12 Steps for Your Midyear Fundraising Tune-up

When most people hear the word ‘tune-up,’ they naturally think about automobiles, and probably that their own car is overdue. A car represents a major investment, and timely service and maintenance ensures the best return on that investment. Similarly, giving your fundraising efforts a ‘fundraising tune-up’ can significantly enhance their efficiency and yield better results in achieving your organization’s goals.

All for- and non-profit organizations will enormously benefit from similar tune-ups to ensure operations are performing at peak efficiency. We often hear that non-profits should model themselves more like businesses. I’ll take that one step further: Non-profits that typically even in good times need to stretch nickels into dimes, have more motivation to make sure they are running as efficiently and cost-effectively as possible. There is little, if any, fat to trim.

The pressures to maintain and increase gift income mount as the need for programs, services and benefits escalate during times of inflation and challenging economic realities when more people are struggling.

Here are 12 elements to consider for conducting a mid-year fundraising tune up to diagnose, make repairs and improvements that will drive up gift income that is so essential in carrying out noble missions that touch, improve and save more lives.

Assess Where You Stand

1. Make a brutally honest assessment of where every part of the resource development program stands. What were the goals and objectives set at the beginning of the year? As temperatures rise during the summer, how is your organization doing? Are you ahead, on or behind pace?

2. Engage as many members as possible of your nonprofit family in these frank discussions. If the mindset is that resource development is solely the responsibility of the development staff, the nonprofit is handcuffing itself and compromising its potential. All professional and volunteer team members of the nonprofit have a role to play, and this starts with contributing their ideas and best thinking on where fundraising is succeeding and where there are opportunities for improvement.

3. Be sure your assessment addresses the external environment. How is the local economy fairing? Have any major employers moved in or out of your community? How severe was the impact of the pandemic? How visible and positive is the perception of your nonprofit’s leadership?

Evaluate Your Approach

4. How well do you understand the motivations of your donors? The fundraising tune-up needs to feature private conversations with your leading donors on what they believe provides the greatest satisfaction from their gifts. What have they enjoyed from gifts made to other good causes that they haven’t seen receive enough attention from your non-profit?

5. Communications and fundraising are seamless. In other words, you can’t tell where one ends and the other begins. The good news is that communications has never offered so many tools to connect with donors and prospects. The challenge is to most effectively integrate all of the different communications activities so that they truly reinforce each other. The first step is spending enough time to precisely identify your three most essential messages. Then make sure that your print, electronic and digital media efforts are relentlessly pounding those messages home.

6. Though their share has dropped a few points in recent years the vast majority of gifts still come from individuals. When you add bequests and gifts from family foundations to individuals, this share of the pie is about 85% of the philanthropic pie. By all means, welcome gifts from corporations and foundations, but prospect lists must emphasize individuals, because in the words of the infamous bank robber Willie Sutton: “That’s where the money is.”

Cultivate and Steward Donors

7. We live in a fundraising environment increasingly dependent on major gifts as fewer and fewer donors are making larger and larger gifts. Keep your prospect list of major gift donors in front of you every day of the week. Are they receiving priority cultivation? If not, identify the bottlenecks. The larger the gift target the more challenging it is to get on the prospect’s schedule. Quality interaction is at a premium as money follows time. Is your major gift prospect list missing potential individuals, corporations and foundations? The Six Degrees of Separation reminds us that everyone on the planet is separated by no more than six personal relationships. Take full advantage of doors that can be opened by staff — both fundraising and programmatic — board members, volunteers and donors. A fundraising tune-up can help assess if major gift prospects are receiving proper priority and cultivation.

8. It is amazing how often this simple truth is overlooked: You have to ask every donor prospect for a specific amount, for a specific purpose to be paid by a specific time. The more that you ask — especially in face-to-face meetings — the more money you will raise. There is no precise formula on the duration of the cultivation period, other than we know that the greater the desired gift the more cultivation is necessary. Sometimes the cultivation phase — forging a personal and emotional alignment between the non-profit’s mission, vision and values and the donor prospect’s philanthropic priorities can be completed in months if there is enough quality interaction. For major gifts, this may take a year or more. But no organization should delay its ask one day more than is absolutely essential. Remember that your donor prospect is likely being cultivated by other deserving non-profits championing admirable causes.

