Category Archives: FUNdraising Good Times

Fundraising commentary, tips and information.

Fundraising: investment or afterthought?

Posted on September 9, 2013 | Leave a comment

Investment or afterthoughtInvesting in the fundraising operations of a nonprofit is an investment in the organization’s future. It takes time to build a fundraising program that is capable of securing revenue from multiple sources. It takes vision, planning, leadership and resources – including money.  And, it doesn’t necessarily “pay off” right away. A fundraising program takes time and attention to mature. Often three-to-five years. And during that time the investment in fundraising needs to be consistent. Once a fundraising program is well established it can support a nonprofit organization or institution in meeting its revenue goals. But, again, it takes time. And even once established, it cannot be put on “automatic pilot.”

Fundraising needs consistent attention from the organization’s top leadership. That means the CEO and board members have to be willing to cultivate and solicit gifts all the time, not once in a while. The focus needs to be on building and sustaining a pool of prospective donors and funders. You need a pool who can collectively give three times the fundraising goal because not everyone who wants to give will be in a position to do so when asked. You have to know who these people are. You have to be in contact with them. You have to know what they want from a funding or giving relationship with your organization.

Don’t wait until the organization needs money to build a fundraising program. That’s when it’s too late. Our recommendation: attract the people and expertise to build and sustain your programs and simultaneously attract the people and expertise needed to raise money for the program in future years. It can take a minimum of 12 to 18 months to secure meaningful investments from foundations, corporations or individuals. Having a strong program that meets community needs doesn’t mean an organization will be able to raise money when funds are needed. Successful fundraising is the result of consistent planning and engagement.

With the economy turning around and money beginning to flow again now is the time for nonprofits to build sustainable fundraising programs. Prepare for future challenges. Get your house in order. Be proactive, not reactive. Build a program that attracts unrestricted funding as well as the “easier” to obtain restricted funding. Yes, it takes time and creativity to find ways to secure unrestricted funding: but if you don’t make the investment you won’t have the unrestricted funds. Ensure your board and CEO are committed to fundraising. Seek out volunteers who are fearless fundraisers. Create a fundraising plan that seeks funds from multiple revenue sources – not only foundation or government grants. Attract, train and invest in committed and experienced staff.  Review and refine your case for support. Articulate your uniqueness. Align your organization with community needs. Respond to the market. You can do it: it takes vision, planning, commitment and your time.

Mel and Pearl Shaw are the authors of “Prerequisites for Fundraising Success” and “The Fundraiser’s Guide to Soliciting Gifts.” They provide fundraising counsel to nonprofits. Visit them at www.saadandshaw.com. Follow them @saadshaw.

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How will you fund your strategic plan?

Posted on September 2, 2013 | Leave a comment

Strategic Planning www.fundraisinggoodtimes.comStrategic planning is the process that drives the work of many nonprofit organizations and institutions. It takes different forms depending on the culture and policies of the nonprofit. Some complete the process at a retreat, others hire a facilitator to work with a committee of the board, still others hire a firm to survey best practices and emerging trends amongst competitors and collaborators. The outcome – a strategic plan – will drive operations and decision making over a multi-year period.

We encourage strategic planning that answers the question “where will the money come from” as part of the process. Determining future directions without seriously evaluating how they will be funded can create an unhealthy stress for nonprofits of any size. Assuming that the development director or vice president will raise the money needed to bring a strategic plan to life without planning and budgeting for his or her success is irresponsible. Here are three things to consider:

If fundraising planning is not integrated into the strategic plan, you may find out later that the plan’s underlying assumptions don’t materialize. Assuming a consistent (or increasing) level of funding without planning for how those funds will be raised, can put the organization itself in jeopardy. Creating operating budgets without a market-based assessment of whether or not the required income can be generated can also put your nonprofit at risk.

If the strategic planning committee envisions a major fundraising campaign as part of the organization’s future be sure to poll your board members to learn whether or not they would be willing to give an increased amount of their time, money and resources to that campaign. If your board isn’t willing to lead and give, including such a campaign in your strategic plan may not make sense.

