Tools for Identifying Potential Funders

Solid prospect research helps lay the groundwork to build relationships with the right donors for your organization. Beyond identifying donors who work in the same issue areas or geographies as your mission, quality prospect research helps you find donors who seek to create impact in complementary ways – this is the foundation for strong partnerships.

As part of the Catalyst Now Fundraising Toolkit Masterclass series, Black Fox Global hosted a session on January 22, 2025 titled “Tools for Identifying Potential Donors.” Team members Lisa Heinert, Wonu Owoade, and Julia Chacur shared their tips on how to shape funder research priorities and criteria to assess funder fit and uncover the information your organization needs to support this step in the fundraising process.

This blog post is the first in a two-part series following this Masterclass, with Part 2 to be published later in February 2025 and sharing actionable insights on funder qualification, and a case study on implementing the funder research process. 

The January 22, 2025 session recording can be accessed here, and the slide deck is available here.

Preparing to Research: Establishing Your Priorities and Criteria for Funder Fit

Before conducting funder prospect research, it is important to establish the priorities and criteria that will guide your process. This helps you understand what to look for and keeps you focused when sifting through large amounts of information. It allows you to more easily identify when a funder is a good fit, versus when they are not a good fit and should be ruled out. In this way, you can be more efficient and strategic with the time you invest in your research, as well as in your donor outreach and cultivation process.

1. Know and Anchor in Your ‘Why’
   
   In the flood of information that exists about funders, it is easy to hyperfocus on keywords, program areas, and eligibility criteria (which we recommended looking into later in the process, and we offer guidance around this later in this blog). However, it is also important to remember that the best funders for your organization are those who are mission-aligned, values-aligned, and seek to create impact and solve problems in similar ways. While criteria such as program areas and geographic priorities help narrow funders to consider, this deeper level of mission, values, and impact typically leads you to the most deeply aligned donors, and that will help you establish the type of connection that builds strong partnerships.
   
   Before diving into your research, be clear about your mission and your “why”. Why are you in this work and what problem are you trying to solve? Why is your organization the one to solve the problem, and why in this way? Knowing your “why” helps you see when a funder’s “why” resonates with yours. Beyond this, it also enables you to understand how to position your organization and develop strong communications for funders that tell a compelling story of your work and why it matters.
   
   For additional guidance on understanding your organization’s WHY, take a look at “Uncovering and Engaging Deeply Aligned Funders” and “Connecting Deeply With Donors | Crafting Your Why”. Black Fox Global can also support you directly in these efforts with our Communications Toolkit service.
   
2. Organizational Assessment
   
   Another area to have clarity before starting your research is information related to eligibility criteria that funders typically list for grant opportunities. We recommend assessing two key criteria: your organizational budget and your organizational status.
   
3. Identify Your Research Priorities
   
   The next step in preparing for prospect research is to set your research priorities so you know what you are looking for, what you are not looking for, and what types of funders and opportunities fit your needs and context. Here are some key areas to consider:

• Geographic Focus: Where is the work you seek to fund happening, and at what level (e.g. local, regional, national, international)?
• Funding Priorities & Needs: What programs or organizational goals are you seeking to fund (e.g. an existing program, a new program, an expansion, research, general operations, etc.)? 
• Preferred Grant Characteristics: What are your preferences regarding the type of funder (e.g. foundation, corporation, local funder, international funder) or the type of grant (e.g. unrestricted, programmatic, capital expenditure)? What is the minimum grant size you are willing to pursue?
• Donor Exclusions: Which donors should you exclude from your research so you know not to spend time looking into them if they come up (e.g. current donors, lapsed donors, donors with potential conflicts of interest)?
• Restrictions to Types of Funders/Industries: What are your ethical no-go’s regarding the industries funders operate in, their beliefs and practices, and where their money may come from (e.g. alcohol companies, tobacco, gambling, etc.)? What due diligence considerations does your organization follow that would affect how you look into an opportunity (e.g. a small grant with extensive application and/or reporting requirements)?

4. Identify your primary and secondary issue areas and demographics
   
   In addition to prioritizing your list of funding needs, it is also helpful to think about your work within the broader funding landscape and know what types of ‘buckets’ your work fits into. This includes identifying your primary issue area(s) and secondary issue area(s) to help you navigate funder programs, focus areas, and different aspects of the broader social sector. You can think about:

• What are your primary thematic priority areas (e.g. health, poverty alleviation, education, women’s empowerment, civic engagement, etc.)?
• What other areas does your work impact (indirectly) but also achieves impact (secondary issue areas)? For example, you may have a water, sanitation and hygiene (WASH) program that has an indirect or secondary impact on improving school attendance or women’s empowerment in rural communities.
• Who are your target groups (direct and indirectly)? For example, your primary target group may be mothers, but the indirect target group is their children or the larger community.
• What are the age ranges and demographics of your target groups (e.g. children, youth, rural, peri-urban, migrants, etc.)?

