Fundraising Crash Course by Jeanne Minnicks surveys the strategies, goals, and relationships necessary for a successful development department.
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2. To broaden awareness of the
fundraising/development profession
by familiarizing you with the culture
of philanthropy, common terminology, key staff
members and their functions, and best practices.
3. I. Overview
A. The Importance of Philanthropy
B. Why People Give, What They Expect & Don’t
Want, Other Findings
C. The Fundraising Environment
II. Fundraising’s Basic Elements
A. The Development Team
B. Primary Sources of Contributions
C. The Integrated Development Plan
D. Ethics
III. Friend a Fundraiser
4.
5. Philanthropy means "love of humanity" in the sense of caring,
nourishing, developing and enhancing what it is to be human.
It is experienced by both the benefactor and the beneficiary
but in different ways. The former exercises his or her values
by giving (time, resources) and the latter by receiving.
Philanthropy and charity are related but are not the same thing.
Charity relieves the pains of social problems.
Philanthropy attempts to solve those problems at their root
causes.
Wikipedia
6. Altruistic behavior: Acts that intentionally benefit another
organism, incur no direct personal benefit, and sometimes
bear personal cost.
Meet critical needs of an organization
Give back to society
Help those who are less fortunate
Advance a cause they believe in
Altruistic ? . . . not so much
Feel good
Recognition
Because they were asked
Advice: Don’t guess . . . ask questions!
*Howard , Anne W.; New Brain Study Hints at Why People Are Altruistic; Chronicle
of Philanthropy; February 22, 2007
7. Prompt thank-you letters and calls
Opportunities to be engaged other than just monetary
donations
Information on results achieved with their gift
Communications with staff whose programs they supported
Compliance with terms of the gift
9. The rich aren’t the most generous.
Insulated rich give less than those in economically diverse
neighborhoods
Red states are more generous than blue states.
Conservatives give more than liberals, yet liberals sit on more
non-profit boards
Tax incentives matter.
Regions of the country that are deeply religious are more
generous than those that are not.
Gipple, Emily and Gose, Ben; How America Gives - America’s Generosity Divide;
Chronicle of Philanthropy; August 19, 2012
10. Marketing – employed by commercial enterprises to influence
prospective customers to purchase products.
Development – process by which nonprofits influence
prospective donors to support their needs through gifts and
grants
Berendt , Robert J. and Taft, Richard; How to Rate Your
Development Office; The Taft Group; Washington, DC; 1983
11. Marketing Development
Research identifies and defines
customers and their needs
Positions products to
correspond to customer
characteristics
Dedicates a significant portion of
budget to builds awareness
through advertising & PR
support
Trains employees to sell
Research identifies prospects,
giving potential & interests
Creates institutional case for
support and giving
opportunities that match
donors’ interests
Communicates in a variety of
ways to build awareness
Trains volunteers (board
members & others) to solicit
Berendt , Robert J. and Taft, Richard; How to Rate Your Development Office; The Taft Group; Washington, DC; 1983
20. Executive Director
Director of Development
Director of Annual Fund/Annual Giving
Major Gifts Officer
Planned Giving Officer
Grant writer
Database Administrator
Board of Directors
Development Associate/Assistant
Membership Coordinator
Special Events Coordinator
Volunteers
21. Key spokesperson & lead fundraiser for the organization
Possess real working knowledge of the development
profession
o Different constituencies, giving cycles, forms of giving, donor cultivation
and engagement, gift management and record-keeping, functions
performed by various development department staff
Makes vital decisions about the place development holds
within the organization’s operations
Measures effectiveness of existing and new programs in
terms of short and long term goals for raising money
Evaluates effectiveness of development staff
Understands the role of board members in fundraising and
engages them appropriately
Berendt , Robert J. and Taft, Richard; How to Rate Your Development Office; The Taft Group; Washington, DC; 1983
22. The mythological “Fundraiser” . . .
What’s in a name?
Peer relationship with trustees and often deals with
corporate and foundation officers. The title accords
respect and should reflect the importance and impact of
the role.
23. Primary role: to create a process of outreach to donors by
organizing & using others to seek funds
Involved in the institutional planning process.
