How to raise funds by providing consulting and other income generating services

Written by Berhanu Demissie, Executive Director, Development Expertise Center, Ethiopia

Please describe the fundraising situation that your organisation faced

Our fundraising situation is linked to the policy that governs the civil society organisations (CSOs) and non-governmental organisations (NGOs) in Ethiopia and the funding direction that donor and governments take. In 2015, the global funding direction shifted from aid to trade, which affected our organisation’s ability to fundraise. The shift also included the need to work more with consortium partners than as individual organisations.

Why did you decide to raise funds via consulting and how did you go about doing this?

Due to the global funding situation, we faced resource limitations for our projects. This led us to think about how we could raise resources locally instead and use this change as an opportunity. We asked our donors to help build our local resource mobilisation capacity and they were happy to help us with this. We also asked one donor to fund a feasibility study to look at potential income generating activities (IGAs).

IGAs in Ethiopia are governed by trade laws and it is challenging to raise enough money to be organisationally self-sufficient. However, by mapping our skills and experience against the needs of other CSOs, the government and private companies, we found that they required a lot of assessments, training and organisational capacity development sessions. This was an opportunity for us to open a consultancy service. We also began to work more as part of consortiums.

What did you achieve?

Establishing the IGAs has helped us to see the fundraising opportunities locally. It also gave us the opportunity to become more familiar with protocols and requirements for CSOs, as well as the trade laws of our country. We turned our expertise and experience in education, jobs creation and food security into producing quality educational materials, skills training in the garment and weaving industry and fattening poultry. Later, we expanded into baseline, mid-term and end of project assessments, and business entrepreneurships. Through this we brought in income to finance other parts of the Development Expertise Centern (DEC). We have also widened our networks and collaborations with other CSOs and have undertaken joint resource mobilisations and project implementations.

What did you learn from this experience?

One of our big learnings has been that by diversifying our sources of funding and looking for opportunities, we will be able to continue our project and reach beneficiaries. We also learnt that you need to have clear business model that links your IGAs to those who may need your services. As the IGA governance and CSO governance is different, there is a need to have experienced and committed people and expertise in both areas of work. Local resource mobilisations are possible, but they grow slowly.

What are your tips for someone facing the same or similar issues?

  • Know your local context including opportunities that may exist
  • Know your country’s rules and regulations – this is essential and should be a priority
  • Develop a clear business model and assign a committed, passionate and experienced expert with holistic skills
  • Work on establishing and strengthening networks.

Would you like to tell us more about this challenge your organisation faced? 

It is not easy to be successful as a consultancy when your experience is on project design and implementations in the not-for-profit field. The IGA/consultancy environment is a very different context and in our context also governed by a different law.

When we first started as a consultancy, one of our experts in CSO work was interested to work in the IGA but found the work environment and the different laws governing a for-profit business too different. So, we found there was a need to find an expert from the IGA/private business sector to run the business for us. The return from the IGA including consultancy services is small at the beginning and there is a need to adjust the expectations about what income these activities can generate.

Berhanu Demissie, Executive Director, Development Expertise Center, Ethiopia

Berhanu has been working in fundraising since 2011. His expertise relates mainly to searching for calls for proposals; mapping the relevance of the calls to the Development Expertise Center’s (DEC’s) programmes, expertise and experience areas; deciding whether to apply alone or as consortium and developing concept notes and proposals. Since 2015, he has also been establishing income generating activities (IGAs) for DEC; these have included DEC providing consultancy services.