Category: Financing & Loans

Last Thursday’s post addressed the participation of NPO staff in the fundraising process – staff other than those directly involved in development. A response to that posting suggested that there were other issues to be addressed.

Staff members as donors:

It would be a major plus for a nonprofit organization to be able to tell its constituents that all members of the staff feel strongly about the mission and are also donors. That the NPO is able to publicize that every staffer has (voluntarily) given to the best of his/her ability can only strengthen the org’s image.

It would also be a major blow to that image if the public were to learn that staff members were coerced into giving.

Many overly enthusiastic EDs/CEOs require staff to be donors. That “requirement” can and should be perceived as coercion; and, coercing people to give is highly unethical … and bad for the NPOs public image.

Ethically, it is a “given” that ALL giving is voluntary … including from the NPO staff.

Staff members as event designers/participants:

If an NPO is lucky enough to have staffers who are skilled at designing and implementing events, and those folks are willing to be involved with events … without their participation having been coerced, then that speaks well and loudly to the community of staff’s commitment to the mission.

If, however, the public was to hear that such participation was not wholly voluntary, it’s likely that the image of the NPO would suffer … as would its fundraising efforts.

Staff members as solicitors:

With the exception of those individuals who are hired as part of the fundraising staff, other staff members (ideally) should be involved in telling the NPO’s story, but should not be “required” to act as solicitors. The key word, again, is “required.”

In addition to the resentment that staff members would feel, it would be impossible to discount the impact that resentment would have on a fundraising solicitation … and on job performance. One must also consider that untrained and unwilling solicitors will never be able to solicit the “maximum gift” from a donor.

Bottom Line:
It’s not unusual for all staff members of an NPO to have some input in the design/implementation of an event – offering advice/direction based on their particular area of function/expertise.

But, an organization that “requires” staff to perform in areas for which they were not specifically hired is an organization that doesn’t mind putting its public image at risk.

And a good test of whether this kind of employee policy might or might not be ethical is to ask yourself whether you’d want to see a newspaper headline announcing that your organization coerces its employees….!!

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Have a comment or a question about starting, evaluating or expanding your fundraising program? Email me at AskHank@Major-Capital-Giving.com. With over 30 years of counseling in major gifts, capital campaigns, bequest programs and the planning studies to precede these three, we’ll likely be able to answer your questions.

Tracking

Once you begin tracking federal grant opportunities through the Federal Register (www.gpoaccess.gov/fr)) and Grants.Gov (www.grants.gov), you will begin finding grant announcements. To take advantage of these opportunities, you first must understand what you are reading.

Doing a Basic Search

Doing a basic search for grant announcements is straightforward. At both sites, you can use the “Basic Search” option to search by keyword, funding opportunity number, Catalog of Federal Domestic Assistance (CFDA) number, agency, or grant category. Browsing by category may result in hundreds of listings, which will help you understand the kinds of programs and agencies involved in a particular category of grants, such as energy or elementary education.

Deciphering Information about Federal Grants

Familiarize yourself with the language and format of federal grant listings. Here are the key components of a typical grant listing:
•  Posted date.
•  Closing date for applications. This tells you when the application is due.
•  Expected number of awards. This tells you how many awards will be
made through this grant program.
•  Estimated total program funding. This tells you how much money
is available through this grant competition.
•  Award ceiling and floor. This tells you the lowest and highest grant
budgets you can submit.
•  Cost sharing or matching. This tells you whether or not you must
contribute a certain percentage of cash or in-kind resources to your
federally funded project.
•  Description. This is a short summary of the grant program.
•  Link to the full announcement. The URL will link you to the entire
grant application package.

Taking Your Grant Pulse

Now that you have this information, you can match up your nonprofit’s program needs to a specific federal grant competition. But before you apply, you must candidly assess your nonprofit’s readiness to apply and your chances of winning a grant.

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Dr. Jayme Sokolow, the founder and president of The Development Source, Inc. helps nonprofit organizations develop proposals to government agencies, foundations, and corporations. He can be contacted at Jayme Sokolow.

