Challenges in non-profit fundraising

(Image courtesy pdclipart.org)

(Image courtesy pdclipart.org)

As 2015 chugged into its last days and hours, e-mail inboxes overflowed with end-of-year appeals from non-profit organizations seeking cash contributions. In some cases it became a deluge, with multiple e-mails from the same groups. It seems that one of the costs of being a steady donor is to feel relentlessly hounded for more.

In some ways, I get it. I’ve been a denizen of the non-profit sector for most of my career, as an educator, public interest lawyer, and board member. One of the realities of non-profit life is the need to generate donations.

But just because I understand the need for fundraising doesn’t mean that I endorse the year-end blitzkrieg route to doing so. Being on the receiving end of these year-end requests can prompt donor fatigue. Some appeals may trigger annoyance, like the ones who remind me that this is my “last chance” to claim a further tax deduction, as if I’ve waited right until year’s end to dump supposed piles of disposable cash into non-profit organizations, simply to cut my bill from Uncle Sam.

I’m feeling a little defensive as I write this, because it may sound like I live to keep my money away from non-profit organizations. Quite the contrary; my giving levels are pretty solid. However, I have become more discerning and careful about how, why, and when I donate.

I’d like to use this space to offer some observations and advice about non-profit fundraising. Although I’ve never been a non-profit fundraising officer, I have lots of experience in this realm, including (1) chairing the board of a small foundation that gave seed-money grants to fledgling public interest law projects; (2) writing successful grant proposals for several organizations (low-four to low/mid-six figures); and (3) developing and implementing a fundraising campaign that solicited individuals and labor unions (mid-100k).

As I indicated above, I also know what it’s like to be solicited for money at different points and income levels of my career. The donor’s perspective must be understood and appreciated, and it informs what I have to share. I hope what follows is helpful.

REALITIES AND OBSERVATIONS

Let’s start with some of the challenging realities of non-profit fundraising:

Twice the work (sort of) — It’s important to acknowledge up front that non-profit fundraising is hard work. The standard finance model for a business is that you offer a good or service in return for payment. It’s a this-for-that exchange. By contrast, in the non-profit world, providing the good or service is often severed from the generation of revenue.

For example, if you’re a human services non-profit, then you offer assistance to those in need, but you may not require payment. Instead, funds have to be raised from private donors and perhaps government grants to keep the enterprise going.

The myth that there’s money “out there” — There’s got to be some money out there. We need to tap into the money out thereHow can we raise some of that money sitting out there. Newbies to the non-profit world sometimes assume that there are cadres of generous individuals and foundations sitting on piles of cash that they want to give away. And because said newbies believe deeply in their cause, they assume that the funders are “out there,” waiting to be tapped to support their particular organization or initiative.

In most cases, this is not true. It rarely works that way. ‘Nuff said.

Direct mail appeals — Before the Internet, direct mail was the primary form of larger scale fundraising from individuals. For many groups, it remains so. But it is expensive and time consuming, with positive response rates averaging between one and three percent.

Organizations don’t like to hear this, but we throw away a lot of their mailings without even opening them. I receive dozens of fundraising appeals in the mail each week. Especially if the letter was not mailed with a first-class stamp, I am unlikely to bother opening it. There’s not enough time in the day to wade through all of it.

E-mail appeals — Assuming the organization has a decent e-mail list of contributors, e-mailed fundraising appeals are cheap and relatively easy to send. They can also be personalized and effective. As I suggested above, however, they also can feel tiresome on the receiving end. Too many blast e-mails within a short time frame may well invite “unsubscribe” requests from donors and prospective donors who don’t like the feeling of being hounded or guilted.

Phone calls Nooooooooooooooo! Okay, I got that off my chest. I’m not big on using the telephone to begin with, and any kind of phone solicitation — non-profit, business, what have you — annoys me considerably. I’m hardly alone in feeling this way. Yes, I know that many larger non-profits use direct calling to raise money. I guess it’s a cost-benefit calculation as to whether to do so. But I won’t be answering your call.

Face-to-face canvassing — On a couple of occasions I’ve been successfully snared by street canvassers attempting to solicit donations to their cause. I now avoid them like the plague. I do not like to make a split-second decision on whether to give money while I’m standing there on the sidewalk and some (usually) young canvasser is talking me up with canned language.

Crowdfunding campaigns — Given how curmudgeonly I’m sounding, you might be surprised to hear that I do give to non-profit crowdfunding campaigns! If I believe in the need and purpose, trust the sponsors, and see a well-articulated use for my money, then I will strongly consider giving. (See my April 2015 post, “Should I support that Kickstarter, GoFundMe, or Indiegogo crowdfunding campaign?“)

Crowdfunding appeals are proliferating, perhaps the ultimate manifestation of the “out there” myth about money. So if you’re taking this route, then you should have a plan and an appeal that goes well beyond pining for dollars.

Grant funding — Whole books are written and seminars are taught about the art of writing grant proposals to foundation and government funders. It is painstaking work. A grant proposal is both an advocacy document and a substantive description of your work. It can require a lot of hoop jumping, and if you become dependent upon that form of funding, then it becomes a big part of your institutional and professional life. In the ideal world, what you need to fund and what the foundation or public agency wants to fund are a perfect match. The world is not always ideal, however.

ADVICE

Drawing in part from the points above, let me offer three additional clusters of advice:

Respect your donors — If you don’t honestly respect and appreciate people who are voluntarily giving you a piece of their discretionary income, then you probably shouldn’t be asking them for money. I once served on the board of a small non-profit whose executive director never once thanked me or anyone else on the board for our ongoing financial contributions. It’s almost like he thought it was beneath him to say thank you. Is it any surprise that the organization was struggling financially?

By contrast, good non-profits have a special relationship with their supporters. They use their donors’ contributions wisely, and they express appreciation. They have a way of making their supporters feel connected beyond the fundraising appeals. They hold themselves accountable. Their fundraising requests and outreach reflect authenticity, sincerity, and commitment.

Use your work as your best fundraising appeal — Ultimately, the substantive work done by your organization is your most powerful fundraising appeal. If you are good at what you do and can find ways to share that story, then it will resonate with others, including those who make financial contributions.

A quick example: Last week I had the privilege of spending a day at a center that provides daycare services to folks who have Alzheimer’s and other memory-related conditions. I was not there in any professional capacity; rather, I was the guest of a dear friend who is benefiting from these services. During that day, I closely observed how the caregivers worked with and assisted their residents. I was so impressed and heartened by the care and compassion exhibited at this center that, right before leaving, I gave a check to one of their program directors in support of their work.

Grow your funding base — Start with your board and key supporters and go from there. (If your board members aren’t contributing, then don’t expect others to do so.) Membership categories and/or monthly sustainer programs may help to bring in a steady flow of revenue.

In this vein, it’s crucial to understand how smaller donors can become bigger donors. Take the $50 donor who pays attention to what you’re doing and is impressed. Maybe she enjoys one of your events or has a great conversation with one of your staff members. A year or two (or ten) down the line, she agrees to become a major supporter. It happens, a lot.

It gets back to people. With good non-profits, there’s a wonderful match between what the organization is doing and the desire of others to support important, meaningful work, in a way that invites a donor to make a difference.

One response

  1. This is such an important point! There is an enormous “myth that there’s money ‘out there’.” If there is money out there, it is going into political and military campaigns.

    Thank you for noting this myth about non-profit fundraising!

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