Our team at Black Fox Global often uses the United Nation’s Sustainable Development Goals (SDG) as common language for our clients, but you may have other ways to organize and articulate your primary and secondary issue areas. The important thing is to have clarity on these as you look at potential funding opportunities. 

The Research: Identifying Deeply Aligned Funders

Once you have completed your research preparation and set your priorities and criteria, you are ready to conduct your research.

Where to start

The first step of the research process is to surface leads on potential funders. This is where knowing your primary and secondary issue areas, demographics, and priorities like geographic focus can be utilized to provide keywords for searches. Below are four key avenues that we recommend looking to initially identify funding prospects:

• Funder lists of peer organizations
  • This is one of the strongest sources of leads and a great way to see who is in your space that is not yet funding you.
  • Approach this by looking at peer organizations’ websites, annual reports, and Form 990s (if they have US 501c3 registration status) 
• Sector trends and insights
  • Inside Philanthropy
  • Alliance Magazine
  • Black Fox Brief
  • Devex
  • Stanford Social Innovation Review (SSIR)
  • Chronicle of Philanthropy
• Attendees and speakers at convenings and webinars of interest
  • See Black Fox Global’s “2025 Sector Convenings” list 
• Open grants and donor databases
  • See our curated list of tools and databases here

Once you have an initial list of funders to consider, the following steps will help you determine alignment, create a funder profile, and set you up for strategic outreach. 

Assessing funder fit

The bulk of the prospect research process is obtaining the information you need to assess funder fit guided by the priorities and criteria that you have set, and to build later your strategy for approaching the funder and developing compelling outreach. We recommend assessing this information to gauge alignment with your priorities and criteria:

• General overview, mission and programs
• Geographic priorities
• Type of organization and eligibility (organization size, registration status, leadership profile, etc.)
• Funder’s giving capacity
• Values alignment

As you look into this information, we also recommend looking with a critical and strategic eye and noting down key points about why the funder or funding opportunity is a fit and aligns with your mission and objectives. This will ensure that everyone on your team understands the strategic importance of the relationship and helps craft your strategy and compelling outreach. Guiding questions include:

• What are the strongest points of connection?
• Can you mobilize the funder’s language to express that alignment?
• What evidence can you point to  back up this connection (e.g. news items, past grants, funder-specific program goals)?
• Where do you see your points of entry?

For a more detailed look at qualifying a funder at this step in the process, see the 2nd blog in this series when published. 

Finding funder information

To find the information you will be assessing, these are great places to look:

• Funder websites (Key sections: About Us, Programs/Priorities, FAQ, How to Apply/How We Fund, Grants Database)
• Funder annual reports
• US Form 990
  • A United States Internal Revenue Service (IRS) form that provides the public with information about nonprofits and foundations, which includes basic information on grants (more details on how to read a 990 can be found in this Candid article)
• Additional insights:
  • Founder story and biography 
  • Staff biographies
  • Social media pages
  • News and media mentions
  • Grantee and peer organizations’ annual reports (may include more information on what a funder’s grant was used for and the nature of the partnership)
• Online tools and databases
  • See our curated list of tools and databases here

• It is important to note at this stage in the research process that qualifying funders as ‘not a fit’ or only ‘well aligned’ is as critical as determining those who are ‘deeply aligned’. Gaining this clarity will ensure your outreach is focused on the right funders with the highest likelihood of funding your mission. With these funders identified, now is time to build out a funder profile so you are set up for strategic funder outreach. 

Building a donor profile

As you look at and collect all of this great information, it is important to organize it into a donor profile. This profile should make it easy for you and your team to see a quick overview of who the donor is and what is important to consider in your outreach to them. You can store this information in whichever format or tool works best for your organization, such as a CRM tool like Salesforce, a project management tool like Trello, or an online collaborative workspace like Google Suite.

If you do not yet have a format for your donor profiles or are looking for a reference format, you can find a sample of a Black Fox Global donor profile used in our research work here.

Key Takeaways

• Before identifying your research priorities, be clear on your mission and values, and assess your organizational budget and status, as this could affect your ability to receive specific funding or work with particular donors.
• Once you have conducted your organizational assessment, identify your research priorities to narrow down your research and keep it focused. 
• A key aspect of identifying your research priorities is to identify your primary and secondary issue areas; this helps expand your research pool for prospective donors. 
• Consider starting your research by looking at the funders of peer organizations.
• Keep up with sector trends and insights to help identify potential funder leads. 
• Use the research process to qualify funders as ‘deeply aligned’, ‘well aligned’, ‘not a fit’, and ‘not a fit right now’
• Create and update donor profiles to organize the information, quickly see alignment, and prevent the loss of important information over time.

For more information on how Black Fox Global can help you develop a pipeline of deeply aligned funders, visit the Solutions page of our website.