The agency can specify which kinds of art projects it wants to fund, such as public sculptures, city murals or portraits of local historical figures.
Regranting is common for foundations in various sectors regardless of their mission. From public arts funds to disease research and much more, regranting organizations make it possible to ensure the right people are getting the grants they need to maximize their impact on their communities.
Understanding the process of regranting is essential for grantmaking organizations, intermediaries and individual grant seekers because it can help make it easier to determine whether it’s a worthy use of their funding.
Regranting is when a grantmaking organization — often a nonprofit or non-governmental organization (NGO) — applies for and wins a grant, and then uses that funding to create sub-grants for smaller organizations and individuals. In other words, regranting is the process of outsourcing grant management.
The purpose of regranting is to make funding more accessible to the people doing the end work. It’s especially common in abstract sectors like arts and culture, where many potential recipients are competing for a large pool of money.
That’s where the regranting organization comes in. Your organization applies for the original grant, which it then divides to create smaller, more manageable sub-grants for recipients at the community and individual levels. Recipients of regrants often meet specific demographic or geographic categories, which helps ensure the funding can make the biggest possible impact.
Sticking with the arts and culture theme, let’s say a county-level government agency receives a grant for encouraging local art from the state. After breaking this grant into several sub-grants, the agency can then define the criteria for grantees. Some common criteria include:
The agency can specify which kinds of art projects it wants to fund, such as public sculptures, city murals or portraits of local historical figures.
To better serve marginalized groups, the agency can specify which identities are eligible for the grant. For example, a grant could specifically be for women of color, LGBTQ+ teens or immigrant artists. Considering intersectionality in this step is key to improving grant equity.
Is this grant for a specific town, city or county? The smaller the area, the narrower and more manageable your pool of applicants will be.
Because you can get so specific with these criteria, regranting is one of the most effective ways to get high-level funds, such as those from prominent donors and large government agencies, into the hands of the people on the ground.
The regranting life cycle is similar to the typical grant management process, though it requires additional steps to get the funds from your organization to the final grantees.
Here’s how it works:
Because this process involves multiple levels of applications and monitoring, using a streamlined management system is crucial for ensuring you and your sub-grantees meet key deadlines and performance goals.
Regranting is more common than many people think, and seeing how it works in real life can help organizations develop a better understanding of the process.
Here are three examples of how real donors and organizations have used their funds to magnify their impact on specific groups.
Perhaps the most famous example of a regranting organization, the Bill and Melinda Gates Foundation provides private funding to projects in various spheres, including but not limited to:
In 2006, Warren Buffett made headlines for donating $40 billion to the Foundation for regranting rather than donating directly to the end-point donors. When asked, Buffett explained that he lacked the knowledge and expertise to optimize his donations and that the Foundation was much better positioned to distribute that money to the right recipients.
The Edna McConnell Clark Foundation (EMCF) was a well-known regrantor for organizations serving at-risk youth, though it has also seen success in various other regranting initiatives.
Throughout its operating life, EMCF strategically funded long-term investments into evidence-backed projects that benefited disadvantaged children, adolescents and young adults. It also funded research into tropical diseases for approximately 25 years before shifting primarily to youth development.
EMCF transitioned its assets to its affiliate Blue Meridian Partners in 2018, which has continued to pursue philanthropic funding efforts.
The New York-based Mellon Foundation regrants its funding to organizations that specialize in various arts and cultural work across the country, including:
The Foundation is one of the United States’ major arts funders, supporting artists, culture-bearers and educators from various underserved groups.
Although regranting is a beneficial method of funding management, it has some shortcomings that are important to understand before beginning the process.
Organizations can use regranting to achieve more specific funding goals for certain sectors and geographical areas. Some of the biggest benefits of regranting include:
With a narrower applicant pool and smaller sums to manage, regranting makes it easier to get funding to the people who are on the ground.
Regranting enables the original grantmaking organization to act as an anonymous donor, shifting the risk onto a regranting organization that is better positioned to manage it.
Regranting makes it easier for smaller organizations and individuals to use their money according to their community’s requirements.
Regrantors who have strong connections to local organizations can get emergency funds to those in need faster than agencies offering large-scale grants to broader applicant pools.
Regranting organizations have a better understanding of their communities’ needs, which can help bring more funding to underserved regions and issues.
