Maybe you want to build a space to invite entrepreneurs to your downtown or town square. Maybe you want to build an innovation district. Maybe you want to build more opportunities to help close the wealth gap. Whatever your reason, you know you want to “do entrepreneurship” in your community. But how do you fund that?
At our last Quarterly Conversation, we invited Mark Werthmann, economic development representative at U.S. Department of Commerce, to give SourceLink communities an hour of his advice and insights into winning federal grants for economic development projects. SourceLink affiliate communities can request the recorded webinar via email to [email protected]. In the meantime, here are just a few tips to think about as you complete your next grant request for the EDA—or grant application to any funding institution.
You have to have a problem.
SourceLink has helped its affiliate communities raise millions in grants for economic development projects from foundations, state entities and federal funders. And here’s what we know without even a glimmer of a doubt: every successful grant project is centered on having a quantifiable solution to a defined problem.
It starts with identifying your assets and understanding your gaps. Once you know your strengths, you can start to identify your weaknesses. What’s missing in your community? And what will move your community forward, in a demonstrable and measurable way? Is it inclusion, proof-of-concept funding, connectivity and visibility of resources?
You have to have the data that proves you have a problem.
Once you’ve identified the fulcrum issues that will flip your story of entrepreneurship, you define it and formulate measures and benchmarks for success. Because as entrepreneurs know all too well—and make no mistake, you have to be entrepreneurial when you build entrepreneurial communities—there is no investment without a demonstrable market and return. As you identify your problem, you must ensure you have the tools in place to prove that you’ve made progress toward your proposed solution.
Find the right funder.
This is a big section. Because it’s critical to actually getting the funding you seek.
If you’ve worked in entrepreneurship for even a smidge of a bit you know this: people buy from people they have a relationship with. What’s true for entrepreneurs is true for the emerging field of entrepreneurship-led economic development—and its funders.
Once you know your special suite of problems, find funders with synergy, funders whose mission matches your problem. And then get to know them.
Because here’s the secret about funding entrepreneurial ecosystems that not many people will tell you: the ask starts will before you ever put fingers to keys and type out that grant request. It starts with a relationship.
Once you’ve identified a potential match, whether it’s the EDA or some other funding entity, engage with potential funders before you ask for assistance.
You need to understand what’s in it for the funder; often the only way to do this is to have that conversation with them. What is the funder trying to accomplish? How can you help funders hit their goals and make them proud of the resulting investment? Often, funders only invest in a specific portfolio of projects. Don’t waste your time going to the wrong funder. Understand their passion, what is it they’re trying to accomplish to fulfill their mission, and make what you want to do fit with that.
There’s also the very practical reason behind talking to funders before you make the ask. As Werthmann noted in our Quarterly Conversation: there may be ways to meet eligibility criteria in different ways or they may be able to guide you to a better fit program or opportunity to meet your needs.
(Now, go back and reread those sentences and replace “funder” with “investor” or “customer” and you’ll quickly realize that this is the same speech you preach to every entrepreneur who sits down with you asking about how to raise their next round.
Find the right collaborators.
Be clear with our purpose, be specific in your focus and direct with measured success.
But (grant request) strength also comes in numbers.
When you have a clear understanding of your ecosystem and your gaps, build collaborations with other organizations to demonstrate that you have a community-wide approach and support. Funders like the EDA require match dollars. Other funders appreciate the due diligence of making sure that you have community buy-in for your request beforehand. Be sure that anyone you include in your grant request is an engaged and committed partner.
Address the request.
Simple, clear, direct. If you’ve answered a college essay or (hopefully not) been on the stand during a trial, you know that the best answers are the ones that directly address the question. It’s worth repeating: understand what funders are asking for and make sure your solution directly addresses it. When you align your ask with the grant request, you make it easier for grant funders to say yes on how their funds can be applied directly to your practical solution.
See the results you can achieve.
Strengths, assets, gap, problem, solution, focus—and metrics.
Know in the beginning how you will measure success in the end and come equipped with a plan for how you will sustain these efforts going forward.
The EDA, as just one example, views their grants as a kind of kickstarter project. How will you demonstrate results and build sustainability for the future? Bake those two things into your grant request, via potential collaborators, future funding partners, sustainability plans, identified metrics and a clear story that demonstrates your results.
Want more tips on funding or building our entrepreneurial infrastructure?
Make sure you check out our field guide, Beyond Collisions: How to Build Your Entrepreneurial Infrastructure. We have a whole chapter dedicated to funding entrepreneurial ecosystems—and another one dedicated to how to measure them: www.joinsourcelink.com/book.