Category: Finance

The Campaign (Annual, Endowment Or Capital) Is Over And The Goal Has Been Achieved — Life Is Good!

Issue a press release and a final newsletter thanking campaign leadership, volunteers and the donors. Single out people who should be commended, and praise the campaign chair. Then, be sure to convene a meeting of the campaign leadership for in an-depth, no-holds-barred, assessment and review of what was accomplished and what was learned.

Follow the First Rule in evaluating a completed campaign: Don’t wait! The Second Rule is to get the evaluation done quickly. That way, knowing all that is important about the finished campaign, leads to helping the next campaign to be an even better one.

The Campaign Is Over And The Goal Has Not Been Achieved — Life Has Been Better!

This has happened to me more times than I like to admit. Goals and resources do not always match, campaigns do develop insurmountable problems, and sometimes you just can’t pull it off. Fundraising professionals have to be prepared for the occasional failure.

Bear in mind, however, that a campaign can come up short of its goal and still have demonstrated a lot of accomplishment. You may still be able to say congratulations to volunteers and donors. Though not enough, the money raised may be an all-time high for the organization’s annual fund.

You’ll still be able to build or renovate … perhaps reduced degree. You’ve raised a goodly amount of endowment funds, enough to help safeguard your organization’s future. More donors than ever before may have given. More volunteers worked the campaign than any before. The campaign may have come within 10 percent of a goal we knew to be very ambitious.

It is the rare campaign in which you cannot find a positive accomplishment to call to the attention of volunteers, donors, and the public. Make lemonade from lemons.

So issue a press release and a final newsletter thanking campaign leadership, volunteer solicitors, and the donors. Single out people who should be commended, and praise the campaign Chairperson. Thank-you functions are still appropriate. Donors still need to be told how much they are valued and appreciated.

With the people who worked on the campaign, you need to be practical and honest about the disappointment, but don’t let words of regret, frustration, and unhappiness get to the ears of those who gave.

If you become preoccupied with the shortfall and forget all the good things that happened, you do a disservice to those who worked a campaign and to those who gave to it. They should never be left to think their efforts were a waste.

I liked to host a thank-you function or functions for my volunteers and major donors. The format should be in tune with the organization and the community — a cocktail party, picnic, or open house, for example. Don’t forget to seek underwriting for this event. Board members may contribute food and drink at their home, country club, yacht club or even in their corporation’s board room.

Editor’s Note: As has been emphasized so often in these postings: Goal setting is not an arbitrary process!! If adequate research and planning precede goal setting, the risk of not attaining the goal is reduced dramatically.

=-=-=-=-=-=-=-=-=-=-=-=-=-=
Have a question or comment about the above posting?
You can Ask Tony.
=-=-=-=-=-=-=-=-=-=-=-=-=-=
Have you seen
The Fundraising Series of ebooks?
They’re easy to read, to the point, and inexpensive ($1.99 – $4.99)
=-=-=-=-=-=-=-=-=-=-=-=-=-=

If you’re reading this on-line, and would like to comment/expand on the above piece, or would just like to offer your thoughts on the subject of this posting, we encourage you to “Leave a Reply.” If you’re reading this as an email, and you want to comment on the above piece, email Comments to offer your thoughts. Your comments, with appropriate attribution, could be the basis of a new posting.

The following is a recently received email. My comments/responses are the indented paragraphs.

We’re a relatively young 501c3, at about 5 years old, but have relied mostly on dues from members up to this point. Last year we participated in our state’s annual nonprofit day of giving.

It is my observation that memberships/dues are not the best ways to
raise money. As an organization matures, it becomes easier to raise
a lot more from contributions, because people who pay dues very often say,
when asked for a contribution, that they’ve already paid/given for the year.

We earmarked all of that income as Educational Scholarship money, to turn around and give to applicants from the local high schools (not our membership), and to each of 3 local university/college art departments (it was their discretion which student was awarded.)

Simple enough. This year, we’d like to … fund those same scholarships again, perhaps in greater number, but we’d also like to spend some on educational opportunities for our own members – via workshops, visiting expert artists, etc. (Membership is open to anyone declaring themselves an artist, and we have 3 levels of membership with varying benefits.)

Ethically, we wonder if just saying/advertising on social media that we’re “raising money for scholarships and education” is enough, or if we need to be more specific. (Like 80% to fund our scholarships and 20% to our own workshops. Spelling out the details on our donor page).

