A nonprofit may have a long list of grantmakers, a campaign calendar, and an annual revenue growth target, yet still lack a clear answer to a fundamental question: How will these resources help deliver its priorities?
Problems arise when the team’s efforts are spread across unrelated opportunities, funding arrives after it is needed, or the organization expands a funded program while an essential service remains underfunded.
A resource development strategy connects what the organization wants to achieve with what it needs to secure. It then identifies the approaches in which it will invest its time, budget, and relationships. This requires clear decisions: What will we fund? Who might support it, and why? What capabilities will we need? When will we review our choices?
1. Define the Priorities That Will Guide Resource Decisions
The strategy begins with a review of organizational objectives, beneficiary needs, and existing commitments. Program staff identify the intended results, finance estimates costs and timing, resource development assesses support opportunities, and leadership approves priorities.
Simply transferring every strategic objective into a funding list is not enough. The organization should identify what must be protected, what can be developed, and what can be postponed if resources are unavailable.
Priorities can be grouped into:
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Existing commitments: Ongoing services, contracts, and commitments to beneficiaries.
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Essential improvements: Systems or capabilities that affect the quality and efficiency of the work.
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Conditional expansion: New activities that require additional funding and capacity before they begin.
This prioritization helps the organization allocate its efforts when it cannot fund everything at once. It also makes clear that funding for expansion does not automatically close gaps in existing commitments.
2. Calculate Full Costs and the Remaining Funding Gap
Once priorities are defined, the organization needs to describe each requirement: its cost, timing, duration, existing funding coverage, and remaining gap.
Full costs include delivering activities and the management, monitoring, technology, and facilities they require, using an appropriate allocation method. Restricted project funding may cover these items within an approved budget. Review actual coverage before assuming additional funding is needed.
For each requirement, distinguish between:
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The purpose it will serve.
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Whether it requires cash or a specific in-kind contribution.
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When the resource must be available and for how long.
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Acceptable conditions of use.
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Whether the need is one-time or ongoing.
Flexibility and recurrence describe funding characteristics; they are not separate categories of need. An ongoing program may require recurring cash funding, while a system improvement may need an initial payment followed by funding for maintenance.
Example: A Youth Empowerment Nonprofit
Suppose the organization is planning for the coming year using the following figures. This is a hypothetical educational example:
| Priority | Planned Cost | Confirmed Funding Available for This Purpose | Funding Gap |
|---|---|---|---|
| Existing training program | SAR 1,200,000 | SAR 800,000 | SAR 400,000 |
| Development of a beneficiary monitoring system and its first year of operation | SAR 200,000 | SAR 50,000 | SAR 150,000 |
| Organizational needs not allocated to the two items above | SAR 300,000 | SAR 100,000 | SAR 200,000 |
| Total | SAR 1,700,000 | SAR 950,000 | SAR 750,000 |
These figures assume that costs are allocated without duplication and confirmed funding will be available when needed. Grant applications under review and potential donations are not counted as confirmed coverage.
The organization now knows exactly what remains unfunded. It also estimates the system’s operating costs beyond the first year, so that development does not proceed without a plan for continued operation.
3. Choose Funding Approaches You Can Realistically Develop
Knowing the gap does not automatically identify who will cover it. Assess potential approaches using evidence: existing relationships, previous support, grantmaker priorities, donor interests, and team capacity.
The following questions help guide the choice:
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Who could provide the resource?
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Why might they want to support this need?
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What makes the organization credible and eligible for their support?
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How will it reach them and build the relationship?
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What time, costs, and capabilities will be required?
“We will secure grants” is not a sufficient plan. The organization needs to identify institutions whose priorities align with the program, their application requirements, decision timelines, and the evidence of results it will provide.
Similarly, developing recurring donations requires an audience the organization can reach, a clear purpose for support, a suitable donation experience, and the ability to communicate and follow up.
In the example, the organization might select two main approaches for the year:
| Approach | Target Funding Gap | Reason for Selection |
|---|---|---|
| Develop institutional and corporate support | SAR 400,000 for training and SAR 150,000 for the system | Existing relationships with organizations that support youth employment or nonprofit capacity development |
| Develop individual donations for clearly explained organizational purposes | SAR 200,000 for organizational needs | An existing donor base that has expressed interest in supporting the organization’s continued work |
These choices require validation; they are not funding guarantees. If suitable relationships, a supporter base, or sufficient capacity are absent, the organization should adjust its approach or ambition.
A separate approach is not required for every need. One funder may support several priorities under a clear agreement, while a single need may require contributions from several sources.
4. Separate the Provider, the Resource, and the Collection Mechanism
To keep the plan clear, record each approach using separate fields:
| Dimension | What It Clarifies |
|---|---|
| Resource provider | An individual, company, grantmaking institution, or another entity |
| Nature of the resource | A donation, grant, in-kind contribution, or service revenue |
| Solicitation and collection mechanism | A grant application, direct outreach, crowdfunding campaign, or payment method |
| Conditions of use | Permitted purpose, duration, and reporting requirements |
| Receipt pattern | One-time support, installments, or expected recurrence under specified conditions |
A company may donate through a crowdfunding campaign. The resource remains a corporate contribution, and the campaign remains its collection mechanism. The amount must not be counted twice.
