The Four Best Predictors of Major Gift Success

Projected Table of Gifts

A core part of our work here at The Osborne Group is helping organizations build fundraising capacity.  Very often our clients want to build a major gift program or strengthen their existing major gift program and our job is take a look at the best way for them to create major gift success.  This involves a detailed understanding of what makes major gift programs and efforts tick and taking a close look at how any given organization measures up. While we take a very comprehensive look at data provided by our clients, we interview staff, board and investors, and we look at marketing materials and marketing collateral, etc. we have found that the likelihood of major gift success boils down to a few factors.  I’d like to share four of them with you here.

Do you have sufficient prospects?  Fundraising is a very quantifiable business; there is no reason to ever guess at projected results or be surprised when your numbers fall short.  How many gifts do you need and at what levels do you need to make your goal?  How many prospects do you need to close each gift?  What does that add up to and do you have enough prospects?  It really is just that simple.  I am continually amazed at how few experienced chief development officers and major gift officers fail to have or make active use of a projected table of gifts or the more accurate name by name table of gifts.  If you have enough prospects, there is a good chance your major gift effort will be successful.  If you don’t, it probably won’t.

Do You Have a Vision?  Vision is a fancy word for answering the question “why should I give you any money?” or saying “this is what will be different tomorrow because you gave money today”.  A good vision promises specific outcomes within a specific period of time (usually 1-5 years), is a stretch for your organization requiring increased generosity by your core supporters, and is articulated in terms of the impact it has on the community and society in general.  Let’s be clear, most major donors have a clear sense of the amount of money they are going to give away in any given time period and when you ask for a major gift you are either asking that donor to not to give to something else or give more than they intended and thus make some other interest of theirs less of a priority.  People and institutions are open to this but only when the impact is clearly and specifically defined.  This is your vision and you need it or your major gift program is dead in the water.

What does your leadership level annual giving look like?  Typically leadership level annual giving is defined as gifts between as gifts from $1,000 – $24,999 or $1,000 – $49,999 depending on the size of the organization.  You can think of it as your mid-level gifts for your organization or your highest level gifts that you receive on an annual basis.  Another way to think about it is the level that a potential donor will give prior to making a major gift.  Explicitly or implicitly high capacity donors who give at this level are saying “let’s see what you do with this money.”  They are evaluating if they hear from you on a regular basis, if you’re communicating the impact of their gift to them effectively and regularly, and if they are appreciated.  If they have a clear sense that their gift made an impact and what that impact was they may start to consider a major gift.  If they don’t, they won’t.

This work is usually only effective if you have an actual plan.  What does your stewardship calendar look like for this group?  For your major gift prospects in this group do you know how they prefer to have you communicate impact?  Do you have an individualized cultivation plan for each?

Do you have a sufficiently large, motivated, affluent and influential volunteer corps?  Many organizations approach the creation of, or enhancement of, a major gift program as a exercise in strategic staffing.  Having well trained and high quality major gift officers certainly is very important for major gift success but the best major gift officers in the world can do little if they are not surrounded by sufficient affluent and influential volunteers starting with the board.  You don’t hire your hire major gift officers and development staff based on their personal connections (at least you shouldn’t).  You hire them because they are skilled at working with large numbers of people and getting them moving in the same direction in a motivated manner that results in large gifts.  But they need prospects to work with and those prospects must be generated by an army of volunteers.  The more volunteers you have with high levels of social capital the more prospects you have.  Again, it’s that simple.

There are many other factors such as engagement, culture of philanthropy, sufficient staffing, sufficient capitalization, etc. that go into major gift success but I would consider the above fundamental.  Without them, no matter how good everything else is major gift success will be difficult.  These four predictors are in many ways the hardest areas to develop but by far provide the largest payoff.

you can follow me at @bobosborne17

50+ Donor Engagement Ideas

Picture 3Engagement and involvement are critical to succesful fundraising.  As fundraisers, we must go beyond simply telling people how strong our work is, how effective the methodology is, etc.; we must show them.  Messages that are delivered by active engagement are far more credible and memorable than messages that are delivered orally or written.  People believe and remember their own experiences.  They tend not to believe or remember what they have simply been told.

Here are 50 ideas for engaging your donors and potential donors and inspiring true belief and buy-in to your mission, vision, leadership, plan and projects.

