Tag Archives: capital campaign

You want to build a building

fundraising, FUNdraising Good Times, capital campaign, campaign planning, building campaign, Saad&Shaw Owning a building can be a turning point in the life of a nonprofit. A building represents positive attributes: permanence, ownership, longevity, visibility, stability, status and achievement. You can control your destiny, make improvements, and expand when needed. You have an asset to leverage for future projects. No one can make you move.

Fundraising for a building is also a milestone. In addition to securing funds for annual operations, you will need to simultaneously raise funds for the building. Questions regarding strategy, leadership, and financing need to be addressed. A new building may require an expanded or new board, especially if your current board doesn’t have the experience, connections, and fundraising expertise required by a capital campaign.

The process of planning for a new building can be longer than anticipated. Knowing your organization’s needs is the first step. Creating consensus is the next. Then come discussions regarding location, and whether to purchase or renovate an existing building, or build a new one. Sooner or later the discussions – and decisions – will center around money.

There are fundraising questions to be answered such as: Where will the money come from? Will our current donors continue their annual support and make additional gifts for the building? Who will lead the campaign? How much money do we need to raise?

The fundraising goal should derive from your building and/or renovation plans. But how do you create a realistic goal? “It could be that a new building will create even more challenges than the ones the organization faces in its current location.” This observation was raised by Sam King, senior vice president and financial advisor at Pinnacle Financial Partners in Memphis during a recent conversation. An experienced banker, fundraiser, and nonprofit board member he has a list of questions for nonprofits to consider as they begin the process of planning for a capital campaign.

Here are a few: In addition to constructing the building, can you raise enough money to sustain the building? How will you cover increased utility and maintenance costs year-over-year? How will you fund improvements and repairs? If you take a mortgage, how will you service the debt? Can your organization qualify for a mortgage?

“Will a new building hurt your organization? Will you have a big building with no programming? Will a new building create problems greater than those you face now? If you intend on raising all the money first, how long will it take to have “cash in hand” – no pledges? And what happens if you don’t raise all the money that you need?”

King raises important questions based on years of experience. Take the time you need to make the right decisions. Ask others who have gone through the process to share their guidance. This is a big decision – make it a positive one.

Image courtesy of Stuart Miles at 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 on Twitter: @saadshaw.

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Unlock the Reasons for Starting a Capital Campaign

Time for QuestionsLet’s be honest. Do you really know why your nonprofit is running a “capital campaign?” Does your institution have specific capital needs such as buildings or equipment that it needs to invest in? Could it be your nonprofit is really running a “we need a lot of money campaign” or an “everyone else has done it” campaign?

Here’s what we’ve learned. The most well-intentioned of people are often afraid to question the assumptions underlying a capital campaign. While many of us have a strong drive to “save face,” that urge can put the organizations and institutions we believe in at risk. Our advice: Don’t be afraid to ask questions. Here are a three to consider.

Have there been conversations at the board level with reports from the finance committee on the costs, variables, timeframes, and projected impact? Is there a budget to support the operations of the campaign, or will staffing, marketing, technology, events, and consultants be paid for “as the money comes in.”

Is your executive director – or college president – seeking to leave a legacy by launching a capital campaign? Our question – will she or he launch a campaign or successfully complete the campaign? There is a slight difference, one that usually reveals itself when the books are presented to the incoming executive.

How exactly are you counting the money? Is your institution counting progress towards its building campaign with annual gifts that were spent last year? You know our question: who can spend a dollar twice? Don’t be afraid to question the numbers or ask for a detailed report instead of a summary report.

Here are some cues you need to start asking questions:

  1. The board is being asked to approve borrowing money that will be paid back with funds from the capital campaign.
  2. Your organization is unable to meet its annual fundraising goal.
  3. There is no pool of current or prospective major donors.
  4. The board is being asked to approve a campaign in spite of a feasibility study that recommends against doing so because of a lack of identified donors, capacity, infrastructure, resources and leadership.
  5. The board is not a fundraising board, fundraising staff is minimal and turns over regularly.
  6. Your questions are answered with statements such as “we can’t afford the time it will take to conduct a feasibility study, develop a case, recruit volunteer leadership… [fill in the blank]….”
  7. Another dangerous response: “I feel we can do it… we just have to step outside our comfort zone.”

We have seen churches, colleges, and community-based nonprofits plunge into capital campaigns only to awaken years later as if from a nightmare.

That doesn’t have to be the fate of your nonprofit: ask questions, and then ask some more.

Image courtesy of Stuart Miles at 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 on Twitter: @saadshaw.

