A fundraising toolkit

A FUNDRAISING TOOLKITBonnie Osinski 3/08/12

Sources2

GOVERNMENT Contracts and grants Really big money; often renewable over the long run Political realities make it less stable that it appears Lots of restrictions, paperwork, reporting Can suppress the impetus to build an effective constituency You can’t use government operating funds for fundraising

The Process: Following detailed instructions in lengthy and complex RFP’s Funding agency tells you what they want Proposals often voluminous Complex budgeting process Reporting and evaluation is different for each grant

Support Center 6/27/11 Bonnie Osinski

Sources


3

GOVERNMENT EFFECTS

Creates and organizational culture that does not support private funding

Organization does not build a fundraising board; difficult to get support when moving to other funding sources.

Program culture that is reactive, looks to fulfill the requirement of the funding agency

Difficult to build projects for foundation proposals Culture is not open to letting individual donors in

Sources4

PRIVATE FOUNDATIONS Mostly restricted grants in their area of interest Not meant to be an ongoing source of support Grants much smaller than government; paperwork less onerous Lack of contacts should not discourage application; valuable relationships

can build once a grant is awarded Potential for flexibility in project design within guidelines

THE PROCESS Creativity to develop & implement projects that meet your needs and

funder’s priorities Building relationships with program officers over time Plan to leverage time limited grants for future benefit – capacity building;

success story for other donors; learning that will inform programs Research to find a match


Sources


5

PRIVATE FOUNDATION EFFECTS

Short term, mostly restricted, grants create management challenges that have to be offset by other funding sources

Small size of most awards can require a patchwork of grants to support a project

The process of project development that goes into creating a proposal that works for the funder as well as the grantee fosters valuable management skills. Differentiating between outcomes and process Defining the need Evaluating results

Sources6

CORPORATIONS Corporate self-interest is key Source of financial, in-kind, sponsorship, matching and volunteer

support Partnership and joint marketing possibilities Renting your good name; Compatibility; Seeking connections with your

constituency Excellent source of board members Multiple entry points and interests possible within the same corporation

THE PROCESS Can be very similar to foundation grantsmanship The more contacts, the better –board networks important Research is different from foundation research Developing joint marketing and sponsorships can involve complex

negotiationsSupport Center 6/27/11 Bonnie Osinski

Sources


7

CORPORATE FUNDING EFFECTS

Greater visibility Opportunity to build relationships with potential major

donors and board members Responsive to a constituency that is very different from

government and foundation funders Building the skill and culture that supports making the

markets/capitalism work for you Requires board members who can make connections and

support the effort

Basic Assumptions 8

It’s not about the money

Money is the means to an end

The end is fulfilling your mission


9 Support Center 6/27/11 Bonnie Osinski

Basic Assumptions10

CIRCLES OF INFLUENCE

The stronger the core; the more effective the organizations All fundraising activities should be managed so they

strengthen the core The stronger the core; the stronger the message you can send The further away from the core; the more expensive it is to

fundraise Public relations is directed at the outer core and should not be

factored into direct fundraising expenses Without good public relations and overall agency

communications; the fundraiser has to spend more time working in the outer, more expensive rings


The Board of Directors 11

You will never reach your organization's full fundraising potential without a board that supports and participates in fundraising

All members give to the best of their ability and all support fundraising in some way

Leadership is sincerely and actively working to add board members who can support the organization’s fundraising.

The board and the chief development officer work together as a team

A CEO who discourages a strong board will hold the organization back (usually a founder)


Types Of Support12

RESTRICTEDDonor specifies the use

If you accept the money, you are legally obligated to comply

Make sure the specified use is in line with your mission and strategic plan

Best to turn it down if it is not a fit

Only a donor can legally restrict contributed funds


Types Of Support13

UNRESTRICTED The most desirable type of support Enables you to be flexible and responsive to changing

conditions and client needs Your best bulwark against a turbulent, unpredictable

environment Virtually impossible to run a strong and effective

organization without a high level of unrestricted supportOPERATING

Generally a sub-set of unrestricted Can also be restricted funds for specific or one-time

operating costs e.g. Computerization, financial systems, fundraising start-up costs


Types Of Support14

CAPITAL Construction, purchase of facility or renovation Generally a campaign with specified goals and time limits

ENDOWMENT Best way to insure long-term financial health Should be big enough to generate significant annual income Can it be too big? Less appealing campaign than bricks and mortar Can be built with planned giving income, much of which cannot

be projected in annual operating budgetsComposed of donor restricted and quasi-restricted funds


Basic Assumptions


15

Where you get your money and what you have to do to get it

determines the culture and

functioning of your organization

Reliability/Autonomy16

RELIABILITYHIGH MEDIUM LOW

AUTONOMY

HIGH

Earned income; Endowments; Memberships; Small/medium individual donors

Fees for services; Event ticket purchasers

Foundation operating grants;

MEDIUM

Major individual contributions; corporate charitable contributions;

Corporate sponsorships

LOW

Ongoing government contracts; Third party reimbursements;

Government project grants; Foundation project grants;


