April 2008
The Funding Matrix: Simplifying Complex Problems
Part Two - Putting the Funding Matrix to Work
Last week we learned how to prepare the “bones” of a funding matrix. Once you’ve done this, it’s easy to begin implementing the matrix to help guide grantseeking and determine if your organization should pursue a specific request for proposals (RFP) that has reached your desk.
The far right column of the funding matrix (Remaining Need) totals all of your organization’s existing funding sources (Grants A through D and Unrestricted Funds) and subtracts that total from the annual budget cost (Annual Cost). The result is the annual remaining need in each budget category.
How to Use the Funding Matrix
I use the Remaining Need column to triage the RFPs and grant announcements that come across my desk. Here’s how I do it:
Grant Announcement Triage
In the RFP, look at what the prospective grant will NOT fund. You’ll usually find this list in or around the budget description. You can assume that anything not listed in the restrictions can potentially be funded by this grantmaker. Will the grant fund any of the budget categories for which you still have a remaining need? If there are areas that match, this is an RFP you should look at more closely. If there are few or no areas that match, toss the RFP and don’t bother reading further.
Flexibility of Unrestricted Funds
The Unrestricted Funds column is where you list any income that is flexible. These funds may come from membership fees, operating funds, project or consulting income. . .any income that your organization is not committed to spending in one particular way should be included under Unrestricted Funds.
Any monies listed in the Unrestricted Funds column can be shifted around within the categories under that column.
As you compare RFPs to your remaining need, ask yourself whether the grant will provide support in a category currently covered by unrestricted funds. If the RFP is otherwise a good fit, you can move your unrestricted funds to another unfunded category and use the new grant to cover that category. For instance, if the new grant would fund Utilities, but not Advertising, then you can shift the unrestricted monies currently listed in Utilities ($8,000 in the example above) to Advertising in the Unrestricted Funds column and use the grant funds to pay for Utilities.
The important thing to remember when looking at the matrix is that Unrestricted Funds are flexible.
Visual Aid/Presentation Tool
As the funding matrix developed, I realized I could finally visualize my program and its complexities. Today, I use the matrix as a visual aid to explain the program to interested parties and have found it to be universally simple to understand. It’s also a great planning tool to use with organizations as they create their initial program budget.
Funding Matrix Offers
Would you like to obtain a copy of the funding matrix template and receive AFE’s assistance in putting the matrix to use in your own organization? AFE is offering a special offer for The Exchange readers: for $199, you’ll receive a copy of the funding matrix template and up to an hour’s assistance from AFE staff to organize your budget into the template, answer your questions, and jumpstart your development planning. Order now
You can also just the blank funding matrix from AFE for $49. Order now