  1. Invite to have a private conversation with your CEO on a matter related to your mission or organization
  2. Do the above but with your head of program or a person in the field
  3. Invite to listen in on a conference call where your CEO discusses a matter related to your mission or organization
  4. Invite to speak at a conference or meeting
  5. Invite to attend a conference or meeting
  6. Invite to speak to the people your mission serves
  7. Ask to host a parlor or vision meeting within their home or office
  8. Ask to provide space for a vision or parlor meeting and then report back to them on the results
  9. Ask to speak at a vision or parlor meeting
  10. Ask to introduce the organization to others within their corporation
  11. Ask to provide feedback on your case for support
  12. Ask to provide feedback on your vision statement
  13. Ask to provide feed back on your website
  14. Ask to provide feedback on your Facebook page, blog, etc.
  15. Ask to provide commentary on your strategic plan
  16. Ask them to serve on your strategic planning committee
  17. Ask to serve on your stewardship committee
  18. Ask to serve on your campaign committee
  19. Ask to serve on your board or advisory board
  20. Ask to provide advice on a matter facing your organization
  21. Ask to provide expertise on a matter helpful to your organization
  22. Invite to a briefing in your office on a issue related to your mission
  23. Ask them to interview a staff, donor or board member for your newsletter
  24. Interview them for your newsletter
  25. Ask them to be a guest blogger on your blog
  26. Ask them to review your marketing materials
  27. Invite them into the field to see a demonstration of your work
  28. Invite them to take pictures of the people you serve when they are in the field- use the pictures for your marketing, send them a nice montage of the pictures too
  29. Ask them to mentor a client
  30. Ask them to meet a parent, student, or someone else you serve
  31. Ask them to volunteer at your event
  32. Ask them to review your finances
  33. Ask them to take part in a panel discussion
  34. Invite to a panel discussion that takes place of Google+ Hangout
  35. Ask to shoot video for you
  36. Ask to edit video for you
  37. Ask if they will look at a screening list and make introductions to foundation officers on the list (or individuals or corporate officers)
  38. Ask them to interview other effective organizations within your community for insight
  39. Ask to help make a PowerPoint presentation to be delivered to another potential donor
  40. Invite to attend a fundraising training with your staff
  41. Invite to attend activism training with your mission staff
  42. Invite to listen in on a staff meeting
  43. Invite to be part of your campaign video or other video
  44. Ask to provide an endorsement quote for your organization
  45. Ask to start a Facebook campaign
  46. Ask to participate in a crowdfunding campaign
  47. Ask to call a list of donors to thank them for their gift
  48. Ask to organize a “thank you-a-thon” where the whole organization calls donors to thank them
  49. Ask to call a list of new donors to thank them for donating
  50. Ask to help your clients find jobs, internships or other relevant experiences
  51. Ask them to host a party for your clients to congratulate them on an achievement
  52. Ask them to visit other potential donors that live in the area on a business trip

 

Crowdfunding: When and How to Use It

Picture 3One of the hot new topics around fundraising in 2012 was the idea of crowdfunding.  Over a billion dollars was raised worldwide through crowdfunding in 2011 and those numbers were expected to nearly double in 2012, with nearly half the total going to nonprofits.  That’s a huge amount of money, making it hard to deny the fact that crowdfunding has become an important fundraising channel.

So, should your nonprofit use crowdfunding?  Well, maybe.  Don’t get me wrong; I’m pretty excited about the possibilities of crowdfunding.  Its online and viral nature make it a potentially very effective way to fundraise raise in our social media driven world.  But it’s no silver bullet as I’ve discovered myself through crowdfunding campaigns that I personally have been involved with and those of people I know and work with.  Below are some quick tips on how and when to use crowdfunding effectively.

  1. If you build it they will NOT come –  I find that there is always the temptation and belief in the online world that if you start a blog, a website, podcast, etc. that subscribers will appear all on their own.  I think most of us realize by now that this is not the case and the same holds true for a crowdfunding campaign.  Simply starting a campaign and hoping it will magically go viral is the recipe for failure.  Like everything in fundraising, you must get the campaign in front of the right people.
  2. The normal rules apply –  It feels like every year in fundraising there is a “new” way of doing things.  But I find that fundraising is based on some firm rules that rarely change.  As in all fundraising, crowdfunding is most effective when your volunteers have active involvement and ownership of your campaign.  The most successful crowdfunding campaigns start with friends, family and colleagues donating and spreading the word; it goes viral from there.
  3. Clear impact and outcomes matter – The most effective campaigns pick a clear project and clearly express the difference it will make.  Campaigns that focus on general support have a much harder time of being successful.  Many campaigns have giveaways based on a donation level; it’s more important to communicate the impact that donations will have.
  4. Big money is hard to raise – Yes, there are many stories out there of very successful crowdfunding campaigns that raise into six figures, the most famous of which is probably Mathew Inman’s (of the Oatmeal fame) campaign for a Tesla Museum.  But this the exception.  A quick scan of charitable projects will show you that $25,000 or less is far more common and realistic.