Yes, you need to be more specific, but not in terms of percentages. Explain (briefly) about the scholarships you award and the educational programs you provide … and, how those scholarships and programs make a difference in the community. Phrase it in terms of how people benefit, not in terms of what a great job you’re doing.

Ethics often equates to transparency, and for a nonprofit, that’s essential.

Also, ethics requires that if you ask people for money for one-or-more specific purposes, and they give to specifically to support those purposes, you have to use their gifts specifically (only) for those purposes.

Financially, we’ll track the funds separately. Not sure how that will effect our annual IRS info/bookkeeping.

Tracking funds via the nonprofit equivalent of an income and expense statement is standard. BUT, you not only have to report to the IRS, you have to report to your constituency/community. Remember, pretty much nothing a nonprofit does is secret. And, if you budget wisely, spend wisely, and report your income and expenses properly, it’s good marketing, good community relations and a good basis for asking people to support what you do.

=-=-=-=-=-=-=-=-=-=-=-=-=-=
Have a comment or a question about starting, evaluating
or expanding your fundraising program?
AskHank
=-=-=-=-=-=-=-=-=-=-=-=-=-=
Have you heard about
The Fundraising Series of ebooks?
They’re easy to read, to the point, and inexpensive ($1.99-$4.99)
=-=-=-=-=-=-=-=-=-=-=-=-=-=

If you’re reading this on-line, and would like to comment/expand on the above piece, or would just like to offer your thoughts on the subject of this posting, we encourage you to “Leave a Reply.” If you’re reading this as an email, and you want to comment on the above piece, email Comments to offer your thoughts. Your comments, with appropriate attribution, could be the basis of a new posting.

I had a conversation, recently, with a board member of an organization – a type of “foundation” that raises funds to support activities designed to advance/sustain their profession, who indicated that the board was “disappointed” with the total dollars that have been raised over their first few years.

When the organization was first created, they sought the advice of a development consultant (me) … who explained the basis of successful fundraising: prospect identification; determination of the needs of prospective donors; working with those prospects to find the fit – where prospect needs could be satisfied by making significant gifts to the organization; determining the amount of the “Ask;” and, actually asking for the gift.

The members of that organization’s board insisted that their organization’s members were different from every other group of prospective donors, that their members would want to help/contribute, that all that needed to be done was to make those members aware of the need, and that they wouldn’t have to be evaluated, cultivated and “Asked.”

Not surprisingly, those board members were also extremely uncomfortable with the idea that they’d actually have to ask someone, face-to-face, for a specific dollar figure. Their solicitations were all passive – emails and flyers lauding the goals of the “foundation,” signs and a sign-up table at meetings, etc. So, no surprise that they’ve only been able to raise 10% of the funds they’ve publicly stated were needed to do what should be done to maintain/advance their profession.

These are intelligent, highly educated, capable people who, like many who would be similarly described, believe they know fundraising/development better than those who trained for and have decades of experience in the field. Can you imagine how disbelieving, even horrified they would be if I told them I knew how to practice their profession better than they do ??

I wonder whether their inability/refusal to take the advice of the fundraising professional stems from a fear of having to ask people for money, from an arrogance often seen in many of the “highly educated” or a combination of the two. Is it possible they’d rather fail than overcome their fears of Asking?

Whatever the reason, this “foundation” has to choose between doing it their way, and not having the funds to actually do what’s needed to ensure their profession’s future, or….

This is not, by the way, an unusual occurrence … and it’s not something that only happens in relation to fundraising/development. It’s fairly common that people/groups/organizations are unable or refuse to accept the advice/direction of the consultant/expert from whom they’ve sought that advice/direction. I’m sure a psychologist could explain it !!

=-=-=-=-=-=-=-=-=-=-=-=-=-=
Have a comment or a question about starting, evaluating
or expanding your fundraising program?
AskHank
=-=-=-=-=-=-=-=-=-=-=-=-=-=
Have you heard about
The Fundraising Series of ebooks?
They’re easy to read, to the point, and inexpensive ($1.99-$4.99)
=-=-=-=-=-=-=-=-=-=-=-=-=-=

If you’re reading this on-line, and would like to comment/expand on the above piece, or would just like to offer your thoughts on the subject of this posting, we encourage you to “Leave a Reply.” If you’re reading this as an email, and you want to comment on the above piece, email Comments to offer your thoughts. Your comments, with appropriate attribution, could be the basis of a new posting.

A recent email asked: “What is a reasonable goal to ask a development person to raise for a non-profit organization?

