Tips for Widening Your Funding Net

Each organization should come up with its own variations on these, but some rules of thumb — or what Adams called a "reality check" — for diversifying income streams include:

• Have at least four or five different types of funding sources.
• Between 30 percent and 50 percent of income should come from individuals.
• With the exception of individuals and earned income, no single source of funding should exceed 25 percent of your annual income.
• Seven percent to 15 percent of an organization's annual income should come from businesses/corporations.
• Earned income/nonprofit enterprise should make up 10 percent to 15 percent of your annual income.
• Special events should generate 10 percent to 15 percent of your annual income.
• Grants from private grantmakers should make up about 5 percent to 10 percent of your annual income.

After you have developed the pie chart and created a reality check sheet, do an income source assessment where you itemize the strengths and weaknesses of each income source and talk about ways to improve it.