Leadership and Fundraising: No Money No Mission

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“…the true leader can be recognized because somehow or other his people consistently turn in superior performances…. A leader is great, not because of his or her power, but because of his or her ability to empower others.  Success without a successor is failure.”  This quote from Robert Townsend was used by Jeanette OBryant, Development Coordinator at the National Civil Rights Museum as she introduced her boss, outgoing museum president Beverly Robertson.

She concluded her remarks with Townsend’s words: “Loyalty to the leader reaches its highest peak when the follower has personally grown through the mentorship of the leader.  Why? Because you win people’s heart by helping them grow personally.”

These words capture the essence of Robertson. She has a strong respect for her staff and has provided them with opportunities to grow and assume leadership. And, she is leaving the museum in a strong position for her successor to build from.

The event we were attending was an intimate breakfast at the newly renovated museum that brought together former board members, volunteers, donors, supporters, staff and community members to hear Robertson’s reflections and tour the museum with her. She began by lifting up current and former staff, board members and volunteers – calling them by name and thanking them for their involvement. She made it clear that her tenure was rooted not the in the status that accompanies her position, but rather in her commitment to the museum and the legacy of Dr. Martin Luther King, Jr.

Here are qualities we observe in Robertson that contribute to her success as a fundraising leader. She makes everyone she comes in contact with feel good about their interactions with her and their support of the museum. She invites everyone to the table, while keeping her eye on the prize: raising money. She lifts up her staff, encourages them to move beyond what they perceive as their limitations, and provides opportunities for professional growth. She is a “we” not “me” person. Never once have we heard “I raised the money.” She is clear that fundraising is front and center for a nonprofit’s success. She summed it up with “No money, no mission” followed by a warm laugh that embraced the audience. In our words: you can have great ideas, but without money it is very difficult to bring them to life.

Robertson has served as president for 17 years, ending her tenure with the opening of the renovated museum and the beginnings of an endowment. She will be succeeded by Terri Lee Freeman, president of the Community Foundation for the National Capital Region, a public foundation serving the District of Columbia, suburban Maryland and northern Virginia.

We salute Beverly Robertson and we welcome Terri Lee Freeman.

Visit the National Civil Rights Museum in Memphis TN.  http://civilrightsmuseum.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 on Twitter: @saadshaw.

Three Steps to launch a comprehensive campaign

Part two of a two part series….Read part One: Four Benefits of a Comprehensive Fundraising Campaign

Three Steps to comprehensive Campaign, an acquaintance blurted out, “comprehensive campaigns are nothing but a con game.” Three steps to ensure your campaign meets its goals

We were taken aback when, in casual conversation, an acquaintance blurted out, “comprehensive campaigns are nothing but a con game.” We listened as he shared his experience of institutions that report campaign success but don’t have the money needed to implement projects laid out as campaign priorities.

While we wouldn’t be so blunt in our assessment, we do agree that a lot can happen in a comprehensive campaign that leaves donors and the community confused and feeling misled. But, comprehensive campaigns don’t have to end that way. We present the following example to share three steps you can take to ensure your campaign meets its goals and has the money to implement priorities.

Let’s say a nonprofit provides healthcare for children ages birth to three years old. It launches a three year $20 million comprehensive campaign for the following: $9 million for annual operations for three years ($3 million a year), $6 million for capital costs for a new medical facility, and $5 million to endow future costs for pediatric services. During the campaign a local philanthropist wants to donate $15 million to provide healthcare services to uninsured local residents regardless of age, and a foundation wants to donate $6 million for childcare services. If the nonprofit accepts these gifts it will raise $21 million but there will be no money for annual operations, the medical facility or endowment of pediatric services. Would this be campaign success?

Consider these three steps before launching your campaign. First, be clear on what you are raising money for. Define your priorities and how much you need to raise for each.

Second, determine which gifts will be counted towards the campaign goal, and which will be counted as what we refer to as “over and above” gifts. For example, when you accept gifts that are outside campaign priorities record them, publicize them, but don’t count these towards your campaign goal as they cannot be used to finance campaign priorities. When you do raise the funds for your campaign priorities be sure to declare success and communicate that you met goal and raised funds for additional projects as well.

The third step is to establish a reporting system that can track how much has been raised towards each priority. Gifts should be appropriately recorded and tied to a priority. Management reports should clearly communicate this information so everyone is aware of overall campaign progress, and progress towards each specific priority.

Here’s our bottom line: Make sure your comprehensive campaign raises money for its stated priorities. Don’t be derailed by an abundance of non-priority related gifts. Be clear and transparent about how you account for gifts received. Decide how you define campaign success and communicate it clearly: don’t leave your community asking “where’s the money?”

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 on Twitter: @saadshaw.

