10/22/2013
Raising Philanthropic Donations
and Grants
Presenter – Marshall H. Ginn, CFRE
Managing Director of Capital
Development Strategies LLC
here in Arlington
— Board member of the AFP
Foundation for Philanthropy
— Selection Committee Chair for
The Washington Post Awards
for Excellence in Nonprofit
Management
—
Fundraising and Philanthropy for Nonprofits
Intro to Nonprofit Management (PUAD 505)
October24, 2013
What will be covered today
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Sources of Funding
Types of Funding – The sources of
nonprofit organizational revenue
— Management – what does it take to keep
this running
— Legal Requirements – compliance and
transparency
— Communication – storytelling, social
media, technology
— Creating a Culture of Philanthropy
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Sources of Funding
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Funding Sources - Individuals
Many ways to raise funds:
—
◦ Individuals, corporate gifts, foundation
grants, events, government support, earned
income, planned gifts, etc.
—
—
◦ Major gifts raised through personal (face-to-face)
solicitations bring in larger gifts ($500 or $1,000+)
than are typically raised through mailings.
The approach should be balanced.
The approach should also be “smart”
and based on organizational capacities.
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Individuals are always the first, best
source of support.
◦ General appeals through direct mail, emails or
telephone will result in smaller gifts of $25, $50 or
$100.
◦ Mailings cost more money but build the pipeline of
donors; personal solicitations are more cost effective
but require investments of time, patience and
expertise.
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Funding Sources - Individuals
Funding Sources - Corporations
Use of the website – tell visitors how to
give and what their gift supports.
— Everyone should be encouraged to
donate to an organization’s work:
—
—
Start with what’s easy, then grow
from there.
◦ In-kind materials, products or services may be
just what the organization needs.
◦ Volunteers, Family members, Friends of clients,
Patrons, Beneficiaries
◦ Corporate volunteer programs; loaned
executives, shared expertise
◦ Corporate matching gifts.
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Funding Sources - Corporations
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Funding Sources - Foundations
Corporate grants can range from $5,000,
$10,000, $25,000 +.
—
◦ Sponsorships are part of this too; typically
they come through the marketing dept.
—
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Funding Sources - Foundations
—
Community foundations and donor advised
funds exist throughout most cities/states and
are dedicated to supporting work in their area.
—
Family foundations are generally cultivated like
wealthy individuals.
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Funding Sources - Foundations
Foundations prefer to support specific
programs (55% of all funding according to “Key
Facts”), but some foundations do support
general operations or “capacity building.”
—
Not just a paper exchange –
must build relationships
here, too.
◦ Charitable grantmaking foundations
are a good source of funding.
◦ Make sure to review their giving
procedures carefully.
◦ Giving beginning to edge upward
here, post-recession. (Source: Key
Facts on U.S. Foundations, Foundation
Center, 2013.)
A business “roundtable” or “council” is
another way to engage business
community, creates a formal way through
which their voice is heard
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—
Monitor the relative cost effectiveness
◦ Sending out lots of proposals at various, typically
smaller, amounts OR
◦ Sending out a few, well researched higher dollar
proposals to foundations with whom the organization
has established a relationship.
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Funding Sources - Events
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Funding Sources - Government
Events should support the fundraising
program, NOT be the cornerstone.
—
◦ Fundraisers/events (galas, black tie dinners, etc.)
can
Government funding makes more sense
when it’s balanced with other funding
sources.
◦ Local, regional, state or federal contracts can be
awarded to an organization.
– Raise financial support for a cause,
◦ Combined federal campaigns or statewide campaigns
are other funding sources to consider.
– Raise awareness of an organization and
– Broaden outreach into the community.
– (Hard to do ALL three!)
◦ Small cultivation events, however, can be a useful,
tactical way to engage constituenceies
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Thoughts and Comments?
Funding Sources – Earned Income
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Nonprofits are allowed to earn
revenue.
◦ Fees for services, ticket sales, space rental, etc.
can bring in additional income.
– For some nonprofits, fee for service is a large part
of their budget
◦ Research, publications, reports, etc. can be
packaged and sold as a resource to the
community.
◦ Some nonprofits create “enterprise” units to
bring in additional revenue.
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Management of Fundraising
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Management of Fundraising
—
Fundraising programs require investment of
time, energy, attention and financial
resources to make it work properly.
◦ “Fundraising does not happen by itself and it does
not happen for free!”
◦ Be cautious about the drive to keep fundraising
costs unrealistically low. (Educate donors)
—
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There are required functions, whether or
not there is a dedicated dev staff (or staff
person).
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Tasks to be Handled
Fundraising Management
Fundraising Program Design &
Management
— Peer-to-Peer Fundraising Support
— Grants Management
— Corporate Relations
— Events Management
— Communications
— Fundraising Operations & Administration
—
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◦ Creating the fundraising plan
◦ Undertaking the actual appeals (annual fund, major
gifts, planned gifts, etc.)
