1. Institutional Funding in tough times
A practitioner’s guide
Lysa Ralph, Head of High Value Giving, British Red Cross
Philip Goodwin, Chief Executive, Tree Aid

2. Session overview
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Clarification and definition
Outlook for general fundraising
Institutional donor trends / features
Savvy INGO’s – commonalities & success rates
INGO growth 2008-12
Tree Aid’s approach
Last thoughts
Useful sites / resources
Questions

3. Point of clarification…
Money is not a dirty word!!
Fundraising, funding co-ordination,
resource mobilisation…
…essentials and disciplines are the same

4. Definition of Institutional Funding
Funding from governmental donors plus those whose assessment
methodology / priorities share the characteristics and requirements i.e. project cycle management - of governmental donors:
 UK government streams – e.g. DFID, Island donors eg Jersey
Overseas Aid, Scottish Government International Funds
 European Commission – ECHO / DEVCO
 Other countries government funding streams e.g. USAID
 ‘Foundations’ sharing those behaviours - Comic Relief, Big Lottery

5. Outlook for general fundraising
> Supplier capacity
> Increased competition
> Demands for donor engagement
> Social media creating closer relationships
> Potential to flatline ??

6. Trends – Institutional income
State Funding of Voluntary Sector (£bn)
14
£ bn
13
12.8
12
12.8
11.9
11.9
11.8
Public Funding of
Voluntary Sector
11.3
11
10
2006
2007
2008
2009
2010
2011
> Between 2006-11, despite the economic outlook, increase in state
funding to the voluntary sector of 4%, plus ringfenced Int’l Aid
> EC budget reduced for first time, down 1.5% for 2014-2020 €960bn,
from €975 bn 2007-2013
> DFID’s ringfencing / commitment to 0.7 GDP may not last beyond 2015

7. Trends – IF features
> Shift away from grants to contracts:
> 2001 grants worth £4.6 billion, contracts £3.8 billion
> By 2008, grants worth £3.7 billion, £9.1 billion worth of
contracts
> Full cost recovery principles widely accepted, set
margins
> Increase in ‘payment by results’; Social Return on
Investment / Social Impact Bonds
> Polarisation of the sector, consortia development
> Need to evidence outcomes / impact
> Increase in competition
> Introduction of private sector, new landscape

8. Donor trends / savvy INGO’s
> Decentralised operations / decision making
> Preference to reduce admin costs / deal with consortia lead /
Int’l orgs / input to central funds eg Global Fund
> Assessment via programme cycle management methodology:
‘theory of change’
> Ownership by local actors
> Shared policy environment / MDG’s etc
> Value for Money / having policies around this

9. Return on investment, success rates
> High return on investment: IoF Fundraising Index
2012 - £16:1
> BRCS success rates:
– EC 1:5 rising to 1:3 where closest to core mission
= ECHO.
– Lottery 85% against a sector average of 15%
> Tree Aid: 1:3 success rate by number of
submissions, 1:4 by project value

10. INGO’s ranked by institutional income (2012)
Rank
Total income
Institutional funding
1
Oxfam
367.90
162.10
2
Save the Children
283.75
150.66
3
Merlin
60.86
54.88
4
CARE International
43.68
31.98
5
Christian Aid
95.45
27.44
6
British Red Cross
200.10
21.40
7
World Vision
68.79
21.06
8
Plan
54.25
20.06
9
Islamic Relief
100.37
19.47
10
Tearfund
60.05
18.56
11
Action Aid
59.45
15.33
12
CAFOD
48.80
11.11
13
Concern Worldwide
14.62
6.79
14
UNICEF
62.33
3.99
15
MSF
23.89
0.00

11. Total income and IF income, 15 INGO’s 2008-12
1800
1,694.56
Income (£millions)
1600
1400
1200
1,544.79
1299.776
1,544.28
1,337.97
1000
Total income
800
IF income
600
400
409.25
425.57
535.47
638.18
564.84
200
0
2008
2009
2010
2011
2012
> Many grew their Institutional income quite dramatically, avg +38%
- British Red Cross, + 570% 2008-11
- Tree Aid, £195k to £1.1m and growing, doubled since 2011

12. IF income of charities (2008 - 2012)
200.00
180.00
160.00
Income (£millions)
140.00
120.00
2008
2009
100.00
2010
2011
80.00
2012
60.00
40.00
20.00
0.00
British Red
Cross
CARE
International
Christian Aid
Merlin
Oxfam
Plan
Save the
Children
World Vision

13. Institutional funding as a proportion of total income
400.00
350.00
Total income (£millions)
300.00
250.00
Other income
200.00
Inst. Funding
150.00
100.00
50.00
0.00
British Red
Cross
CARE
Christian Aid
International
Merlin
Oxfam
Plan
Save the
Children
World Vision

14. Tree Aid - Key Principles

15. Key Principles for Institutional
Fundraising

16. Building Capacity to Attract Funding
1.
2.
3.
4.
5.
Building strategic relationships
Understanding the "market"
Building credibility and track record
Increasing visibility and evidence of impact
Resources

17. 1. Building strategic relationships

18. Strategic Partners
TREE AID
•Technical
•Technical insights
knowledge
•Field knowledge
•Policy insight and
•Impact on the
influence
ground
•Intelligence on
•Policy influence
funding opportunities Influence
•Networks
Networks
Scale
Credibility
IMPACT

19. 2. Understanding the market

20. 3. Building credibility

21. 4. Increasing visibility & evidence of
impact

22. 5. Resources / tools to pursue funding
> Fundraisers = highly valuable assets = not cheap
> Interpretation – EC, DFID, Lottery
– Experience: programme management, track record
fundraising success, building / monitoring complex budgets
– Knowledge : technical donor knowledge (<ECHO / DEVCO)
– Skills: relationship building; communication; negotiation,
financial, creativity, research, statistical analysis
– Characteristics: resilience, patience and ….Zen!
> Investment of staff time
– In-house teams
– How they are constructed
– Use of external support

23. Last thoughts
> Match - European Commission: co-financing – from
15% International to 50% domestic - can include
cash and / or in kind match
> Stewardship – Trusts approach to Inst Funding
> Know your place / added value in your sphere
> Be nimble, react to trends / corporate dfid wash
> Understand risks / resources needed & investment /
don’t just follow the money
> Know your theory / story of change …can you hook
them emotionally?

24. Useful sites
EuropeAid / Search – ‘calls for proposals’
http://ec.europa.eu/europeaid/index_en.htm
Local, regional, national and European sources
http://www.governmentfunding.org.uk/default.aspx
fundsforngos.org
http://www.inprogressweb.com/
http://www.trustfunding.org.uk/default.aspx
http://www.biglotteryfund.org.uk/funding

25. Questions
Philip Goodwin
Lysa Ralph
Philip.goodwin@treeaid.org.uk
lralph@redcross.org.uk
0117 9166 442
0207 877 7094