9. Your most likely major gifts will come from your current donor base. Is your stewardship program genuine and robust in acknowledging and thanking people for their gifts of time and money? This can take a wide range of forms from intimate recognition events to much larger public events. Stewardship should be carefully designed with the donor’s personality in mind. The deepest concern for the vast majority of donors is understanding how their gift dollars are making a difference. New technology is providing more and more effective strategies such as impact videos. Never underestimate the power of donors personally interacting with the beneficiaries of their generosity. In higher education, this power is evident when donors meet with scholarship recipients. Study your retention rate to keep donors and encourage repeat, and potentially larger, gifts each year. This approach offers a fundraising tune-up and proves more cost-effective by retaining a current donor base instead of solely focusing on acquiring new ones.

Implement Improvements

10. Are all your outreach channels emphasizing new and popular ways of giving? Donor advised funds have emerged as the most dynamic component of American philanthropy. according to the most recent data from the National Philanthropic Trust. Grants from DAFs rose 28% to $46 billion. Your website, marketing material and especially solicitation activities should inquire about opportunities to give through DAFs.

11. People can make gifts several times larger through their estates than through wealth. Be sure to discuss the wide range of options from charitable bequests, retirement funds, insurance policies, gifts of stock and other assets.

12. Celebrate victories. Recognize the roles played by everyone in the discovery, cultivation, solicitation and stewardship of gifts. They don’t come easily, especially major gifts. Let everyone know that they are directly contributing to the power of your mission to advance good works.

This list, by no means, is all-inclusive. No doubt, you can and should add other components to assess, analyze and upgrade the caliber of your resource development program. Final word: Don’t be afraid to make changes. Keep to sound fundraising principles and best practices but take full advantage to adjust strategies as circumstances warrant. Your nonprofit needs to be operating at peak performance as you enter the later stages of the year when most gift income is raised.

National Nonprofit Day: Celebrate Nonprofits on August 17th and Every Day

There is a national day for just about everything. So, sandwiched between National Tell a Joke Day and National Fajita Day is an observance that merits being a forerunner of all days. August 17th is National Non-Profit Day. While many more people in our industry are familiar with National Philanthropy Day, few know about National Non-Profit Day. It shouldn’t be that way.

On that day, do something meaningful like thanking nonprofit staff members or volunteers who are all around us. But, also recognize that nonprofits deserve our respect, admiration, and support 365 days a year.

When Nonprofits Do Well, We All Do Well

We can sum up the sentiment to this simple but powerful truth: when non-profits do well, we all do well. There is no part of the quality of life they don’t enrich and make better. They embody the best spirit and values of our nation. During the pandemic, we have seen nonprofits increase the volume and do even more to help those struggling.

Why celebrate on August 17th? Because that’s the date the Tariff Act of 1894 became law. It imposed the first federal income tax on corporations, which included exemptions for non-profits and charitable institutions.

Keen Appreciation of the Sector

My perspective on the subject is personal. For the better part of the last three decades, I’ve enjoyed the privilege of working in the non-profit world. I’ve held advancement positions and raised money for higher education institutions. It was instructive, challenging, and enormously fulfilling. Then in 2018, I decided to combine two passions. I wanted to teach the art and science of fundraising with the desire to venture out on my own by launching Eskin Fundraising Training. 

After conducting more than 150 workshops and webinars and working with hundreds of board members, volunteers, and staff from a broad cross-section of organizations, my appreciation and admiration for the non-profit sector have only deepened. I am inspired by the men and women who have selfless devotion in their unwavering commitment to improving the lot of others. Toiling away in relative obscurity, they’re genuine unsung heroes.

Nonprofit Proliferation

Though voluntary organizations endorsed by private contributions have existed in the U.S. since the mid-eighteenth century, they have only recently become an omnipresent part of American society. As recently as 1940, there were only 12,500 secular charitable tax-exempt organizations. Today, there are more than 1.5 million tax-exempt organizations in the nation. This stat includes all 501(c) designations such as churches, cultural centers, food banks, and disaster relief organizations. There are more than 100,000 non-profits in Texas alone.

Their story is compelling. The sector represents 10 percent of the American workforce or about 12 million jobs making it the third largest force in the U.S., behind retail and manufacturing.

High Job/Volunteering Satisfaction

You won’t get rich working for a non-profit, but the level of job satisfaction is much higher than among American workers. A survey by Classy, creator of online fundraising software for non-profits, reveals that 84% of non-profit employees are satisfied in their current roles at their organizations. Those involved with their organization’s fundraising efforts are especially satisfied, with 92% of this cohort expressing contentment. This contrasts with just 51% of all employees reporting that they were satisfied with their jobs.