◦ Donor stewardship and cultivation initiatives
◦ Providing timely reports
—
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Grants management
—
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Fundraising Management
Event Management
◦ Coordination of all aspects of event design and
implementation (budget, volunteers, sponsors,
logistics, etc.)
◦ Coordination with an event planner
◦ Follow-up activities with prospects and others
◦ Coordination of smaller cultivation events
Corporate relations
◦ Prospect research and qualification
◦ Relationship building and engagement with businesses
and firms; relationship building with local chambers
◦ Preparation of grant requests and reports
◦ Coordination of volunteer activities to engage corp
employees
—
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Fundraising Management
◦ Prospect research and qualification
◦ Relationship building and engagement with
foundations
◦ Preparation of grant applications as well as grant
reports
—
Peer-to-Peer Fundraising Support
◦ Managing prospect assignments
◦ Tracking “moves” with prospects by solicitors
◦ Supporting solicitors with training, coordination,
materials, etc.
◦ Maintaining materials in support of the process
Fundraising Management
—
Fundraising Program Design & Implementation
—
Communications
◦
◦
◦
◦
Newsletters, donor stewardship communiques
Storybanking for appeals, website, reports
Annual reports
Social Media
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Thoughts and Comments?
Operations and Administration
◦ Gift and pledge tracking
◦ Database management
◦ Acknowledgement letters/receipts
◦ Donor records
◦ Coordination/Comm between
departments/functions
◦ Training and prof development
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Legal Requirements
Legal Requirements
—
What are the objectives here?
◦ Compliance – there are rules that have to
be followed
◦ Public Trust – forging the bond between the
nonprofit and the community that supports it
◦ Transparency – keeping everyone informed
about what’s happening (and why) in the
nonprofit
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Compliance
Public Trust and Transparency
Filing the Form 990
— Tax Deductibility of Charitable Gifts
—
—
Tax docs available to the public
◦ Form 990
◦ IRS 501(c)(3) status determination letter
◦ Currently under great scrutiny
—
Substantiation
— Disclosure of Quid Pro Quo
Contributions
— State Level Registration to Solicit Funds
— State Level Registration (business license)
—
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Public Trust and Transparency
Adherence to the Donor Bill of Rights (Assn
of Fundraising Professionals)
Professional affiliations, such as AFP, Center
for Nonprofit Advancement
Certifications, awards and recognitions
Charity rating organizations
Organizational values statement
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Thoughts and Comments?
It is critical to educate donors about what
these things MEAN, so donors know how
to interpret the data.
— Donors ARE doing research; they are
looking for proof points, examples, clear
evidence that the nonprofit is making an
impact.
—
◦ They are seeking out nonprofits that provide
measurable results. (Source: The Burk Donor
Survey, Cygnus Applied Research, 2013.)
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BREAK
Communications
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—
It’s a cycle that builds on itself –> MESSAGE
–> MONEY –> MISSION
—
Use stories to get past the fear/anxiety of a
dollar-focused conversation; that’s not real
fundraising
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Putting stories to use
Stories are but one tool in our fundraising
toolkit. They provide a great beginning, but
we have to use them properly.
— Stories can be “repurposed” for fundraising.
— One of your most important fundraising
stories is your own personal “basic ask.”
Many of the SAME elements of good storytelling
come into play when making a strong solicitation.
—
Stories and Engagement lead donors from
transactional giving (like many first gifts) to
transformational giving (such as renewed giving or
increased giving)
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“Numbers numb, jargon jar, and nobody ever marched
on Washington because of a pie chart. If you want to
connect with your audience, tell them a story.
-- Andy Goodman
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◦ Focus and clarity of the message is critical
◦ Honesty and authenticity is really motivational
◦ Putting yourself in the mind of the potential donor is
absolutely essential
◦ Using emotional links to draw the prospect in works
all the time
—
Focus on what the dollars make possible – not
the dollars themselves – the IMPACT
◦ (Remember the Burk Donor Survey)
Transaction vs Transformation
—
—
Good storytelling results in good fundraising
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Dollar figures, ask amounts, fear, worry, etc. all
get in the way of good fundraising!
◦ Don’t get hung up on numbers, even though
fundraising is somewhat bottom line driven.
◦ A good message enables org to bring in money
◦ Money provides the resources that enables the
mission
◦ Mission – and org accomplishments – provides
the building blocks for stories, which are used to
highlight the message
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Stories Work Better Than Numbers
Communications – About the STORY
—
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◦ Work on creating your own story, in your own
words!
◦ Practice it and rehearse
◦ Never be caught off guard – be ready with a
story that paves the way to an ask when you
meet someone who can help your organization!