Unless your nonprofit is funded through a well managed, unrestricted endowment, someone within the organization will ultimately be charged with raising the funds required to bring the strategic plan to life. The extent to which he or she can raise the required funds is often impacted by the extent to which the nonprofit’s strategic direction aligns with funding priorities of local and national foundations, corporations or individuals who have the financial capacity to make major gifts.

One way to integrate fundraising planning into the strategic planning process is to invite input from select donors and funders. Ask program officers and corporate leaders about the vision, strategic directions, goals and objectives of the foundations and businesses they represent. Your CEO and fundraising staff can also provide the strategic planning team with information they have gained over the years regarding giving trends and requirements.

When you know your nonprofit will need to invest time and money to grow a new pool of donors and funders you can budget and schedule growth to align with realistic revenue projections. Incorporating this into your strategic plan can help set realistic expectations.

Mel and Pearl Shaw are the authors of “Prerequisites for Fundraising Success” and “The Fundraiser’s Guide to Soliciting Gifts.” They provide fundraising counsel to nonprofits. Visit them at www.saadandshaw.com. Follow them @saadshaw.

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What’s Your Policy?

Posted on August 26, 2013 | Leave a comment

www.saadandshaw.comMost people who volunteer with nonprofits are ethical and deeply committed to the organizations and institutions they serve. But sometimes in the midst of doing good there may be a tendency to sidestep best practices that build credibility. One way to ensure credibility is for the board to craft, approve, and implement fundraising guidelines, policies, and procedures. These should be clearly worded and should support the work of board members, volunteers, staff, and donors.

We advise our clients to take the time to identify the full spectrum of guidelines, policies, and procedures needed to support their fundraising efforts — before launching a campaign. Choosing to adopt policies on an “as needed” basis is choosing to be reactive instead of proactive. When policies and procedures are clearly communicated, the work of fundraising is made easier.

For example, if you do not have a pledge policy in place, it can be frustrating for a volunteer solicitor to learn that the three-year pledge she secured from a local business leader requires a signed pledge form. If she had known, she would have informed the donor at the time she solicited the pledge. Having to come back to secure a signed pledge form means reopening negotiations. It provides the donor with an opportunity to reconsider her giving. It sends the signal that your organization does not have its house in order. It can frustrate volunteers who are giving their valuable time.

Take the guesswork out of fundraising. Define your policies and procedures. If unusual circumstances arise, respond to them. But have the fundamentals in place and apply them consistently. Nothing can lose the goodwill of an investor or volunteer more quickly than a situation where the rules are changing constantly. Take time and work with your board, staff, volunteers, and donors to develop guidelines, policies, and procedures that are credible and in line with your mission and culture.

Here is a three-step process you can use as you put policies in place. Step one: the development committee of the board is responsible for drafting guidelines, policies, and procedures. They can work with your development staff, with a consultant, or with Internet resources to craft these. Step two: the documents created in step one should be brought to the full board for approval. Step three: once approved, the guidelines, policies, and procedures should be implemented by staff and referred to on an ongoing basis.

Details on policies and procedures for consideration are available from the Association of Fundraising Professionals (AFP) website www.afpnet.org. We also include examples of policies (and what they related to) in our recent book Prerequsites for Fundraising Success. Following the AFP Donor Bill of Rights and the AFP Code of Ethics are two items all nonprofits should review and consider adopting as part of their fundraising policies.

Mel and Pearl Shaw are the authors of “Prerequisites for Fundraising Success” and “The Fundraiser’s Guide to Soliciting Gifts.” They provide fundraising counsel to nonprofits. Visit them at www.saadandshaw.com. Follow them @saadshaw.

 

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Nonprofit values and efficiency

Posted on August 19, 2013 | Leave a comment

Board members with experience and connections in the private sector can help nonprofit organizations grow and think in new ways. And nonprofit service can help board members from the private sector to grow and think in new ways, too.

www.fundraisinggoodtimes.comEfficiency and cost reductions often contribute to business success. Time and energy is devoted to developing and implementing strategies that increase the efficiency, value and profit while decreasing costs.  Technology, collaboration, and innovation have factored greatly in this process.