There are so many more people who toil for non-profits. However, they’re just not paid. America is blessed with a gigantic army of dedicated volunteers. According to data released by the Corporation for National and Community Service, 77.4 million Americans, or 30 percent of the adult population, give 6.7 billion hours of volunteer service worth $167 billion.

These volunteers set an amazing example. As champions of good causes whose time and resources are already stretched, they find ways to give more time and more money to better the lives of others. And they do so with smiles on their faces. The secret is that they are energized, not drained, by their labors of love.

Fundraisers have even more reason to love volunteers. Gifts of time, talent, and treasure go hand-in-hand. Volunteering and Civic Life in America research reveals that nearly twice the number (80%) of volunteers donate to charity as people who don’t volunteer (40%).

By the way, the term “nonprofit” is a bit of a misnomer. Nonprofits can make a profit and should try to have some positive revenue to build a reserve fund to ensure sustainability. The key difference between nonprofits and for-profits is that a nonprofit organization cannot distribute its profits to any private individual. However, nonprofits may pay reasonable compensation to those providing services. 

In Closing …

Whether we like it or not, the stark reality is that it is likely that the government’s role and grant funding in meeting escalating human service needs will continue to shrink. It will be up to nonprofits to fill gaps to ensure that people in need and pressing issues aren’t abandoned.

I can’t wait for each new day to partner with nonprofit staff and volunteers to develop more resources so that they can extend the impact of their noble missions. Their passion for their respective causes gives them an essential tool to be effective fundraisers. Armed with the Jeffersonian virtues of a “knowing head and an honest heart,” they can effectively tell their stories, nurture relationships, and ask for and obtain gifts.

Non-profits are all around us and improving the world through advances in education, healthcare, arts and culture, economic development, animal welfare, human services, seniors, children, and other vital areas. They remind us that more is possible and that we can take matters into our own hands and make the world a better place to live, one person and one community at a time. If you’re not already contributing time and money to a nonprofit, there couldn’t be a better time than August 17th to add your voice to the non-profit movement and magnify good works.

Shout out to our friends at DipJar for making today’s episode possible! This clever cashless donation system has revolutionized our sales and donations at events…Ready to try it?

What makes a good fundraiser?

Wait a minute, let’s raise the bar: What makes a great fundraiser?

For the sake of this discussion, we will focus on those in the profession who are on the front lines of making one-on-one solicitations. They’re raising support from the individual philanthropists who account for about 70% of America’s nearly $500 billion annual philanthropic enterprises. No matter the title — development director, development officer, major gift officer, rainmaker, etc., they share skill sets, passion, and grit that culminate in the development of significant sums of private resources.

While not exhaustive, here are some traits I believe make a successful fundraiser:

•  Humility
•  Enthusiasm for every ask
•  Excellent skills in oral and written communication and active listening
•  A broad set of interests
•  Moxie

Before we dig deeper into these characteristics, let’s provide context on the talent drain and shortages facing nonprofits.

We’re Churning and Burning

According to an Association of Fundraising Professionals (AFP) study, half of the development directors expect to leave their current jobs in less than two years. As many as 30% are not sure they will remain in the profession.

A simple explanation: Too much aggravation and stress for too little reward. The smaller the nonprofit, the greater the pressure and the less the reward. Don’t forget that the overwhelming majority of America’s 1.5 million nonprofits are smaller. 88% have annual budgets of $500,000 or less. In an environment where the rich get richer — both staff-wise and organization-wise — there is a significant demand for proven development professionals, particularly major gift officers who have shown results in securing leadership gifts of five-, six- and seven-digits. The larger nonprofits can pay handsomely and do land such talented individuals. 

Let’s take a closer look at the five qualities of a great fundraiser: 

Humility: This is the foundation of realizing that no one knows it all. There are self-improvement opportunities all around us. Fundraising is the ultimate continuous improvement process. Whether the responses are yes,   no, or maybe, each solicitation has a genuine learning opportunity. Fundraisers are keenly aware of the need to keep their egos in check.

Enthusiasm for every ask: Let’s consider fundraisers as social entrepreneurs who live with the reality that reward comes with risk. In a genuine sense, the capacity to ask is like exercising a muscle. Do it regularly and well, and the muscle grows, don’t do it often, and the muscle trophies.

Great oral and written communication skills and active listening: Many people — especially those outside the nonprofit sector — mistakenly assume that live fundraisers can talk/persuade donors into making a gift. Not true. Laura Fredericks, the Expert on THE ASK, reminds us that during a productive meeting, the donor talks 75% of the time, while the nonprofit representative talks the other 25%. But they know how to make every second of their 25% count. Guide the discussion and ask the right questions; the donor prospect will tell you when, how much, and for what purpose they want to support.

