Workshop, Seminars and Conferences: Blessing or Curse?

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.

Evaluate your nonprofit from a funder’s perspective

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?

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

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.

Investing in Fundraising Success

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.

 

Nonprofit overhead costs

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A public discussion is stirring on the topic of nonprofit overhead and the extent to which overhead costs should influence giving. The three leading sources of information about nonprofits recently issued a call to action asking individual and institutional donors to stop using “overhead” as the measure of a nonprofit’s success. GuideStar, Charity Navigator, and BBB Wise Giving Alliance have issued a call to donors to move beyond the “Overhead Myth.”

Here’s the background. Nonprofits are required to report administrative costs and fundraising costs when they file their 990 form with the IRS. These are costs that are not directly related to nonprofit services or programs. Administrative costs include things such as human resources and accounting personnel, information technology and management systems. Fundraising costs include staff time and materials dedicated to donor development, and fundraising events among others. Together these represent “overhead.”

Some people believe that low overhead is a sign of an effective and well run nonprofit. We join GuideStar, Charity Navigator, and BBB Wise Giving Alliance and others in taking a different stance. Long time readers know that we believe “impact” is the measure of a nonprofit. And, for many organizations and institutions high impact requires an investment in what we refer to as “capacity and infrastructure” or “overhead.” Nonprofits need to invest in technology and talented staff. They need to compensate employees with competitive salaries and benefits and provide them with the tools they need to best deliver on their mission and vision.

Overhead ratios do not communicate effectiveness. Emphasizing these ratios as a basis for funding and giving decisions has led to what the Stanford Social Innovation Review has called the The Nonprofit Starvation Cycle and what the Center on Nonprofits and Philanthropy, Urban Institute & Center on Philanthropy at Indiana University refers to as Getting What We Pay For: Low Overhead Limits Nonprofit Effectiveness.

Overhead costs and ratios may vary from year to year, and from institution to institution. There are always new ways to consider minimizing costs, but a “race to the bottom” is not what the nonprofit sector needs. Consider looking at impact instead. Encourage the nonprofits you believe in to participate in Charting Impact (www.ChartingImpact.org). Prepare to answer these five questions: What is your organization aiming to accomplish? What are your strategies for making this happen? What are your organization’s capabilities for doing this? How will your organization know if you are making progress? What have and haven’t you accomplished so far?

If you are concerned about how donated funds are used by a nonprofit you support, take the time to review their annual report, their 990 form (posted online at wwww.Guidestar.org, and ask to speak with management. Looking at overhead costs won’t answer your questions.

Learn more at www.overheadmyth.com.

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.

Start Small, Think Big

Economic-Impact

Let’s talk about data: the exciting information hidden within your nonprofit’s donor database. There’s much to be learned by running reports, and many reports to run. The most in-demand: funds raised to date. But what about less popular reports and the secrets they can reveal? What about your “top-tier small donors?”

Use your summer months to produce and study reports showing donors who have given in each of the past three or five years. Look for those who consistently give at the highest levels of your “small donor” category. Those included in this group will vary from nonprofit to nonprofit. For a college, this group may be those who give $1,000 each year. For a national nonprofit, the group may be $500 annual donors. For a grassroots organization, it may be those who give $100 annually. The most important thing is to know who falls into this group – let’s call them “top-tier small donors” – at your nonprofit.

Take the time to create and implement a strategy for reaching out to these donors and growing their collective impact. They are the backbone of individual giving programs: a segment of your donors who can be cultivated for larger gifts, to serve as ambassadors, or to encourage others to give. They need to be tended to and summer is a perfect time to reach out.

Craft a personalized outreach program where someone from your organization or institution calls these donors to thank them for giving over the years. Create a script that includes a request that the donor consider a slightly increased amount when she makes her next gift. Determine who within your nonprofit would be ideal at making such calls. Set up a short training program and get into action.

When reviewing your list of “top-tier small donors” look for who you know and who you don’t. Invite a mix of these donors to a small reception, especially those who have not been invited to visit with your nonprofit before. Better yet, consider scheduling a personal visit to their home or office.

When reviewing lists of lapsed “top-tier small donors” consider a call or email to reengage each. Thank him for his prior support, share a few updates on your impact, and ask for his consideration when he makes his future giving decisions. No hard sell. A simple call from someone who works for, volunteers at, or benefits from your nonprofit.

If you believe specific donors will respond better to an email than a phone call consider a “real” email – short and personal; not an “e-blast.”

We offer these suggestions as a way to retain and grow current donors who may be able to make a larger impact: as a way to get to know them. Pick up the phone, say hello. Don’t take your donors for granted – show them you care.