So, given the above facts, when should you use crowdfunding?

  • When you have a clear and specific project
  • When you have volunteers that are willing to support it through email, social media, etc.
  • When you have the time and resources to regularly post progress updates, video, etc.
  • When you only need a modest amount of money

OK, lets say you meet the above criteria.  Which platform should you use for your campaign.  Here are a few to consider:

  • Kickstarter – The most famous; more geared toward tech and project start ups than nonprofits but certainly charitable causes can be done.  You must reach your goal or the money is returned to investors.
  • Indiegogo – My personal favorite, this site is well set up for charitable causes and well integrated into social media.  You have an option of whether to make the project “all or nothing” or if you can keep the money even if you don’t hit your goal.
  • StartSomeGood – uses a “tipping point” model where your project can be partially funded if it reaches a threshold where you can minimally proceed.
  • Crowdrise – Volunteers can fundraising on their own for any charity already registered on the site.
  • GlobalGiving – worldwide crowdfunding.

Once you’ve selected a site, here are some tips to make your campaign successful:

  1.  Get volunteers – Before you launch, make sure that you have a number of volunteers that are willing to personally give and promote the campaign via face to face and their own social media.  Volunteers will get your campaign out there and give it some momentum.
  2. Pick a clear project and a realistic goal – Pick a project that is concrete with easy to understand outcomes and pick a goal that is realistic.  Remember, people aren’t going to give you $1,000 (probably) because of an email request.  Crowdfunding is mostly “small ball” with two and three figure donations, so plan accordingly.
  3. Give Personally – I always check to see if the campaign sponsors have personally given.  If you haven’t, why should I?
  4. Communicate – Communicate to your donors and potential donors on a regular basis.  Update them on the progress of the campaign and demonstrate impact through words, pictures and videos.

We are sure to see a lot about crowdfunding in the coming year.  Experiment and see how your nonprofit might use this new channel for fundraising effectively.

You can follow me on twitter @bobosborne17

What I Learned About Fundraising Here By Fundraising Abroad

Over the last few years I have had the privilege of conducting fundraising and management work globally.  It has been an incredibly rewarding and fun experience; an experience that goes beyond merely having the opportunity to see new parts of the world.  It has in many ways confirmed and strengthened my/our philosophy of fundraising here in the United States.  My experiences have varied and of course every country and culture are different, but I’ve boiled what I’ve learned down to three main lessons.

Communicating Impact Matters – We all know this in our heart, we talk about it constantly, but I am continually amazed at how infrequently I actually see this happening.  In 2011 I was speaking at the International Fundraising Festival, a conference run by the Czech Fundraising Center in Prague, Czech Republic.  As part of the conference the organizers brought in some donors/philanthropists to speak to the attendees.  I was struck by how forcefully and constantly that talked about a need to have a clear understanding of what their philanthropy was accomplishing.  In fact, it was more or less the only thing they cared with the exception of the percentage of each donation that actually went to services, which I could also argue is part of impact.

Here in the US I rarely see impact talked about in such an upfront manner.  We tend to spend a lot of time talking about mission (what we want to do), methodology (how we do what we do) and track record (what we’ve done in the past).  We seem to rarely “bottom line” our work and come out and say “here’s how the world/community/this family,etc. is better off because of your donation” or if we do, it’s lost in a sea of other information.  Impact is why people give.  Make it front and center.

Stick to Your Vision – Over the last two years I’ve developed a personal interest in civil society development in Central Eastern Europe and South East Europe.  I’ve gone so far as to join the international advisory board of the Czech Fundraising Center and start a blog on Serbian NGOs and civil society.  In talking to some of the folks involved with the civil society sector over there they have lamented to me the fact that in many ways the nonprofits have, or are in danger of becoming, mere arms of the government.  The government or the EU or USAID puts out an RFP for certain work they desire to have done and nonprofits submit proposals to conduct that work.  This isn’t a terrible thing over all BUT I would argue that nonprofits serving communities in those countries will have a far better sense of what those communities needs are than government bodies based in Washington or Brussels.

Far more impactful and interesting and then seeing what institutional funders desire to fund is having your own vision of the impact you’d like create based on the needs that you and your organization see.  Your own vision will inspire and motivate.  Following the money results in mission drift, at best.

