What is Grant Management Software for Nonprofits?
The grant process can be daunting – from searching for funders and completing applications to recording expenditures and managing reporting requirements. That’s why many nonprofits, big and small, utilize a grant management software system.
Grant management software takes the administrative grunt work out of the grants process, allowing nonprofit personnel more time to focus on their mission and the patrons they serve.
In this article, you’ll learn what grant management software is, how it can help your nonprofit, and what to look for when choosing a grant management software system.
What is Grant Management Software for Nonprofits?
As part of establishing a diversified revenue stream, most nonprofits have some reliance on grant funding, and if they do not currently, aspire to have at least some grant funding in the future.
Grants are very attractive. Unlike loans, grants do not need to be paid back, and unlike donations from individuals, they are often larger and more predictable sources of funding.
However, unlike a one-time donation from an individual or business, acquiring a grant often involves a lengthier process. That’s where a grant management software system can be effective.
A grant management software system administers the entire grant process – from recording grant applications and their outcomes to setting up necessary information for grant reporting requirements. Most software applications have features such as grant matching, expenditure recording, and collecting project outcome data. This software is often utilized by both grantseekers and grantmakers alike, including some foundations which are both administering grant opportunities and seeking their own funding.
Grant management software is a paid service provided by contracted vendors. Nonprofit organizations typically purchase the software or subscribe to a cloud-based service. Many software programs are easy to implement, versatile for team or individual use, and are compatible with a nonprofit’s existing CRM or donor management system.
For the purposes of this article, we will be focused on grant management software for grantseekers – those nonprofits whose involvement in the grants process is primarily from a seeking perspective, as in they are the recipients of grants. Keep reading for helpful info about how grant management can help your organization.
How Does Grant Management Software Help Nonprofits?
As mentioned above, grant management software takes the administrative burden away from keeping track of everything involved in the grants process. Many small-to-mid-sized nonprofits do not have dedicated personnel whose sole job is to pursue and manage grants. Often this responsibility falls on the shoulders of the Executive Director or CEO, or on a Program Manager. Even if a nonprofit has a Development Director, this person is often also in charge of all revenue campaigns, not just grant management.
Because the grant funding process involves many steps – before, during, and after acquisition- it is helpful to have a software system to manage it all. By cutting the administrative hours necessary to pursue and acquire a grant, personnel have more time to dedicate to the other relationship-building components so crucial to nonprofit work. – serving patrons, establishing partnerships, and engaging the community. Make the most out of your organization’s human capital and let the software keep track of reporting deadlines, analyze impact data and expenses, and auto-populate future applications.
An embedded and integrated grants management system allows an organization to easily retrieve data, assess past applications and plan for future applications, and retrieve reports. It helps your nonprofit collect accurate data on expenses and project impact, instilling confidence in grantmakers that your organization will be successful stewards of future grant awards.
Read through these nonprofit case studies below to get a practical sense of the effectiveness of grant management software tools.
Ask yourself: can my nonprofit relate?
ABC Nonprofit is a mature, mid-sized nonprofit who is well-recognized in the community and has been in existence for twelve years. For the first decade, the organization had received much of its funding from a municipal contract, individual donors, and a yearly community breakfast event. However, when COVID restricted in-person events, and municipal budgets were redirected to essential services, the organization turned their focus on acquiring grant funding.
The Development Director was savvy with event planning and donor campaigns but had little experience with grants. Therefore, they had trouble finding matches, completing applications, and gathering the requested information.
Grant Management Software Solution:
Grant management software identified potential grant opportunities and their deadlines. ABC Nonprofit integrated the software with their existing CRM system and tracked accurate reports on how much revenue they were generating from all sources.
The organization planned to focus on grant applications to make up for lost event revenue. They gathered necessary information on their organization, such as financials, annual reports, and impact data, which they recorded in the grants management software system, and used for all applications going forward.
XYZ Nonprofit is a young but quickly growing nonprofit that recently acquired two substantial general operating grants awards to expand their organization’s capacity. They also have several small grants that were used to start their organization which still have reporting requirements. Last year, XYZ also received a three-year project-based grant whose funds are restricted to a specific initiative.
The new Executive Director is responsible for the grants process and recently nearly missed a mid-year reporting deadline on a grant that was awarded before they took the position.
