The power of micro grants

The demands of society are diverse, and so are the roles of foundations. There should be foundations making substantial grants and undertaking the bulk of grant funding. But there should also be foundations focusing on micro grants.


The ideas behind micro grants


When talking about the ideas behind micro grants, the first thing is to understand that people matter. The team of a charity, the potential of its founder and core members, and the impact they are capable of creating are all highly valued by micro-grant foundations. Taking that into account, foundations should be cutting unnecessary procedures to suit the charities’ needs better. 


Second, micro grantmaking should be localized, taking account of local conditions. The funding should be on-time, flexible, and effective. Besides funding, foundations can promote cooperation between local charities, bringing more resources into charitable projects. 


The characteristics of micro grants


Micro grants are, by definition, small amounts of money used to fund charitable projects or organizations. When making micro grants, apart from setting the amount between 30,000 and 50,000 RMB ($4,000 to $7,000), foundations should also focus on the flexibility of funding, balancing social demands and impact, to support charities in achieving their ideals and values. 


In this process, micro grants emphasize trust and cooperation, treating NGOs as partners on an equal footing. As previously mentioned, foundations should spend time listening to a charity’s plans and status of development and understanding the local situation.


Meanwhile, people making micro grants need to be able to identify problems and risks and communicate them to their partners to help them clarify their goals and position. But at the end of the day, the decisions should still be made by NGOs. 


Another characteristic of micro grants is that they need more branding to be seen by more people and thus gain more public support for the charitable projects they fund.


The practice of micro grants


Fujian Zhengro Foundation has been advocating micro grants since its establishment in 2013. It has summarized four main approaches for micro funding to maximize its impact.


The first is to support start-up NGOs and projects. Foundations need to emphasize projects with grassroots initiatives, diversity, and creativity.


Secondly, foundations should focus on potential, specifically on charities in second or third-tier cities, projects in new areas, and communities.


Thirdly, foundations should advocate the integration of local resources and local foundations to support the development of regional charitable organizations.


Lastly, different foundations can form a pool of joint funds to support projects and insure against risks.


Through years of practice in the micro-granting field, the director of Zhengro Foundation, Wu Junjun, emphasized the importance of respecting local conditions, respecting diversity, emphasizing grassroots organizations, cultivating talent, and focusing on scientific, professional, and institutional approaches.