Multi-talented:
Strategist Tactician
Financial planner Marketer
Party planner Market researcher
Networker Competitor
Trainer Cheerleader
Diplomat Psychologist
News Junkie Communicator
24. Prospects for & stewards individuals
Manages the Annual Fund and other individual-giving
oriented initiatives, i.e. Giving Tuesdays, Day of Giving
25. Annual Fund – a program that annually solicits a body of constituents
for unrestricted contributions
Time consuming and expensive with relatively low return
Goal is to establish a giving habit and provide a basis for planned
giving
Funds are in the form of cash and used primarily for ongoing
programs
Typically directed towards individuals who receive multiple
contacts during the fund period using a variety of methods
Most begin in the fall, conclude end of the tax year
The Center on Philanthropy at Indiana University – The Fund Raising School in
partnership with the Bayer Center for Nonprofit Leadership and support of The
Forbes Funds; Developing Donors; Indianapolis, IN; 2004
26. Solicits funds for special needs
o Programs and projects
o Limited capital improvements
o Equipment
o To build or add to an endowment fund
Higher $ value “asks”
27. Planned Gift
A legal vehicle to carry on the charitable values of an
individual/family converting property into a program of good
works which continue after his death.
Created during the donor’s lifetime but benefits do not
accrue to the institution until some future time, usually at
the donor’s death
Voluntary vs. involuntary philanthropy discussion
Englund, Gregory J.; Beyond Death and Taxes, Old Questions,
New Answers; Estate Planning Press; Boston, MA; 1993
28. Requires specialized knowledge - financial concepts, financial
products, & charitable giving strategies to take best advantage
of existing tax laws
Defer to an expert
Great interpersonal skills and sensitivity in discussing delicate
matters
Considerable expenditure of time & possibly expense
Process can’t be rushed
Timing of gift can’t be predicted
29. Misleading title
Development - writing-intensive
Paper & on-line submissions - applications, proposals, letters,
reports, and agreements
Variation among funders’ preferred formats
Standardization vs. customization
Versatile writing skills – creative, personalized, formal,
structured, technical
Very different skill set from marketing & PR
31. Fiscal stewardship & strategic advice about investments &
financial direction
Input on specific management problems
Member recruitment
Expertise – law, finance, marketing, etc.
Personal gift
Fundraising support – gift solicitations, attendance at events
Advocacy
33. In 2012, largest single source of charitable contributions – 72%
of $316.23 Billion
Sources of major and planned gifts
A strong individual base hedges risk
Many ways to engage – mass marketing, group, or one-one-
one
Larger base provides the basis for specialized appeals &
avoidance of donor fatigue
The Giving Institute & Indiana University Lilly Family School of Philanthropy
34. Instrumental in pressuring nonprofits to define with greater
clarity their missions, goals, outcomes
Divorced from the emotion of giving
Arms-length relationship with grantees and applicants
Focus - goals & outcomes, sustainability, board participation
Primary contacts - executive and/or program officer
Structured application process
35. Corporate Relations or Community Affairs
Relationship-oriented; board contacts are key
Focus - brand visibility (event sponsorships, naming rights)
Selective
Contractual
Quid pro quo
Corporate Foundations – similar to private foundations
Focus - programs tied to corporate initiatives
Primary contact – mid-level manager
Structured application process
36. Funding availability fluctuates widely depending upon
budgets and political climate
Contact with elected representatives is important; lobbyists
helpful but expensive
Application process – similar to foundation process, but more
cumbersome and less transparent
37. Intensive program designed to raise a specified and large sum of
money over a specified time period to meet capital needs
(building construction, remodeling, expansion, equipment)
Elements:
External consultant often hired to steer
Usually multi-year
Feasibility study
Creation of the case for support
Giving charts
Prospect review to identify sources of funds
Prominent leadership
Volunteer committees
Quiet & public phases
“Pledge” system of giving
38. A comprehensive plan to raise funds needed to
support the organization’s mission
Identical to a business plan used in the for-profit
world:
o Mission & vision statement
o Organizational description
o Plan goals
o Market opportunity analysis
o SWOT analysis
o Strategies and tactics to be used in pursuing opportunities
o Resource needs
o Budget & detailed forecast
o Measurement and evaluation
39. Development professionals serves the public trust by
promoting ethical and effective fundraising practices by
demonstrating values in all aspects of our personal,
professional, organizational and public lives.
These values require that we:
Observe and adhere to all relevant laws and
regulations
Build personal confidence and public support by
being trustworthy in all circumstances
Demonstrate honesty in relationships
Remain accountable for professional, organizational
and public behavior
Are transparent and forthcoming in all dealings
Association of Fundraising Professionals
40.
41. Understand that our focus is not on technology but on our mission
Recognize constraints of our limited resources
Add value to your nonprofit clients by understanding the functions
of the individuals with whom you may deal
Remind us of the resources at your disposal – partnerships, training,
etc.
