Our experience of the social sector’s funding landscape

6 Mar

In this blog we reflect on our experiences of the social sector’s funding landscape. We share our own story in applying for funding to support the sector and share insights into other social organisations who have sought funding for their own digital transformation.

Our funding journey has at times been one of significant risk, short turnaround times and fragmented reporting approaches. Looking back, it has highlighted to us the need for more accessible, long-term and diverse funding routes for the social sector.

THE NEED FOR DIGITAL FUNDING

In recent years we’ve seen more social sector organisations begin to conceptualise digital solutions, however many still struggle with the actual implementation. Having now supported 837 organisations, we’ve spotted a key pattern; organisations are consistently impeded by limited budgets, finite resources and a lack of technical leadership.

At Dot Project we believe that digital solutions and technology can radically transform social organisations and the communities they serve. However, for this to happen effectively, we must first build up the digital resilience and confidence in the social sector.

A VISION TO SUPPORT THE SECTOR

Our vision has always been the same - to create a world where the social sector is thriving and where Dot Project doesn’t need to exist. Since the very beginning we have focused on empowering social organisations to leverage their digital capabilities, to build their resilience and to increase their impact. The word ‘project’ in Dot Project was chosen to signify our adaptability as we iterate our support alongside the changing needs of the sector and community.

In the earliest days we delivered on this vision in whatever way we could, helping organisations to put digital compliance frameworks, governing principles and new tech solutions in place. But even back then, it never felt like enough to just provide technology consulting… Every digital transformation had to start with people, incorporating the relationships that team members held with us as a consultancy and with their organisation’s technology. Only then, once we had a partnership built on trust, transparency and allyship, could we really embody technology leadership and support their transformation.

It became clear that this level of holistic support was rare in the sector. Our proposition felt unique and our principles as a cooperative meant our members were focused on delivering deep lasting impact, not profitability. However, this brought its own challenges! With no access to private sector funding, we had to turn to charity funders, carefully positioning ourselves as a support partner to their digital funding grantees. This was, and still is, difficult!

NAVIGATING THE FUNDING LANDSCAPE

In the UK, the social sector’s funding landscape is like an onion, with so many layers and different types of funding support, mechanisms and structures to navigate. This short overview of how to find funding shows how much it varies with your location, your organisation type and what you want funded. The landscape is so complex and fragmented that you can spend hours sifting through different websites to work out what’s relevant and often organisations seek specialist support to even work out where to start.

Public sector funders were our first port of call. In 2017, the year we began, the UK government added the word ‘Digital’ to the now Department for Digital, Culture, Media and Sport (DCMS). Recognising the vital role Digital should play in society, they built a clear governmental strategy to build digital skills and capabilities within organisations and communities. Much of our early work with charities was funded by DCMS in one way or another.

From here, we began researching funding that considered digital transformation at an organisational level, which was much harder to find! We found support available through Lloyds Bank Foundation, Comic Relief, and Paul Hamlyn Foundation’s 2016 Tech for Good Fund - The National Lottery Community Fund was also starting to place an emphasis on digital.

REGIONAL FUNDING

In the early years, we followed so many evolving strands of funding. Regional funding played a big part in that as we explored any funding opportunity that made sense and felt in some way aligned to our greater purpose of digital resilience.

The West Of England Combined Authority, was funding collaborations that support digital skill development across Bath, North East Somerset, Bristol and South Gloucestershire. Meanwhile, the West of England’s Council for Voluntary Services (CVS) were funding digital skills training for those driving community action.

Another key regional partner has been 3SG BaNES, a pivotal community organisation who were among the first to identify the importance of digital for social organisations. Over the years we’ve developed a mutually beneficial relationship with them, supporting regional charities and voluntary sector organisations with training, guidance and support.

CORPORATE FUNDING

Corporate funding has moved apace since we began Dot Project. Back then some organisations were donating money and staff volunteering time to support charities; though this made vital skills available within the sector, the ad hoc nature of it meant charities rarely felt sustainable change. Meanwhile, CSR activities were predominantly focusing on developing “new” tech (mobile apps, websites, bespoke solutions etc) with very little consideration for the on-going commitment, maintenance and cost.