A broad set of interests: People outside the sector also mistakenly think fundraisers are workaholics consumed by their work. That would work against them. Enjoying hobbies, culture, entertainment, and life, in general, empowers the fundraiser to relate more effectively to the donor prospect, no matter their age and walk of life. It also helps to read regularly and keep up with the news, which puts you in a position to have lively conversations and bond with others. (Be sure to avoid controversial subjects, such as politics.}

Moxie: Coming from Boston and being old enough, I remember drinking Moxie (one of the first mass-produced soft drinks) with an acquired taste. It is labeled “distinctly different.” Moxie also implies the admirable characteristics of courage, guts, and the belief that more is possible. It’s diplomatically asking and reminding influential people to take action and schedule essential appointments with donor prospects. Successful fundraisers aren’t afraid to dream big dreams. They believe every solicitation is a possible success, and you have a personal responsibility to give it your all-out best try.

How do we help them stick around?

Now that we’ve tried to define the DNA of great fundraisers, how do we keep them at our nonprofits longer than 18 to 24 months (an average tenure for the development officer)? 

For sure, salaries must be competitive, but the same AFP research indicates that this isn’t just about the money.

There are several non-financial factors at play: 

(a) Strong two-way communication. Fundraisers know they are heard and recognized for their accomplishments and invited to provide input on areas outside of fundraising. 

(b) Work-life balance has evolved into work-life integration since the beginning of the pandemic, with so many of us working remotely from our homes. Fundraisers often have events claiming their evenings and weekends and deserve the flexibility to meet the needs of loved ones that might come up during the traditional work week.

(c) Heart-to-heart discussion on a career path and growth opportunities. Professional development and robust interaction with peers are strongly supported. What are the options to move up? I am far from unbiased, but I fiercely believe that with some management training, development officers are well-suited to take on CEO or Executive Director’s responsibilities.

In Closing…

Losing a good fundraiser doesn’t make any sense. Experts estimate the cost of replacing, training, and transitioning new staff is well above the $100,000 level. Even more severe is the loss of relationship capital. Your top donors enjoy working with people that thoroughly know and appreciate their stories, preferences, and interests. Working with a new staff member can be a disappointment and loosen the emotional bond with the nonprofit.

Search and recruit development officers with a heightened sense of purpose. Work hard to orient them to the organizational culture and make every effort to keep them on board. Do all these steps with spirit, and the return on investment for your cause will be better than ever.

The reality is that the needs being served and the requirements to achieve more with less are challenging. There is no magic formula that will instantly make everything better. But in the world of resource development, there are plenty of sound principles, proven strategies and time-tested best practices to lean on. As you prepare for the rest of 2022, be resolute in the conviction that you can more effectively further your mission by relying on the art of fundraising.

Here are 10 measures to put your nonprofit on the path to more effectively sharing your story, nurturing relationships and friendships, and ultimately raising more money.

1. Revisit your mission, vision and values

We live in a world of constant change, except that now those changes are on steroids. Bring together your management, staff, board and other key stakeholders to have a frank discussion of your mission, vision and values. These should serve as guideposts for virtually everything you want to do to succeed. Let’s quickly review definitions: mission defines what the organization does; vision defines what the organization aspires to be; and values tells us what the organization believes in. These three critical components should be reviewed on an ongoing basis, and the need for a thorough review has never been so important as now.

Always keep this reality in front of you: Donors are faced with making difficult choices for how to invest limited resources of time and money. The truth is that they are not choosing between the good and the bad but choosing between the good and the good. Think hard and honestly assess both the pluses and the minuses. What makes your organization distinctive? How do you contribute to improving the quality of life in ways that all the other good nonprofits can’t? The philanthropic environment is competitive. Now is the time to make sure your key messages empower your organization to compete and succeed.

2. Major gifts are the name of the game

Don’t get me wrong, I cherish grants from foundations and corporations, but prospect lists should be dominated by individual philanthropists. Last year, gifts from individuals comprised 69% of America’s impressive $471 billion annual philanthropy enterprise. When you add in bequests and gifts from family foundations, this share rises to a whopping 87%. It has been my experience that individual philanthropists also reach their decisions more quickly than foundations and corporations.