“Our Executive Director, a former college president, expects me to raise 6 to 8 times my salary in new money, which was the expectation at the college.

“Have you heard of that concept before? I’ve been a Director of Development for a few organizations in the past and never heard of this!!”

Almost always, when I learn of the impossible situations in which too many good development officers find themselves, I reply in ways intended to ease the pain as best I can and, when I can, offer soothing and workable ways to help them change the minds of their bosses.

This is not, however, one of those instances. What this development officer is experiencing not only troubles me, but it makes me angry to see once again the gross short-sightedness of a supervising official at a non-profit seeking to impose the impossible.

Now, I will calm down (only a bit) and tell you what I told this harried development officer.

First, there is not, nor could there be, any reasonable expectation of someone raising new money based on x-times her or his salary.

That expectation – edict – is based totally on ignorance regarding how money is raised for most nonprofit organizations.

Unfortunately, I have heard of such numbers before. Different numbers, at different times, because they are almost always made up by people who know no better.

Even more to the point of such an expectation being totally unfounded, is the fact that the development office is to be “the” fund-raiser, either mainly, or solely. That is even worse, regardless the way any goal is set – even a legitimate goal.

Any boss telling the development officer that she or he must work to such an 8 to 10-times-money-raised number, as it is relates to the development officer’s salary, needs to tell everyone else why and how they came up with that meaningless formula.

For that matter, why ten times? Why not fifteen, or twenty, or five? You get the idea. There is no sense or order to such a ratio. And how could there be justification further to throw out an 8-10 salary-X range, where the difference could be huge in the amount ordered to be raise.

Think of it. Let’s just say that being paid $50,000 for the year means that the development officer is required to personally raise $500,000. And this is to be “new” money.

From where will this money come?

The boss can make up a goal such as this one, but the boss cannot create prospects from phantoms. And, with the rush and crush to raise “new” money to meet the so-called goal, you can bet that some of the “old” (previous contributions) money would not be pursued with the same vigor. And, certainly, there would be little-or-no time to emplace a cultivation process to provide for future fundraising.

Even so, what if the institution needed more than that particular salary-Xs amount to balance the books and meet its fund-raising goals? Would the institution then expect the development officer to raise say, 15 times the salary?

Suppose, on the other hand, the institution could forecast that it would be in position to balance its annual operational budget, thus able to meet a fund-raising goal with less than the previously-set salary-Xs formula. Would the ratio then be dropped accordingly? I don’t think so.

Therefore, when I am asked the “how-many-times” question for funds to be raised based on a salary figure, as related to what is average, standard, or likely, I reply that everyone involved must consider the extraordinarily wide range of non-profits’ actual money needs, the respective contribution potential possible to them, the means and resources available to raise the money, the experience and skills of the development officer – and a good measure of luck.

When any institution’s leadership tells the development officer that she or he must raise an amount of money based on a salary-multiple factor, I would like to be there and ask that particular supervisor how and why such a number is presented. There could not be a good answer.

As previously noted in this blog, fundraising is performed based on a plan derived from reality – not at the ignorant whim of an executive director or board member.

=-=-=-=-=-=-=-=-=-=-=-=-=-=
Have a question or comment about the above posting?
Send an email to Comments to offer your thoughts. Your comments, with appropriate attribution, could be the basis of a new posting.
=-=-=-=-=-=-=-=-=-=-=-=-=-=
Have you seen
The Fundraising Series of ebooks?
They’re easy to read, to the point, and inexpensive ($1.99 – $4.99)
=-=-=-=-=-=-=-=-=-=-=-=-=-=

This time, calling it by it’s correct name !!

As previously noted in these postings, “Development” has its focus on the relationships between the organization and its constituents/donors that can result in contributed income, “Fundraising” focuses only on the dollars.

For a new nonprofit, immediate funding would probably be needed to ensure survival in the short term, but 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.

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.

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 achievable, 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.

At the end of the year (or whatever period for which the development plan was constructed) you look at each element of the plan: what the goal was for each activity (direct mail, personal solicitation, special events, etc.); whether each of those goals were attained; what factors, if any, kept you from attaining each/any of the individual goals that comprised the overall goal; and, what you’d need to do to reach all of your funding goals next year.

The development plan for the period just concluded is the basis for constructing the plan for the next time period. The new plan is based on the realities learned/faced last time, and its goals must be attainable.

