MSI Grants

ELIGIBILITY FOR GRANTS

The MSI is designed to support strategic partnerships. We define strategic partnerships to include: nonprofit mergers, acquisitions, back office collaborations, joint ventures, and other long-term or permanent programmatic alliances.

• The proposed strategic partnership must be intended to strengthen the applicant’s effectiveness in fulfilling its mission, including the promise of improved services and outcomes for the applicant’s constituents.
• The applicant must be a Chicago area-based nonprofit 501(c)(3).  Based upon the current funding sources for the grants, consideration will be given to applicants in Cook, DuPage, Kane, and Lake counties.
• The applicant must be exploring or implementing a nonprofit merger, acquisition, back office collaboration, joint venture, and other long-term or permanent programmatic alliance.
• The applicant and final entity that results from the partnership must be nonprofit organizations.
• Applicants with annual budgets of $10 million or less will receive priority consideration. The Funders Committee will consider grants to larger organizations that demonstrate need.
• The proposed strategic partnership should promise greater effectiveness or efficiency of work in the public interest.

TYPES OF GRANTS

We make three types of grants:

Pre-Exploratory Grants

• These grants are for an organization seeking to assess its readiness to engage in a strategic partnership or for multiple organizations needing to assess their preliminary compatibility or define their goals prior to exploring a formal partnership.
• These grants are often used for single-organization assessments or for the cost of a facilitator, space, and food for a meeting(s) with the key decisionmakers of multiple organizations.
• The maximum amount available for a pre-exploratory grant is $5,000.

Exploratory Grants

• These grants are for two or more organizations engaging in good faith negotiations regarding a strategic partnership.
• These grants are often used for consultants to assist with negotiations, for outside financial or facilities experts to assist with due diligence, or cultural assessments.  Due to our strong partnership with the Chicago Lawyers’ Committee for Civil Rights (see “MSI Resources”), MSI grants cannot be used to cover legal fees.
• Before receiving approval to apply for this grant, organizations must have:
  1. evidence of support from the boards of all the organizations; and
  2. scopes/estimates from all consultants or vendors.
• These grants range from $5,000 to $75,000.

Implementation Grants

• These grants are for partnerships that have been consummated or finalized.
• Before receiving approval to apply for this grant, organizations must have:
  1. final agreement between the organizations; and
  2. scopes/estimates from all consultants or vendors.
• These grants will cover the one-time costs of implementing the partnership and are often used for donor database integration, technology integration, rebranding, a new website and/or logo, cultural integration, directors and officers tail insurance, moving costs, and closing out contracts or leases for property or equipment.
• These grants range from $5,000 to $75,000.

Organizations may apply for the grant most appropriate for where they are in the partnership process, and an organization may apply eventually for all three types of grants. The maximum amount that may be awarded is $75,000 across all the grant types, and the average grant is just over $20,000.

SELECTION CRITERIA

Grant awards are determined by the MSI Funders Committee based upon the criteria below.

• The grant will play a material and catalytic role in the exploration, design, or successful completion of the proposed strategic partnership.
• The strategic partnership project proposed for funding is likely to go forward.
• The strategic partnership project proposed for funding will serve the public interest and the mission of the organization.
• There is alignment of mission among the applicant and proposed partner(s).
• The applicant and proposed partner(s) are committed to the long-term success of the strategic partnership.
• The project is likely to meaningfully increase the capacity, service delivery, effectiveness, and/or financial health of the nonprofit(s) involved.
• The applicant and proposed Partner(s) have engaged in a thoughtful pre-planning process.
• If the applicant or the proposed partner(s) use of the grant is for the hiring of a consultant, there is a well-conceived scope of work.
• The budget relies upon reasonable assumptions, including projected expenses and timeframes.
• The applicant and proposed partner(s) are contributing financial resources according to their ability to do so.
• The proposed strategic partnership is likely to be sustainable over time.

If funding is being requested for implementation:  

• There has been formal board approval for the strategic partnership by each organization.
• There is a formal written plan detailing the scope of the strategic partnership with clear implementation steps and pre- and post-repositioning budgets.
• There is an agreed-upon, written plan to evaluate the success of the strategic partnership.

MSI grant funds are not available for:

• Strategic partnership projects that already appear to be on track and well-funded.
• Any transaction involving only one organization (e.g., internal reorganization/restructuring) or any short-term activity (e.g., organizing a conference in partnership or working together on an informal basis).
• Program-level only collaborations that do not involve a fundamental shift in the applicant and/or proposed partner(s) business model (e.g., a nonprofit providing afterschool programming is not eligible for a grant because it “works” with a school)
• Staff time, ongoing programmatic and operational costs, or capital costs of the applicant or proposed partner(s).

GRANT AMOUNTS AND USE

Grants will be made on a sliding scale from $5,000 to $75,000. Most grants awarded will be for less than the indicated maximum dollar amount. Grants may be used to pay the necessary one-time, out-of-pocket costs incurred in exploring or implementing a strategic restructuring. Exploratory grants will generally be smaller than implementation grants and be awarded for strategic planning and consulting, though they may also be awarded for other purposes. Implementation grants may be awarded for a wide variety of purposes, including merging technology systems, closing out contracts or leases for property or equipment, human resources, cultural alignment of the applicant and proposed partner(s), rebranding, and printing new collateral materials.