Technology, collaboration and innovation are also prevalent within the nonprofit sector. At the same time many nonprofits are often seen as inefficient. Sometimes even board members question the “results” of the nonprofits they serve. While questions are always welcome within organizations that value the full participation of all members, it is also important to consider some of the ways in which nonprofits, in general, are different from the private sector, in general.

Many nonprofits place trust, relationships, community building and diversity at the heart of their values and operations. This enables them to do the hard work that takes time – and sometimes generations – to accomplish. Ending poverty, eliminating health disparities, decreasing family violence and increasing educational attainment often require strong relationships, trust and a knowledge and understanding of the people being served. An efficiency-focused organization might, for example, choose to consolidate services in one location, eliminating neighborhood-based services. This can reduce operating costs and benefit staff who can work together more closely in one office instead of five smaller ones. But, this might not be what is best for the families being served. Removing service providers from the fabric of the community can decrease an organization’s understanding of the issues, concerns and assets of a neighborhood. It can make it more difficult for people to access services due to transportation issues. It can work to break down the trust that has been built up over years – a trust that encourages people to take different actions in an effort to achieve different outcomes.

Likewise, it may not be apparent to board members that a long-term receptionist is one of the most important people within the organization because of the relationships she has developed with families the nonprofit serves. She could be replaced with a new phone system, but what else might the organization loose that is core to its mission?

And that is the difference – nonprofits measure success by their ability to deliver on their mission. Sometimes that process is very similar to that used by the private sector. Sometimes it is different, or may appear inefficient. If you provide leadership for a nonprofit take time to understand the core values that drive the organization and how these are made manifest in operations.

Mel and Pearl Shaw are the authors of “Prerequisites for Fundraising Success” and “The Fundraiser’s Guide to Soliciting Gifts.” They provide fundraising counsel to nonprofits. Visit them at www.saadandshaw.com. Follow them @saadshaw.

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Nonprofit success: more than “feel good”

Posted on August 12, 2013 | Leave a comment

Part two of a two part interview…View part one here

Mike Bruns www.fundraisingggodtimes.comSuccess in business is not enough. In fact, nonprofit involvement –and giving – can be a greater “buzz” than continued business growth. “After becoming reasonably able to share, a person realizes that the buzz you get from sharing can be greater than the buzz you get from daily life in business. Ten percent growth year-after-year doesn’t always equal the buzz of giving ten percent to the community.” That’s the experience of Mike Bruns, founder of Comtrak Logistics, a national transportation and logistics company headquartered in Memphis.

“The true donor misses the boat if they don’t get just as much back in their heart, meeting people and making friends,” Bruns continued.  “Involvement brings satisfaction – it makes the donor feel good.  I was chair of Youth Villages for so many years, and they did as much for me as I could ever do for the organization.”

Youth Villages, also headquartered in Memphis, is a leading national nonprofit dedicated to providing the most effective local solutions to help emotionally and behaviorally troubled children and their families live successfully.

“Youth Villages grew as a result of a wonderful culture, incredible leadership team, and a management team that knew this was a business. Nonprofit is more than a feel-good. Many stall out because the person who started the organization didn’t surround themselves with good business people. At Youth Villages the leadership surrounded themselves with business people who helped them run the organization like a business, but not at the expense of their passion. They serve 60,000 young people and they measure everything.  ‘Feel good’ doesn’t last long if the business model doesn’t work.”

That goes for the board as well. The biggest challenges Bruns has experienced arise when board members don’t know what is expected of them. “That has to be done on the front end. You can’t read a board manual to people. You need to explain their job description, financial expectations, and share with them why they were recruited. They have to become involved with the organization and passionate about it. Board members who are engaged and feel a part of something come to meetings. This solves the problem some boards have where they spend almost half their time worrying about the best time to get attendance. As board chair I focused on getting engagement. So many boards operate without engagement.”

Bruns closed with his perspective on board members’ reluctance to fundraise. “When a board member is not prepared, and is not personally passionate, the gifts he solicits become a ‘trap’ wherein he now ‘owes’ an equal gift to the donor’s nonprofit of choice.” The solution: “Be prepared and sell the nonprofit on its merits; then people give to the organization and not to you. You then are free to make your gifts based on merit too.”

