Here are answers to some of the most common funding questions we are asked by prospective partners.
Frequently asked questions about our funding process
Do you accept unsolicited proposals?
Currently, we are unable to accept unsolicited proposals. You can find more information about our process here.
What types of funding do you offer?
Common types of funding we have provided in the past include:
- Unrestricted and restricted grants, including Expenditure Responsibility and fiscally sponsored grants
- Project funding through our LLC
- Contracts for specifically commissioned research.
We no longer provide equity investments or loans, except for potential follow-on investments to current partners.
Aside from potential impact and how well an opportunity aligns with your strategy, what else do you consider before providing funding?
We will need to be sure everything involved meets applicable legal requirements. We may look at the alignment between our organisations around mission and values. And we may assess the partner organisation in terms of:
- Financial and organisational health
- Leadership’s theory of change
- Team dynamics
- The broader market or ecosystem
- The organisation’s impact to date
When do you make funding decisions?
We evaluate opportunities on a rolling basis. Any key dates that may affect the process, such as the prospective partner’s or our financial year-end, are communicated as part of the funding process.
How long does the process take?
We can't give a set timeline on the decision to fund a potential grantee, as it depends on many factors. However, when we decide to move a specific opportunity through our approvals process, our goal is to complete the process within three months. We may not always meet this goal if complications arise during diligence, but we will always keep applicants informed of their grant's progress.
Factors that influence timing include:
- Whether or not we have previously supported your organisation
- The degree of due diligence required
- Our internal funding deadlines
- Jurisdictional, legal, or regulatory aspects beyond our control
- Scheduling constraints for decision meetings
If you are involved in a funding process with us and funding is urgent, please tell your Luminate contact as soon as possible.
Who makes funding decisions?
This depends on the characteristics of a grant. For large or complex transactions, we will hold a Funding Committee meeting. The Funding Committee may include our CEO and other Leadership Team members. In some cases, we will engage external advisers or seek approval from our Board.
Do we need other funders on board to receive support from you?
We prefer to avoid organisations becoming financially dependent on one funder or funding stream. So, for most grants, we expect the organisation to have, or be seeking, support from other sources.
Do you provide multi-year grant funding?
Our grant terms usually vary from one to three years, and we often tranche our funding into separate disbursements over each year. We will agree these terms with you before signing the grant agreement.
Will our grant be renewed automatically when it expires?
We never renew grants automatically. We approve a renewal depending on the merits of the opportunity, its continued alignment with our strategy and values, and its impact to date. Each opportunity must go through the full approval process.
Do you provide unrestricted grant funding?
We prefer to provide unrestricted grants, also known as general operating grants. However, in some cases, restricted grants are more suitable. For example, a restricted grant might be relevant if the alignment with our strategy is limited or the partner’s organisational structure limits the funding method. We evaluate each opportunity to determine the most appropriate grant type.
Do you tie funding to conditions such as meeting particular goals or metrics?
We evaluate each funding opportunity individually. Once we have approved a grant, we may tranche our funding into specific disbursements that are conditional on meeting certain goals or other criteria. We will always discuss these with you, both before and during the partnership.
Can we apply for more than one grant at a time?
We may consider an additional grant for a specific purpose but only under exceptional circumstances and for time-sensitive opportunities.
We are a non-US organisation; how does that affect the grant process?
As a US-based private foundation, we evaluate each organisation and determine whether it is likely to get certified as a Foreign Public Charity Equivalent (FPCE) and whether this makes sense to pursue. If it does, we will have a third party conduct an Equivalency Determination that evaluates your organising documents, funding sources, and activities.
Having charitable status in your country of registration is a positive indicator but it does not ensure FPCE certification. Seeking FPCE certification can add time to the approval process yet it may also provide additional flexibility in structuring the grant, and it may help you attract funds from other US private foundations. Please note that not having charitable status in your country of registration does not preclude you from receiving FPCE certification.
If you cannot achieve FPCE certification, we have two other funding options.
First, we may exercise ‘Expenditure Responsibility’ (ER) over the grant, as required by the US Internal Revenue Service. This ensures that our funding goes solely towards charitable activities. ER requires strict narrative and financial reporting from you on how you have used funds. It also requires additional due diligence to confirm your ability to carry out the charitable project and to properly use and account for funds. As part of this, your organisation’s experience, management, activities, and practices will be evaluated. You must maintain grant funds in a separate account on your books – and sometimes through an entirely different account. You may not use these types of funds for lobbying, re-granting, or any purpose other than the one stated in the grant agreement.
Our second option is to provide funding through our LLC. While LLC funding enables us to support non-charitable entities and activities, these agreements generally offer less flexibility and require more reporting than unrestricted Foundation support. In each case, we will work with an organisation to determine the best-fit funding structure. If you need more information on FPCE, ER grants, or LLC funding, please ask your Luminate contact – they will be happy to help.
We are fiscally sponsored; how does that affect the grant process?
We will need information about both your organisation and your fiscal sponsor. Fiscal sponsorship is commonly used for organisations that have not yet acquired charitable status, or individuals or coalitions that have not yet incorporated as an entity. The sponsor is typically a well-known public charity that regularly engages in this practice.
Under this arrangement the sponsor lends its non-profit status to the sponsored entity or project, is legally and financially responsible for the project, and has full discretion and control over the use of the funds. Communication between the funding’s end-recipient and ourselves will always go through the fiscal sponsor.
We are a for-profit company seeking a grant; can you support us?
In some limited circumstances, we can provide grants to for-profit companies for charitable projects through the use of Expenditure Responsibility or our LLC. In these cases, we'd work with the organisation to determine the best type of funding.
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Who can I contact if I have feedback about the funding process?
You can always get in touch with your Luminate contact. If you would like to speak to someone else, please email [email protected] and we’ll put you in touch with someone who can help.