Crowdfunding belongs in the plan when the organization has a need it can explain to the public, the ability to reach an audience, and the capacity to fulfill its commitments and provide updates. The duration and flexibility of support depend on the campaign’s design and stated conditions.
If the organization considers charging for a service, it should estimate demand, operating costs, and the expected net contribution. Earned income does not necessarily mean regular income or an available surplus: sales may fluctuate, or service delivery costs may absorb most of the revenue.
5. Assess Opportunities Before Making Commitments
Unexpected opportunities will emerge after funding approaches have been selected. The organization needs an assessment that supports consistent decisions while allowing it to respond to new needs.
Use five questions:
Does the opportunity serve the mission and a genuine need?
The connection should be clear in terms of beneficiaries and outcomes, rather than merely a similarity in activity names.
Does it adequately cover costs and commitments?
Review the budget, disbursement conditions, uncovered costs, and the resources the organization must contribute.
Do we have the capacity to deliver?
This includes staff, systems, partners, and time, as well as monitoring and reporting requirements.
What happens when the funding ends?
Can the activity conclude responsibly, or will it establish a service or contracts that require ongoing resources?
Are the acceptance conditions appropriate?
Review restrictions, conflicts of interest, and legal and ethical requirements in accordance with organizational policies and decision-making authority.
In the youth empowerment example, a company might offer funding for a new program that does not serve the target group and requires additional staff. The value of the offer alone does not justify accepting it.
Alternatively, a new training opportunity may address a documented need and support the mission while falling outside the current plan. The organization can consider an approved plan revision if the opportunity’s benefits, costs, and delivery requirements justify it.
The decision may be to accept, negotiate, defer, or decline. An opportunity outside the plan requires explanation and review; it does not automatically require rejection.
6. Fund the Capacity to Develop Resources
The selected approaches require investment. Proposal writing, relationship management, campaign preparation, data improvements, and agreement monitoring all have costs.
In the example, suppose the organization allocates SAR 60,000 to resource development:
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SAR 35,000 for proposals, budgets, and institutional relationship development.
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SAR 25,000 for improving donor data, the donation experience, and communication.
If these costs are not included in the previous table, total planned requirements rise to SAR 1.76 million, and the overall funding gap becomes SAR 810,000.
The organization must explain how these development costs will be funded and when they must be paid. Resources restricted to other purposes cannot automatically be treated as an available fundraising budget.
Avoid counting the cost twice: once in the budget and again when calculating the resources required to cover it.
The organization may also choose a limited pilot before expanding its investment, such as submitting several suitable grant applications or testing communication with a segment of previous donors. The results can help assess the approach before adding permanent roles or ongoing expenditure.
7. Turn Choices Into Targets and Responsibilities
A strategy is incomplete if it merely states “develop grants and donations.” Each approach needs a target, amount, deadline, budget, and accountable owner.
The organization could express the example’s objectives as follows:
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Secure an additional SAR 400,000 for the training program before the expansion approval deadline, through agreements whose conditions align with the program budget.
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Secure SAR 150,000 for the monitoring system during the first half of the year, alongside an approved plan for its subsequent operation.
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Secure SAR 200,000 for organizational needs and SAR 60,000 for resource development during the year, through contributions whose conditions permit these uses.
These remain funding targets until confirmed through agreements or contributions under their respective conditions. Including them in the plan does not make the funding available.
Assign responsibilities clearly: program staff define outcomes and delivery requirements, finance verifies costs and coverage, resource development manages funding opportunities and relationships, and leadership approves decisions within established authority.
8. Review Progress and Act When Plans Fall Behind
Monitoring needs a limited set of indicators that support decisions, such as:
| Indicator | Purpose |
|---|---|
| Confirmed funding for each priority compared with its gap | Identify what is covered and what still requires work |
| Actual cash receipts compared with the dates funds are needed | Detect delays that affect delivery |
| Development costs compared with the approach’s budget and results | Assess whether to continue or adjust |
| Progress of qualified opportunities | Track movement into applications, negotiations, or agreements |
| Renewed and continuing support, where applicable | Assess whether relationships can support ongoing needs |
Distinguish between funding targets, submitted applications, confirmed agreements, and cash collected. Each has a different meaning.
In the example, if training expansion funding is not confirmed by the decision deadline, expansion should not begin on the strength of applications still under review. The organization should review the delivery scope, explore a phased arrangement, or postpone the unfunded portion.
Use findings from funding concentration and disruption risk reviews to adjust choices and commitment limits, without recreating a full risk plan within every funding approach.
A Strategy Your Organization Can Use
The intended result is a clear document connecting each priority with its cost and funding gap, the selected funding approach, the reason for choosing it, its development budget, its accountable owner, and the decision deadline.
The board or authorized body approves the direction, budget, and acceptance limits in accordance with the organization’s governance arrangements. Management turns these decisions into action and reviews them as circumstances change.
A resource development strategy succeeds when it helps the organization focus its efforts, secure resources when needed, and protect commitments when expectations are not met. It should enable the organization to explain every funding decision: which priority it serves, what it requires, and how success will be assessed.
