Archdiocesan Development Council Development MATH.

Archdiocesan Development Council

Development MATH

Agenda

A. Welcome

B. Competition Game

C. So….is $250,000 good enough?

D. Stats and Trends….(get your coffee now!)

E. 7 Faces of Philanthropy….

F. Questions and Answers

3 LatzBruni Partners. LLCLatzBruni Partners. LLC

GOAL…..> GOAL OF THE GAME IS FOR EACH

TEAM TO GET 5 MARKS IN ROW. TWO RULES:

• Once a box is full, it’s full

• Have to go one team at a time

PLAY BALL……..


What ensures success?

KNOW YOUR GOAL!!!


So….if you can raise $250,000 would you?> Why wouldn’t you do it?

> When shouldn’t you do it?


FRAME OF MINDAs Development offices, we are:

• For-profit entity of the non-profit

• Can provide measurable results

• Expenses vs. Revenue

• Gains and losses

• A business


>“Non-profit is a Tax-status, NOT a state of mind.”


Event Goals (math)> Maximum costs….40 cents on the

dollar

> Your goal……25-30 cents on the dollar

> “You deserve a raise” status……..….

15-20 cents on the dollar


Friend-raiser vs. Fundraiser> IF a friend-raiser then make it a true

friend-raiser. Don’t count in overall development revenue because “profit” should be small and seen as an investment in the business.

> IF a fundraiser, then follow guidelines for appropriate “profits!”


Primary and Secondary School Benchmarks:> Minimum “Profit” margin: 2-3x annual

expenses (salaries count as expenses!)

> Average “Profit” margin: 3-5x annual expenses

> High Achievers: 6-8x annual expenses


HARD MATH> IF your office costs $300,000 to run THEN

you should generate a minimum of $600,000 - 900,000 in revenue

> Ask for a raise if your office costs $300,000 to run and you generate $1,800,000 - $2,400,000

* This is non-capital campaign revenue


Caveats…..(these are important)

• Big debate on whether or not Alumni Relations Coordinators should be included in costs. LatzBruni thinks yes, but not everyone thinks that way, especially Alumni Relation Coordinators!

• Marketing should NOT be included in the equation. Marketing should be its own department and cost center. Can’t always be that way but that is ideal.


Hard math VS. Development Math> Pledges don’t count (sorry, that

stinks!)

> Planned gifts don’t count (unless they have their funeral that year)

> Gross revenues from events don’t count (unless nobody shows and there are no expenses!)


Salary Review> So……before you determine what you

should be paid…..

> DO THE MATH…(not development math!)


Salary ranges in Chicago> Low range: $40,000 - $65,000

> Middle range: $65,000 – $90,000

> High range: $90,000 - $125,000

* No surprise….there is a direct correlation with the high range salaries and the net “profits” of that particular development office.


Statistics!Raise your hand if caffeine is needed!


Individual Giving Rocks & Always Has (and always will!)


Stuff that makes you go “Hmmmmm.”• 2006 Giving in US = $295 Billion

• More than GDP of Norway

• 68% of all households gave something to charities last year

• Of those that gave, only 6% gave through bequests and 3% through gifts of stock. It is believed this is due to LACK of AWARENESS! What a great opportunity.

• More Americans give to charities than VOTE! (More bad news for Hillary and Company)

• Oprah – Most generous celebrity, she gave away $58M herself (no wonder why Stedman is p.o’d at her!)


More Hmmmm stuff……• Average American donates 2.6% of

their income

• 50,000 and below = $971 avg. investment

• $50,000 - $100,000 = $1,918 avg. investment

• $100,000 and above = $3,975


Capacity equations(this is actually interesting hmmmm stuff)

> High Net worth individuals (those w/ assets higher than $5M) typically give from investment returns, NOT principle balances.

> 10X rule…..IF you’re going to ask for 1M over 5 years, person should be in the 10M net worth range minimum.


Where The Money Goes• Religious organizations: $96.82 billion (32.8%) • Educational organizations: $40.98 billion (13.9%) • Human service organizations: $29.56 billion (10.0%) • Foundations: $29.50 billion (10.0%) • Public-society benefit organizations: $21.41 billion (7.3%) • Health organizations: $20.22 billion (6.9%) • Arts, culture and humanities organizations: $12.51 billion (4.2%) • International affairs: $11.34 billion (3.8%)• Environment and animal organizations: $6.60 billion (2.2%)

Arts, culture and humanities experienced the biggest increase in giving in 2006 (9.9 percent), closely followed by giving to education (9.8 percent) and giving to foundations (7.4 percent).


Why people give where they give.

Reasons we support one charity over another….as personal as why some cheer for the Sox and others the Cubs.

Some donors are smart, some are not.

GO SOX!