A Reader Wrote: “I have been looking around your web site/blog trying to find information about the role of employees in fundraising for an NPO. I see some information about the role of board members and volunteers, but I seem unable to find anything specific about employees….”

It’s a “given” in the fundraising world that: “Everyone at a nonprofit has an impact on the organization’s ability to raise money” … even though not everyone is involved in “Asking.”

Although someone else might have the title, the CEO is also the chief development officer. S/he is the chief advocate for the organization and its mission, and should be the most knowledgeable person about how the NPO is pursuing that mission. S/he is the public face of the NPO, with the most credibility.

The CEO is (and should often be) involved in many of the major solicitations, either alone or with someone who is better suited to do the “Ask.”

Board Members, ideally, should all give to the best of their ability and should be involved in the process of identifying, cultivating and soliciting (other) major donors — but, they aren’t always wealthy, and they don’t always have wealthy friends.

I refer to “Volunteer Leaders” as the people most involved with the identification, cultivation, evaluation and solicitation of major donors. They don’t have to be board members, but they must be committed to raising (or helping raise) the needed funds.

Staff members fall into three categories: (1) Those who actually work at advancing and supporting the NPO’s development/fundraising efforts; (2) Administrative and support staff; and, (3) The program staffers who design and deliver the NPO’s services.

In the context of this posting, nothing needs be said about group #1.

The group #2 people have occasional contact with (prospective) donors, and how they treat those folks creates an impression that can/will impact the likelihood of giving.

The folks in group #3 have the most experience with advancing the mission. They design and implement the NPO’s programs, and they know the people being served. They are the best people to be describing how the donor’s money has or will impact people’s lives.

These folks don’t have to be involved in “Asking,” but they should be involved in the process of cultivating/educating prospective and current donors … ‘cause nobody can tell the story the way they can.

One more thought: Everybody should pass on to the development staff any (non-confidential) information they have that might help identify, cultivate, evaluate or solicit (potential) donors.

I hope I answered the reader’s question. If not, let me know.

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Have a comment or a question about starting, evaluating or expanding your fundraising program? Email me at AskHank@Major-Capital-Giving.com. With over 30 years of counseling in major gifts, capital campaigns, bequest programs and the planning studies to precede these three, we’ll likely be able to answer your questions.

Live auctions can have large payouts, and can be a lot of fun for the audience – especially when a bidding war on an item becomes major entertainment.

I speak from experience. Many years ago, at a VIP reception prior to an event with both a silent and a live auction, the emcee for the evening decided to offer up a special item as a preview of what was to come. The reception room was packed and once the item was announced, the bidding quickly got competitive.

It was an item I really wanted, so I was vigorously waving my bid number. Soon it came down to a tug-o’-war between me and someone elsewhere in the crowd.

The audience got into it, and started cheering, urging us on. In the end, the item was mine and I was thrilled.

Years later, I would meet people who talked about that night and what fun it was to watch the two of us in action.

Auction Basics

It takes months and months of legwork getting the items — with enough variety in both type and price to involve all the attendees. It takes a fabulous auctioneer to make the sale … at the highest prices possible. And, it takes an audience with the funds to bid up the items and stimulate the essential “war.”

It also takes a good deal of time to write the catalogue and put together the displays with proper signage and bid sheets. It’s also essential to have enough staff so that, at the end, people who have made their purchases are not kept on long lines waiting to pay and receive their items.

Successful bidders must pay and take the item at the event. Otherwise, you will find yourself taking many weeks to track people down to get their payments, and spending lots of dollars to ship the items.

Partnerships

A great way to do an auction event is to find a partner and set a theme. For one auction, we partnered with Nickelodeon and focused on children’s items at the auction. There is an endless array of possibilities. All it takes is creativity !!

So, if you ask me, when it comes to whether or not “to auction,” my answer is, “Go for it,” but be sure you have all the pieces in place.

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Have a comment or a question about creating or expanding your special event? Email me at Info@NatalieShear.com. With over 30 years in conference and event planning, we can help you turn your vision into reality.
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Have you seen Natalie’s ebook on Special Events ??