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You can’t sell what you don’t know

Posted on August 5, 2013 | 3 comments

Part one of a two part interview with Mike Bruns

Mike Bruns www.fundraisingggodtimes.comMike Bruns possesses the characteristics of an ideal board member: deeply engaged with the organizations he supports, generous as a donor, and he treats his nonprofit involvement with the same seriousness he applies to business ventures. He has a great sense of humor, a kind heart and a warm smile. He’s also the founder of Comtrak Logistics, a national transportation and logistics company headquartered in Memphis, and chairman emeritus of Youth Villages, a national nonprofit. We recently talked with Bruns to learn the secrets to his success as a nonprofit volunteer leader.

We asked what he looks for in a nonprofit when deciding whether or not to become involved. His response was straight-forward, “I do not want to be a part of an organization that is a fixer-upper, or is trying to make payroll by Friday. I want to support organizations who want to grow to the next level. The ‘heart tug’ is always trumped by an organization that is well run. With a well run organization I can work with other board members to help grow it to the next level.”

It’s not that he is opposed to the “heart tug.” In fact, Bruns is passionate about the organizations he is involved with. “I truly believe in the organizations I become a part of. And I expect that of fellow board members. There’s nothing worse than leadership that is begrudging or ‘resume building.’ The secret to success lies in the passion of the leadership.”

Equally straight-forward were his comments regarding expectations of fellow board members in the area of fundraising. He cited the lack of board giving as the number one obstacle to fundraising success. “There’s nothing worse than a board member soliciting money and they haven’t made a meaningful gift. It doesn’t always have to be all money – it can be meaningful giving of time. But they have to believe in the organization and be engaged.”

Comparing fundraising to sales, Bruns was critical of board members who are not qualified to “sell the product.” For that he places responsibility squarely on the shoulders of leadership, “What is the orientation? Without proper training, orientation, knowledge, feeling and involvement a board member can’t ‘sell’ the nonprofit to potential donors. You can’t sell what you don’t know or believe in.”

Next week: Nonprofit success: more than “feel good”

Mel and Pearl Shaw are the authors of “Prerequisites for Fundraising Success” and “The Fundraiser’s Guide to Soliciting Gifts.”  They provide fundraising counsel to nonprofits. Visit them at www.saadandshaw.com. Follow them @saadshaw.

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Workshop, Seminars and Conferences: Blessing or Curse?

Posted on July 29, 2013 | Leave a comment

Saad & Shaw workshopContinuous training, education and exposure to new people and ideas can lead to continuous improvement, motivation, and engagement. Workshops, seminars and conferences add to the skill set and competency of nonprofit employees, executives, board members and volunteers. The question is: what happens after the workshop or conference?

Our experience has shown that the euphoria and “light bulbs” that go off during a workshop or conference sometimes don’t make it back to the office or the board room. It’s no one’s fault – it’s just human nature. Life gets in the way of good intentions, and sparks of creativity and innovation can dim without kindling. One method for ensuring you and your team bring your “aha! moments” back to the office is to create a plan for implementation before attending.

Here’s how it works. First determine which workshop, conference or webinar will benefit your organization’s work. Then determine who should attend. Where possible select more than one person – they will become your learning leaders. Prior to attending ask selected participants to write down the three things they are seeking to learn from the event. During the event they should take notes, with an emphasis on recording information and ideas that relate to what they are seeking to learn.

After the event, participants should share their learnings and ideas with others in the organization. The presentation should be part of a formal debrief. A team should be created to implement the ideas and learnings, and dates should be set that drive actions towards new goals.

This process can apply to learnings at all levels. Perhaps it is something simple: ensuring all members of the organization have a signature block for their emails that includes the nonprofit’s mission, website, social media and the individual’s direct phone number and email. It could be a bit more complex: integrating the nonprofit’s ticket sales into the donor database, or increasing revenue from special events. Maybe board members have suggestions for how to improve their meetings and increase attendance.

