Many grantmakers now prefer that applications for funding support be submitted in a letter of intent or inquiry format instead of as a full proposal. This helps potential funders decide if they are interested enough in the project to ask for a formal grant proposal. (Government agencies don’t require such a letter, however, because they have a more formal process for qualification.)
The LOI: A Thumbnail Sketch of Your Nonprofit
The LOI gives the funder a thumbnail sketch of your organization, the need you are addressing, and a description of your project plan. Foundations typically designate a grants administrator (GA) to screen letters of inquiry or intent to decide if the program is worthy of their review and possible funding.
Grants administrators will quickly ‘skim and scan’ the letters and if they feel funding your program could be a strong probability, you may be asked for additional information or invited to submit a grant proposal.
It’s worth the investment of time.
When you submit a LOI, you learn if your full grant proposal will be considered—which is preferable to wasting time and effort writing a complete proposal to a funder unlikely to support your project.
The LOI may require almost as much time to develop as a full proposal. Using fewer words to deliver your message requires more crafting of concise text.
Let’s get started by organizing the LOI the “right” way.
Though there is no “boilerplate” letter of inquiry, if you organize your LOI according to the major topics shown below, it has a better chance of getting to the gatekeeper—the grants administration—and on to the board for review.
- Subject line. Include a subject line so readers can immediately identify the contents of the letter—even before perusing the text.
- Introduction. Explain why you’ve sent them the letter of inquiry to learn if you might be invited to submit a full proposal. Include the amount of funding you’re requesting in this section. Also provide a brief executive summary.
- Organization overview. Provide a brief overview of your organization with a clear focus on your ability to fulfill the stated need. Describe the staff and their relevant qualifications related to the project. (Save the mission statement for your full proposal.)
- Need or problem statement. Describe the need or problem clearly. Include relevant demographics, a few concrete examples of the problem, and supporting statistical data.
- Project description. Show that you have a viable solution appropriate to the need. Describe the project briefly and include supporting activities, direct staff involvement and titles, and desired objectives.
- Other funding sources. List other funding sources, including government agencies and private and public foundations, including those you currently are approaching for funding support.
- Fit with the funder’s focus. Communicate clearly how your project relates to their funding guidelines and philanthropic philosophy.
- Clear closing. Wrap up the letter with contact information. Assure your readers you are available to answer any additional questions that might not be covered in the letter. Show appreciation for their considering your request.
- Attachments. Include only those attachments clearly spelled out by potential funders’ guidelines. Attach a project budget clearly showing the relationship between financial support and project’s sustainability.
How to write the major parts of the letter of inquiry.
Use the recommended three-page limit to clearly describe your project, including your philanthropic focus. Provide the budget information as a separate attachment of 2 – 3 pages.
Introduce the letter with a brief executive summary.
The introduction to the LOI is a short executive summary. Include the name of your organization, the amount of funding you’re requesting, and the name of the program or project. Describe the qualifications of your project staff and your method for evaluating the program’s success, and provide a timetable for the project.
Include the amount of funding you are requesting up front (rather than at the end of the letter) so readers don’t have to search for it. Here’s an example of the first line of an introduction for a letter of inquiry.
I am writing on behalf of the Habitat for Humanity of Central Idaho to ask if we might submit a formal proposal for a $15,000 grant from West Valley Farm Foundation. The grant will be used toward the acquisition of one of two building lots with the purchase price of $75,000 each.
Briefly describe your organization, including its history and successful programs.
Include a brief history of your nonprofit (when it was formed and for what purpose) and a short description of your programs. If you’re a fledgling organization, describe programs you plan to offer as a result of your fundraising efforts.
- Clearly connect your nonprofit’s current activities and what you intend to accomplish in the future with the requested funding.
- Describe two or three projects you have run successfully. If your organization is new, address your plans related to the targeted project.
- Briefly describe how the nonprofit is managed. Include such descriptors as “strong board leadership,” “robust management,” or “ongoing improvement.”
- Focus on your nonprofit’s ability to meet the stated needs. The example below depicts in the first sentence of the introductory paragraph the success of this organization’s programs over the past six years.
HHCI has been at work in Olympus County since 2011, building houses in partnership with those in need of decent affordable housing. In fewer than seven years, our organization completed ten homes for low-income families, providing affordable housing to more than 75 family members.