Real reasons for giving> People ask! (82%)

> History of giving to that particular cause (80%)

> Belief in the cause (76%)

> Belief contribution will make a difference (52%)

> Belief money is used effectively (42%)

> Knowledge of the beneficiary (put a face on the case…kids, kids, kids) (28%)

> Knowledge of the person raising the money (17%)

> Tax advantage (15%)

> Employer encourages me to contribute (6%)

> Lots of media attention around a particular cause (2%)


Today’s “NEW” Donor(Not a dream date for Development officers)• More demanding

• More reward driven

• Wants more accountability

• Wants more accessibility to leadership

• Wants to be heard

• Wants to be recognized

• Feels less a “duty”


10 Necessities for Raising Money in the 21st Century1. Become distinct and appealing as best commercial brands!

(Brand yourself, single sex schools have an advantage!)

2. Demonstrate Value-for-money and impact.(Make sure donors see how their contributions make a difference…Save Lives/Change Lives….IIT Example)

3. Engage Donors (People support what they help to create!)

4. Offer wider choice of giving products

(ie. Premium Life Insurance options)


5. Blur boundries between giving and living (ie. 3-day breast cancer walk)

6. Make donors stakeholders. Give them a say in how and where they give their $.

7. Provide an emotional return in their giving.

8. Appeal to specific, defined, targeted audiences. All alums shouldn’t be solicited the same way.

9. Ask for marketing dollars, not philanthropic dollars from corporations and business’s

10 Ask them for more than just dollars!!


7 Faces of PhilanthropyGENERAL MOTIVATIONS FOR CHARITABLE GIVING - In The Seven Faces of Philanthropy, Russ A. Prince and Karen M. File present a framework of seven general philanthropic approaches or outlooks in our society.

• CommunitariansCommunitarians are individuals who give because of their sense of belonging to a social community. They give, not out of a sense of obligation, but because they consider nonprofit organizations more effective at delivering social services and more attuned with community needs. These people often have a history in, and ties to, their local community. They support cultural, human service, religious and educational organizations.

• The DevoutThe Devout do good because it is God’s will. They believe that giving is a moral obligation. Everyone needs to take responsibility for creating a better world and should not expect personal recognition for volunteering of time, talent or money.

• InvestorsInvestors see philanthropy as “good business.” They are motivated by the personal tax and estate benefits philanthropy represents. They also give in the same way they invest their personal wealth—looking for nonprofit causes and organizations which are business-like and effectively respond to civic needs.

• SocialitesSocialites focus on doing good work or charitable giving of money because it can be fun. They are often members of a social class or group for which fundraising includes some form of socializing and entertainment. The authors acknowledge that Socialites are often charitable “at heart.”


7 Faces of Philanthropy Cont.• Altruists

Altruists tend to focus on social causes and giving that provide a sense of purpose and personal fulfillment. They believe giving promotes spiritual growth (in this case, not religious-based). Giving is a moral imperative and everyone’s responsibility. They see themselves as the true philanthropists, unfettered and untainted by business considerations or personal gain.

• RepayersRepayers do good in return for what they have received in life. This can involve gratitude for medical or educational benefits they’ve received. They think wealthy people have a special responsibility to be philanthropic in their actions and social outlook. Repayers insist on cost-effectiveness and want nonprofit organizations to focus on client needs.

• DynastsDynasts see philanthropy as a family tradition. Their giving results from childhood socialization by parents or other relatives as to the importance of philanthropy. Philanthropy is part of their self-concept and their rewards from giving include a positive self-identity and strengthened family values. They believe philanthropy is everyone’s responsibility.


Great moments of Philanthropy(First math…now history!)• 1643 – Volunteers go “begging” and collect $500 for Harvard.

It is thought to be America’s first fund-raising drive.

• 1881 – Clara Barton founds the American Red Cross, which today provides disaster relief, among other things.

• 1889 – Andrew Carnegie pens The Gospel of Wealth. In 1911, he endows the Carnegie Corp. with $25 million ( $525 million today).

• 1938 – Entertainer Eddie Cantor asks radio listeners to send dimes to help fight polio, collecting $268,000


More Great moments….• 1985 – Bob Dylan, Madonna and others

perform at the Live Aid concert for famine relief.

• 2002 – Pharmaceutical heiress Ruth Lilly gives $100 million to Poetry magazine

• 2006 – Warren Buffett pledges to give away more than $40 billion, most of it to the Bill & Melinda Gates Foundation


One of life’s greatest rules…..

“You can’t hold a torch to light another's path without brightening

your own!”


Our responsibility……Introduce our “investors” to paths they can brighten, both for the institutions they are aligned with as well as themselves.

Archdiocesan Development Council

THANK YOU!

Archdiocesan Development Council Development MATH.

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