You may be noticing that there are many foundations asking for an LOI before requesting a full grant proposal. A funding source also uses an LOI to determine if applicants align with their vision mission.
LOI: Letter of Intent, Letter of Interest, Letter of Inquiry
An LOI should be thought of as a mini-grant proposal where you hit each of the points generally required in a full proposal. It is your one or two page elevator pitch that needs to include, very briefly the organization’s background, mission and capacity, needs, goals, objectives, activities, evaluation, and budget. Your organization’s contact information should be checked and rechecked for accuracy.
Asking for an LOI can help the funder to weed out organizations that are not a good fit or appropriate to receive their offered grant. Additionally, organizations also use the LOI to assess how much staff is needed in order to review the upcoming proposals. An LOI is a non-legally binding document that includes:
- an introduction to your project,
- contact information at your agency,
- a description of your organization,
- a statement of need,
- your methodology and/or an achievable solution to the need,
- a brief discussion of other funding sources,
- as well as a final summary.
Your LOI needs to demonstrate your passion. An LOI can be more difficult to write than a full grant proposal because of the limitations of space. Although foundations usually provide an outline for the LOI, we hope that the following tips will help you successfully win grants!
11 Tips to Help You Write Your LOI
- Keep it short.
The LOI should be a brief, one-page, informative letter that summarizes your ultimate full proposal. There are times, however, when it can be as long as three pages.
- The structure of the LOI is a business letter.
Therefore, write the LOI on business letterhead. Also, be sure that your company’s address appears on the letterhead or add it to the letter on the right-hand side. The recipient’s address should appear on the left-hand side of the paper.
- It is important to use the specific name of the recipient.
It is best to avoid general terminology such as, “Dear Sir” or “To Whom It May Concern.”
- The opening of your LOI might be the most important part of your letter.
It should be a concise, executive summary that provides enticing information to inspire the reader to continue. Include the name of your organization, the grant you are applying for and/or the amount of money you are requesting as well as a short description of the project involved. You should also include how your project fits the funder’s guidelines and funding interests.
- Next, give a brief history of your nonprofit and its programs.
There should be a direct connection made from what you currently do to what you want to accomplish with their funding. Include a description of your target population and geographic area. It is wise to incorporate statistical facts about what you are doing and hope to do as well as specific examples of successes and needs.
- Elaborate on your objectives.
How do you plan on using the funding to solve the problem? Describe the project succinctly. Additionally, include major activities along with the names and titles of key project staff.
- Give a brief outline of your finances.
If you are requesting funding from other sources, mention this in a brief paragraph. In addition, include any funding already secured as well as how you plan to support the project in the future.
- Briefly summarize your goal.
Note that you are open to answering any further questions. Also, thank the funder for his consideration of your organization.
- Don’t go too overboard.
You may attach any additional forms which are helpful to present your information. However, keep in mind that this is an LOI and not a full proposal.
- Double-check your letter before submission.
Review the given guidelines for the LOI to assure that you have met all of the funder’s requirements. Failing to include all requested information can cause your LOI to be disregarded.
- Keep it professional.
When signing the LOI, also make sure to use proper business salutations such as “sincerely” or “respectfully.” It is best to avoid an overly friendly closing.
Most importantly, be meticulous in following the directions provided by the funding source. Think of an LOI as a “pre-proposal.” If the funding source likes what they read, it will help your organization to get noticed. Especially, if you’re reaching out cold to a foundation without an established relationship, then an LOI can be a great way to introduce yourself. Now, sometimes an LOI is mandatory, in which case, it will be stated in the guidelines of the grant. However, more often than not, an LOI is not mandatory but strongly encouraged.
Discover free grant resources available online to help with your grant application. You can view sample grants, funding documents, grant application toolkits, and find legal support to help you get started.