).
A funder is changing its funding mechanisms or procedures (e.g., changing an award mechanism from open competition to invitation-only, or merging program areas).
Why is this of interest? This information will not only help you understand what’s happening with individual funders, but also, by collecting similar information across several funders or types of funders, you’ll spot patterns indicating broader trends in grantmaking.
For example, if you were to look at a handful of US-based foundations, you might notice that across the board, the foundations are awarding fewer grants, the grants are for increasingly higher dollar amounts, and the grants are going to a limited group of recipients.
What would this tell you?
If you saw just one foundation with a modified grant program, your response might be to adjust your decision to apply to them. On the other hand, if several funders show the same pattern in their grant awards, it could point to a trend in which foundations are forming relationships with a select number of organizations and funding them at higher levels for longer periods.
Is this good news? It could be if your organization already has an established track record with several foundations. If your organization is new or hasn’t won many grants yet, this trend would not be a welcome discovery. Based on where the trend seems to be pointing, you may need to adjust your grant strategy and lower your estimate of how much grant money you’ll bring in in the coming year.
A landscape analysis might also show that less funding is flowing to specific geographic regions or that there is a growing emphasis on invitation-only grant processes instead of open solicitations.
A landscape analysis can also validate your organization’s funding strategy. You might learn that your organization’s mission, location, and programs are perfectly aligned with the funders you’re planning to approach, and you’re better positioned than you thought for the upcoming grant cycle.
Either way—whether the trends are positive or negative—you will emerge from the process with valuable information.
How to Conduct a Landscape Analysis
To start, we’ll cover the basic steps for completing a funder landscape analysis. These steps apply regardless of the type of funder under review. After reviewing the basic process, we’ll highlight funder-specific details based on whether you're targeting foundations, government agencies, or corporate giving programs.
The Basic Steps
Generate a List of Funders: Any analysis begins with defining the scope of the information to be analyzed. In the context of funding trends, you'll need to decide which individual funders, group, or class of funders you want to research. If your organization’s funding strategy is focused on one or more US government agencies or institutes, you’ll want to list the names of the specific agencies or institutes you are interested in, as well as insert a description such as “USG budget for FY2020” as a reminder to also research the overall funding and policy trends at the federal level. If foundations are on your list, you’ll use a similar exercise: list the names of the foundations your organization has decided it will apply to or is tentatively interested in targeting in the year ahead.
Decide on the Information to Collect: After you have listed the names of the funders you want to research, the next step is to determine what information you should try to collect about each one. Going back to the idea that you only want to collect information that will be useful for decision-making, in deciding what information to collect, think about what kind of information your organization finds most persuasive. If you know your organization’s leadership does not consider statistics about application success rates when deciding whether to apply to a funder, don’t bother gathering or calculating that data. On the other hand, if you know that a funder’s average award size (and whether it’s growing or decreasing) is information of value to your organization, you’ll want to prioritize collecting data on the number of grants awarded over the last five years, along with the average grant size per year.
Create Templates to Capture Information: After you identify the information you want to collect, the next step is to create templates to capture the information. Using a template will help you organize the information logically and ensure you collect the same information for each funder. How you structure your template is less important than its usability: the key is to have a template that makes sense, is easy to use, and is easy to interpret. For search parameters, collecting information from the last 5 years is usually a good strategy. For example, you might want to gather information from the last 5 years on metrics such as the number of grants awarded, the average grant amount, the number of unique grantees, and the geographic distribution of grants (all data broken out by year).
Research Funders: Step #4 is the heart of the landscape analysis: gathering data. To collect the data you identified in Step 3, use all the resources at your disposal, such as the foundation’s website, IRS filings, annual reports, and any reports released by advocacy groups and watchdogs. For some funders, you may not find much data, or the data quality may be questionable. If you believe the data to be incomplete or of questionable quality, you’ll want to note that in your report. As you conduct your research, you’ll also want to keep track of your data sources so you can cite them in your final report.
Research Your Organization’s History with the Funders: This step is another aspect of the previous step, not a sequential step. As part of your research, you’ll want to look at internal records as well as external ones to see what history, if any, your organization has had with a funder. Your organization’s records may reveal the number of proposals you’ve submitted to the funder over X period of time (possibly your organization’s entire history); the number of grants received from the funder, including their size and purpose; and any connections to the funder (e.g., whether your organization’s executive director knows a member of the foundation’s board, etc.). When possible, try to cross-reference internal records with external sources. For example, if your organization’s records indicate that a funder awarded your organization a $10,000 grant in 2013, if the funder publishes a list of past grantees and awards, look up your organization to confirm that the award information you have on file matches the funder’s records.