Not only should your prospect lists be populated by individuals, but individual philanthropists should also receive your precious time and resources for cultivation. Needless to say, the bigger the prospect, the more difficult it is to gain a quality appointment, in person or virtually. On the other hand, like everyone else, the pandemic has kept major gift prospects much more confined to the home and likely more available.

3. Virtual fundraising, even for major gifts, has proved that it works

Virtual fundraising is here to stay, though some might have difficulty processing that reality. But virtual fundraising set records in 2020, with a substantial chunk of that facilitated by discovery, cultivation, solicitation and stewardship via video-conferencing. The key requirement is still establishing and nurturing a genuine friendship in which the donor prospect knows, likes and trusts both the solicitor and the organization. Video-conferencing also opens the door to involving people whose schedules and geography would not allow them to participate in person.

With practice, you can establish that all-important eye contact, screen-to-screen. But you must be disciplined and invest your time and resources to ensure that everything—from audio, lighting, background, and especially the video transmission—is top-quality. This is no place to cut corners. Take the time to make sure that the donor prospect is also comfortable with the technology.

4. You don’t have a board seat to waste

Board members have a fiduciary responsibility for the financial health of the non-profit. Noting in the minutes where a colon should be replaced by a semi-colon doesn’t cut it. There are many effective ways for board members to contribute to resource development success without ever asking for gifts themselves. This includes identifying prospective donors from their personal, professional and civic networks; and more than that, breaking the ice and introducing these prospects to the mission of the organization.

When the time is right, others such as staff or board members who are comfortable in making solicitations can step in and make the ask. A great way to introduce those board members who are hesitant of fundraising is simply to have them make phone calls to thank donors for their gifts. If all they can do is leave a voice-mail, that’s okay—the donor will still be reminded that they are appreciated by those at the highest level of the organization. Research repeatedly shows that such board thank you calls lead to gift increases in the next cycle.

5. Special events aren’t that special

I have to admit I’m not a big fan of special events such as luncheons, galas, and golf tournaments. Too much staff time and resources are devoted to covering the cost of the event and making it happen. I would rather take the list of supporters and solicit their same gifts for virtual or hybrid events. People don’t go to these events to get dressed up, drive distances and enjoy rubber chicken. They go because they believe in and want to advance the mission of the organization. The last year vividly demonstrated the creativity and effectiveness of alternatives to traditional special events. I might be biased, but I truly doubt major gift donors are going to criticize the nonprofit for erring on the side of public health, caution and safety in foregoing in-person annual fundraisers.

6. Make monthly giving easy and visible

I have to start with a confession: I am a monthly giving convert. Fortunately, my path crossed with Erica Waasdorp, who I like calling the “first lady of monthly giving.” Erica powerfully drives this conclusion home with plenty of data. The cost is low and new technology is lowering it every day. Especially profound is the impact on retention—an enormous challenge for non-profits with an average sector retention rate of 46%. When you convert a new or repeat donor to give monthly, the retention rate jumps to an astonishing 90%! Another great advantage is that monthly giving often supports much-needed unrestricted funds.

7. Consider the enormous potential of gifts of stock and equities

In this historically robust market, many of your donors likely hold enormously appreciated assets. Donating these stocks to their favorite nonprofits can help them avoid costly capital gains taxes. Consider this: Approximately 97% to 99% of all wealth in the U.S. is held in assets like stocks and real estate—not cash. So, donors are able to give more with these gifts. You would be surprised to learn who is holding multi-million-dollar stock portfolios. This includes next-door neighbors who appear to be living very modest lifestyles.

8. Make sure Donor Advised Funds (DAFs) are highlighted 

This is the most dynamic component of American philanthropy. Fidelity Charitable donors alone recommended grants totaling more than $9.1 billion, benefiting 170,000 charities during 2020. All indications are that DAFs will continue to grow in importance and impact. Be sure to highlight DAFs on your website, in your marketing materials, and especially during solicitations.

9. Giving starts at home

If management, staff and board members haven’t made personally significant gifts to the cause, they simply won’t have credibility soliciting others in the community. Personally significant will mean very different things to you, and me, but there must be an element of stretching involved. Think about it: Why should those outside the organization donate if those inside it aren’t?

10. Believe that more is possible, and it will be

The most effective fundraisers dream big dreams. They also believe that their programs, employees and especially beneficiaries deserve the best. Enthusiasm for big dreams is infectious. Believe me, nothing connects and energizes major gift donors like the passion of the nonprofit professionals who ask for their support. Now your job is to work hard and to work smart to make 2022 your best fundraising year ever!