Grant Management Software Solution:
XYZ acquired grant management software which allowed them to input all their past and current grant information, award amounts, and reporting requirements. The system sets up reminders for reporting and keeps track of expenses for both general operating grants and those which are project specific. It allows the new Executive Director to see the progress on grants and projects thus far, accurately report to the Board, and plan for future initiatives.
What Should I Consider When Looking for Grant Management Software?
Many nonprofits, particularly those with limited budgets, hesitate when faced with another subscription or cost, especially when they may be managing just a few grants or when they have been administering grants the “old-fashioned way” (Excel spreadsheets, etc.) for a long time. The most important factors to assess when choosing to use a grant management software system are cost, features, and integration capability (and of course, how these factors efficiently work together).
Grant management software prices vary widely and are dependent on multiple factors including the size of the organization and the available features. Small to mid-sized nonprofits can expect to pay about $2,500 - $4,000 per year or about $200 - $350 per month.
A 2016 study by NTEN shows that nonprofits with less than 1 million dollar annual budgets spend about $5,000 per year on technology needs. Of course there is a big difference between an organization with a $900,000 budget and one with a $100,000 budget, but the study suggests that these organizations spend about 13 percent of their annual budget on technology.
Grant management software is helpful to all, and except for very small, very new, or financially destitute organizations, the benefits of grant management software generally outweigh the costs. $200 per month can easily be absorbed on the merits of increased efficiency, less administrative time, and more opportunities for acquiring grant funding.
To be worthwhile, even the most basic of software systems should include a few essentials:
- a grant matching system or database
- templates for applications and reports
- application progress tracking
- email reminders for deadlines
- options for multiple users and collaborators
- document storage (990s and other financial documents)
- user friendly interface
Additional features include tools to forecast expenditures or report on project progress.
Many nonprofits already use programs to pay bills and track staff hours (such as QuickBooks) or communicate with patrons through a CRM platform (such as Bloomerang).
When choosing grants management software, look for a platform that integrates with your current programs. This will help avoid time-consuming backtracking and re-uploading of information to the new grants management platform.
When Should My Nonprofit Get Grant Management Software?
Grant management software is beneficial for most 501c3 nonprofits with a stable budget, regardless of size, and an annual operating income of 90k or more. According to a 2017 study by Streamlink, the chief struggles among grant seekers were finding grant opportunities and writing the grant application.
Even if organizations do not yet have a lot of grants to manage, they will benefit from simply having the tools at their disposal to connect with more opportunities, and when they find a match, complete a thorough and compelling application. It behooves new organizations to implement basic grant management software as soon as they start, to avoid having to backtrack and retrace steps as they grow in financial, personnel, and program capacity.
How to Use Instrumentl for Grant Management
No matter if your organization is big or small, just starting up or has decades of going strong, Instrumentl offers effective grant management software, bringing grant discovery, research, and tracking to one place. We offer Basic, Plus, and custom plans to suit all needs and organizational budgets with prices starting at $179/ month when paid annually.
Our plans offer comprehensive grant management tools to assist throughout the grant process. All plans include features such as:
- Smart Grant Matching
- Foundation Profiles
- Grant Tracker
- Automatic Deadline Reminders
- Document Library
- CSV and PDF Reports
Additional information such as Personalized Support & Training, Foundation Discovery, Advanced Funder Insights, and Recipient Profiles are part of more advanced plans.
Custom plans, suited for larger nonprofits, offer unlimited project management capabilities, team collaborators, and account users.
With strategic matching, deadline reminders, application tracking and task lists, your nonprofit can stay organized and efficient throughout the grant process.
You can check out what best-selling author, Meredith Noble, has to say about us below:
If interested, you can start a 14-day free trial today and see firsthand how Instrumentl can help your nonprofit reach its grant funding goals.
Wrapping Things Up: What is Grant Management Software?
Most nonprofits are built on a passion for helping causes and community, but not necessarily best suited for the administrative work required to do so. With the help of a grant management software system, nonprofits can spend more time devoted to their mission and patrons, and less time on behind-the-scenes desk work.
An effective grant management system enables organizations to maximize their human capital by letting the software shoulder part of the grants process.
If you found this article helpful, learn more tips for securing grant opportunities and managing grant funding by checking out our posts on the Ultimate List of Common Questions Grant Funders Ask and How To Manage Grants: The Ultimate Checklist and More.