Tag Archives: Fundraising Goal

How do you count your money?

MoneyA cornerstone of successful nonprofit fundraising is trust. While there are many reasons to give, there are also reasons why people, foundations and corporations do not give. One reason is a lack of trust: donors and funders don’t trust the nonprofit to use the funds for the stated purpose. Here are some suggestions to help ensure your institution or organization retains a high level of trust from current and prospective donors.

Whether you are raising funds for an annual campaign or for a capital, endowment or other campaign the process of building trust begins with how you define what you are raising money for. Gain consensus amongst leadership (board and executive) regarding how much money you seek to raise and how the funds will be used. Be specific. Measure your progress against the agreed upon goal.

Work with the development committee of the board to develop gift acceptance policies. These can help avoid future confusion. For example, how long are your pledge periods, and when do you write off uncollected pledges? How do you account for gifts of real estate?

Be specific when talking about fundraising progress. A donor may have given a verbal commitment for a large gift, but you can’t include it in your fundraising total until it has been received or until you have a signed pledge agreement in place. The gift may not materialize.

Develop standardized fundraising reports that clearly communicate how much has been raised and for what purposes. Differentiate between pledges and actual funds received. When in the midst of a major fundraising campaign you are sure to receive multi-year pledges. These are vital, but they are also typically difficult to spend until the funds are received. Develop reports that show when pledge payments are expected to be received. These should match the terms of each pledge agreement.

When conducting a comprehensive campaign, list your fundraising priorities, and how much has been raised towards each. You may be able to reach or exceed your overall fundraising goal but may not have the funds you need to implement all stated priorities. This can occur when donors are inspired by a campaign and choose to make a restricted gift to a non-campaign priority. You should celebrate such gifts – but be careful how you include them in campaign accounting.

Remember – different people have different foci when it comes to counting money. Bring in the CFO, the CEO and your fundraising team and agree on how you will record and report on your fundraising. Be sure to reconcile fundraising reports with those produced by the finance office. Do this on a monthly basis.

If it sounds like we are focusing on small details, you are right. Don’t claim a fundraising success you cannot substantiate – it can come back to haunt you.

Picture credit: 401(K)2012 via Flickr

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.

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?