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.

Setting an annual fundraising goal

How do you set your annual fundraising goal?

moneyWe were recently asked what we thought about setting a fundraising goal for fiscal year 2014 by simply adding 10% to the 2013 goal. Good question. And of course we had questions of our own. The first of which was “did the nonprofit meet its 2013 goal?” The answer – and the reasons why – will be important to take into consideration when setting a goal for 2014.

Here are a few other things to take into consideration. What are the organization’s financial needs and how will these fluctuate based on changes in projected operating expenses and program costs? For some organizations the fundraising goal is set based on projected revenue from earned income, multi-year grants and other “secured” funding streams. These numbers are subtracted from the nonprofit’s expenses and the balance becomes the fundraising goal. That is one way to determine a goal, but it may or may not be a goal that can be met.

The time and attention paid to setting the goal can impact the extent to which you can meet it. Here are a few things to consider when creating a fundraising goal. Were there any unusual large gifts in 2013 that may not be repeated in 2014? (In order to sustain 2013 giving levels you will need to determine how these can be replaced if you believe they were one time gifts.) How many donors give annually, and how much do they give? What is your “donor attrition rate” – how many people who give one year don’t give the following year? (Knowing the attrition rate can help inform how many new gifts you need to maintain at prior year’s level.) Who are the prospective donors you have identified? What is the likelihood they will give in the coming year? What has been your organization’s track record in turning prospective donors into actual donors? How many donors increase their giving year over year.

Other issues to consider include, who will ensure your special events meet their revenue projections? Has event revenue been growing or declining? Who will solicit corporate sponsors and underwriters? Can your marketing team create awareness that drives giving? Who will ensure that direct mail and/or e-giving campaigns are produced on schedule? Which of the foundations that have provided support in the past might make a grant in 2014? Have you identified new sources of foundation or corporate support? Who will solicit these?

Finally, review your fundraising goal against your capacity. Consider how fundraising volunteers can positively impact (increase) funds raised. Compare the number of staff, board members and volunteers against what needs to be accomplished. Last but not least, compare 2013 fundraising revenue against 2014 projections.  We believe that taking all of the above into account is a better way to determine a fundraising goal. What are your experiences?

 

Summer Reading Can Increase Revenue in the Fall

Cynthia Hopson http://www.saadandshaw.comTo be the best, learn from the best – and in fundraising, Pearl Saad and her husband Melvin B. Shaw, have the creds to not just teach fundraising essentials but to literally “write the books” about it. In an updated version of The Fundraiser’s Guide to Soliciting Gifts, first published in 2008, everything you need to know is laid out in this small but powerful compilation in the form of how to’s for the novice and gentle reminders for the veteran.

These amazing 33 pages are a quick but empowering read from an accomplished couple with more than 30 years of experience in innovative fund development, capital campaign research, planning, design and implementation. Topics covered include the language and philosophy of the “ask,” how to cultivate, honor, recognize and involve donors, preparing for solicitation visits, and the importance of personal and meaningful interaction with potentials.

As someone who has to inspire gifts and investment into my cause, (I manage The Black College Fund which supports the 11 United Methodist Church-related historically Black colleges and universities) I felt better prepared, even inspired to go out and “win friends and influence people” to share. While I never try to sell anything I don’t invest or believe in, their “It’s an honor to be selected as the person who asks others to give” philosophy was refreshing and empowering.  I am all the things listed in the title of their new book, Prerequisites for Fundraising Success, 18 Things Every Fundraising Professional, Board Member, or Volunteer Needs to Know, so reading it was a logical next step.

Prerequisites, is a homerun, slam dunk and a touchdown! Whether you’re trying to figure out which way is up or down, this is the book you want to get this year. “Fundraising is a competitive endeavor” was my favorite quote and if you are ill equipped for the competition, get this book and then proceed. They cover funding your fundraising, the importance of teamwork and commitment to the cause, and every chapter has a checklist and action steps to keep you on course. If you’re serious about improving your fundraising success, and who isn’t these days, this resource will be a blessing for everybody who goes out in your name to raise money. Fundraising is an art and a science and those who excel at it must understand the processes and intricacies that lead to success. Again, this roadmap will enable the newcomer and provide additional tools for the pro—either way, you’re bound to learn something new.

Pearl and Mel are consummate professionals and they continue to impress and amaze me with their creativity, insights and extensive knowledge of all things fund related. With these two books, they take comprehensive fundraising, development and management to a new and more accessible level. Both are available from their website, www.fundraisinggoodtimes.com, and are economical enough to get one for each team member.