Provide a compelling statement of need, including impact on the community you serve.
Readers must understand and accept the urgency of the need and the validity of your request for funding, so you must be able to—
- Explain how your program will either eliminate or at least lessen the impact of the problem.
- Clearly describe the community or individuals most effected.
- Provide relevant statistical data as well as a few concrete examples to support the data
After reading the example below, do you feel that the community impacted by the problem was adequately described? What are the outcomes included in the need statement?
People who have spent their lives in poverty and live on the edge of homelessness have neither the resources nor the skills required for home ownership.
Habitat homeowners generally come into the program full of fear and mistrust from their years of experiencing disappointment, poverty, and discrimination. Through participation in our program, they come to understand previously intimidating terms associated with purchasing a home. Most individuals who have never needed such skills learn home maintenance and repair.
Describe the project and include major goals and objectives
Describe your program, project, or activity as it relates to the need or problem described under the Statement of Need as previously discussed. Include your desired objectives, major activities, and names and titles of key project staff. Save your eloquence for later. If you’re invited to submit a full proposal, you will present this information in more detail.
If you were evaluating this grant for support, how quickly do you think you could locate the project goals and objectives in this methods statement?
In order to support our goal of bringing families out of poverty through home ownership, our objectives are an integral part of the program.
Two families are selected to be placed on our annual construction schedule of two houses. Family members attend a four-month homeowner training course, where they learn such skills as how to budget and perform household repairs and maintenance, and to be a good neighbor. During this period, they begin their sweat equity commitment. Adults are required to give 250 sweat equity hours toward the building of their own house as well as community service.
Describe present and future funding and all sources of support
Include a list of your current program supporters as part of the budget you attach to the letter of inquiry. Backing from others implies your nonprofit has credibility and your project is viable and worthy of being funded.
Provide names of other funders or government entities you have approached for funding. Funders want to be assured you are continuing to seek other options for funding.
This example includes reference to community supporters by name, and also repeats one of the program objectives (affordable housing).
Habitat houses are purchased by families at prices affordable to low-income Iowans thanks to the donated labor of our volunteers and the financial support of organizations including City Bank, the Simmons Family Foundation, Wells Fargo Bank, Salisbury Homes, and the Home Builders Association of Iowa. A list of current and prospective donors is included with the attached program budget.
Connect your goals to funder’s giving focus: explain the benefits of your solution.
Your LOI must establish a connection between your project’s goals and the funder’s philanthropic interests. Here are some suggestions on how to weave such references throughout your LOI:
- Explain how the project fits their priorities for giving. Keep in mind the community they serve, type of support, and favorite program areas (all of which you know about from reviewing the guidelines).
- Clarify why you think your project is a good fit with their giving focus and priorities.
- Use clear benefits statements, always focusing on their need for a good return on investment.
This example suggests in the beginning sentence that the grant seeker understands and shares the funder’s goals.
We know that the West Farm Insurance Foundation prides itself on making grants to those organizations that directly improve the quality of those communities where West Farm employees work and live. HHCI supports similar goals and focus by assisting low-income families in realizing their dreams of homeownership, thereby improving the environment of communities where they live and shop. Following are some of the ways by which this project already benefits the community….
Wrap it up with a brief closing statement.
Restate the intent of the project. Then provide clear contact information for possible follow-up. Tell your readers what comes next and how you can be reached; include your phone number even though it might appear on your letterhead. Thank the funder for considering your request.
Wondering when to submit your letter of inquiry?
Once you establish the deadlines for submitting full proposals, you can decide the best time to submit a LOI (after the dust has settled). A rule of thumb: Send your letter thirty days after the previous submission deadline so the funder will have adequate time to review it and to decide if they want you to submit a full proposal.
For example, the 2017 application deadlines for filing a grant application to a major bank’s foundation are February 28 (Arts and Culture, Economic Opportunity) and May 31 (Education, Economic Opportunity).
Use the tips we’ve shared to develop a model letter of inquiry to streamline your proposal writing.
After making just a few minor changes based on the potential funder’s requirements, you should be able to use a “boilerplate” letter of inquiry to continue to fill the pipeline of potential funding. Keep sending letters of inquiry to increase your chances of being invited to submit a full proposal.
You can connect with Shannon by emailing her at firstname.lastname@example.org.
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