In the nonprofit world, a letter of inquiry (LOI) is a first formal request to a funder.
Don’t be lured into thinking that an LOI “is just a letter” and therefore easier to write because it is shorter than a grant proposal. It’s no ordinary letter.
An LOI is a heavy hitter. It’s a mini-proposal that distills your work and your specific project into 1-3 pages. If successful, your LOI will earn you the opportunity to submit a full grant proposal.
A letter of inquiry is a lot like an audition. (More on this comparison.) If you drop the ball here, you won’t get to advance to the next round. But do a good job with your letter of inquiry and you’ll get the opportunity to move on to the next step.
And as with an audition, preparation is the key to success.
First, let’s lay down some groundwork.
Note that a Letter of Inquiry is different than a Letter of Intent.
As the name suggests, a Letter of Inquiry poses a question from a nonprofit organization to a funder, asking “Are you interested in learning more about our project?” The writer is inquiring about the funder’s interest.
A Letter of Intent, on the other hand, is an agreement that summarizes the terms of a deal between two parties before the final legal agreement. The letter outlines the intentions of both parties. Two businesses sign a letter of intent to conduct operations together. A student athlete signs a letter of intent to play her sport at a university.
(As a side note, some freelance writers refer to a prospecting letter as a letter of inquiry. But here, I’ll keep the LOI term in the grant writing space just to make things simpler.)
While not every funder requires an LOI, increasingly it’s becoming more commonplace in the grant making process. Yes, an LOI adds a step. But in the long run, LOIs save everybody a lot of time.
By using an LOI as a screening, the funder can tell within two or three pages whether or not to request more information from you. It’s a step that saves time because the funder needn’t pour through long applications that are not relevant to its areas of interest.
An LOI has advantages for you, too. It allows you to submit a shorter application on the first time around, saving time and expense. When the funder comes back to you and requests a full-blown proposal, you’ll have already completed much of the background concepting and a good part of the writing. Plus, in writing an LOI you’ll gain clarity about your project because you’ll have to distill the need and your solution into a very tight space. You can get valuable feedback from your LOI from the funder which you can use to hone your proposal before final submission. And once you’ve submitted an LOI you are added to the funder’s mailing list – meaning that you will be among those notified when the funder sends out a funding opportunity.
The purpose of your LOI is to show the funder whether or not your project is potentially a good fit for its goals.
So prepare and write your LOI with mega amounts of care, always keeping your funder front and center in your mind’s eye as you write. She is your “audience.”
Before you dig in to write the LOI, make sure the funder is a good fit for your project. Study the website and eligibility requirements. Search the funder’s past 990 forms (tax forms, filed publicly, which provide an overview of the funder's activities) to find out what kinds of projects the funder has supported and how much it has awarded to each.
Ask yourself these questions:
You might draw some of the elements for this LOI from a grant proposal that you have already written, even one that may be already partially funded. Or you may need to put together elements for a grant proposal for the first time. (Here's a list of 7 key grant proposal elements.)
Gather your organization’s identity content, statement of need, your target population, description of your programs, recent program outcomes, your methods of program evaluation, a list of collaborators, and a list of current funding sources.
And while you’re at it, assemble grant application attachments including your organization budget, IRS nonprofit status letter, financial audit, board listing, and other requirements (check this list.)
I like to keep all of these content elements in files which I update regularly so they are at my fingertips when I write an LOI or a full grant proposal.
Clarify your project request before you write. Use this checklist:
Here’s a template to help you clarify your ask:
I am writing on behalf of [name of your organization] to request [grant amount] from [name of funder] to support [name of project], which will [name quantifiable objective].
[Name of client] is a good example of who we serve. [Insert her success story here.]
Some funders request an LOI in letter form. Others accept submissions through an online portal with fields for different elements. Each funder sets specific formatting and submission instructions. Make sure you follow them to the letter. Otherwise, your LOI may be eliminated merely on the basis of mechanics, rather than content. Use this checklist to check your formatting against the funder’s preferences.
Remember the purpose of your LOI? It is to get the green light to submit a full grant proposal. Your letter should make the case that your project is a good investment for the funder.
Some funders request specific information in your LOI. Others don’t. Regardless, you need to identify the problem or need your project meets, why it’s crucial that it be addressed, and how your project is THE solution to that problem. Be sure you your letter includes the following.
First paragraph (Executive Summary)
Tip: Break up this information into separate paragraphs. You can use subheads if space allows.
Most LOIs are unique from other letters in that they do not include a P.S.
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