Tools18

SPECIAL EVENTS Costly form of fundraising; staff time required is often

underestimated Can be good for building visibility Means for volunteer support and involvement; opportunity for

donor cultivation Can bring in some new donors Can build a constituency that is loyal to the event, rather than

the organization or it’s missionTHE PROCESS Determine level of substantial support from board members and

current supporters- more than 50% of gross revenue required Consultants well worth it for large events; free staff to focus on

donor cultivation and solicitation You are not selling tickets


Tools19

DIRECT MAIL Can be a very reliable support of annual cash income A successful mass mail program usually loses money for the first

three years; Pays off when a critical mass of repeat donors is reached

Becoming more costly as postage and other costs increase Entry point for major and planned gift donors Not all organizations or causes can be successful in the mail Consider starting an in-house mailing program with contacts

generated by board staff, and other supporters

THE PROCESS Get professional help to develop competitive text and graphics –

even for in-house or donor renewal mailings Don’t even think about donor acquisition – renting lists – without

hiring a professional direct mail consultant You must mail several times a year to be successful


Tools20

MAJOR GIFTS Most effective way to raise the largest gifts and the lowest costRequires time and effort to cultivate and upgrade donorsResearch and moves-management essentialVery strong advocates and solicitorsBoard must be intensely involvedBest indicator of long-term organizational strength

THE PROCESS Regularly mine general donor lists from direct mail, events, on-line,

etc. for major gift prospects Research is important Contacts from board members and other major donors Continuous cultivation and stewardship required Determine and respond to donor’s interest in becoming more involved


Sources


21

INDIVIDUALS

It’s not about the money

It’s all about relationships

Sources22

INDIVIDUALS Source of more than 80% of all philanthropic funds Your best bet for long-term strength and survival; reliable insurance

against fluctuations other funding sources Investors; advocates for your cause – your power base Best source of ongoing, unrestricted funds Only source of planned gifts; best way to build endowment Most cost effective at major gift levels

THE PROCESS Research essential Requires ongoing maintenance of relationships and stewardship Best returns come after years of cultivation. Direct mail for general donors – entry way for major donors –

expensive start-up On-line email and social networking present cost-effective options Events can bring in some new donors; reinforce & cultivate others


Sources


23

INDIVIDUAL FUNDING EFFECTS

Parallel to taking a private company public Open to a new kind of scrutiny Taking donors to higher levels of giving requires giving

them opportunities for greater involvement with the organization

Effects are felt throughout the organization Requires board members who can make connections and

support the process

The Ask


24

The right solicitor asking the right prospect for the right amount of money for the right reason at the right time

10% of the major gift fundraising process The result of long term cultivation Not a single event Most of the time – the result of teamwork Many sources of training and literature to help build

skills Misused measures – annual revenue goals – individual

staff credit

Tools25

PLANNED GIVING The desired, ultimate result of individual giving programs Not limited to major donors Gifts made from assets, not income Require long-term planning on the part of the donor, preferably with the

help of a financial planner or attorney Bequests are the most common source; not the most beneficial for

donors of substantial means The ultimate payoff does not correspond to the costs incurred in a given

year

THE PROCESS Any organization can remind all donors about making bequests in

newsletters, web sites, targeted mailings, etc. Maintain awareness of the possibility of planned gifts as part of the

major donor process Stay on top of general tax law as it applies to philanthropy Investing in outside expertise yields the best results


Tools26

CAPITAL/ENDOWMENT CAMPAIGNS Time-limited campaigns to reach specified goals Requires existing supporters to make significantly larger gifts Organization must be able to maintain annual giving income Reaching the goal requires that at least 10% of income comes

from one or two donors Depends on an existing major donor base Bricks and mortar tends to be more popular than endowment

THE PROCESS Outside counsel is highly recommended; feasibility study can

make a difference Campaign chair and committees essential Start bringing in lead gifts as soon as possible Silent phase until lead gifts and half the income is committedSupport Center 6/27/11 Bonnie Osinski

Tools27

INTERNET Effect on fundraising is still evolving – not significant as

direct source of funds Good web site can be a source of on-line contributions New prospects check websites before making gift

commitments Effective ongoing donor cultivation – newsletters, event

announcements, press releases, photos, etc. Social media can be effective for visibility and reinforcement Appears to be low cost; very labor intensive Studies show combination of direct mail & internet is

especially effective

THE PROCESS Get on the learning curve and move up fast – periodicals,

newsletters, training, consulting Create an effective web site - expensive


The Plan28

All the tools have to come together into an integrated, coherent plan

Fundraising cost/benefit analysis Budget, staffing, and organizational culture Do we have the necessary skills and knowledge in-house? Staff or consultants

Develop a calendar of activities for the year, keeping in mind:cash flowstaffingthe organization’s programmatic and administrative planning

Plans and budgets serve as important political documents: use them to get leadership and staff buy-in.


More tools


29

Your skills and experience – fundraising and nonprofit management

Education, training Keeping up with the latest information and research Skills for dealing with board members, staff, clients, donors

– listening is key Public relations and communications Writing Professional organizations and contacts The mission and reputation of your organization Organizational support

Let’s Get Real30

What will work best for my organization?

Can I identify immediate next steps?

What barriers do I face?

What changes can I make?

What is beyond my control?


Where to Get More Information

31

Other training sessions Books, articles, electronic sources Consulting services, other sources Keep up with the field


A fundraising toolkit

Documents

Transcript of A fundraising toolkit