A fundraising goal cannot be set just because the Board and/or the ED says more money is needed. Board and/or ED insistence that the goal be higher (by a percentage or by a dollar figure), when the goal isn’t supported by history/reality, is a recipe for failure. And failure to achieve fundraising goals leads to a loss of confidence in the nonprofit and its leadership.

More on Goal Setting next week.

=-=-=-=-=-=-=-=-=-=-=-=-=-=
Have a comment or a question about starting, evaluating
or expanding your fundraising program?
AskHank
=-=-=-=-=-=-=-=-=-=-=-=-=-=
Have you heard about
The Fundraising Series of ebooks?
They’re easy to read, to the point, and inexpensive ($1.99-$4.99)
=-=-=-=-=-=-=-=-=-=-=-=-=-=

If you’re reading this on-line, and would like to comment/expand on the above piece, or would just like to offer your thoughts on the subject of this posting, we encourage you to “Leave a Reply.” If you’re reading this as an email, and you want to comment on the above piece, email Comments to offer your thoughts. Your comments, with appropriate attribution, could be the basis of a new posting.

As noted last week: (1) The fundraising plan addresses (where appropriate) mass solicitation (mail, email, telephone), individual solicitation (major gifts), foundation applications, corporate solicitation and special events; and, (2) A fundraising plan, more than anything, must be a reflection of reality.

In crafting a plan, “reality” derives from experience. For example, only if you’ve previously done direct mail can you project how much you will need to spend for that activity and how much you’re likely to raise from that activity in the coming year.

For a new nonprofit, without the experience to craft an actual plan, the “plan” will consist of a number of activities that will investigate various fundraising methodologies.

That “plan” might include the intent to research a number of foundations to determine which (type of) foundations would be likely to support the organization’s mission. It might include the intent to call and/or write (or have someone write) letters-of-inquiry (preliminary proposals) to a small number of foundations. It might even include the intent to identify the executives and board members of the identified foundations who live in the organization’s service area.

It might include the intent to compile lists of local and national corporations that serve your area and/or your constituency, then to research which of those corporations … and which of their executives … are active members of your community.

And, most importantly, it should include the intent to identify who the leaders are in your community … those people who sit on the boards of local corporations, who are board members of other nonprofits, and those who are major donors to other nonprofits. Those are the folks with the money, the people who are most likely to be able to make the major gifts you’ll need for long-term survival.

The “plan” might include the intent to talk with one-or-more fundraising/development consultants … with an eye toward identifying one with whom you’ll be comfortable working. You might even talk with a direct marketing firm about direct mail … how many pieces should be in a “test” mailing, how many test mailings should you do in a year, what would it cost….

If an organization wants to grow/survive, it must invest in the research that will (help them) identify likely (long-term) donors.

=-=-=-=-=-=-=-=-=-=-=-=-=-=
Have a comment or a question about starting, evaluating
or expanding your fundraising program?
AskHank
=-=-=-=-=-=-=-=-=-=-=-=-=-=
Have you heard about
The Fundraising Series of ebooks?
They’re easy to read, to the point, and inexpensive ($1.99-$4.99)
=-=-=-=-=-=-=-=-=-=-=-=-=-=

If you’re reading this on-line, and would like to comment/expand on the above piece, or would just like to offer your thoughts on the subject of this posting, we encourage you to “Leave a Reply.” If you’re reading this as an email, and you want to comment on the above piece, email Comments to offer your thoughts. Your comments, with appropriate attribution, could be the basis of a new posting.

This is one of the most important aspects of a successful Development program, but it’s a subject that needs a lot more attention than it gets.

An organization’s development/fundraising plan, once formulated, provides the map, the guidelines for doing what must be done to raise the funds an organization needs to operate/survive. Sticking with the “map” analogy for a moment, it shows you the route you must take to get to where you want/need to be … and where you want to end up.

A Fundraising Plan addresses what will need to be done in order to raise a dollar amount that has, through the above-described process, been deemed attainable.

Typically, an organization should be creating a “new” fundraising plan each year. As circumstances change, like the economy, as there are changes in a nonprofit’s leadership and/or staff, as new potential donors are identified and as more is learned about current donors, a fundraising plan must change, must adapt to any/all changes.

The first question that you should be asking is, “What is a fundraising plan?”

So, I’ll start by noting what a Fundraising Plan isn’t: A Fundraising Plan is not the equivalent of “Let’s Put On A Play,” or “Let’s have a Bake Sale.” A Fundraising Plan is not just a list of activities. It is not a wish list.

