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August 27, 2014

Why Can't I Find That Foundation?

This is a cross-post of Sandy Pon's latest from the new GrantSpace blogSandy Pon is the lead editor for GrantSpace and the GrantSpace Blog. 

One frequent question that our Ask Us team gets, often fromFoundation Directory Online (FDO) subscribers, is “Why can’t I find the the foundation I’m looking for in FDO?” Understandably, they expect to be able to find every U.S. grantmaking foundation in our database. We do, too! Here are some reasons that make this an elusive goal:

It’s not a grantmaking organization

Not surprisingly, many people quickly assume that an org with “foundation” in its name makes grants. In fact, the term “foundation” on its own has no legal definition, so any org can use it in its name.

So before you get excited about discovering a new funding prospect, search the Internet or other sources to learn about its mission and activities, including whether or not it makes grants. (Can you think of an example of an org that has “foundation” in its title, but doesn’t make grants? Hint: It’s literally right in front of you. Answer is at the end of this post.)

It’s a public charity

Private foundations file Form 990-PF, so they’re easy to detect. However, grantmaking public charities file Form 990, the same form used by most nonprofits that  don’t make grants. Thus, they are harder to find unless we learn about them from the org itself, the news, or from members of the public, like you! Several public charities are in FDO, thanks to many of you who have asked about them.  

It’s not a separate organization

Some so-called foundations are actually donor-advised funds (DAFs). DAFs are separate funds or accounts maintained, operated, and legally controlled by an exempt sponsoring organization, like a community foundation, public charity, or a charitable fund.

Increasingly, individual donors are using donor-advised funds because they can direct how funds are invested and distributed, yet they can avoid the administrative requirements, operating costs, and public disclosure requirements involved with managing a separate private foundation. (Want more info about donor-advised funds? See this Knowledge Base Article.)

It’s a new foundation that was recently formed

The first time we will hear about most new foundations is when we get their initial Form 990-PFs from the IRS, at least one year later after they are established. Even then, many new foundations don’t start awarding grants until 2-3 years after they are initially funded.

If a new foundation is formed by a company or a high-profile or newsworthy individual, or if it’s formed with roughly $5-10 million or more in assets, our FDO editors will add those new entries based on news reports, telephone calls, and any websites available, even without a 990 in hand. But generally, they need some sort of proof first; otherwise, we’d have thousands of skeleton entries with nothing more than a name. What use is that?

It’s a foundation that was formed in another country

We're gradually adding more international grantmakers to FDO, but access to their information varies with each country. Meanwhile, for non-U.S. funders not listed in FDO, search the Internet to find their websites or news articles about them, or check the grantmaker association's website for their home countries.

How does this info help you become a better grantseeker?

If you can’t find info about a foundation that you know exists, that might prompt you to do some more investigation to figure out what kind of donor it is. Knowing the type of donor can inform so many subsequent steps, from research to cultivation to making the actual ask. In our next blog post, we'll talk about the tools that we use to answer this question, so you can use them, too. Even better, most of them are free! 

- Sandy Pon

Answer: Foundation Center! Do we get a lot of people asking us for grants? Yes. Good thing we’re not a grantmaker. We use these opportune moments to show how some quick Internet research into the org's mission and activities can avoid a bad first impression.)


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