Be an agent of change
Broaden your knowledge of the nonprofit sector
Create a culture of philanthropy in your workplace
42. Association of Fundraising Professionals
Pittsburgh Planned Giving Council
The Bayer Center for Non Profit Management
The Forbes Funds
Greater Pittsburgh Nonprofit Partnership
PANO
Chronicle of Philanthropy
44. Bibliography
Bell, Jeanne and Cornelius, Marla; Underdeveloped, A National Study of Challenges Facing Nonprofit Fundraising;
A Joint Project of CompassPoint and the Evelyn and Walter Haas, Jr. Fund; Compass Point; 2013
Berendt , Robert J. and Taft, Richard; How to Rate Your Development Office; The Taft Group; Washington, DC;
1983
Englund, Gregory J.; Beyond Death and Taxes, Old Questions, New Answers; Estate Planning Press; Boston, MA;
1993
Gipple, Emily and Gose, Ben; How America Gives - America’s Generosity Divide; Chronicle of Philanthropy;
August 19, 2012
Hall, Holly; Fiscal Crisis Reshaped How Donors Give; Chronicle of Philanthropy; September 22, 2013
Howard , Anne W.; New Brain Study Hints at Why People Are Altruistic; Chronicle of Philanthropy; February 22,
2007
Lewis, Nicole; Half of Affluent Americans Say Tax Policy Doesn't Affect Their Giving; Chronicle of Philanthropy;
November 9, 2006
The Center on Philanthropy at Indiana University – The Fund Raising School in partnership with the Bayer Center
for Nonprofit Leadership and support of The Forbes Funds; Developing Donors; Indianapolis, IN; 2004
Notas del editor
The rich aren’t the most generous.
$50,000 to $75,000 - giving average - 7.6% of discretionary income
$100,000+ - giving average - 4.2%
Rich people who live in neighborhoods with many other wealthy people give a smaller
share of their incomes to charity than rich people who live in more economically diverse
communities.
Red states are more generous than blue states.
In 2008 election 8 states where residents gave the highest share of income to charity went
for McCain. 7 lowest ranking states supported Obama.
Tax incentives matter.
State policies are rooted partly by political philosophy about the role of government vs. At
least 13 states offer special tax benefits to charity donors, often in hopes of stimulating
giving at the same time that big cuts in government services are occurring. While not every
donor may admit it, it’s not just a pull at the heartstrings that encourages giving but the tug
of the taxman.
Regions of the country that are deeply religious are more generous than those that are not.
2 of the top 9 states—Utah and Idaho—have high #s of Mormons who have a tradition of
tithing ~ 10% of income to the church. The remaining 7 states are all in the Bible Belt.
But some nonprofit experts question whether religious donations should even factor into
generosity rankings. “Giving to a church is a different kind of giving than giving to other
charities because it’s‘ inward-centered’, i.e. you get a personal benefit from it. (vs. giving
to an antipoverty program which is “other-centered’”. New Hampshire gives next to
nothing to religious organizations,” “but their secular giving is identical to the rest of
country.
When religious giving isn’t counted, the geography of giving is very different. Some states in
the Northeast jump into the top 10 when secular gifts alone are counted. New York would
vault from No. 18 to 2, and Pennsylvania would climb from No. 40 to. 4.
Gipple, Emily and Gose, Ben; How America Gives - America’s Generosity Divide; Chronicle of Philanthropy; August 19, 2012
Back in the day development work didn’t get much respect. Colleges offer courses in marketing, advertising, public relations, and companies invest heavily in professional selling skills and customer relationship management classes. Historically there have been few degree programs in the development field but that’s changing.
Today, the market is awash in seminars, self-help books, classes and webinars. Professional associations support their members with continuing education and have established accreditation standards which have increased awareness and respect for development as a profession. The CFRE credential designates an individual who has invested in course work, has demonstrable results across a range of performance categories, and has passes a difficult qualifying exam. For small and medium size nonprofits, professional associations have been particularly instrumental in elevating the professionalism of development staff by offering affordable education programs and networking opportunities. Unlike leading universities, hospitals, and other large organizations which have staffs of 24-150 people and sizable budgets, the typical development department in a small nonprofit is a one person shop. These people do the grant research, write the proposals, conduct site visits and funder meetings, administer the grant, write acknowledgement letters and required reports.
Relationship intensive – the fact that majority of donors prefer electronic communications doesn’t make it any less so. Appeal to those who give for tax benefits as well to those who give because of a personal interest in your mission.
Communications intensive – Variety of modalities – person-to-person, phone, e-mail, direct mail, brochures .
Highly competitive - It wasn’t so long ago that universities, hospitals and other large nonprofits had an elitist attitude about promoting themselves. It was considered demeaning to sell their institutions to prospective donors and users of their services. Museums felt their collections spoke for themselves and charitable giving campaigns focused on building expansion projects culminating in grand openings and special exhibits attended by wealthy patrons.
Hospitals too tended to concentrate on major capital needs or research efforts, and used their ladies auxiliaries to organize and lead fundraising campaigns.