Refine the Data: After you collect the data, review it for discrepancies, gaps, and errors. You might decide to drop a particular data point after discovering that it has not been consistently reported by all funders, making comparisons across funders impossible. This is also when you’ll decide on the best format for sharing the data. Some data will lend itself to visual summaries in the form of graphs, tables, and charts. Other data will be easiest to share as a written summary. Although it depends on the intended audience and how they prefer to consume information, it’s likely that the bulk of your landscape analysis will be reported in visual form through graphs and tables, with text included only as necessary to summarize and highlight the findings.
Present the Data: You’ve determined which data to collect, you’ve created the templates to collect the data, and you’ve reviewed and polished the data. The final step is to present the data to decision-makers at your organization. Some organizations may prefer a lengthy, detailed written narrative. For most organizations, the preferred method will be a short summary document or a PowerPoint presentation that highlights key takeaways such as: “X foundation’s average grant amount is Y dollars, 90% of X foundation’s money goes to this program area, all funders surveyed prioritized ABC,” etc. You’ll have the detailed data to refer to if needed, but providing decision-makers with the key points and recommendations on next actions is probably the best way to proceed.
Use the Data to Make Informed Decisions: The purpose of the landscape analysis is to help the organization make informed decisions about its funding strategy. The results of a landscape analysis can also influence an organization’s structure, programs, and services. Does the data show that several funders are moving away from funding certain types of projects or work in certain geographic regions? If so, the information may indicate it is time for the organization to reconfigure or scale back one or more of its units or teams in anticipation of reduced funding.
Review the Process: After you finish collecting, reviewing, analyzing, and presenting the data, and discussing its implications for the organization, the final step is to observe the outcome: Does the organization use the results of the landscape analysis in its decision-making? If the answer is Yes, find out which parts of the landscape analysis were most helpful for decision-making and make a note of them. Also, note what information did not prove helpful for decision-making. If the organization decides to conduct a landscape analysis in the future, you can use this feedback to refine and simplify the process. You don’t want to spend time collecting and analyzing data that no one finds valuable or is willing to consider for the organization’s long-term planning. Likewise, if you see no evidence that the landscape analysis had any effect on decision-making or behavior, it could be that a landscape analysis is not the best tool to help your organization with its long-term planning and should be shelved in favor of another type of review.
Foundations
Foundations vary considerably in how much information they share about their grant programs. Some foundations share the names of all grantees, the dollar amounts of every awarded grant, and the amounts allocated to specific program areas over time.
The foundations that share the most information are often the largest, with more resources to spend on collecting and publishing the results of their grantmaking. Smaller foundations may publish the names of recent grantees and the dollar value of the awards, but you’re much less likely to find a searchable database of past grants when researching a small family foundation.
Because foundations release varying levels of information about their grantmaking, it isn’t always easy to capture consistent data on each funder. This can make it difficult to compare and combine data from different funders. There’s no easy solution to this problem. You may end up having to drop something from your data collection template (see Step 3 above) because you’re not able to collect the data across several of the funders of interest.
Sometimes the data you want to compare across funders is actually out there…just not in the same place for each funder. Large foundations often maintain sophisticated databases on their websites (see this example from the Ford Foundation) that make it easy to access information about their grantmaking history. For other foundations, while some data might be on their website, you’ll need to supplement that data with information gathered elsewhere.
IRS Form 990-PF
For US-based foundations, a good source of additional information is the foundation’s IRS Form 990-PF. You can access 990s for free on the Guidestar website. When you pull a foundation’s 990 for a given year, you can see who the foundation gave grants to in that year and how much each organization received. To establish funding trends, you’ll need to look at 990 filings for several years, pulling the information out of the 990s and into a spreadsheet in preparation for developing a graph. It can be slow, tedious work.
One additional point to note about the 990s is that it is not always clear whether a payment is a lump-sum payment or part of a multi-year grant to a grantee. You may need to consult several sources of information, such as the annual reports of grantees, to determine the year the award was made and its total value to interpret the information you're seeing in the 990s. Another thing to know about the 990s is that you may not be able to access an organization’s most recent 990, as organizations have up to 18 months to file their 990s after the close of the year.
Funders Based Outside of the US
For grant-making institutions outside of the US, you won’t have the advantage of being able to pull information from the 990. However, you may be able to find most of the information you need from the institution’s website and annual reports, combined with the websites and annual reports of their grantees.
For example, if the institution’s website profiles the work of grantee XYZ organization, you can visit XYZ organization’s website to see if the organization has published information about the grant (e.g., program area, project location, period of performance, and dollar amount) on its website or in an annual report. If the recipient organization is based in the US, you can look up its 990s to see if they include details about the grant. Additionally, there’s always Google: conducting a general internet search may uncover news articles and press releases that will provide additional insights into a foundation’s grant-making activity.
