|The following case study comes from Ashoka's booklet Creative Strategies for a New Era - South African NGOs Mobilise Local Resources, written by Fazila Farouk and edited by Lisa Cannon.|
Situated in the North West Province, The Greater Rustenburg Community Foundation (GRCF) is a community based grantmaking institution. It is one of ten community foundations forming part of a novel pilot programme established by the South African Grantmakers Association (SAGA). Working within a specific geographic area, the GRCF secures endowments from and disburses grants to institutions that are restricted to its region.
Set up an investment fund
In order to fund its grantmaking programme, the GRCF has established a permanent investment fund (PIF). The capital collected for the fund is invested through asset managers who are allowed to invest twenty percent off shore, i.e., out of the country. The GRCF will start making its first grants in the second half of 2001. No more than seventy-five percent of the revenue generated from the PIF will be used for grantmaking. The balance will be split between re-investment and covering the operating costs of the community foundation.
A resource mobilisation sub-committee, comprising selected members of the GRCF's multi-skilled board of trustees, is responsible for building up the revenue. Their multi-pronged strategy includes fund raising from donor agencies, corporate partnerships, entering into partnerships with other NGOs and establishing a 'Bequests Programme'. This strategy also creates various investment options for likely contributors. These include, but are not limited to, unrestricted donations, designated funds (donations to support a specific community organisation, project or field of interest) and named funds (naming a fund after a donor).
As a way of attracting larger donations, the GRCF places restrictions on the type of funds people can invest in depending on the size of their grants. For benefactors to have a say in the way money is invested, they must make a grant greater than R5,000. Donations smaller than this amount are automatically allocated to the unrestricted fund.
Mobilise community resources
The modest seed capital for the PIF was secured from board and community members at a local fundraising event. Members of all community structures attended the event where some made written pledges as small as twenty-five cents. Total community contributions came to seven thousand Rand. An additional one thousand Rand from GRCF's board members raised the total seed capital to eight thousand Rand and set the stage for attracting larger donations, as large as 250 thousand Dollars.
Establish income-generating partnerships
Also at the community level, the GRCF enters into partnerships with other NGOs. Local NGOs deposit funds into the PIF earning returns on their portion of the investment. The GRCF charges a five percent handling fee for this service. Of this five percent, half is re-invested and the balance is allocated to the operating budget of the GRCF.
Acknowledge the support of donors
Much of the GRCF's success is based on quality relationship management. The GRCF hosts a monthly function, viz., the Conversation Desk, which is targeted at new and potential donors. After a brief GRCF presentation, new donors are acknowledged and celebrated for their contributions, while an appeal is made to potential donors for their support.
Set up a network of friends
The guest list for the Conversation Desk is carefully compiled to ensure that people who attend are not just rich philanthropists but also ordinary citizens wishing to make a social contribution by befriending the GRCF. Members of the community who have relatively less disposable income contribute through volunteer work and by making modest financial contributions. For example, some people donate as little as fifty Rand per month through debit orders on their personal bank accounts. Three thousand Rand has been raised in this manner and the total increases on a monthly basis.
For its Bequests Programme, the GRCF has established a firm friendship base with local bankers and lawyers who work closely with clients drawing up their wills. As a result of the advice offered by these agents, some prosperous community members have bequeathed part of their wealth to the GRCF.
The GRCF is leading the community foundation pilot pack in resource mobilisation. It has already secured one million Rand for its annual budget which merely stands at R700,000. The surplus will be ploughed back into the PIF. The most successful GRCF fund is the designated fund, at 35,000 Rand it hasn't attracted the most money but it has managed to attract the highest number of donors. The GRCF has found that people are more inclined to contribute to a cause that they are passionate about.