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Wednesday, October 26, 2011

Rush Hour: Is Time a Fundraiser's Greatest Luxury?

You've just start a new job as a development director for a nonprofit organization. How much money can you raise by Friday?

Now you've been on the job for two months. Have you raised enough money to cover your salary?

Oh, and the board members are asking--we gave you that list of cold calls to make. Why haven't we seen a major gift yet?

In a tough economy, there is a lot of pressure to "show me the money." Yet in the traditional fundraising model, we talk about the development cycle:


  1. Identify prospective donors
  2. Qualify prospective donors
  3. Make initial contact to gauge interest
  4. Cultivate donors who are interested in your cause
  5. Ask for a gift
  6. Continue cultivation if the timing is not right
  7. Accept and steward the gift if the gift is made
  8. Renew cultivation of donor and repeat.
To optimize the value of the experience for the donor and the value of the gift for the philanthropic cause, we are supposed to take time to build relationships. But in today's world, do we have time to do that? 

When it comes down to it, if you're dependent on contributions to keep the doors open, you do not have the luxury of time. In fact, budgets have been so tight that far too many nonprofit organizations have eliminated their development staff positions, even though it is supposed to be the revenue generating line in the budget! Boards are often needing and expecting quick, if not unrealistic results from their development staff.

So what's a development professional to do? Here are some coping mechanisms:

Expand your annual giving with a monthly giving program. It may not be huge dollars individually, but as an aggregate, your annual giving program is your most reliable and steady source of fundraising revenue. Whether or not you have an established donor base, ask people to give monthly, which helps increase their gifts by making it easier to include in their budgets.

Churn out proposals. This is a case where volume may help. As much as I hate submitting proposals that I know will not get funded, you're going to have to go after some long shots, if anything just to prove activity to the board. You're going to need to increase your ask rate across the board.

Reduce every expense possible as long as it does not affect the donor experience. The supporters that are sticking with you should be rewarded and thanked for being generous in difficult times. Every time you think about cutting back on something, put yourself in the donor's place and decide if it's something they value. For example, I once decided to change a donor lunch menu from a hot meal to a sandwich plate as a cost saving measure. Boy, did I hear about it! The hot lunch was back the next meeting. I was, however, able to cut back on holiday gifts for my major donors that year with no objection. Turns out, my donors didn't really care about the fruit basket. It's important for donors to know you're being fiscally conservative, but try to minimize the impact on them.

Don't let the board off the hook. If they give you a list of people to call on, write a letter to go over their signature as an initial contact. And every time a board member asks if you've closed a gift from random prospect number 98, be ready to report the steps you've taken and where you need their help. Keep reminding them, and asking them to be a part, of the process.

Be honest with your donors. Be factual about your financial situation and the end result impact on community needs. For example, if you need $10,000 to make payroll, say, "If we aren't able to raise this money, we'll have to cut our hours or layoff staff, which will mean fewer services for those in the community who need them." 

Continue to focus on donor intent. Be particularly vigilant about moving money around. As much as there may be a temptation to "borrow" from a restricted fund, DON'T DO IT. Plus, if a donor really doesn't want to support your general operating fund, respect their wishes.

Decide what you're NOT going to do. Maybe it's an event. Maybe a program that needs to be shelved. Maybe it's all new programs. Boil your organization's services down to the core and only focus on funding those activities.

Report your actions. You're probably feeling under the gun! In spite of feeling overwhelmed with everything you have to do, this is not the time to withdraw. Err on the side of oversharing--prepare a regular activity report to your organization's leadership, and if people ask, "How is it going?" tell them! Celebrate every success, no matter how small.

Create your rallying cry! It may sound corny, but you need a mantra. What can you stay focused on? When I was Vice Chair of Membership for the Association of Fundraising Professionals during the only downturn in membership in the organization's 50 year history, my mantra was, "Keep who we have." New members were great, but membership retention was more important to the overall financial picture. Our membership division activities became focused on renewing our members and rewarding them for staying.

Maintain the development cycle, just move it a little faster. There are going to be times when you have to go after the quick win. This does not mean that you jump to the ask; you just need to spend less time researching and cultivating. Jim once secured a major gift within three days after initial contact, but still went through the stages of the cycle. Then, focus your efforts on slowing down the cycle for subsequent asks with that donor, so you can take time to build the relationship after the fact.

There will be many times when you feel like your Herculean efforts are being ignored and that no one understands that you just can't "print money." But by focusing on regular, actionable steps, it will be easier to show progress and hopefully lead to more solid financial footing.

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