The net effect - an approach to fundraising that was sporadic with major gift efforts conducted with the assistance of outside help. Annual giving, planned giving and other techniques were ignored.
However, as competition for donors intensified due to changes in economic conditions, social priorities, and emerging technologies which made it possible for even the tiniest nonprofits to promote themselves and reach potential donors , nonprofit leaders had to adopt new ways of doing business. They realized that a well-managed, ongoing process for raising funds was needed. They also recognized that they needed a base of donors who were continuously cultivated, involved and informed.
Berendt , Robert J. and Taft, Richard; How to Rate Your Development Office; The Taft Group; Washington, DC; 1983
Many nonprofit executives have backgrounds other than development so there’s often a disconnect in their abilities to understand and analyze how development programs are working to provide proper leadership.
No such animal. Fundraising is a process that is better defined as delopment. Fundraising may also be called institutional advancement. Because of the narrow perception that people often have about the word “fundraiser” many people prefer to be called development officers.
It’s no secret there’s enormous turnover among those who raise money for nonprofit organizations. The latest estimate of the average tenure of a director of development was less than 2 years.
There are many factors at play regarding the turnover issue. Development work is complex and staff turnover is often a result of unrealistic expectations and minimal understanding of development’s complexity.
Bell, Jeanne and Cornelius, Marla; Underdeveloped, A National Study of Challenges Facing Nonprofit Fundraising; A Joint Project of CompassPoint and the Evelyn and Walter Haas, Jr. Fund; Compass Point; 2013
New iterations of individual giving programs include foundation and corporate sponsored events such as Giving Tuesdays and Day of Giving which are intended to raise the profile of the nonprofit community and encourage giving to favorite charities. These events are very popular with the nonprofit community since many have brought in a nice amount of money with minimal effort. The event sponsors bear the cost of the technology, infrastructure, and gift administration. All the nonprofits have to do is create a profile on the sponsor’s website, promote the event to prospective donors, and send thank you letters afterwards.
Requires artistic talent to design the appeal package, list generation, print and mailing costs, gift recording in the donor database, and personal gift acknowledgement.
The conversation often involves a discussion of voluntary vs. involuntary philanthropy. In the voluntary scenario, you’re holding funds to be preserved and applied to specific charitable causes of your choosing. The involuntary scenario is where government spends your dollars, which through lack of advance planning you wind up paying in taxes. The dollars you’ve worked hard for over a lifetime could be used for programs you don’t support or worse, squandered through government waste.
Most development people are not qualified financial planners and could get themselves in hot water by giving bad tax advice so it’s best course to refer a potential donor to an expert. There are lots of options to chose from – wills, insurance programs, trusts, and the use of a good financial planner is recommended. A good development officer is knowledgeable enough to initiate the discussion, but also knows when it’s time to call in an expert.
A planned giving program involves a considerable expenditure of time and possibly expense but is necessary to achieve a return in this area. Approaching the topic takes great interpersonal skills and sensitivity in discussing delicate matters. Negotiating a will, bequest, life income gift, annuity or trust arrangement requires specialized knowledge, and possibly many meetings with lawyers, accounts and donors, but returns could be substantial.
The person in this role does much more than write grants.
In some cases, it’s possible to use boilerplate but often times not since many funding requests are unique and require that we use a funder’s preferred format.
Writing versatility is very important. At times it must reflect creativity (as in the case of annual appeals and cases for support). Letters should be personalized to convey gratitude and details about how the gift will be used. Grant proposals are structured, must satisfy all application criteria or may be declined. Scientific or research organizations need someone with technical writing skills.
Not long ago, donor information was kept on 3x5 record cards. Today, highly sophisticated yet affordable and easy to use software is available.
This person’s role revolves around donor information management and analysis. This person needs to be proficient with computers, capable of generating and interpreting information for use in development planning.
Nonprofit board members are volunteers which means there’s only so much that can be expected of them. They join boards for various reasons: community responsibility, commitment to the mission, business or social exposure, ego. Few join because they enjoy fundraising which ranks as their least favorite responsibility.
When recruiting board members, expectations for personal giving and fundraising support need to be clear.
As for fundraising, board members are crucial to fundraising success. Even is they’re not comfortable making an “ask”, they can still support the fundraising process by being involved in planning, case statement development, review of financial needs, prospect identification and review, and solicitation when possible. Personal giving provides a board member with “moral authority” to ask others for donations.
Corporations are primarily interested in brand visibility and are careful with whom they associate. If an organization has just gone through a public scandal, it will be very difficult to get support until the incident is long forgotten, if then. Also, decision makers pay attention to how well and often your organization is in the news.