Through the Lloyd Bank Foundation’s Enhance Programme partners can provide a range of development support, including training, consultancy and mentoring, to help charities become more digitally resilient. We have partnered on 10 projects to date, supporting charities for 3-5 days each with technology audits, moving to the cloud, selecting case management systems, and engaging IT Partners. This work has been deeply important to us, enabling us to work within a funded context to support small charities that couldn’t do the projects alone.

However, offering just a few days support over several months meant it was challenging to maintain momentum with charities. The programme felt no longer sustainable and we felt we needed:

More time for in depth alignment and connection across the charity teams
More space for charities to reflect on their own sustainability
More time to build relationships within the system we are influencing

We are hugely hopeful that the corporate funding landscape is shifting and that more funders will provide longer-term resilience funding to the charity sector. The work we are currently doing with Okta is a good example of how corporate funders can really achieve this, allowing for a deep, sustained change process. As a cyber-security business Okta seems to really understand digital resilience as people, process and technology aka a ‘tech and teams’ challenge.

“We believe digital infrastructure and capacity is a critical - an often invisible - determinate of the strength and resilience of the social sector” - Okta Social Impact report Feb 2021, pg 8

Through Okta Tech for Good funding, we’ve been able to build a programme of support in partnership with Charity Digital. This 12-month Digital Strategy Accelerator Programme enables 12 charities to create a digital strategy that works for all of their stakeholders. Okta then fund a follow-on 12 months to support organisations in embedding the strategy, with one-to-one mentoring supporting each organisation’s specific team and tech challenges.

APPROACHING CORPORATE FOUNDATIONS

We recently reviewed the strategic priorities of corporate foundations to assess where new funder relationships and advocacy could enable our work.. Based on the excellent resources from Charity Excellence Framework we identified at least 6 foundations that looked to focus on organisational resilience, capacity building or digital / technology. This process alone highlighted the complexity of this space, with many foundations specifying they will not accept inbound enquiries or unsolicited proposals.

We have felt the barriers to developing relationships with funders. Funders are somewhat reliant on organisations making themselves visible, but, if you are a small, capacity stretched organisation, this is hard. Without a significant investment in relationship building, external communications and PR it is an impossible, perpetual cycle.

ADAPTING OUR MODEL

We have always endeavoured to keep Dot Project’s model simple; being contracted by funders to either help with the design of funding programmes or to support their grantees directly.

This hasn’t worked out perfectly - matching available funding streams to our mission and the work we know is needed is difficult given the nuance, constraints and eligibility requirements of each funder. We’re often asked to kick off projects prior to contract completion, working to tight delivery deadlines with no assurance of when funding might come through.

Whilst we have been able to navigate funding roadblocks, the process has been hugely time intensive. One of our larger pivotal grants involved an 81-page contract which was (eventually) signed 4 months post awarding of the work!

We’re encouraged to deliver in good faith, taking the risk of paying staff without a guarantee of payment for our work. Inevitably, this impacts our teams, forcing a surge in activity to mobilise quickly, going against one of our founding values that we ‘build relationships, not temporary connections’. When funding is tied to financial years and dependent upon internal decision making it can take an inordinate amount of time, leaving grantees, their service users and beneficiaries suffering most.

THE IMPORTANCE OF UNRESTRICTED FUNDING

There is an urgent need to increase access to funding for the charity sector. Right now it’s desperately hard to come by and the funding that is available is often short-term or restricted to use on a specific project or area of the business.

To enable sustainable digital transformation in the social sector, funding needs to be allocated beyond ‘projects’ to actually support organisations’ long-term digital infrastructure and resilience. Funders need to become more transparent and accessible, opening their channels of communication to organisations in need. Funding also needs to be diversified and made available to wider partner organisations, like Dot Project, who can support digital transformation.

Meaningful digital change isn’t linear, it takes time and every social organisation should be able to access funding that helps them to navigate the complex world of technology in their own way and in their own time. Supporting organisations in this way is much more likely to build their capacity for self-generated income, reinvesting into the social sector and the communities they support.

What are your experiences of working with funders? Let us know what challenges you've encountered in the past and if you’ve had success in applying for funding.