The learning – or aha! moment – could require a culture shift. Board members and staff may return from a conference with suggestions for how to better engage the board members, volunteers and staff with fundraising. When a culture shift is required, the first step is to debrief with the executive director. Gain her support and buy-in. Share the plan for how to implement the new idea along with projected outcomes.

This process creates opportunities for leadership, and allows those who did not attend the event to benefit from key learnings. When seeking to grow your nonprofit’s fundraising be sure to extend the impact of outside learning opportunities by planning in advance and following through afterwards. Let us know what works for you.

Mel and Pearl Shaw are the authors of “Prerequisites for Fundraising Success” and “The Fundraiser’s Guide to Soliciting Gifts.” They provide fundraising counsel to nonprofits. Visit them at www.saadandshaw.com. Follow them @saadshaw.

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Evaluate your nonprofit from a funder’s perspective

Posted on July 22, 2013 | 2 comments

Empty Conference Room --- Image by © Bill Varie/CorbisDonors and funders don’t necessarily tell you why they won’t fund your nonprofit. Many will make their evaluation based on your organization’s presentation and reputation without sharing their objections. But, if you know the criteria by which you will be judged you can proactively prepare.

We recently had a candid conversation with corporate representatives to learn what they look for when investing in a nonprofit. Not surprisingly, the conversation started and ended with a focus on the role of the board of directors. Funders assess the board in determining whether or not to give, and the level at which they will give. That assessment includes a look for corporate representation. They want to know who is on the board, how they are involved, what they collectively give, and how much they raise. They look at small cues that communicate an organization’s capacity and board engagement: who circulates throughout the community with the executive director? Is he or she accompanied by other board members or senior staff when attending meetings or events? Do board members identify themselves as such  they circulate personally and professionally?

The funders we talked with see the board as the party responsible for sustaining and growing a nonprofit. They want to know if the board can provide the resources and funding to grow the organization, with or without the executive director. They won’t invest in nonprofits where the board does not demonstrate the leadership required to guarantee growth. Having a strong executive is not enough.

Related to current board involvement is the issue of “the bench.” Funders want to know how the current board is engaging and cultivating future board members. For community-based organizations the questions relate to the process of growing from a community board to a diverse board that integrates, welcomes and engages professionals and corporate representatives. Those we talked with mentioned the importance of boards knowing what type of leadership model they seek to emulate. While concerned about funding for today, these funders are equally focused on an organization’s ability to succeed in future years. They want to know about succession planning: who is capable of ensuring continuity of operations should the executive abruptly leave. They want to know if and how the board surrounds the executive director with professionals who can help attract people resources.

Finally, they made it clear that they invest in nonprofits where their employees provide board leadership: funding and resources follow employee board engagement.

The bar is set very high. But you can’t meet the mark if you don’t know what it is. If you have been struggling to grow your organization to a new level of operations, and seeking corporate support, you may want to consider looking at your nonprofit from the perspective of a corporate funder. What will they see?

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Corporate Partnerships: What Does Your Nonprofit Bring to the Table?

Posted on July 15, 2013 | Leave a comment

Does your nonprofit’s special event help sponsors and underwriters meet their business objectives? Do the benefits you offer align with the business needs of your sponsors/ underwriters? Here are some things to consider as you build your corporate partnership program.

SubaruCauseMarketingPhilanthropic support can be directed by an executive within the business, through the community relations department, or its foundation. Marketing dollars are typically secured from the marketing department. Distinctions between the two types of giving include the expected “return on investment.” Sponsorships from the marketing side of a business need to advance the business’ objectives. Pursuing such a relationship will require you learn these objectives; know your demographics; and are prepared to apply creativity in creating sponsorship benefits that have meaning to your partners.

Businesses know who they want to communicate and interact with. They know which communication methods work best with specific target markets, and they have prioritized their markets. They will want to know the demographics associated with your event, program, or nonprofit as a whole, so be prepared. What do you know about the people you serve; those attending your events; people you reach by email, social media and print communications? Can you provide traditionally requested information such as gender, race, age, zipcode, income, education, and children in the household, for your different constituencies and/or audiences?