In the group of attendees for a recent class in Major Gifts Fundraising was a person identifying herself as a consultant, a member of a fundraising-consulting firm, who was shortly to be working with a client organization in the creation of a major gifts program.

This started me thinking. Who/what is a fundraising/development consultant??

My old dictionary defines a consultant as an expert who is called on for professional or technical advice or opinions.

In this context, I should think there’d be heavy emphasis on the “expert” part of the definition. The problem is that I “hear” many people describing themselves as development consultants that clearly don’t have the education/training and experience it takes to be an expert.

Folks that come from various areas “somewhat related” to development —
i.e., marketing, public relations, special events, etc, even those from totally unrelated fields, feel comfortable hanging out their (fundraising) consultant shingle.

At various luncheons, workshops and seminars, I’ve met people who have worked as volunteers and think they now know enough that non-profits should risk their financial futures on them. And I’ve met folks from other fields, and those out of work, who think that “fundraising might be good to try,” and they want to start as consultants.

So, considering the above, I get the feeling that, to protect the non-profit sector from a “bad rap” and consultants (in general) from having a negative label hung on them/us, there needs to be established some set of criteria for who can/should be a fundraising consultant.

It has been suggested that one must have some sort of “credential” to be a fundraising consultant – that the CFRE (as an example) should be required and should be proof enough that the holder is qualified to be a consultant.

Realistically, however, having the CFRE attests only to the fact that the individual has demonstrated knowledge of the basics of fundraising. That’s not the equivalent of “expert“ !!

Like trusting the health of your loved ones to a physician with an on-line degree; there are many practitioners out there in fundraising-consulting-land to whom you’d not want to trust the financial health of your nonprofit organization.

So, before I get too carried away, I’ll step back and ask, “What do you think?”

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Have a comment or a question about starting, evaluating or expanding your fundraising program? Email me at AskHank@Major-Capital-Giving.com. With over 30 years of counseling in major gifts, capital campaigns, bequest programs and the planning studies to precede these three, we’ll likely be able to answer your questions.

It wasn’t that long ago that crusty-old-direct-mail-consultants were worried that email would cut into direct mail revenue. Consistent testing and a steady stream of anecdotes indicate that’s just not true.

For the last ten years, I’ve been testing direct mail results and the impact of email messages. In one of the simplest and longest-running tests, I tested three segments of names against each other, all from the same pool of recent donors who were scheduled to receive a direct mail “house” appeal:

Group A was comprised of recent donors with email addresses who were sent an email message just before they should have received a direct mail appeal.

Group B was comprised of recent donors with email addresses, to whom we did not send the email message.

Group C was the rest of the list – recent donors for whom we had no email address on file.

The email message that was sent to the people in Group A was only a brief note saying “I have just mailed you a very important letter. It’s in a white business envelope with the words “[Insert envelope teaser copy here]” across the top. Please look for it.”

That’s it. No link to give, nothing else. (I plan to test an upgraded pre-email message with an actual photo of the outer envelope).

Group A had a direct mail response rate that was about 10% higher than Group B. No surprise. The pre-email probably resulted in more recipients somehow sorting that appeal envelope into the “open” pile rather than the “recycle” pile.

But Group B, however, had a response rate that was in turn about 10% higher than that of Group C. Why? They received the same package at the same time, and neither had the advantage of the email message. They were from the same list of recent donors. Our theory? They had been well cultivated with email newsletters for the past several months, and that increased their response to this appeal.

At a recent nonprofit conference, a major nonprofit announced similar findings: when they added email messaging to support direct mail, they got 5.7% response and a $29.25 average gift in the mail, v 3.65% and $21.12 from those who didn’t get the email — plus they got $4000 in online gifts!

Would a post-email message improve direct mail results as much, or more, than a pre-email? Would both do even better? Ah, now you’re thinking.

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Rick Christ has been helping nonprofit organizations use the internet for fundraising, communications and advocacy since 2009, and has been a frequent writer on the subject. He delights in your questions and arguments. Please contact him at: RChrist@Amergent.com or at his LinkedIn Page

The Fundraising Appeal

A few months ago, a NYTimes article suggested that donors are being highly selective in deciding whose name goes on the payee line of their checks. Non-Profit Organizations, therefore, must do all they can to get donors to want to give to them.

