If you’ve ever tried to get a project off the ground that requires some kind of outside investment, then you’ve probably encountered (or have been requested to provide) a funding proposal.
Funding proposals may seem like a barrier that you have to overcome, but they actually serve a useful purpose, and can provide additional benefits and guidance to your project. In this article, we’re going to look at what exactly a project funding proposal is, what their purpose is and what some of the advantages are. We’ll then explain how best to go about writing a project funding proposal and write a checklist for some of the most important things to include.
The purpose of a project funding proposal is to convince key stakeholders that your project is worthy of funding. Included within these stakeholders, will be the decision makers who will decide whether you get funding. For this reason, it’s important to make the proposal as convincing as you can.
For key decision makers, they want to see that your project is going to have some kind of tangible result. They’ll want this result to be aligned with them or their organisation's goals.
With all projects, there is an inherent risk. When investment is at stake, decision makers will want to be sure that these risks have been accounted for and mitigated as best possible. They will want to see evidence that the project is adequately planned, with the necessary steps in place to ensure its success.
These factors are all part of the purpose for a funding proposal, so are important to consider throughout the process of writing one.
By writing a project funding proposal, not only are you justifying to your key stakeholder groups the viability of your project. You are also doing an essential part of the project planning process. Writing a proposal means you have a plan for how you see the project going. This can be useful to refer back to, guiding your decision making and assisting in processes associated with the project.
The research element of writing a project proposal can also prove useful further down the line. When you conduct research to support the need for a particular project, you are gaining a better understanding of the environment in which you operate. This greater level of insight means the decisions you are making are more well informed than they would otherwise be, increasing your projects chances of success.
The stakeholder engagement element of a project proposal should also be considered. Though the primary aim of a project funding proposal is to convince stakeholders of the value, it also servies to align stakeholders behind the aims of the project. This makes sure everyone is working in the same direction, towards the same goals. This can also provide an opportunity to clarify roles and responsibilities in a project, further strengthening your project organisational capabilities and chances of success.
Now that we understand what a project funding proposal is, the purpose of it and some of the advantages, it’s time to look at what needs to be included. This list is by no means definitive - each project will have its own different requirements depending on size, industry, time, cost, etc. This is more of a general outline on the elements that you should be thinking about, when putting a more definitive checklist together.
The first thing to consider is background information. Not everyone will be as familiar with the project's context as you are, so the objective here is to communicate the relevant information as clearly as possible. Try to get all the important details in, as concisely as possible. Overwhelming your readers with information will only discourage them from reading, whereas not enough details can leave your reader unconvinced. A good way of testing whether you have achieved this balancing act is to have someone external proofread and provide feedback, with you changing the document until you find the right balance.
Once you have explained the background information around your project, you should look to summarise the problems that the project will solve through a problem statement. The purpose of this is to communicate as simply as possible the reason for the project. The problem statement should captivate both the reason for the problem and the potential value of it being solved. It should also be easy enough to understand that by simply reading the problem statement and summary of the project, someone could fully understand what it’s all about.
The project details section is where you outline the key elements of the project. This should begin with a summary, before expanding into more specific details. The details should include:
Once these project details have been covered, you may wish to think about any other details that will be important for the project. Think about any logistical or operational details that are relevant to the success of the project. These should be included at this stage. For some projects, not all the details will be fully known at the time of funding being requested. That’s fine, as long as this is highlighted, and it’s made clear how and when these details will become known.
Since your project requires funding, it is likely that a variety of resources will be instrumental to its success. It is also likely that your organisation has many of these resources already available. It’s therefore important to first assess what is currently available. This has 2 major benefits. First, it's a chance to justify your project's viability by demonstrating that the inputs required are already partially available, making the additional investment seem less significant. Also, it shows that you have found a way to put what may otherwise be spare capacity to work, demonstrating resourcefulness and a desire to create value in the organisation.
