Leveraging and Duplication

Posts tagged ‘fund development’

Funding 2020 Donor-Centered Approach to Fundraising

Key Elements in a Donor-Centered Fundraising Program

Eighty of all philanthropic dollars in the US come from individuals. This means that the key to sustainability lies in having a robust individual donor program. Before you can worry about your donors, however, you must first attract them to your agency and its cause.

At its core, philanthropy is a heart-centered activity. Donors want to make the world a better place, but each has their own vision for doing so. Since most donors can’t achieve this kind of change on their own, your organization could be the perfect vehicle that can help them realize their goal. Before donors will hand over their hard-earned money, however, your organization must:

1. A compelling case for support to which donors can connect
2. A relational approach to your donors (it’s about relationships, not numbers or money)
3. A vigorous relationship-building program (which implies the use of multiple strategies), and
4. An understanding of the connection between fundraising and every other function of your organization.

Other elements that contribute to successful fundraising include an agency-wide commitment to continuous learning and growth, good organizational systems, and the use of strategic, efficient and effective management. Organizations that successfully attract — and retain — donors keep their mission at the center of their operations, practices, procedures and culture, creating an Axis of Synergy. This means that every aspect of organizational functioning lines up with its mission, vision and values.

Nurture Relationships

Today, there are nearly 1.5 million non-profits in the US. The average donor gives to between 5-11 institutions per year. Approximately seventy percent of Americans donate on a regular basis. This means there is already a trained pool of donors out there, ready to support our cause. Our job is to acquire and retain as many of those donors as possible.

Being donor-centered is about nurturing relationships. Once a donor is in the door, it’s our job to “court” them. How many of you asked your spouse to marry you on the 1st date?! You shouldn’t be doing that with your donors, either! If you want someone to become a donor, convert to a habitual donor and increase their gifts over time, you must get to know them, identify their self-interest and appeal to that over and over again. You must treat your donors like people, not ATM machines!

Information vs. Recognition

One way to do this is to provide information about how their gift has been put to work. Most donors care about this far more than they do about recognition, because recognition without information essentially renders their gift meaningless. People want to know that their gift made a difference, because that’s what compelled them to give in the first place.

To ensure that your donors stay in love with you, you must communicate with them on a regular basis –- at least 7 times per year. This means making phone calls, sending out regular newsletters or e-news updates, emails, and personal notes. It’s a lot of work, but it’s the only way to maintain and nurture the relationship. After all, it’s far easier to retain an existing donor than to go out and find a replacement for the one you lost. Most non-profits can lose up to 1/3 of their donors every year. This is primarily because we treat donations as a transaction, not as the extension of a relationship.

Communication and Cultivation

In order to foster and nurture relationships, we need to communicate with donors in relation to their self-interest. That requires getting to know them on an individual basis and connecting them more deeply to the life of the organization. It means hosting cultivation events where prospective donors and existing donors can enhance their understanding of and connection to the agency and its mission. Developing meaningful relationships takes time. The number of donors that needed to cultivated, over time, to ensure the longevity of an organization requires the efforts of many people in your organization, including your board.

In building a board, it’s important to recruit people who are passionate about your mission and are willing to share that passion with others. Please do not ask your board to trespass on their personal relationship in the process! Find people who are genuinely interested in the cause, bring them together with a passionate, mission-centered board, and watch the magic happen. As donors deepen their relationship with the organization, they are often more than willing to engage in solicitation on the agency’s behalf.

Measuring Success

In a donor-centered organization, the measure of fundraising success is not only the amount of money raised, but the percentage of donors retained. Examining retention rates will reveal a lot about your existing fundraising efforts and where you need to strengthen your program. In order to truly learn why donors are involved with your organization, conduct surveys, interviews or focus groups. It’s particularly important to listen to any complaints that are made and interview former donors, because it is from these people that you can learn the most about how to become more donor-centered. Although donor-centered fundraising requires significant effort on the part of multiple people in your organization, in today’s economy, it is the only way to secure your agency’s future. Connect with us by clicking here


Fundraising or Fund Development – What’s the Difference?



The terms fundraising and fund development are bantered about almost interchangeably. But there is a difference, and if you’re interested in the nonprofit field, it’s a good thing to know.

But, there is a difference.

Fundraising is probably the easiest of the two terms to define. It is activity that is conducted with the intention of raising money for a nonprofit organization or charity. It usually involves asking people for donations, using a variety of communication methods, asking people to purchase a product or service that supports the charity, or having people participate in an event of some sort. Some extend the definition of fundraising to include activities like sponsorship sales, which is essentially a form of advertising, gaming and gambling activities that benefit charity, and application for funds from government programs.

Fund development is a bit less straight-forward and a bit more of an abstract concept. The way I think of fund development is the process by which organizations use fundraising to build capacity and sustainability. Fund development is a part of the strategic marketing of a nonprofit organization. It is the concerned not only with raising money, but doing so in a way that develops reliable sources of income that will sustain the organization through the realization of its long term mission and vision. Fund development usually involves building relationships with people and other organizations that will support the charity. It requires a strategic plan that relates funding to the purpose and programs of the organization. A part of the strategic plan will be a fund development plan that coordinates various forms of fundraising, marketing, communications, and volunteer management.

There are various ways of categorizing nonprofit organizations and charities. When it comes to determining which require fund development strategies, as opposed to fundraising, I tend to think in terms of three categories. There are organizations that do not concern themselves with development because the membership keeps changing, the goal for fundraising is almost always to meet the immediate needs of the members, and the infrastructure costs are supplied by a larger, affiliated organization. Church youth groups, bands, cheer leading squads, and sports teams, and so on, fit into this category. Participants in these groups are usually involved for a few years, so typically no long term relationships with people outside the group are established, their is no incentive for members to fundraise beyond their immediate needs and they are usually affiliated with larger groups, like schools or churches, which supply needs like meeting space and leadership. These types of groups typically engage in fundraising activities that require minimal organization, leverage volunteer participation and require simple communication strategies.

A second type of organization is primarily member based. Funds are raised from among the members themselves for the purpose of sustaining the organization’s needs, which are usually a building or meeting space of some sort and staff. The money required may be in the form of fees paid to belong to the organization, as in the case of a professional association, or in the form of donations, as in the case of a church. These organizations have a built-in fund development strategy. The supporters of the organization are the recipients of the organization’s programs and services. So the strategy for sustaining the organization and building its capacity usually revolves around the members themselves organizing in a way that provides trust of the leadership to spend funds wisely, communication about how funds are being used, involvement of the membership in budgeting and other decision making processes, and a strategy to build and rejuvenate the membership.

The third type of organization potentially describes the rest of the nonprofit and charitable world. This is the organization that serves the entire community or society in some way. It has a long term vision and strategic plan and requires funding to maintain its service to the community year after year. Sometimes organizations like this have a base of government support, but often must raise funds from a variety of sources to maintain their budgets. This type of organization must have a fund development strategy in place to ensure its long term viability and build its capacity over time. The methods of fundraising it uses may be similar to the other organizations described above, the difference being that underlying its choice of fundraising methods will be the desire to build sustainable relationships with all funding sources.

A key decision an organization must make is what type of fundraising or fund development strategy it should use based on the type of organization it is and if it has long-term needs. Many organizations start with meeting their needs through short-term fundraising strategies and at some point must make the transition to fund development strategies. Otherwise, they will flounder, moving from one fundraiser to another without developing sustainable relationships.

Learn more LADA Fund Development connect here

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