Fundraising is the lifeblood of nonprofits and charities, and a well-crafted proposal can mean the difference between success and falling short. While fundraising software is an excellent tool that boosts nonprofits’ growth, today’s lesson is about creating something equally dynamic — a fundraising proposal that compels donors to invest in your cause.

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In this blog, we’ll discuss what a fundraising proposal is, things to keep in mind before you start writing and how to structure it. In the end, we have some great tips that’ll elevate your proposal to the next level.

We also talked to nonprofit professionals and grant writers and added their valuable insights and expertise throughout the article. Jump ahead to your preferred sections by clicking the links below!

Article Roadmap

• What Is a Fundraising Proposal?
• Things To Keep In Mind Before You Start
• How to Structure Your Fundraising Proposal
  • Executive Summary
  • Problem Statement
  • Proposed Solution
  • Budget
  • Team Experience and Qualifications
  • Evaluation and Risks
  • CTA
• Some Tips To Create a Killer Proposal
• Next Steps

What Is a Fundraising Proposal?

A fundraising proposal is a formal document that helps convince potential donors to give financial support to your organization’s cause or project. It acts as a persuasive argument that enables you to make a compelling case about why your initiative deserves funding. It helps communicate:

• What your fundraiser is about
• Why your cause matters
• How much money you need
• How you can use the money

It’s important to craft a good fundraising plan before creating a proposal, as it will promote accountability and keep everyone on the same page. A good fundraising plan precedes a great fundraising proposal, so make sure to give both documents their due attention.

Things To Consider

Before defining why your nonprofit needs funds, here are some things to consider to make your case even more convincing:

The Cause You Work For/ Problem You Solve

Deepthi Sirla, Project Manager at the NGO Nirmaan, emphasizes the importance of research and needs assessment as the basis for creating a great proposal.

The first thing you need to do is needs assessment. Unless you’re very clear about what the need is, you cannot make the proposal seem effective. And for you to recognize the need, there should be a lot of research that goes into it. What’s the target population you’re looking at? What’s the impact that you’re going to make? The project will fail unless you understand the target population well.”

She talks about how research can be a time-consuming but worthwhile process. Some proposals require many months to a few years of research to be effective.

It’s key to clearly define the issue your organization addresses. You can use data and statistics to paint a vivid picture of the need and why it requires funds.

The Solution

The second step is to showcase your program or project as the answer. Explain how it works and the outcomes it will achieve. It helps both you and your potential funders to break down your intended outcomes into SMART goals.

Define your project as the solution, and remember to demonstrate its impact. Show how your organization can bring about positive change in the cause you’re working for.

Know Your Target Audience

Rosemary F. Chudnof, a professional nonprofit grant writer, said that knowing your potential funders is critical.

It’s not enough to research foundation names and deadlines, or even to read a funder’s statement of priorities. You must dig deeper and discover who they have funded, in what amount, and how recently. Then you know whether your organization has a strong priority alignment. You never want to waste your sweat and tears on a proposal that has no chance of funding.“

Try to understand your potential funders’ priorities, mission and past funding trends. This will help you tailor a proposal that resonates with their values. Knowing your audience will help personalize your proposal, which will further persuade them.

Sirla had a similar point:

The structure is similar for any kind of proposal but varies slightly depending on who you’re writing for. Are you writing it for a corporate? Or an NGO? Because corporates tend to look more at numbers, number of beneficiaries while NGOs look at stories.”

Demonstrate Past Expertise

It’s time to take out your organization’s highlight reel and showcase your nonprofit’s expertise, experience and impact. Pick out success stories and testimonials that provide evidence of your nonprofit’s work. Written testimonials are just fine, but pictures and videos are even better. A picture is worth a thousand words, after all.

Get Clear on Budget and Objectives

Outline your budget clearly, showing exactly how you will use funds. This demonstrates responsible financial management and helps you gain clarity into your objectives and goals. Define long-term and short-term goals and which ones are the priority right now.

