The Letter of Inquiry (LOI): Templates and Best Practices

What is an LOI and Why Funders Use Them

A Letter of Inquiry is a brief (1-2 page) preliminary application used by many foundations to screen proposals before inviting full applications. Think of it as a "pre-proposal."

Why funders use LOIs:

• Reduces funder workload (they review 50 LOIs instead of 50 full proposals)
• Filters out poor-fit applicants early
• Helps them identify promising opportunities to fund
• Speeds up their decision-making

Why nonprofits should embrace LOIs:

• You only write a full proposal if invited (saves time)
• If your LOI is rejected, you get feedback and can improve
• LOI success rate is typically 30-40% (higher than full proposal success at 15-25%)
• An LOI takes 2-3 hours; a full proposal takes 20-40 hours

LOI Structure and Components

Standard LOI Length: 1-2 pages single-spaced (roughly 250-500 words)

Required Components (Check funder guidelines first):

• Executive Summary (1 paragraph) — What you're asking for and why
• Statement of Need (2-3 paragraphs) — Why does the problem exist? What's the evidence?
• Project Description (2-3 paragraphs) — What will you do? Why will it work?
• Goals & Outcomes (3-5 bullet points) — What will change as a result?
• Budget Summary (1-2 sentences) — How much are you requesting?
• Closing (1 paragraph) — Invitation for next steps

LOI Template

[YOUR ORGANIZATION LETTERHEAD]

[DATE]

[FUNDER NAME]
[PROGRAM OFFICER NAME]
[ADDRESS]

RE: Letter of Inquiry – [PROJECT NAME]

Dear [PROGRAM OFFICER NAME]:

Executive Summary
We are seeking $[AMOUNT] from [FOUNDATION NAME] to [SPECIFIC ACTION] that will [SPECIFIC OUTCOME]. This project is critical because [BRIEF JUSTIFICATION]. We have served [POPULATION] since [YEAR], and this grant will allow us to [SCALE/IMPROVE] our impact.

The Problem
[SPECIFIC DATA] shows that [PROBLEM] affects [POPULATION] in [GEOGRAPHY]. For example, [SPECIFIC STATISTIC]. This creates [CONSEQUENCE]. Existing solutions are insufficient because [GAP IN CURRENT APPROACHES].

Our Solution
[YOUR ORGANIZATION] will [SPECIFIC ACTIVITIES]. Our approach is evidence-based because [RESEARCH/DATA]. We will serve [NUMBER] individuals over [TIMEFRAME]. Our past work demonstrates our capacity: [SPECIFIC PAST RESULT].

Expected Outcomes

• By [DATE], [NUMBER] individuals will [SPECIFIC OUTCOME]
• By [DATE], [METRIC] will improve by [PERCENTAGE]
• [ADDITIONAL OUTCOME]

Funding Request
We are requesting $[AMOUNT] to support [NUMBER]-month implementation. This investment will [SPECIFIC RESULT]. Our total project budget is $[TOTAL], with [X%] coming from [OTHER SOURCES].

Closing
We believe this project aligns perfectly with [FOUNDATION NAME]'s commitment to [THEIR PRIORITY]. We would welcome the opportunity to discuss this further. Thank you for considering this proposal.

Sincerely,
[YOUR NAME]
[TITLE]
[ORGANIZATION]
[PHONE]
[EMAIL]

How to Write Each Section

Executive Summary (The Hook)
This first paragraph determines whether they'll read the rest. Make it compelling. Include: organization name, what you're asking for, why it matters, what impact it will have. Example: "The Martin Luther King Community Center seeks $50,000 to expand our afterschool mentoring program, reaching 200 additional youth in East Sacramento. Last year, our participants showed 40% improvement in school attendance."

Statement of Need (The Evidence)
Use data, research, and local statistics to prove the problem is real and urgent. Don't just say "children need mentorship." Say: "In Sacramento County, 35% of high school students are chronically absent, compared to 21% statewide. Students with mentors show 64% higher attendance rates." Cite sources. Use specific numbers, not vague claims.

Project Description (The Action)
Describe what you will actually do. Be concrete. Not: "We will provide mentoring." Instead: "Each student will be paired with a trained mentor for 1-on-1 meetings twice weekly. Mentors will focus on academic support, confidence-building, and college planning. Mentees will set quarterly goals and track progress using our custom tracking system."

Expected Outcomes (The Proof Points)
Use bullet points. Each should start with "By [DATE]" and include specific metrics. Example: "By June 2027, 80% of program participants will report improved school attendance" or "By December 2026, graduating seniors will have submitted 25 college applications."

Funder-Specific Customization

Never send the same LOI to two different funders. Customize each one:

• Reference their specific priorities: "Your foundation's focus on youth leadership aligns perfectly with our mentoring approach"
• Match grant size: If they typically give $50k, request $50k (not $100k)
• Geographic match: If they fund California, emphasize California impact
• Past grant alignment: "We see you funded [similar organization] in 2024 for youth programs"

Common LOI Mistakes

Mistake 1: Too vague
Bad: "Our program helps youth succeed."
Good: "Our mentoring program increases school attendance by an average of 22 percentage points for at-risk high school students."

Mistake 2: No data
Every claim should have evidence. "This problem affects thousands of families" is weak. "In our service area, 1,247 families live below the poverty line according to 2024 Census data" is strong.

Mistake 3: Asking for wrong amount
If funder typically gives $10k and you ask for $50k, you're unlikely to be invited. If they typically give $100k and you ask for $10k, you're not asking for what you need.

Mistake 4: Focusing on need instead of solution
Spend 30% of LOI on need, 70% on YOUR solution. Funders know the problem exists. They want to know if YOU can solve it.

Mistake 5: Not addressing funder priorities
Every LOI should include 1-2 sentences showing you understand what THEY care about. "Your foundation's commitment to environmental justice resonates deeply with our work" shows you've done homework.

LOI to Full Proposal Conversion

If invited to submit a full proposal, your LOI becomes the foundation. Expand each section:

• Executive Summary → becomes your 1-2 page proposal introduction
• Statement of Need → expands to 2-3 pages with more research and local data
• Project Description → expands to 3-4 pages with detailed timeline, staffing, activities
• Outcomes → develops into full evaluation plan with data collection methods

You're not starting over. You're adding detail and evidence to what was already written.

LOI Submission Best Practices

• Submit 5-7 days before deadline (not day-of)
• Proofread 3 times for typos, spelling, grammar
• Use funder's specified format (PDF, Word, email, online form)
• Include all required attachments: organizational summary, 501(c)(3) letter, board list
• Send from official organization email address, not personal email
• Save the document with clear naming: "[ORG NAME]_LOI_[FUNDER]_[DATE]"
• Keep a copy for your records and grant tracking

LOI Success Rates and What They Mean

A typical funder receives 50-100 LOIs and invites 15-25 to submit full proposals (15-25% LOI success rate). Of those invited, 50-70% receive full funding (7-18% full funding rate).

If your LOI is rejected, request feedback. Ask: "What would strengthen our LOI for next year?" Feedback helps improve future applications.

If you're invited to submit a full proposal, you've passed the first major hurdle. Now focus on writing an excellent full proposal (see related chapters on proposal strategy).