Some businesses may value the opportunity to sponsor intimate events that provide an opportunity to participate in meaningful conversations with individuals who represent their target market. Others know their ideal consumer communicates via social media. Still others want a very specific demographic such as highly African American educated females with incomes over $60,000 who are homeowners. Some businesses will want to build and strengthen brand loyalty. Others may be searching for a new market. You won’t know until you do some research and talk with those responsible for creating or influencing partnerships.

Here’s the bottom line: Growing a corporate partnership program requires data management systems that provide accurate demographics, as well as staff – or qualified volunteers – who can manage the program and meet sponsor/underwriter expectations. Focus on your sponsors’ needs and how your nonprofit will advance their brand. Be prepared to answer specific questions such as: How will results be measured? What will the metrics be? For events, what happens before, after and during the event? Are there multiple “touch points” through which sponsors can engage with your audience? Will you provide sponsors/underwriters with the names of people attending the events they support? Are you offering industry exclusivity? For example, will you engage five banks as sponsors, or one bank, one realtor, one national retailer….?

Most businesses know who they want to communicate with.  They also know their demographic and geographic markets. The question is, are you a match?

Mel and Pearl Shaw are the authors of “Prerequisites for Fundraising Success” and “The Fundraiser’s Guide to Soliciting Gifts.” They provide fundraising counsel to nonprofits. Visit them at www.saadandshaw.com. Follow them @saadshaw.

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Investing in Fundraising Success

Posted on July 8, 2013 | Leave a comment
Invest in Fundraising

Invest in Fundraising

When the reality of “it takes money to make money,” collides with shrinking budgets, nonprofits can face short-term and long-term revenue challenges. Consider the trend among some donors and funders to “restrict” their giving and grantmaking to programs, or direct services. This is a move away from “unrestricted giving” or “operating grants” which allow a nonprofit to use gifts and grants where they are needed most. Restricted giving can reduce funds available for overhead which in turn can limit a nonprofit’s ability to support effective programs: “overhead” pays for technology, accounting, fundraising and more, all of which support successful programs.

This trend was documented in a 2009 Stanford Social Innovation Review article written by Ann Goggins Gregory and Don Howard. Here are a few powerful quotes from their article The Nonprofit Starvation Cycle.

“…. nonprofits settle into a ‘low pay, make do, and do without’ culture…..”

“… we often see clients who are unable to pay competitive salaries for qualified specialists, and so instead make do with hires who lack the necessary experience or expertise.”

“The burden of breaking the cycle of nonprofit starvation does not rest solely with funders (and donors). Nonprofit leaders also play a role. As a baseline task, they should commit to understanding their real overhead costs and their real infrastructure needs.”

In our work we engage with board members and nonprofit executives on the subject of fund development and fundraising. We have found that there are nonprofits – small and large – who cut expenses related to development and fundraising as a way of reducing overhead. Some cut these expenses in a process of “across the board” cuts. We both understand the tendency, and object to it. The development department – or advancement department as it is referred to by colleges and universities – is a revenue center. A challenging fundraising environment should be met with strategic investments in fund development and fundraising.

We also understand the skepticism that can greet the idea of increasing investment in fundraising: some nonprofits are not confident in the ability of their development/advancement department to meet fundraising goals. Yet cutting the ability of these departments is not necessarily the answer. Instead, pay attention to factors that contribute to the lack of confidence. These can include noncompetitive salaries that fail to attract and retain experienced and talented fundraising professionals; staff whose skills do match well with the type of fundraising your nonprofit needs to focus on; executives without the knowledge or experience to effectively manage and coach the development/advancement team; the setting of unrealistic fundraising goals based on projected budget gaps instead of an analysis of current and prospective donors; and expecting fundraisers to focus on areas other than fundraising.

We encourage board members and nonprofit executives to ensure adequate investment in fund development and fundraising to help ensure nonprofit financial health.

***Image courtesy of Sujin Jetkasettakorn / FreeDigitalPhotos.net

Mel and Pearl Shaw are the authors of “Prerequisites for Fundraising Success” and “The Fundraiser’s Guide to Soliciting Gifts.” They provide fundraising counsel to nonprofits. Visit them at www.saadandshaw.com. Follow them @saadshaw.

 

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