Using the right tools can help your organization optimize your regrant management strategy and streamline compliance management, which are essential steps for optimizing your impact.
While regranting enables organizations to make more meaningful impacts, it does have some considerations:
Traditional grant management is a costly process. Regranting involves even more administrative costs due to its more complicated lifecycle, which reduces the amount of funding available to the final recipients.
Excessive regranting can come off as inauthentic, undercutting the impact you’re trying to make. Being deliberate about who will receive your sub-grants and why is essential for maintaining the public’s trust in this regard.
Although regranting is a major source of funding for many social justice initiatives, the process can sometimes result in a lack of funding for the most underserved and unserved communities. Taking deliberate action to eliminate bias and make your applications more accessible can help you create a more equitable regranting process.
When it receives funding, the regranting organization takes on the original grantmaker’s legal and financial risk. Thorough preparation and advanced software tools can help regranting organizations reduce their risk and simplify compliance management.
Fortunately, advanced planning and effective grant management techniques can help your organization minimize these disadvantages and maximize your positive impact.
It’s important to remember that regranting is a more complex process than traditional grantmaking, which is why it requires more intensive grant management processes.
These tips and best practices can help your organization simplify grant management for regranting and save your team valuable time and energy.
Close collaboration between everyone on your team is crucial for ensuring an efficient regranting process. All individuals involved in the grant-making and administration process should understand their specific roles and responsibilities to prevent duplicate work and keep key processes moving.
Grant management software can help you ensure everyone is in alignment with teamwork-enhancing features such as:
Real-time collaboration capabilities enable multiple reviewers to view and comment on the same applications simultaneously, eliminating redundancy and improving communication.
A solution that automatically alerts users of upcoming deadlines, updates and outstanding tasks makes it easier to ensure key processes are completed at the right times.
An AI-powered analytics tool that complies with key industry and legal regulations simplifies the process of collecting, analyzing and reporting on grant data so everyone on your team can keep up with grantees’ progress and funding usage in real time.
Remember, it’s essential to overcommunicate. Whether your team members are working from the same office or across the country, leaving detailed notes on what you’ve done can reduce the risk of confusion and duplicate work.
Unlike conventional grant management, regranting requires multiple application phases. That process can be overwhelming for potential end-point grantees who lack experience in applying for grants, which can discourage them from applying.
A grant management solution with a user-friendly self-service portal can help you create a more diverse pool of applicants by making it easier for people to complete and submit their applications. It can also help to cut some application questions to ensure fairness.
Applicants who are short on time are more likely to abandon a grant application if it’s too complicated to complete in one sitting. Carefully evaluate the questions you have on the application to determine whether you can remove or reword some without making a major change.
Performing due diligence investigations helps reduce your risk by investigating each potential sub-grantee’s history and likelihood of delivering on its goals.
Some critical due diligence considerations for regranting include:
Has the sub-grantee previously received funding from your organization or similar regrantors?
Who is the sub-grantee, and what kind of reputation does it have? What is its role within its community?
Is the sub-grantee financially stable and able to manage its funds well? What justification has it provided for its intended funding usage?
Will you need to train sub-grantees on processes such as using grant money or reporting progress? Do they have previous experience with grant management, and what tools will they use to do so?
How closely does the sub-grantee’s mission and business processes align with those of your organization? Do you agree with the intended outcomes and metrics?
Completing this step before the award phase is vital, as it can help you narrow down your list of applicants much faster.
Are you looking for a digital tool to streamline your regranting processes? Meet IntelliGrants IGX. Our fully configurable solution enables you to tailor your workflows to your organization’s unique grant-seeking and awarding requirements.
Its web-based architecture and responsive design capabilities enable your team members to view grant data and documents from anywhere with an internet connection, so you can keep things moving even when key players are on the go. Plus, its compatibility with various other software programs provides a seamless flow of data across your tech stack for quick, frictionless access.
If your organization lacks the time and resources to set up a fully customizable solution, we offer another option. IntelliGrants IGXpress comes with preconfigured workflows, reports, forms and roles to save your organization valuable time on implementation and startup. You’ll also gain additional budgeting flexibility, which can help you ensure the maximum amount of funding reaches the grantee.
See why more than 100 clients choose IntelliGrants IGX to enhance their grantmaking and regranting processes. Book your live demo today.