How to Structure Your Fundraising Proposal

A fundraising proposal should include:

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Executive Summary

An effective executive summary is the first impression you make on potential donors, so crafting a compelling one is crucial.

Sirla emphasizes the importance of a good proposal summary:

The executive summary has to be very captivating, it has to be very attractive. It needs to convince the audience to read what comes next.”

Some tips to keep in mind are:

1. Include a cover page: Insert your organization’s name, logo, project title, date and contact information.

2. Keep it concise: Aim for 1-2 pages or approximately 300-500 words. Remember, it’s a summary, not the entire proposal.

3. Start it off strong: Grab the reader’s attention with an impactful statement or statistic that highlights the problem you address.

Kalyan Kakarla, Program Manager at Nonprofit Organization Alokit, talks about how starting your document/presentation with a question can help guide the thought process.

We try to start with a question that makes them think about our company’s end goal. We ask them a question that will make them answer in a way that our vision comes out, trying to bring out the ‘why.’ Why does our company exist? What is it going to solve? We’ve found that to be an engaging way to start communicating.”

4. Introduce your organization: Briefly state who you are and what you do. You can review some of your past key projects and impact to build credibility.

5. Define the need: Clearly outline the problem or challenge you aim to address and how it can help your nonprofit’s cause.

6. Present your solution: Showcase how and what your nonprofit does to address your target population’s needs. Aim to highlight your solution’s significance and its predicted impact.

7. Briefly mention your team: Succinctly go over who your team consists of and their expertise. This helps build trust and enhance your legitimacy.

8. State the funding request: Talk about the total amount of funds you need and how you’ll use them.

9. End with a call to action: Encourage the reader to learn more by reading the full proposal or contact you to discuss further.

Problem Statement

Instead of calling it a problem statement, Sirla prefers calling it a needs assessment.

We cannot solve problems, it’s absolutely not in our hands, we can only address certain needs.”

Before starting with the needs assessment, go over your organization’s background, mission and track record to help build context. To write a compelling problem statement:

• Use data and statistics to demonstrate the need’s severity.
• Connect the problem to larger societal structures or how it impacts a specific community.
• Include real-life stories and anecdotes to create a sense of urgency.
• Stay focused on the specific issue.
• Avoid using inflammatory language or playing the blame game.

Proposed Solution

In this section, you should define your overall goal and then break it down into smaller, SMART goals. This provides both you and your potential funders with clarity about what to expect.

Mention specific activities you’ve planned and how they directly help in achieving your goals and project mission. Be sure to make it detailed, but don’t go overboard — you don’t want to bore the audience with too many points.

This step is a great place to include visuals like charts, diagrams and flow charts to effectively illustrate project activities and make it more solid.

To make your presentation more effective, Sirla suggested:

You need to have clarity. Unless you have clarity of why you’re doing it, you cannot really convince the donor to fund it, right? And make sure to add some visuals. Instead of just presenting the data in numbers, do it with graphs, or a brief PPT or something visual…make it visually more appealing.”

Baidurya Bhusan Sen, Co-founder of the NGO Alokit, agreed:

You need to have a very sharp focus on the end outcomes and the impact and not leave it fuzzy…have a very clear understanding about how the program is leading to desired outcomes.”

It’d also help to showcase how your project is different from previous similar campaigns and what sets you apart from competitors. Is your approach more innovative, effective or impactful? Explain how, with examples. Don’t forget to mention your project’s timeline, resources and personnel.

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Budget

Ah, the dreaded B word. Here are a few things that can help navigate this tricky part:

• List all project expenses: Create a comprehensive list of all anticipated costs associated with your project. This could include personnel, materials, equipment, travel, venue rentals, marketing and administrative costs.
• Quantify each expense: For each listed expense, clearly state the estimated amount needed. Be as specific and realistic as possible in your estimations.
• Categorize your expenses: Organize your expenses into logical categories for easier understanding. Common categories include personnel costs, project materials, operational costs and evaluation costs.