Try to consider resources available beyond existing budgets or funding. Think about human resources, time, space, equipment etc. Almost every organisation has spare capacity in one way or another. This is your chance to prove that something better could be done with it.
Now that you’ve explained what is currently available, you’re in a strong position to ask for additional support to make this project a reality. In the same way that match funding can be more persuasive than single source funding, demonstrating that both parties are contributing something to the project increases your chances of success.
When explaining the resources that are required, it’s good to start with the total figure, before breaking it down into each element's costs. To demonstrate due diligence, it’s sensible to gather several quotes from different suppliers. This shows to the funder that you’ve ‘shopped around’, and are conducting the project at the best possible cost.
Once you’ve demonstrated where the costs of the project are likely to be incurred, you can budget for these costs across the timespan of the project. Having an idea of not just where, but when costs are to be incurred is necessary for a few reasons.
Firstly, though funding may be available for the project, it may not be immediately available. Forecasting when costs are to be incurred therefore puts deadlines on when funding is required to avoid the project running out of money or going into debt.
Secondly, by highlighting that the cost of a project can be spread over a period of time, you are minimising some of the risks that may be associated with large upfront investments. For example, if the project needs to be terminated midway for whatever reason, the investors are aware that only the costs prior to that will have been incurred.
Make sure to include alongside the budget the reporting methods that will be used to ensure the budget is on track, and that any deviations are noted and communicated to the relevant individuals. You may even wish to assign someone the responsibility of ‘budget controller’, who is in charge of managing the budget and communicating the relevant information.
During the project details stage, you would have highlighted who is relevant to the project, along with their roles and responsibilities. Now it’s time to expand on this. Here, you’re looking to explain each person’s role, their workflow, any processes and procedures that they should be following, and how they should be reporting on progress. You may also wish to assign a ‘line manager’ who will be taking care of individuals.
Aside from those directly involved in the day-to-day operations of the project, you will also likely have other stakeholders who will be interested in the progress of the project. For these individuals, we would suggest drawing up a stakeholder map, and stakeholder communication plan, that keeps them informed with the information most relevant to them.
After the project is complete, your stakeholders (particularly the ones granting funding) will want to see some measure of success. To achieve this, we would recommend detailing your project evaluation methodology in the project proposal.
The project evaluation should aim to summarise to what extent the project is a success. In order to take a holistic and balanced approach, we would recommend using both quantitative and qualitative data from a variety of sources.
For quantitative, try to establish KPIs that objectively assess the project's impact. One way to do this is to measure a ‘before’ and ‘after’ case. If the KPI is representative of the project impact, then a successful project will show a significant difference between the ‘before’ and the ‘after’.
For qualitative, it can often be the case that those closest to the project will be most aware of the impact. Having these individuals provide a quote regarding the impact is a surefire way to gather useful qualitative insights.
Lastly, you may wish to detail what will be the following steps in response to evaluation outcomes. For example, a positive evaluation may mean the project is rolled out on a larger scale, whereas a negative evaluation may result in the project being archived.
Now that we’ve gone through an 8-point checklist for a project funding proposal, we’re going to conclude the article with some top tips for maximising your funding proposals chances of success.
The first tip is to consider the alignment of project objectives against company objectives. If the primary objective is somewhat less aligned with organisational objectives, there may be other impacts of the project that are more aligned. It’s important to highlight these, and sell them to your key decision makers.
The second tip is to think about where each stakeholders objectives and interest in the project are. This is especially true for the decision makers. If a decision maker is primarily concerned with one element of a project, highlight how this element will be impacted, and how the progress will be communicated to them.
Finally, we would suggest focusing on presenting the right balance of details in your proposal. Try to summarise key points throughout, so that somebody with limited time could quickly skim through and get a general idea of the project. At the same time, provide adequate detail that someone who is more interested in specific points could gather all the information they need to make a decision.
If you enjoyed reading this article, we would also suggest downloading our guide below, to never miss another funding opportunity.