At most times, especially in an economically “troubled climate,” donors want to be sure that their gifts are going to support/help people in need. NPOs must be sure, therefore, that their marketing, their literature and their solicitations all focus on the people in need … not on the needs of the NPO.

And, in addition to talking about people and their needs, the best wording can also talk about how the NPO is helping those people, how cost-effective it is in its operations, and how a donor’s gift to the NPO can/will help so many people.

Major Gifts Should Be A Priority

It occurred to me, following a recent conversation with the executive director of an NPO on the brink of closing its doors … that many people may think of major gifts as those you pursue after you’ve done all of the other fundraising.

The language that the E.D. used was to the effect that, “we have to be sure we can stay in business before we can think about going after major gifts.”

I would hope that I never said anything to any client, in any of my classes or postings, that would suggest that !!

I’ve often mentioned that many (start-up and ongoing) NPOs can (and do) create major gifts programs from scratch, and can (and do) operate quite nicely on that income.

Certainly, in tough economic times, NPOs should be making every effort to raise funds by whatever (legal/ethical) means possible … keeping in mind that one major gift can (and often does) exceed what is raised via other methods.

Any NPO not actively/vigorously working on obtaining major gifts is doing a disservice to the people it serves … or could serve.

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Have a comment or a question about starting, evaluating or expanding your fundraising program? Email me at AskHank@Major-Capital-Giving.com. With over 30 years of counseling in major gifts, capital campaigns, bequest programs and the planning studies to precede these three, we’ll likely be able to answer your questions.

The Catalog of Federal Domestic Assistance …

That describes over 500 grant programs (awarding hundreds of billions of dollars), is a great place to get an overview of every grant program administered by the federal government.

The CFDA provides a full listing of 2,110 federal programs available to state and local governments, Indian tribal governments, territories and possessions of the United States, nonprofit organizations, and individuals.

The top five grant programs by Department are:
• Health and Human Services (417).
• Agriculture (229).
• Interior (217).
• Education (170).
• Justice (125).

On the CFDA Web site, you can use the search engine to identify grant programs by agency or by general topic; and, grant programs on that site are classified as either:

A formula grant… which is federal money distributed by a state agency
— based on some kind of formula.

A project grant… that comes directly from a federal agency.

The Federal Register

(www.gpoaccess.gov/fr) is a major resource for specific information about available grants. Published by the National Archives and Records Administration, this is a daily publication of the rules, proposed rules, and notices about grant programs of federal agencies that is searchable by date of announcement or by topic.

Although the Federal Register is very wordy, there is a very good reason to use it. The advance notices you can receive about federal grant opportunities will enable you to begin preparing your grant application before the official notice appears.

Grants.Gov

Perhaps the handiest way to find grant opportunities is through this website (www.grants.gov), which lists all current and upcoming grant opportunities by agency, number, and by topic. Clicking on a listing leads you to the grant guidelines, deadlines, eligible applicants, the amount of money available, and the estimated number of grants to be awarded.

For example, under “family planning” there are over 100 federal grant and contract opportunities in the area of contraception, family planning services, HIV/AIDS, and STIs.

Become a Tracker!

Once you have identified federal grant programs of interest, you should begin monitoring them (on a daily basis) in the Federal Register or Grants.Gov. That’s the only way you will know when grant funds become available. A successful application often depends on how ready you are to pounce on a grant opportunity.

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Dr. Jayme Sokolow, the founder and president of The Development Source, Inc. helps nonprofit organizations develop proposals to government agencies, foundations, and corporations. He can be contacted at Jayme Sokolow.

Someone asked, recently, about putting together a “fundraising plan.” My response was about creating a “Development Plan.”

Where the latter has its focus on the relationships between the organization and its constituents/donors that can result in contributed income, the former just focuses on the dollars. And, when just focusing on dollars is sometimes OK for the short-term, it’s quality relationships that result in consistent dollars over-the-long-term.