Four Benefits of a Comprehensive Fundraising Campaign

Part one of a two part series

comprehensive fundaraising campaigns,  annual campaign, capital campaign, comprehensive campaign, coordinating fundraising campaigns, fundraising, fundraising campaig, how to grow your fundraising, nonprofit campaigns

Do you need to raise money for your nonprofit? If you answer “yes”, you are in good company. Fundraising is critical for most nonprofits and it takes time to build relationships that generate the revenue needed to operate. Organizing your fundraising into a campaign with specific financial goals and timelines is one way to focus on revenue and invite others to join you in fundraising.

The most common campaign is the annual campaign. This is a campaign to raise funds for annual programs and operations. Funding may come from foundation or corporate grants, individuals and families, events, and/or government sources. Gifts may be large or small. Another type of campaign is the capital campaign. This is a campaign to raise funds for assets such as buildings, equipment, furnishings or an endowment. The financial goal is typically such that it cannot be paid for with an increase in annual funds. It is a milestone occurrence within the life of the nonprofit that requires major investment. A major gifts campaign refers to a campaign to raise funds through large gifts. Unlike the other campaigns, funds may be used for multiple purposes as the name refers to the types of gifts a nonprofit seeks to secure. A comprehensive campaign is a campaign that coordinates multiple campaigns into one.

A major benefit of conducting a comprehensive campaign is that it focuses an organization’s energies into one campaign with multiple goals and revenue sources. It reduces confusion amongst prospective donors, allows them to make a one-time decision on how to support your diverse needs, and reduces duplication of efforts on the part of the nonprofit. For example, if you are raising funds for annual needs and simultaneously raising funds for a building you may find that an annual solicitation was made of an individual with the capacity and interest to give to your capital campaign. If the two campaigns are not coordinated you may receive a meaningful annual gift, but lose the opportunity to ask for a gift that combines annual and capital giving. Returning to donors multiple times within a year is not always possible, and the donor may have thought the first solicitation represented your needs for the year.

A comprehensive campaign also allows donors who give small gifts to feel a part of a major campaign. The value of their annual giving is made clear through campaign marketing messages and they are encouraged to be a part of the larger campaign as well. With a larger financial goal a comprehensive campaign can create buzz and excitement that re-engages lapsed annual donors, or encourages annual donors to increase their giving. A comprehensive campaign is not “business as usual” and that excitement can attract new donors and fundraising volunteers.

Next week: comprehensive campaign challenges.

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 on Twitter: @saadshaw.

Museum Fundraising Success

“To everything there is a season and a time to every purpose under the heavens.”  

 Beverly  Robertson, National Civil Rights Museum, Saad and ShawThis is the biblical quote Beverly Robertson, president of the National Civil Rights Museum used to begin our conversation.

She quickly followed with its special relevance to her at this point in time. “I recently announced my retirement from the museum because I believe it is time. On March 1, 2014, the National Civil Rights Museum will re-open the historic Lorraine Motel after an 18 month, $28 million renovation. An additional $12 million is being raised to support the first ever major endowment for the museum to secure the life of the institution. This tremendously challenging accomplishment along with so many other successes and challenges over the past 16 years have led me to realize that I have had my season. It has been an honor to work at this sacred place, but even the best of leaders must know when it is time to go. People who lead understand that they have a season. They also understand that exits are better done when individuals are at the pinnacle of their success.”

The National Civil Rights Museum showcases the history of the African American struggle for civil rights within the context of a global struggle for human rights. It holds a vision for us of a world dedicated to creating opportunity for the disenfranchised.

Located in Memphis, Tennessee at the former Lorraine Hotel – the site of the assassination of Dr. Martin Luther King Jr, – the National Civil Rights Museum has steadily expanded and updated exhibits and curriculum.  Over 3.5 million people have visited since its opening in 1991 – an annual average of 200,000 visitors. It is an educational and cultural site of conscience for visitors from around the world.

Under Robertson’s leadership the museum has stayed focused on fundraising. To date, $25.2 million has been raised for renovations, and $2.2 million for endowment. Robertson has also grown the museum’s annual fundraising which includes direct mail, personal solicitations, and The Freedom Awards, their annual gala. The Freedom Awards, honor individuals who have made significant contributions in civil rights and have laid the foundation for present and future leaders in the battle for human rights. This year awards were presented to Mary Robinson, first female president of Ireland and human rights champion; Geoffrey Canada, CEO and president of Harlem Children’s Zone and a leading advocate for education reform and equality; and Earl Graves, founder and publisher of Black Enterprise Magazine, activist for black consumer and black business power. The event raised over $490,000 and was one of their most successful.

“I have always wanted to leave people and organizations for whom I have worked much better than I found them,” Robertson said. “I can only hope and pray that this is part of the legacy I leave when I depart the National Civil Rights Museum on July 1, 2014.” Beverly Robertson – we salute your leadership.