A fundraising plan, more than anything, must be a reflection of reality. It must be based on what you know … not on what you think you know or would like to be true, but on fact. A fundraising plan addresses all types of fundraising that your organization will be doing for the coming year. It includes mass solicitation (mail, email, telephone), individual solicitation (major gifts, planned gifts), foundation applications, corporate solicitation and special events (not fundraisers).

Usually, for a new/young organization, very little is “known.” You don’t know who the people/foundations/corporations are who would be likely to support you if they knew about your mission/purpose; and, you don’t know why potential donors would want to support you – and their reasons will rarely relate to how good you think your organization might be or how strongly you believe in your mission.

So, obviously, you must first learn who those people are and what would cause them to want to support you.

For a new nonprofit, the founders, their families, their friends, their families’ friends, and their friends’ friends are the most likely (prospective) donors. They will give because the people that are asking are people they care about … they will support those people … not necessarily the mission.

Please note:
1. We do not advocate the use of “fundraisers,” to the contrary,
    as those activities can’t be relied upon for ongoing/long-term support.

2. Better than two-thirds of funding for nonprofit organizations comes from
    large gifts from individual donors. If you’re looking for funding, you should
    look at where most funds come from !!

Next week’s posting will look at a Fundraising Plan for a New Organization.

=-=-=-=-=-=-=-=-=-=-=-=-=-=
Have a comment or a question about starting, evaluating
or expanding your fundraising program?
AskHank
=-=-=-=-=-=-=-=-=-=-=-=-=-=
Have you heard about
The Fundraising Series of ebooks?
They’re easy to read, to the point, and inexpensive ($1.99-$4.99)
=-=-=-=-=-=-=-=-=-=-=-=-=-=

If you’re reading this on-line, and would like to comment/expand on the above piece, or would just like to offer your thoughts on the subject of this posting, we encourage you to “Leave a Reply.” If you’re reading this as an email, and you want to comment on the above piece, email Comments to offer your thoughts. Your comments, with appropriate attribution, could be the basis of a new posting.

Back in February, I posted a piece “Development As A Profession Vs. Development As An Activity,” in which I noted that the Development process includes the establishment of relationships with potential donors (individuals, foundations, corporations), with the purpose of learning their needs and how the satisfaction of those needs can/will correspond with the satisfaction of the needs of the nonprofit organization – specifically, financial support of the nonprofit.

The Development process involves the education of the prospective donors as to the mission, programs, successes and needs of the nonprofit organization and the people it serves. The term “donor cultivation” refers to the “getting to know you” process – the donor getting to know the NPO and the appropriate people at the NPO getting to know the (prospective) donor.

Cultivation is also preparing the prospective donor for the solicitation. After all, once the “cultivation” process begins, most folks will know that they are going to be “Asked” at some point. Cultivation is not, and should not be, a “secret” process. It is not something you’re doing to the prospect, but is something you’re both doing together.

It is only after the relationship has been formed, the parties have gotten to know each other, and how the needs of both could be satisfied, that the “solicitation” of the donor can proceed. “Fundraising,” asking for the gift, is the next-to-the-last-step in the development process.

The next steps, part of creating/maintaining/enhancing the relationship between the organization and the donor, include how and how often you thank the donor, how you maintain ongoing contact with the donor (personal visits, phone calls, notes … by email and/or snail mail, depending on the generation/age of the donor, newsletters … electronic and/or snail mail), and how you recognize/honor the donor.

It is often said, “The thank-you is the first step in the cultivation in preparation for the next solicitation.”

That is the “stewardship” process. It is what happens after the gift has been made. It is ongoing, and many people may be involved — more on that in a later posting.

But, whether it’s called “cultivation” or “stewardship,” it is all about the “relationship.”

So, bottom line, because it is an ongoing process, there is, in practice, no “last step” in the Development process.

=-=-=-=-=-=-=-=-=-=-=-=-=-=
Have a comment or a question about starting, evaluating
or expanding your fundraising program?
AskHank
=-=-=-=-=-=-=-=-=-=-=-=-=-=
Have you heard about
The Fundraising Series of ebooks?
They’re easy to read, to the point, and inexpensive ($1.99-$4.99)
=-=-=-=-=-=-=-=-=-=-=-=-=-=

If you’re reading this on-line, and would like to comment/expand on the above piece, or would just like to offer your thoughts on the subject of this posting, we encourage you to “Leave a Reply.” If you’re reading this as an email, and you want to comment on the above piece, email Comments to offer your thoughts. Your comments, with appropriate attribution, could be the basis of a new posting.