It must also be understood that Development Plans are constructed for specific sets of circumstances — there is no one-fits-all model.

The basics of a Development Plan:

Before the Development Plan comes the Strategic Plan … to determine priorities and where the organization wants to be by the end of this year, in two years, in three years … and for what programs/staff/equipment/overhead/etc. funding will be needed.

The development plan functions to help you keep in mind where the money came from last year, what you had to do to get it*, and what you’re going to have to do to get that same money this year. Secondarily, the development plan looks at how to increase funding from former sources and generate new money from new sources.

   [*…referring to the various methods of cultivation as well as the various
   methodologies for fundraising, i.e., direct mail, major gifts, events, etc.]

At the end of the process of constructing a Development Plan, you have a fundraising goal for the year (or for whatever period you’re doing the planning), a goal that MUST reflect reality. It must represent what you know of the organization’s fundraising history and what you know about your prospective new donors.

That goal must be attainable, it cannot contain any element of wishful thinking, If the fundraising goal and the projected income from all other sources don’t add up to what the budget requires, it’s the budget that must be trimmed, not the fundraising goal that must be increased.

In constructing a Development Plan, you must keep in mind that where fundraising serves the needs of the nonprofit organization (NPO), it is not about the needs of the NPO. Fundraising is about the needs of the (prospective) donor. If your Development Plan doesn’t consider the donor’s needs, how can you expect him/her to consider yours?

(See: Fundraising or Not Fundraising, That is The Question)

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Have a comment or a question about starting or expanding your fundraising program? Email me at AskHank@Major-Capital-Giving.com. With over 30 years of counseling in major gifts, capital campaigns, bequest programs and the planning studies to precede these three, we’ll likely be able to answer your questions.

I respond to Michael (his comment is below) that we don’t disagree, that it’s just a difference in vocabulary.

My reference to nonprofits being public institutions is a matter of perspective, not legal language. Nonprofits are required/supposed to serve the needs of the “community,” and I write from the perspective of the “community’s” right to know how effective a nonprofit is that serves them – how cost effective and how effective at addressing the issue it was created to address.

Organizations (like AFP) that serve/represent staff and consulting fundraising professionals use language that refers to nonprofits as being “publicly owned.” The intent of that language being to maintain awareness among fundraising professionals and the organizations they serve and keep us/them focused on what is and isn’t “ethical.”

Where that language may differ from the legal language of the IRS, the intent is the same – to protect the rights of the community/public.

In that context, “Ethics” is all about doing what’s best for the community/people being served. To word it in a way that addresses a common problem: “Ethics” is about doing what’s best for the community/people being served, not what’s best for the board and staff members of the nonprofit. “Ethics” is also about using contributions (only) as the donors intended, and letting those donors know such is the case.

Excerpt from Michael’s comment:
“Hank and I are old friends and colleagues, so my disagreements
with him are always respectful – and I admit the possibility of error!

“I take issue with the assertion that charities are, in effect, public
institutions due to their tax-exempt recognition and “tax subsidy”.
In fact, legally as well as functionally, charities are explicitly private
entities run for a specific defined “public benefit purpose” (to use
IRS language).

“If favorable tax treatment alone defined whether a US institution is
public, than there would be *no* private institutions. Every taxpayer,
whether individual, partnership, or corporate, receives favorable tax
treatment to reduce or eliminate their Federal income tax burden.

“Charities, as private entities, receive favorable tax treatment in
exchange for their explicit promise to operate in a certain way and
comply with applicable parts of the IRS Code.

“I would never argue that charities and nonprofits should act without
accountability. However, nonprofits serve a valuable societal function,
recognized in law and regulation, that is collective, but explicitly not
public.” Michael Wyland — michael@sumptionandwyland.com

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Have a comment or a question about starting, evaluating or expanding your fundraising program? Email me at AskHank@Major-Capital-Giving.com. With over 30 years of counseling in major gifts, capital campaigns, bequest programs and the planning studies to precede these three, we’ll likely be able to answer your questions.