Funder Databases
For paid resources, if your organization has a subscription to a funder database such as Foundation Directory Online, you will find a wealth of data to download and incorporate into your report. A funder database can help fill in gaps when a funder’s website provides limited information about their grantmaking, so much so that, if you don’t already have a subscription to a funder database, you might want to purchase a short-term subscription while you’re working on the landscape analysis.
Free Reports on Giving Trends
You can also access many free reports on giving trendsand the foundations themselves through the Foundation Center (now called Candid).
US Government
If one or more US government agencies are of interest to your organization, you can find information in a variety of places. However, if your goal in conducting the landscape analysis is to try to predict funding trends for the next fiscal year, you may want to focus your analysis on the Congressional Budget Justification (CBJ) for each of the federal agencies or institutes of interest.
Each year, federal agencies prepare budgets for Congress. The resulting document is called the Congressional Budget Justification (see examples for the Library of Congress). The federal fiscal year begins on October 1, and the CBJs are usually available online in March.
To find the latest CBJ for the agency of interest to you, the first step is to go to the website of the agency or institute and type “Congressional Budget Justification” in the website search bar. You can also try Googling something like “FY 2020 Congressional Budget Justification [add name of agency].”
Reading an agency’s or institute’s CBJ will give you information about the direction the agency is heading. You can see which programs will be phased out, the new initiatives it plans to introduce, and highlights of the accomplishments and challenges the agency has faced in implementing its programs. You will also see the dollar amounts the agency has allocated to each program.
By reviewing the line items of the proposed budget—which show how much is being requested for the coming year and how the amount compares to what was requested and actually funded in the current and prior years—you can quickly get a sense of the agency’s (and the current administration’s) priorities. The CBJ is a proposed budget for the coming year, so keep in mind that the final, approved budget may differ significantly.
If you want to learn more about the U.S. government budget process, you can find many excellent resources on .gov sites, including this summary on usa.gov. Additionally, you can find an analysis of annual budget requests in mainstream publications such as the Washington Post. The news articles will give you a general idea of how things are trending at the federal level.
While the CBJs will help you understand spending trends and government priorities, there are additional resources to consult for a fuller picture. This includes obvious ones, such as the agency’s website, especially blog posts discussing what they’re working on and highlighting upcoming events and staffing changes; and the agency’s current strategic planning document, which usually covers a 3–5 year period. An agency's strategic plan is useful to review alongside its CBJ. If you see an alignment between the two, it suggests that priorities remain stable. On the other hand, if the annual CBJ is quite different from the strategic plan released a few years ago, it may signal that the agency is shifting its priorities, possibly as a result of a change in administration.
Corporations
Of all types of funders, it is most difficult to obtain information on corporate giving programs.
Unlike the US government, which has a duty to be transparent about its operations, and private foundations, which often feel a responsibility to be transparent about their activities, private corporations are less forthcoming about their giving programs. In fact, for corporate cash or in-kind donations (as opposed to giving made through a formal corporate social responsibility program), it’s unusual to find a detailed, comprehensive list of a company’s giving history.
If your organization plans to target corporations as part of its funding strategy, even though it can be challenging to find information, it’s still worth investigating. While you might not find enough data to create charts or graphs on things like average grant amounts or number of awards, you may be able to gather information through the company’s website, annual reports, and press releases that, taken together, provide an indication of how active their giving program is and the types of recipients and programs they favor. You may also find it valuable to research the company’s performance to assess its overall status and whether it’s in a growth phase or facing a financial or legal crisis that could affect its philanthropic activity. A visit to Yahoo Finance can help surface this type of information.
Your goal in researching corporate giving programs is to understand how they work, their priorities, and their current partners. Because the amount and type of data published about corporate giving programs can be quite limited, you may need to modify the template (see Step 3 above) you use to collect, organize, and present information about corporate giving programs. Although it’s ideal if you can collect similar information about each company as part of your landscape analysis, because corporations vary so much in what they share, it may not be possible to analyze and compare giving trends within this class of donors.
To Conclude
A funding landscape analysis is intended to provide you with a broad understanding of individual funders and trends among groups or classes of funders. Since you’ll be looking at several years of information for each funder, and because conducting a landscape analysis is such a time-consuming process, this is not an activity you’ll necessarily want to undertake each year.
As mentioned earlier, a landscape analysis is only worthwhile if your organization is open to revising its grant strategy based on the analysis's results. More information about funders and funding trends is not always better, especially when collecting it requires a significant investment of time and money. If your organization tends to respond to funding opportunities by saying, “let’s apply and just see how it goes—maybe we’ll win a grant!” when all evidence points to the contrary, a funding landscape analysis is probably not a good investment of resources.
However, if your organization is interested in understanding where funders are heading, individually and collectively, and is open to revising its funding strategy, a landscape analysis could be a valuable resource to inform your decision-making. The key to a successful analysis is to collect and analyze information that your organization will find useful as it develops its funding strategy.