Guidebook on Alternative Funding Models

In Africa, many civil society organizations (CSOs) are heavily reliant on donor funding, which has been decreasing due to shifting donor priorities over the last decade. To achieve sustainability, CSOs must seek alternative funding sources, but face numerous challenges such as restrictive government regulations, poor economic conditions, a lack of local philanthropic culture, competition, and inadequate skilled labor. Additionally, internal issues like organizational culture, management capacities, governance structures, and financial planning also hinder financial sustainability. Various stakeholders have adopted different strategies to overcome these challenges, with revenue diversification being a key method. Combining external and domestic funding sources, including donor aid, consultancy, social enterprises, for-profit subsidiaries, private sector partnerships, microcredit, and social investments, can help CSOs maintain financial viability. This guidebook aims to assist CSOs in exploring and implementing suitable financial models, emphasizing the importance of conducive factors for financial sustainability and development objectives.