You should also include your previous financial plans and performance for reference. Use them as an opportunity to demonstrate how successfully you’ve completed them.

On financial resources, Chudnof said:

For new or startup organizations seeking grant funding, it’s important to consider your existing financial position. For example, if your annual budget is $20,000, don’t apply for a $150,000 grant. Instead, start local: look for grant opportunities from funders in your community who have a vested interest in providing services.”

Chudnof further explained how grant funding can be slow and frustrating. However, building a base of smaller grants can help avoid these challenges by:

1. Creating language you can use again on larger grant applications.
2. Increasing your legitimacy for future funders.
3. Boosting finances, even if in a small way.

Team Experience and Qualifications

A great way to persuade funders is to prove to them that you know what you’re doing and that you can do it well. How can you do that? Highlight your team’s expertise and what they’re capable of.

You can do it by:

• Developing individual profiles for key personnel to showcase their strengths.
• Making them concise — 1 to 2 paragraphs for each profile is enough; you don’t want it to look like the end credits of a movie.
• Focusing on relevant skills and experience and using strong action verbs to describe their past achievements.

Chudnof said:

The more specific you can be about your accomplishments, the more likely you are to get the funding you need to continue. If you are a new or startup organization, you will need to convince the funder, through actual stories and evidence, that you are planning to fill a crucial gap in services in your community.”

She also suggested that:

If you are seeking a program grant, funders want to know that the program will continue after the grant period ends. The more you can demonstrate your sustainability plan, and rely on your existing track record the more likely you are to succeed.”

If your team reflects diversity and inclusion, consider highlighting this aspect to demonstrate your commitment to a broader range of perspectives and experiences.

Evaluation and Risks

Last but not least — talk about your evaluation plan, i.e., how you’ll measure your project’s success against stated objectives. Describe the data you’ll collect and how you’ll use it.

You should also outline how you’ll communicate your progress and results to donors, including the frequency and format of reports. This adds another layer of trust and lets funders know that you won’t disappear into thin air as soon as you get the money.

Also, discuss potential challenges, risks and pitfalls you might encounter and how you plan to mitigate them.

Sen said:

I think it’s very important to be honest and transparent in telling what we know and what we don’t know. Let them know this is what we’re trying to do to learn more. And these are some risks involved with it. So being vulnerable and honest about our limitations is crucial in creating proposals.”

CTA

Now comes the final part (phew, almost done!).

The call to action should clearly specify the desired action for the donor to take next. Make it easy for them to donate and contact you further. You can also ask them to share your proposal with others to increase your resources.

Lastly, thank them for their time, regardless of the financial outcome. You want to be professional and courteous even if funders don’t open their wallets.

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Bonus Tips

Use Dynamic Storytelling

Compelling narratives and stories can help donors emotionally connect with your case.

Sirla said that “people get connected to stories a lot.” However, choosing the right kind of story is also key in captivating funders. She dropped a surprising nugget:

We usually tailor-make these stories. We find people we think would appeal to the donor. The more the suffering of the beneficiaries, the better the chances of receiving funds.”

She also emphasized that:

You need to add an element of pathos in every story that you get. Maybe make it more sobby? That is the truth. It makes it more engaging because you’re actually showing that there is this need and that it needs to be addressed.”

However, there’s a fine line between trying to evoke an emotional response and being overly sentimental. It may often come down to how sincere your efforts are.

Sirla belongs to a queer community and has written a bunch of proposals for them. She talks about how relating to the cause on an intimate level and being passionate about it is vital.

You have to identify with the cause. You have to be attached and passionate about it; otherwise, it becomes just another activity for you, and you won’t be able to give it your best.”