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A multi-channel approach
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Multi-channel approach
All stories can be delivered in a variety of
ways and through a range of channels
Format and delivery can be new and trendy,
but there still has to be a “story” there.
— Things to remember:
—
◦ Facebook and Twitter
◦ Press Releases/Media Relations
◦ Toolkits for volunteers
◦ Email blasts
◦ Website
◦ Newsletters or donor communiqués
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◦ Many donors still prefer written communications.
◦ Few donors read things sent to them thoroughly.
◦ If the goal is to inform, then inform. Don’t also
solicit in the same communication. It can turn
people off.
– (Source: The Burk Donor Survey)
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Social Media and Fundraising
—
We have a sense of where the resources
come from
— It takes a lot to manage the mechanics of
this process
— There are compliance and transparency
issues to be addressed to be sure
— And all of it must be grounded in a solid,
authentic message.
—
◦ A tweet or a post with no “story” behind it
means nothing
◦ Be responsive to what your donors what to
know/hear
◦ Don’t just shove stuff at your constituents
◦ Good examples (esp their Twitter pages):
– Humane Society of the US www.hsus.org
– National Wildlife Federation www.nwf.org
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Thoughts and Comments?
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So where does this take us?
Social media still must hold to the basics
of good communication/marketing
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Culture of Philanthropy
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Culture of Philanthropy
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Creating a Culture of Philanthropy
CompassPoint’s report - January 2013:
An organization’s VALUES and
PRACTICES support and nurture
development.
— Fund development is VALUED as a
MISSION ALIGNED program of the
organization
— SYSTEMS are in place to support donors
— DONORS are deeply valued, they are
right in the center of an organization
—
A serious wakeup call, with some seriously alarming facts;
but it provides us with a great way to frame a conversation
about how we should be approaching fundraising
differently.
www.compasspoint.org/underdeveloped
Download it. Read it. Today.
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Creating a Culture of Philanthropy
Creating a Culture of Philanthropy
Investing in fundraising CAPACITY and in
the technologies and other fund
development systems that they need!
— The fundamental conditions for fund
development SUCCESS are in place:
—
Fund development and philanthropy is
valued and UNDERSTOOD across the
organization
— Shared ACCOUNTABILITY for the
organization’s achieving its fundraising
goals
—
◦ Basic tools such as a plan and database
◦ Essential board and executive leadership and
development skills
◦ Shared culture of philanthropy across the
organization
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EVERYBODY – staff, executive director
and board – can do the following:
—
Articulate a case for giving
Get people engaged in and passionate
about your organization’s work, and
contributions are almost an “accidental”
by-product!
— How would you “promote philanthropy”
at your organization?
—
Everyone is deeply ENGAGED in
fundraising
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◦ Are ready to do that?
◦ Have an “emergency ask” ready
◦ Don’t be caught off guard
◦ Act as an ambassador
◦ Engage in relationship building
◦ Promote philanthropy
◦ Articulate a case for giving
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Being an Ambassador
Creating a Culture of Philanthropy
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Thoughts and Comments?
Wrap-up
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Creating the conditions for fundraising
success means you have a few things in
place:
◦ A balanced approach regarding funding sources
◦ A commitment to properly investing in and
managing the fundraising process
◦ A commitment to transparency and high ethical
standards
◦ A range of tools effectively in use and deployed
to get the job done
◦ A culture at the organization in which fundraising
can thrive
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Further Reading
Further Reading
Ciconte, Barbara L. and Jacob, Jeanne G.
Fundraising Basics – A Complete Guide, Third Edition.
Sudbury, MA: Jones and Bartlett Publishers. 2009.
— Lysakowski, Linda. Establishing Your Development
Office. Arlington,VA: Association of Fundraising
Professionals Ready Reference Series. 2002.
— Ciconte, Barbara L. Developing Fundraising Policies
and Procedures. Arlington,VA: Association of
Fundraising Professionals Ready Reference Series.
2007.
— Lysakowski, Linda. Nonprofit Essentials –The
Development Plan. Hoboken, NJ: John Wiley &
Sons, Inc. 2007.
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Complete description of AFP’s ethics codes,
practices and value statements:
http://www.afpnet.org/ethics
— Charitable Giving Coalition, convened to protect
the tax deductibility of contributions:
http://www.protectgiving.org
— Foundation Center recently published report on
facts related to foundation giving:
http://foundationcenter.org/gainknowledge/resear
ch/keyfacts2013/
— Chronicle of Philanthropy (a top source of up-todate news and information.)
http://philanthropy.com
—
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Thank You!
Use what you’ve learned today
Share what you’ve learned today
— Good luck with the rest of the semester!
—
—
Marshall H. Ginn, CFRE
(703) 875-3000
[email protected]
www.capdevstrat.com
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