Writing an LOI: A Fresh Look at Best Practices
Each year more foundations wave the white flag of surrender to the tidal wave of nonprofit grant requests coming their way. How? By checking the tiny box on the IRS Form 990 indicating they only make contributions to preselected charitable organizations and do not accept unsolicited requests for funds. What does this invitation-only scenario mean for nonprofit organizations? How can nonprofits—especially small and mid-size organizations—introduce themselves to foundations and receive these coveted invitations? The Letter of Introduction or Intent has for many years been considered a go-to tool for connecting with funders and exploring potential partnerships. But it’s worth asking: Is this strategy still worthwhile? and How do I craft an LOI in a fresh and effective way?
Types of LOIs. There are two primary types of LOIs: Letters of Introduction and Letters of Intent. The purpose of a Letter of Introduction is to brief the funder on the organization and offer a site visit. Letters of Introduction don’t detail a specific ask for a program or project; rather, the letter seeks input from the funder about what they would like to support. A Letter of Intent, on the other hand, is more targeted in its focus—on a specific program and the amount necessary to fund the project. **It’s worth noting here that some foundations now require an LOI as an initial screening mechanism. Even if you’re writing an LOI to fulfill a mandatory requirement, we hope this post serves as a helpful guide.
Getting Started. The first and most important step in crafting an LOI is research. Once you have a target funder in mind, it’s crucial to know their funding criteria to ensure that your programs are an exact fit. If your organization runs a program that addresses a need the funder cares deeply about, consider sending an LOI.
Before mailing or hand-delivering your LOI, contact with the funder should be made so that the recipient is not receiving it “cold.” Of course this isn’t always possible—but make every effort to contact the funder first.
Writing an LOI. When composing an LOI, focus on clarity, brevity, and impact. There is no formula for writing a successful LOI, but compelling LOIs may include the following components:
WHY [INSERT NAME OF YOUR NONPROFIT HERE]?: The purpose of this introductory section is to immediately engage the reader, making the case that your nonprofit fits the foundation’s funding priorities and therefore deserves consideration! It is based on research—into their funding patterns over several years—not just last year, and not just based on their IRS Form 990. Dig into the foundation’s directors/trustees and their interests, and even the recent successes of past grantees, especially those they have funded consistently over time. It’s very likely that the funder takes pride in, and feels some responsibility for, these successes. Acknowledging and congratulating them on the impact they’ve made through other nonprofits shows a willingness to collaborate (a soft spot for funders) and to be part of a coalition, as opposed to competing for scant resources. Don’t forget to close the circle by stating, in one sentence, how your program supports, extends, complements, or otherwise increases the impact they are already making.
ORGANIZATION DESCRIPTION: You may include a summary of programs here if necessary (and if space allows), but focus on the program for which you are seeking support.
NEED STATEMENT: Be succinct and cite current, geographically relevant data from reliable sources. This is the heart-strings opportunity—incorporate a case study/testimonial that conveys the need for your program and its impact.
PROGRAM/PROJECT DESCRIPTION: Depending on your strategy and funding needs, components of this section could include primary activities, qualifications of project staff, a brief description of evaluative methodology, a timetable, and key objectives.
FINAL SUMMARY: Wrap your letter up by restating the connection between your nonprofit and the foundation’s funding objectives. If the funder is local and it’s appropriate, invite them for a site visit to see your program in action. Thank them for their consideration, and then state the follow-up actions you will be taking: a follow-up phone call or an email to set an appointment for a follow-up phone call.
More Quick Tips
LOIs should not be more than 2 pages long.
When mailing LOIs, hand address the envelope to increase your chances of getting it read!
LOIs should be easy to read: no jargon or acronyms, and use generously-sized typeface in a serif font. Headings and photographs may be helpful.
As with every strong promotional communication piece, a call to action can be very powerful. Consider including an appropriate call to action in your letter so that the recipient is clear on what your aim is.
Acknowledge that your letter is a request for an invitation to submit a full proposal—not the proposal itself.
A few days after you mail your LOI (or choose to hand-deliver), email the LOI as well, if you have a good email address for the funder.
Personal connections can improve the odds of an LOI getting read. Additional research on the foundation's directors or trustees may provide an entrée that could make all the difference.