Build Rapport With Beneficiaries

Here are some things Sirla said that’ll help you collect the right stories:

You have to be genuine about addressing their needs. You can’t be like ‘I’m trying to help your community. So please tell me your story.’ Doesn’t happen like that, you have to build rapport first.”

She also highlighted the importance of transparency:

Tell them exactly what you can offer. Don’t set unnecessary expectations or false hopes…the conversations might not go to the next level but at least you won’t spoil your relationship with them.”

If you’re looking to boost your donor relationships, fundraising software is an excellent tool for it. You can analyze which communication channels and content work best for which donors. Based on this information, your staff can personalize and craft campaigns in a laser-targeted way to maximize donations.

Start this process by assessing your software requirements to pick the best fit for you. You can access our fundraising software free requirements template and comparison report to compare market leaders and the features they offer.

Keep It Concise

Just like the point, we’ll keep this sentence concise — aim for 3-5 pages and avoid too much jargon.

Pay Attention to the Layout

Proofread, proofread, proofread. Typos and errors scream unprofessionalism, so you don’t want that. Be attentive to the design and layout — it’s not just about what’s being told; it’s also about how it’s being told.

Chudnof, who has extensive experience in writing grants and proposals, shared some of her key tips:

Many grant applications have word counts for each question – honor them. You don’t want your proposal eliminated from consideration due to a procedural issue. On the other hand, some applications include very long word counts; in this case, don’t feel that you need to add more information than necessary. Make your case as succinctly and clearly as you can, and then stop. Before you submit your application, part of your editing process should eliminate extra verbiage for clarity.”

Refer To Other Proposals

Sirla talked about the importance of referring to similar proposals and precedents:

If there was any similar project or intervention, through another nonprofit, you can add about the impact it made.”

This helps further solidify your case and shows funders you’ve done your research. If you’re looking for examples of some great fundraising proposals, these templates are a great place to start.

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Next Steps

Fundraising proposals are only one aspect of the fundraising process. Other key elements include fundraising campaigns, unique fundraising ideas that bring the community together and dynamic fundraising solutions that help execute all this.

If you’re looking for fundraising software but are overwhelmed with all the options in the market, don’t fret. Check out our free comparison report that’ll help you find the best fit for your nonprofit. Good luck!

Which insight did you like the best for creating fundraising proposals? Which ones are you planning to implement next time? Let us know in the comments!

Contributing SMEs

As a project manager at the NGO Nirmaan Organization, Deepthi Sirla specializes in Diversity, Equity and Inclusion (DEI) initiatives. She designs and executes skill training and livelihood projects tailored for LGBTQIA communities, fostering empowerment and economic independence.

Collaborating with small LGBTQ community-based organizations (CBOs), she provides capacity-building support to strengthen their impact and sustainability. Additionally, Sirla conducts gender sensitization sessions to raise awareness and promote understanding of queer communities, advocating for inclusivity and acceptance.

Rosemary Frenza Chudnof is the owner of RFC Writing, LLC. She is a licensed attorney, grant writer and nonprofit strategist. She has nearly 15 years of experience researching, drafting and submitting successful grant applications. She also specializes in nonprofit resource development, fundraising materials, board recruitment and strategic planning.

In addition to her nonprofit specialties, Chudnof rounds out her writing practice by drafting web content across diverse industries, including biographies, site pages, blog posts, articles and more. She serves a national client base.

Kalyan Kakarla is a program manager at the nonprofit Alokit. He has been in the education development sector for 5 years and worked as a teacher for 2 years in an Indian government school. Kakarla trains and coaches school principals and is extremely passionate about making an equitable education system in his country.

Baidurya Bhusan Sen is the co-founder of the nonprofit organization Alokit and has been running it for the past 4 years. Previously, he worked at India School Leadership Institute, where he acted as the program lead and then went on to head curriculum design. Sen has been in the education sector for more than a decade and worked in multiple organizations, including Teach for India and Shoshit Seva Sangh.