Trends & Insights

How to increase unrestricted funds for fiscally sponsored projects

Crowdfunding Advisors, FundRazr Team

Helping our community get to the next level of crowdfunding success

About the author:

Julie Jehly is the Director of Fiscal Sponsorship Collaborations of FundRazr. Julie is responsible for the development, launch and management of FundRazr’s crowdfunding program targeting 501c3 fiscal sponsors and their projects. For several years prior to joining FundRazr, Julie was the Development & Fiscal Sponsorship Director with a Northern California based fiscal sponsor nonprofit. Her experience in the nonprofit industry includes stints with art and environmental organizations dating to 2007. Julie is based in Sonoma County, California.

There are many benefits to being a Fiscally Sponsored Project (FSP), including having a Fiscal Sponsor (FS) provide mentoring, bookkeeping, and most importantly, accepting tax deductible donations on behalf of the FSP. Donations can be from individuals, local mom and pops and corporations. The fundraising wildcard is securing grants from foundations and government agencies. Since the Fiscal Sponsor holds the 501c3 number, some foundations and agencies won’t accept FSP grant applications, thus limiting an avenue to income.

Yet not all foundations and agencies have this policy, and many do financially back the work of Fiscally Sponsored Projects (FSPs). Should a Fiscally Sponsored Project be awarded a grant, the funds are most likely restricted. This means the money can only be used for what is included and approved in the application’s scope of work. Potentially the grant will not cover cost of doing business expenses incurred by the FSP.  

Here’s a real-life example of a restricted county grant. A FSP was awarded funding to bring members of an underserved community to county parks for hikes, provide plant and animal education, art activities, and generally be outdoors and enjoy nature. Members of the community are families whose children are visiting a park for the first time. It’s a feel good all the way around – 

• the county grant provides rangers, docents, art supplies and lunch;
• the FSP knows the underserved community members it wants to invite and how to reach and connect with them; and
• underserved families enjoy a day and new experiences in their local county park. 

What are the missing pieces to make these outings successful? How does the FSP cover their essential outreach and implementation expenses – website development and management, monthly internet fees, phone, insurance, staff time and most importantly – transportation to the parks??? In other words, how will the FSP ensure it can meet the county’s grant requirements to reach underserved communities and provide outings when the county’s grant is restricted and doesn’t fully cover the costs? 

Crowdfunding through FundRazr remedies these two funding challenges as the FSP can – 

• accept an unlimited number of tax-deductible donations using the FS’s 501c3 number AND
• all donations are unrestricted, meaning the funds can be used as the FSP sees fit. 

Here are six avenues the Fiscally Sponsored Projects can use to reach current and new donors, and examples of how to frame the ask to cover transportation expenses. 

1. Post story updates 3 times a week on your FundRazr campaign. Your donors want to know their gift is making a difference. For example, keep them informed by sharing “We have received $500 in donations and can bring 10 families to Main Street Park! Thank You!”. Additionally, add links to your blog, website, news articles, and more! Create your free fundraising campaign
2. If you have not already done so, create a Fiscally Sponsored Project Facebook page. Share campaign updates 3 times a week here as well and be sure to include photos and video, especially from outings, to help Facebook prioritize your story. 
3. Regularly Tweet and here’s a template – Please RT: Support my #fundraising for (your cause). Every $1 makes a difference (your campaign link here) Be sure to include relevant hashtags. The FSP could tweet – Please RT: Support my #fundraising to cover transportation expenses so we can bring underserved families to county parks for the day. Every $1 makes a difference (your campaign link here) #countyparks #nature #families #outdoors
4. Messenger is perfect to reach a select group of friends and donors who may view and respond more favorably to your plea via a personal and private message. 
5. Email remains a great way to reach donors. We all have our favourite nonprofits and enjoy reading their updates and staying invested in their success. Be sure to include photos, quotes and testimonials from families who attended outings, and the impact donations to cover transportation have made. Perhaps families would not have attended without donor support, and if so, share their stories! 
6. Instagram is a great way to show pictures and video of fundraising progress and happy families enjoying an outing because of the difference your donors have made. Let them know! 

As your donors are diverse so are the ways for you to reach them. Vary your message to match the format but stay focused on your key message and share the success donors helped create. 

In summary, crowdfunding with FundRazr fills the unrestricted income and budget gaps left by foundation and government grant restrictions, and is an essential component to your fundraising strategy. 

Ready for a one-on-one meeting to learn how FundRazr can meet your specific needs? Connect with us!