Learn more about the National Civil Rights Museum at www.civilrightsmuseum.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 on Twitter: @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.

Transformative Giving

Philanthropy makes front page news with the announcement of large, transformational gifts. Think Bill Gates. Oprah Winfrey. Warren Buffet. With the news comes the question “What would it take for us to receive such a gift?” This three-part series seeks to provide insights that can help nonprofits begin a conversation that may itself be transformational

Barbara Pierce www.fundraisinggoodtimes.comWe recently asked Barbara Pierce, founder of Transformative Giving, to share her experience working with donors who give transformational gifts. Pierce works with local and national nonprofits who want to grow their major gifts programs. She has experience soliciting gifts ranging from $10,000 up to $10 million. Her comments can stimulate conversation and an examination of how your institution or organization approaches fundraising, and those who can make transformational gifts.

We asked Pierce what guidance she would offer to an organization or institution who wants to secure transformational gifts, and she got right to the point. “You need to be able to answer, without hesitation, what you would do if a donor gave you a million dollar gift. It is harder to answer than you might first think. If you don’t have a vision, don’t expect visionary gifts,” she said.

That’s a strong message. And we totally agree with Pierce. Those who can give at the highest levels want to know your vision, how you would deploy a major investment. Pierce continued, “You also need to have the organizational capacity to take advantage of such a large gift. I use the word transformative because such a gift will transform an organization and if you aren’t ready, it can take you off course, possibly in the wrong direction.”

She also highlighted the need to have your financial house in order before focusing on transformational giving. “You have to be financially sustainable before you can take advantage of a transformational gift. This type of gift allows you to move beyond “we’re surviving” to a point where you are thriving. As an organization, you have to demonstrate your capacity to steward a transformational gift. Nonprofits need to have the business knowledge of how to ramp up in terms of institutional capacity and implement a plan for the vision that the donor is funding.”

Transformational donors look closely at your institution’s leadership. “The first things to be satisfied before someone will consider a major investment in your group is a belief in the management of your organization. They want to know and trust your executive director or president and your board. These donors are people who have made smart decisions in earning and investing money. They want to know such a gift will make a lasting impact, and that means it will be well managed.”

Next week: Part Two. Are you interested in donors or their money?

Visit Barbara Pierce at www.transformativegiving.com.

Preparing for your Capital Campaign-Asking the right questions

ChangeA capital campaign – or any other quantum leap in your fundraising – will pull at every fiber of your nonprofit. These are not “business as usual” activities. If you want to grow from one level of donated revenue to another you have to do things differently. It’s no different than a business seeking to enter a new market or release a new product. New, more and different thinking, actions and people are required for new, more and different results.

We know this means more work for nonprofits that are often already operating beyond capacity. But you have to find a way to operate differently if you want different results. We are not saying that everything has to change all at once, but the rate at which you engage potential donors and funders is the rate at which you will begin to see a change in revenue.

Change can begin with an honest assessment of the road ahead. Your institution may need to raise money for new facilities or technologies. Your nonprofit may need to replace a government contract or grant that won’t be renewed. In these examples the first step is to identify the amount of money that needs to be raised. This is the starting point for an important organizational conversation. For too many nonprofits, it is also the end point.

Knowing what you need to raise is not enough. What needs to take place is a conversation about “how” the money will be raised, and what it will cost. Fundraising costs include money, time, talent and resources. You can hire a fundraising consultant to talk with your leadership team, or you can begin the conversation on your own. Questions to discuss include: Where will the money come from?  Who could provide how much? Can we identify three-times as many potential donors as we will need to meet our goal? Why would a donor or funder want to give? Who would ask them to give? How will we organize ourselves? Who will manage and coordinate our fundraising? What resources will he have available? How will a capital campaign impact our annual fundraising? How will we sustain and grow our current donors while attracting new ones? What new policies are needed? What impact will new buildings or technologies have on our operating budget? How will we budget to maintain these?

Open and honest conversations can be both sobering and revealing. Most importantly they contribute to organizational and financial health. They are an opportunity to candidly assess your capabilities and options before launching into a major campaign. When successful a capital campaign – or any quantum leap in your fundraising – will have a major impact on the life of your nonprofit: you will have the funds you need to deliver on your mission and expand your impact.

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.

Branding your capital campaign

Jennie Winton

Jennie Winton of Mission Minded

Our regular readers know we always push for a clear, concise and compelling case for support. Jennie Winton – a talented marketing strategist – takes it to the next level advocating that nonprofits need more than a case: capital campaigns need a brand. We agree with her. Take a look at her blog and let us know your thoughts…. http://bit.ly/13RiPsO