Cynthia Bond Hopson, Ph.D., is an author and assistant general secretary of the United Methodist Church’s Black College Fund in Nashville, TN. chopson@gbhem.org

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.

Donor Research

Start by asking “why?”

Part three of three part series on transformational giving

Warren BuffetDo major gifts to nonprofits fall from the sky, or are they more typically the result of deep commitment, relationships, and the ability to use the tools and data available to nonprofits? We asked Barbara Pierce, founder of Transformative Giving, about how donor research supports transformational giving.

“Since a transformational gift is one that can move the nonprofit to a different level of operating, it will be a large gift by necessity,” she began.  “Donor research will identify those donors capable of such a gift so you can focus your cultivation efforts with an aim toward deepening relationships with a small number of top donors.  We are all limited by time so you need to prioritize.  Donor research allows you to make these choices based on data.”

We closed our interview with Pierce asking her to reflect on her experience and share what she has found to be the factors that influence major donor’s largest gifts.

“There is so much talk around evaluation and donors do want to know you have a method of determining progress.  Beyond these basics, donors making their largest gifts based on advancing the causes that mean the most to them personally and that express their most deeply held values.  They are not choosing the organization based solely on their metrics,” Pierce commented.

“The desire to leave a legacy beyond their financial success is what I have found influences donors the most. They have more money than they need according to their own standards and they want to make an impact on something bigger than themselves.  While it can be a planned gift, transformational gifts are often while the person is alive—the transformation goes both ways in that the donor is changed also through the process.”

She shared an experience of visiting with a very prominent venture capitalist who was known to be rather hard-edged.  She was armed with reams of data in anticipation of his questions.    “I was surprised he was taking the time to see us and I asked why he cared about this environmental cause.  He turned to a photo of his children and said, ‘all of this doesn’t matter if my children can’t enjoy the same beauty that I have been so lucky to know.’  If I hadn’t asked ‘why,’ we would’ve missed out on an opportunity to understand what drives him to make transformational gifts.”

This led to Pierce’s closing remarks and the topic of working with people who can give at the highest levels: “You need to start with the most basic question of ‘why?’  Otherwise, you may be making a lot of assumptions about what they care about most and gearing your pitch based on your thinking versus theirs.”

Visit Barbara Pierce at  www.transformativegiving.com.

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.

 

How to engage major donors

Part two of three part series on transformational giving

Giving Pledge

Photo credit: Fortune Magazine

Why does one nonprofit receive $1,000 from a donor when another receives $1 million? What is the difference between fundraising and the process of securing transformational gifts? To get some answers we talked with Barbara Pierce, founder of Transformative Giving.

Pierce got right to the point: “Transformational gifts come out of a partnership with a donor, built on a common goal that neither the donor nor the organization can accomplish on their own.   Fundraising is about getting gifts to meet a budget; transformative giving is about achieving a vision.  Without fundraising and the financial foundation it provides, you cannot engage in transformative giving.”

She elaborated further, sharing what it means to be “donor focused.” “Usually, nonprofits are driven by their own budget on their own timeline, i.e. fiscal year, solicitation cycle, board meeting schedule,” she began.  “To be donor focused is to focus on the donor’s timeline versus your own.   Most transformative gifts take more than a year to transpire but too many organizations forfeit a larger, more meaningful gift for a smaller, immediate one to fit their own calendar.”

“When you are donor-centric, you don’t think in terms of ‘they should give us X; they are really rich,’ which is something I’ve heard many times.   You also have an attitude of exploring common areas of interest versus believing you have to ‘educate’ donors on all aspects of your organization before they are qualified to play a meaningful role in your discussions.”

“Institutionally, it is an approach that says, ‘we want to understand who our donors are, what drives their decisions and what type of involvement is important to them,’ Pierce continued. “Any successful for-profit company takes a deep interest in understanding who their customers are and how they can be of service to them.  I see this as a critical gap in nonprofits engaging with those donors most able to make a transformative gift.”

Vision, leadership, capacity, stewardship. These are at the core of successful nonprofit fundraising. They are magnified and held to a higher standard when talking with individuals who can give at the highest levels. How donors are perceived and treated can impact if and when they make a meaningful investment.

“I believe one of the biggest factors that impede groups from attracting such gifts is their lack of interest or ability to see donors as partners versus a source of funds, Pierce advised.  “There are a lot of assumptions about ‘rich people’ among many nonprofit staff members, including the idea that a donor will have undue influence on the organization’s mission if they accept a large gift.  People don’t make transformative gifts to organizations that aren’t already embracing a vision they both hold in common.”

Next week: Part Three – Start by asking “why?”

Visit Barbara Pierce at  www.transformativegiving.com.

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.