People are Generous – A common complaint I hear in parts of the US is that “there is no money here.  This isn’t like New York City where you’re from.”  True enough.  I understand that different regions have more or less people, industries, foundations, etc.  That said, nearly$300B was donated privately last year here in the US.  Many of the places I have been abroad have far less money available to them and far less of a culture of philanthropy and manage to carry on.

Is fundraising always easy?  No. Often it is very hard.  But altruism is a part of our heritage as human beings, hardwired into us.  Give people a clear sense of your vision and how their generosity can help realize that vision and the money will come.

you can follow me at:  @bobosborne17

How to Never Hear No Again

by Karen Osborne

Asking is only a sentence. “Please join me with an increased investment of $x.” What inspires a generous and joyful response is all that went before the solicitation conversations.  Here are some sure-fire tips.

  1. Make sure you know the Right people from the beginning.  Who makes the philanthropic decisions? For many of us, we work with the person we know, our alumna, grateful patient, board member, check signer.  In today’s marketplace, more families (not just spouses) are making decisions together.  Research tells us women seek out many inputs before making a decision. Corporations and foundations often have multiple decision makers.  Ask, “In my family, we make our decisions together.  How does that work in yours?”
  2. Engage them all before you ask.  We know engagement leads to more giving.  Engagement is not the same as showing up, or helping out.  It is meaningful and contains a thinking component, feeling aspects, and most important doing.  Engage my mind, not just my time.  Seek my advice and professional expertise, not just my money and contacts.  Ask, “What engagements with other not-for-profits have you found the most satisfying?”
  3. Identify the Right purpose or impact.  Purpose drives amount and BIG IDEAS inspire big gifts.  Our task is to reach the point in the relationship (even if its short term for a leadership annual gift) where the donor says, “I want to make that happen.” Or, “How do we make that happen?” It’s about impact and outcomes, not a shopping list of giving opportunities.
  4. Bring the Right solicitation team.  Who inspires these donors?  Who can ask, “Please join me?”  If the solicitation is made by staff alone, invoke an admired colleague who has stepped up.  You are not pitching an amount or a project, you are engaging your donors in a discussion about outcomes that the project or amount will achieve.  Bring along virtually or physically a believer.
  5. Start with THANK YOU AGAIN. Steward past gifts.  Don’t just thank immediately after a gift (but do thank within 24 to 72 hours).  Take it to the next step and connect the donor, three months, six months, nine months, after the gift with the IMPACT she had or the collective had (everyone who gave to the event, or to the annual fund).  People repeat joyful experiences.  Make your donors say “Wow.”  The next time you ask, you’ll receive an inspired, generous, joyful, “Yes.”

You can follow me on twitter: @kareneosborne

Capitalize Your Development Operation!

by Robert Osborne

Every organization wants more money for its programs but I am constantly surprised at how few organizations are actually willing to spend money to make money. I know of organizations that have cut back their development staff even as they have raised their fundraising goals. I know of organizations that refuse to do stewardship because they think it is too expensive. And I know of “national” organizations that wish to fundraise across the United States but have no travel budget.

The problem becomes even larger when we talk about capital campaigns. Organizations that wish to raise 10x or more of their annual operating budget and tens of millions of dollars often balk at spending even a $100K to do so!

Your development office is a “profit center”, another way of saying that your development office makes you money. But only if it is properly capitalized. While different types of fundraising have different costs associated with them, a good rule of thumb is anticipating spending somewhere between $.15-$.20 for every dollar you want to raise. Events have the highest costs associated with them with a cost of roughly $.30 on the dollar and major gifts have the least with a cost of roughly $.12 on the dollar. But there is no such thing as free fundraising.

Every organization should ask itself what it needs to be successful to meet its fundraising goals. Do you have enough personnel, not just “front line” fundraisers but also administrative support? Do you have the proper technology to operate efficiently and effectively? Do you have the marketing pieces you need including video? Do you have a budget for any necessary travel? Have you built in contingency?

My suspicion is that organization try to do fundraising on the cheap because they do not have the cash on hand when they begin their fundraising. They realize that they are undercapitalizing the effort but are unsure what to do. Ideally, our supporters would help us in this area as Dan Pallotta discuss in this post in the Harvard Business Review and truly leverage their investment, but lamentably capacity building tends to be way down on investors lists of things to fund.

Sadly, there are no short cuts. An undercapitalized effort may even cost you more than not doing it at all. If you don’t have the cash on hand to properly capitalizing a fundraising effort you need to make raising the necessary capital part of your plan. This may take longer but it will be worth it. To not do so is to spend money on what is likely to be an unsuccessful effort. But the right investment can go a long way.

You can follow me on twitter:  @bobosborne17