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 enters the picture. 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 go through the basic process of conducting a landscape analysis. We also provide a summary of what you can expect to get out of the process in terms of actionable information. 

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 is funding all of its program areas equally, or funding some areas more aggressively (e.g., making larger, more frequent awards in one program area compared to the rest); or

• a funder is changing its funding mechanism 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 going on with individual funders but also, through collecting similar information on 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 are showing the same pattern in their grant awards, it could point toward a trend where foundations are forming relationships with a select number of organizations and funding those organizations 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 a lot of 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 off, we’re going to 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 some things that are funder-specific depending on whether you are looking at foundations, government agencies, or corporate giving programs.

The Basic Steps

1. 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 or 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” to remind you 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.

2. 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. 

3. 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 to organize the information in a logical way and ensure that you collect the same information about each funder. How you structure you template is not as important as its usability: The main thing is to have a template that makes sense and is easy to use and interpret. In terms of 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 dollar amount of the grant, the number of unique grantees, and the geographic distribution of the grants (all data broken out by year).

4. Research Funders: Step #4 represents the heart of the landscape analysis, which is gathering the 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 quality of the data 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. 

5. Research Your Organization’s History with the Funders: This step is really another aspect of the previous step rather than 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., does your organization’s executive director know 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. 

6. Refine the Data: After you collect the data, it’s time to 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 stage is also when you’ll decide on the best format to share 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.

7. 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 want to see a lengthy, detailed written narrative. For most organizations, the preferred method will be a short summary document or PowerPoint 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.

8. Use the Data to Make Informed Decisions: The point of going through 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 suggest that it could be time for the organization to reconfigure or scale back one or more of its units or teams in anticipation of decreased funding.

9. Review the Process: After you finish collecting, reviewing, analyzing, and presenting the data and discussing what it means for the organization, the final step is to observe what happens: Does the organization end up using 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 as part of 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 regarding the amount of information they share about their grant programs. Some foundations share the names of all grantees, the dollar amounts of every awarded grant, and how much money has been allocated to a specific program area over time.

The foundations that share the most information are often the largest ones, which have more resources to spend on collating 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 different kinds and degrees of information about their grantmaking, it isn’t always easy to capture the same information about each funder. This can make comparing and combining data from different funders difficult to do. 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 frequently have sophisticated databases (see this example from the Ford Foundation) on their websites that make it very easy to pull the 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 place to go for additional information is the foundation’s IRS Form 990-PF. You can access 990s for free through the website Guidestar. 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 thing to note with the 990s, is that it is not always clear when a payment is a lump sum 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 help interpret the information you're seeing in the 990s. The other 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 following 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 the US, you can look up the organization’s 990s to see if you can find 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 trends through the Foundation Center (now called Candid) as well as through the foundations themselves.

US Government 

If one or more US government agencies is 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 next fiscal year, you may want to focus your analysis on the Congressional Budget Justification (CBJ) for the each of the federal agencies or institutes of interest.

Each year, each federal agency prepares a budget for Congress. The resulting document is called the Congressional Budget Justification (see these examples from the USAID and Library of Congress). The federal fiscal year begins October 1st, and the CBJs can usually be found online in March of each year.

To find the latest CBJ for the agency of interest to you, the first stop 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 it will be phasing out, new initiatives it will plans to introduce, and highlights of the accomplishments and challenges the agency has experienced in implementing its programs. You will also see the dollar amounts the agency has allocated to each of its programs.

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 you do have to keep in mind that the final, approved budget may look quite different.

If you want to learn more about the US government budget process, you can find lots of excellent resources posted on .gov sites, including this summary found on usa.gov. Additionally, every year you can find an analysis of the annual budget requests through 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 other resources to consult to get 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 in conjunction with its CBJ. If you see an alignment between the two, that suggests that priorities are remaining stable. On the other hand, if the annual CBJ is quite different than the strategic plan released a few years prior, it may signal that the agency is shifting its priorities, possibly as a result of a change in administration.

Corporations

Of all the types of funders, it is most difficult to glean information about 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 to 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 what kinds of recipients and programs they seem to favor. You may also find it valuable to research the company’s status to determine how it’s doing in general and whether it’s in a growth phase or in the midst of a financial or legal crisis that might impact its philanthropic activity. A visit to Yahoo Finance can be useful to surface this type of information. 

Your goal in researching corporate giving programs is to try to understand how they work, their priorities, and who their current partners are. 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 meant to give you a breadth of understanding about individual funders as well as trends among a group or class 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 worth doing if your organization is open to revising its grant strategy based on the results of the analysis. More information about funders and funding trends is not always better, especially if collecting the information requires a significant outlay of money and time. 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 knowing where funders seem to be heading, individually and as a group, and if it is open to possibly revising its funding strategy, a landscape analysis could be a valuable asset and assist your decision-making. The key to a successful analysis is to collect and analyze information that your organization will actually find helpful as it develops its funding strategy.