LOI 101: The Fundamentals
What the heck is a LOI?
If you’re a newbie to charity fundraising and grant writing, you may be wondering, “what the heck is a low-eye?”
If you’re an intermediate grant writer, you’ve likely heard the term but may not be sure what it stands for – letter of inquiry, letter of intent, letter of interest – so many options to choose from!
Or you could be a grant writing vet like me, who’s been throwing the three phrases around interchangeably for the last 12 years and just realized there’s one proper term – at least when it comes to sending introductory letters to charity funders.
Since even the abbreviation is confusing, consider this blog your LOI Fundamentals crash course. Read on, and I’ll answer all your burning LOI questions – what does LOI mean, why bother with an LOI, and where and who should you send it to – and share my top five things you must know before you start crafting your winning LOI to send to charity funders.
Letter of Intent vs. Letter of Inquiry vs. Letter of Interest: Are they all the same and does it even matter?
According to grant-writing expert and author Ellen Karsh, a letter of intent and a letter of inquiry are not the same thing, and yes, it does matter! She explains in The Only Grant-writing Book You’ll Ever Need that a letter of inquiry LOI is like a mini proposal in which your charity briefly summarizes your organizational mission, the need you’re addressing, the program you plan to implement, and the amount requested from the charity funder.i
A letter of intent LOI is a different type of letter altogether. It’s requested by government agencies and some foundations to help determine how many grant applications they may expect to receive so they can hire the right number of reviewers. Unlike the mini proposal that is the letter of inquiry, the letter of intent is a few paragraphs long and states a charities’ intention to apply for a grant.
If you’re wondering about a letter of interest, well, I am too! I know at least one foundation that uses the term the same way we’ve defined a letter of inquiry. I’ve also seen it called an Expression of Interest!
But focus on what we do know – a letter of inquiry is different than a letter of intent. And a letter of inquiry is what you send to grant making foundations to introduce your organization and request an opportunity to submit a full proposal. Short and sweet, it’s designed to pique their interest and leave them either writing a cheque or wanting to learn more about your charity.
L-O-Why Even Bother with a LOI?
By now, you may be wondering – why bother with a LOI? At first glance, LOIs may seem like yet another hoop charities must jump through to secure grant funding. And who wants more work – especially grant writing work!? Insert collective groan here.
So, let’s take a step back and look at the purpose of LOIs from the funder’s perspective.
LOIs are brief – no longer than two pages – making them a great way for charity funders to screen a huge number of applicants and quickly determine which organizations are most aligned with their granting interests.
In truth, LOIs are a time-saver for both charities and funders. Grant applications are long and detailed – and it’s better to know a funder isn’t aligned with your charity before investing time and energy into the grant writing process.
And here’s the great news: based on our experience at Grant Advance, once an LOI is approved, your chances of receiving a grant skyrocket to between 80-90%! So, have patience and faith with your LOIs and know it’s a numbers game – the more you submit, the more likely you are to get those game-changing grants.
How to Submit Your LOIs Like a Pro
Now that we’ve covered the what and the why of LOIs, let’s discuss where to send your LOIs and when. If you’re familiar with grant funding or already started your search for charity funders using an online grants search engine, you know most foundations don’t ask charities to submit LOIs – so how do you know when to send one and who to send it to?
Sometimes, funders issue a public call for LOIs. The call will include deadlines for each stage of the grant competition and instructions on what to put in your LOI. Follow these guidelines carefully, making sure to answer all questions (in the order asked) and noting any formatting specifications or attachments required.
But the reality is most foundations don’t issue calls for LOIs. Heck, most don’t even have a website, publicly listed phone number, or email address. In fact, 3,893 – or just over 35% – of Canadian grant making foundations, can only be contacted through snail mail!
Uncovering Hidden Funding Sources: Knowing Where to Send Your LOI
While this may seem like a roadblock, it’s actually a golden opportunity. Think of these foundations as hidden treasures because from our experience at Grant Advance, they are truly your best bet for receiving grant funding, especially if you’re a small to medium sized charity. But why? Read on…
A grantmaking foundation that keeps a low profile and has only a mailing address for contact information is almost certainly approached by fewer charities than their high-profile counterparts. And if a foundation is receiving a lower volume of phone calls, emails, and letters requesting grants, they’re usually more open to considering new partnerships.
And, this type of smaller, lesser-known foundation often makes funding decisions based on LOIs without requiring charities to submit full proposals. Now, if this doesn’t make you want to pull out your pen and start writing your rock solid LOI, I don’t know what will!
When you find a foundation that fits this description and aligns well with your charity in other areas, it’s perfectly appropriate and highly recommended to send a LOI by mail as your first point of contact.
Timing Your LOI Submission to Maximize Success
Okay, I’m going to let you in on a BIG secret on how to time your LOI submissions perfectly to maximize your grant success rate. If you follow this advice, you’ll raise the most funds possible for your organization. Are you ready?
Here it is…the best time to submit your LOI is now. I mean it. Or, as soon as you have a well-written LOI ready to go! Your goal is to get them out there as soon as you can – that’s the key to getting grants in the door.
But truthfully, except in the case where a foundation has issued a formal call for LOIs and they’ve provided a hard deadline for you to follow, there’s no best time to send a LOI because any time is a good time.
In my experience, foundations write a lot of cheques toward the end of the calendar year – September to December – but that never stopped me from submitting a LOI earlier in the year, and it certainly shouldn’t stop you.
The sooner you get your LOIs written and mailed, the sooner you’ll start seeing donations come in the door.
The Two Essential Ingredients of a Winning LOI
Before I share the secret sauce, think again about what you’re trying to accomplish with your LOI. You’re trying to convince the grant maker to believe in your vision and cause so that they will give you a grant.
And the best way to get this result is to craft a letter that employs reason to lay out a clear case for your cause while drawing from personal stories and anecdotes to evoke an emotional response.
Let me explain. It’s a proven fact that giving is emotionally driven. In my experience, the larger the gift, the more emotionally motivated. Likewise, humans like logic – we just do! Think left brain and right brain. Reason and emotion. Head and heart. It’s that simple. Those are two essential ingredients of a winning LOI.
So, craft your letter like a legal argument, each section building off the last, and appeal to the age-old art of storytelling to appeal to human emotion. You’ll make it an easy yes for the decision-makers.
Successful LOIs are also free from grammatical errors and jargon. They read seamlessly, as though you, the charity leader, are sitting in a room across from the grant-making organization, sharing your heartfelt appeal for funding face to face. Your ideal document will flow from word to word, sentence to sentence, and paragraph to paragraph logically and effortlessly.
Is this too much to ask? Don’t worry, dear charity, it’s not as hard as it sounds. And, like always, I’m here to help!
Be sure to join us next week for The Six-Step Guide to Writing Winning LOIs for Your Charity – where I’ll get into the nuts and bolts of writing a LOI, including handy checklists, top tips to guide you to success, and leading questions to get you started.
By Laura Ralph, Fund Development Advisor
Laura is a writing wizard with more than a decade of experience in higher education and medical fundraising.
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