Fund the Mission, Not the Project: Rethinking Revenue Funding for Non-Profits

The world of non-profit funding has long been locked in a strange place. On the surface, it looks functional. Funders ask for innovative, ground-breaking projects, and non-profits, eager to keep their vital services alive, scramble to reframe their work to meet those expectations. It’s an exhausting and, frankly, disingenuous cycle. We all know the reality: non-profits often ask for support to keep their core services running, but the language of "innovation" is forced upon them.

In my work, I’ve seen this happen time and time again. Charities, and organisations doing incredible work for their communities, are forced to repackage their needs into a shiny new project just to satisfy the terms of a funder’s grant requirements. Why are we still playing this game?

It’s clear to me that the way we think about funding non-profits needs to change. Nothing is wrong with funding innovation when it's needed, but more often than not, what non-profits need is not another new project. They need reliable, unrestricted revenue that allows them to do the work they’ve already proven is effective. They need the freedom to allocate resources where they know they’re needed most, without having to constantly justify or pivot to meet a funder’s project-based expectations.

Why Project Funding Fails Charities

The main issue with project-based funding is its restrictions. When funders earmark money for specific projects, they inadvertently limit a non-profit’s ability to respond flexibly to the evolving needs of their community. A funder might say, "We’re supporting this specific initiative," and on paper, that sounds sensible. But on the ground, where non-profits operate day in and day out, things are rarely that straightforward.

Here’s what often happens, a charity identifies a gap in service, an urgent need that requires immediate attention, but because the funding is restricted to a particular project or outcome, they can’t reallocate the resources to address it. The result? The charity either pushes forward with a project that doesn’t match the immediate need or, worse, they turn away people who need help because they lack the unrestricted resources to serve them.

What non-profits truly need is the ability to adapt, to use their funds where they’re most urgently required. Whether it’s covering core operational costs, expanding their existing programmes, or investing in long-term sustainability, non-profits understand where the gaps are and where the money should go.

The Problem with Constantly Chasing Novelty

Another major flaw in project-based funding is the pressure to create something new, something novel, to stay competitive for grants. This encourages "forced innovation." Non-profits feel they have to come up with fresh projects not because those are what their communities need, but because those are what funders are willing to pay for.

The problem with this is that it often leads to unnecessary growth or new programmes that divert attention and resources from the work that already works. Charities that have built meaningful, effective services shouldn’t be forced to reinvent themselves every time they apply for funding. If a programme is delivering measurable, impactful results, why not just fund it directly?

This endless cycle of creating new projects also leads to mission drift. When organisations stretch themselves thin to fit the latest funding trends, they risk losing focus on their core mission. The pressure to constantly offer something "new" can pull non-profits in directions that don’t align with their long-term goals or the needs of the communities they serve. It’s a diversion of energy, talent, and time that could be better spent focusing on what already works.

The Case for Unrestricted Funding

So, what’s the solution? It’s simple: fund the mission, not the project. Give non-profits the unrestricted funding they need to allocate resources where they will have the greatest impact.

Unrestricted funding allows non-profits to invest in their long-term sustainability, build capacity, and meet community needs as they arise. It gives organisations the flexibility to respond to emerging challenges without having to craft a new project every time. And, most importantly, it shows trust.

When funders provide unrestricted revenue, they’re saying to non-profits: "We trust you. We believe in your mission and we trust you to know what’s best for your organisation and your community." That trust is transformative. It empowers organisations to focus on outcomes, on the real, tangible changes they’re making in people’s lives, rather than forcing them to perform for project-based grants.

Unrestricted funding also allows non-profits to think strategically. Instead of constantly looking for the next project, they can focus on scaling what works, improving operational efficiencies, and building the infrastructure they need for sustainable growth. It frees them from the constraints of short-term project cycles and gives them the room to pursue their long-term vision.

The Future of Funding: Partnering for Impact

In my experience, the most effective partnerships between funders and non-profits are those built on a shared commitment to outcomes, not outputs. Funders should see themselves as long-term partners in the success of the organisations they support, not as gatekeepers holding the keys to restricted funds.

To do this, we need to move away from the traditional model of project-based funding and toward a model that prioritises unrestricted, mission-aligned support. This doesn’t mean eliminating innovation, it means allowing non-profits the flexibility to innovate when it makes sense, rather than forcing it for the sake of securing funding.

It’s time for funders to embrace the idea of long-term, unrestricted support. This is how we build strong, resilient non-profits that can weather the ups and downs of economic and social change. It’s how we ensure that the organisations doing the most important work aren’t constantly chasing the next shiny project but are instead focused on the outcomes that matter.

Funders have an opportunity here. A chance to invest in the future of the non-profit sector in a way that truly makes a difference. By providing unrestricted revenue, they’re not just funding the work, they’re funding the mission, the vision, and the long-term success of the organisations they support.

Time for a Shift in Thinking

For far too long, non-profits have been forced to play a game that doesn’t serve them or the communities they work with. The constant pressure to repackage ongoing work into "new" projects is draining resources and energy that could be better spent on delivering impact. It’s time to break this cycle.

Unrestricted funding is the key to real, sustainable change. It allows non-profits to operate with the flexibility and trust they need to meet the challenges of today while preparing for the opportunities of tomorrow. It’s time to stop funding the packaging and start funding the work, the real work that transforms lives and communities.

Let’s challenge ourselves to rethink how we approach non-profit funding. Let’s stop flirting with the issue and start trusting non-profits to do what they do best: deliver impact.