Forming Public-Private Funding Partnerships

In a world of tightly-restricted public funds, it is essential that ambitious, high-impact nonprofits hoping to thrive and grow get serious about raising money from private sources.

How does an organization go about this? These days, one should assume that the entry “price of poker” is a strong program model that reliably delivers satisfying results to those served, plus at least some level of formal evidence of real impact.

Once in the game, what really differentiates the winners is their skill at identifying and developing sound partnerships with a particular type of funder – one having strong strategic alignment with the organization’s work.

While it is tempting to believe that the pathway to sustained private funding lies in making as many calls as possible to a wide diversity of sources, a study by the Bridgespan Group demonstrated the limitations of this approach. Astonishingly, the study found that 90% of the largest nonprofits founded after 1970 were fueled by financial models that relied on a single category of funder – e.g. corporations, fee-paying customers, private individuals or foundations – with whom they shared clear, sustainable, mutual interests.

How can a nonprofit leader identify attractive partnership candidates? A starting point is to ask the following questions:

  • What real social change or benefit results from my work?
  • Who deeply cares about that result?
  • Of those who care, who controls discretionary money?
  • Why should these parties see my organization as the solution to their need?
  • How can we best make our case to them?

Once a leader has candidly answered these questions, there is likely to be work to do before approaching potential partners, perhaps in strengthening the organization’s team or results, perhaps simply in tightening its “pitch.” Whatever the challenge, these leaders should keep firmly in mind this truth – sound partnerships are 2-way streets and the right partners need you as much as you need them.

Paul Carttar
Senior Advisor at the Bridgespan Group
Former Director of the Social Innovation Fund