Session 3 -- January 13, 2010 Richard Male and Associates for the Trinidad Community Foundation.
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Transcript of Session 3 -- January 13, 2010 Richard Male and Associates for the Trinidad Community Foundation.
FUNDRAISING AND RESOURCE MOBILIZATION
Session 3 -- January 13, 2010Richard Male and Associatesfor the
Trinidad Community Foundation
THE PRESENT SITUATION
Fundraising in 2010: Challenges and Opportunities
The Flow of Charitable Gifts Historically: Where the Money Comes From
Bequests
Corporations
Foundations
Individuals
Foundations12%
Bequests8%
Corps5%
Individuals76%
Source: The Chronicle of Philanthropy
The Flow of Charitable Gifts
Historically: Where the Money Goes
Education
Health
Human Services
Religious
Other
Source: The Chronicle of Philanthropy
Other 34%
Education 14%
Health 9%
Human Services 8%
Religious 36%
What is the current economic and political situation in 2010?
5
What is the economic and political situation in 2010? Most challenging time in my 40 years Still very likely to see 20% of nonprofits
(grassroots) go out of business during this “Great Recession”
Economy is as volatile as a tornado: there is no way to predict where it will touch down, how much damage it will do or when the clouds will part
Every state but three ran a deficit in 2009--and for many, these challenges will likely increase in 2010 6
Pressing issues facing grant-seekers/educational organizationsEmerging trends Many private foundations are trying to
hold their giving steady for 2010, but likely will decrease grant funding
Foundations likely to reduce giving in 2010 and 2011 significantly unless the stock market dramatically increases
7
Pressing issues facing grant-seekers/educational organizations Foundations likely to make grants
primarily to existing grantees Significant number of foundations
shifting their grant making to basic needs, emergency and human services
Foundations likely to shift some of their dollars to general operating support instead of program dollars
8
Impact on individual donations Individual donor giving is based on the
psychology of how the donors are feeling about their retirement income, financial portfolio, value of their house, job and future. All indicators remain low.
Individuals likely to give 25%-33% less in 2010. Individuals more likely to give to existing
organizations they know and have strong relationships and involvement with.
Individual gifts likely to be spread over greater periods of time.
9
Impact on corporate resources for grant-seeking and educational institutions Most corporations give 1% of pre-tax
earnings; this have been relatively flat since 1985
Corporate sponsorships and the use of marketing dollars are likely to continue--but at reduced levels
Corporations will become even more selective and “bottom-line oriented” than in the past
Giving of volunteer time and in-kind product will increase more than giving dollars
10
Impact on government contracts and grants 75% of the 1 trillion dollars going to
nonprofit organizations throughout the United States yearly comes from government sources
With almost every state running a deficit, sales tax revenues are down. Income taxes will be lowered and corporate taxes will decrease
A likely upturn in government support can be expected in 2011
11
Still, there is reason to be hopeful during these times1. Americans are incredibly generous people who will
continue to give when “touched” and when consistent trust is built
2. People are still giving, but at reduced levels3. Charities and needs are becoming increasingly more visible4. Conducting educational sessions for your donors will
become even more important5. Some aspects of the economy are growing – tied to
stimulus funding and economic trends, with health care likely to provide new revenue streams
6. We will come out of these hard times more educated and stronger
12
ARE YOU READY TO RAISE MONEY?
A checklist of the essential pieces you need in place
Financial Self-sufficiency
9. Evaluation / reporting
8. Execution of the plan
7. Infrastructure: designatedstaff / resources / database
6. Resource DevelopmentPlan / road map
5. Trust / accountability / teamwork
4. Strong programs / compelling need
3. Leadership withinorganization
2. Commitment from board and staff
1. Desire to become self-sufficient
What It Takes
Are You Ready To Raise Money?1. Clear sense of mission?2. Are your programs strong?3. Is your leadership active and
engaged?4. Are you in touch with your
constituency, members or clients?5. Is there a working partnership
between staff and leadership?
Are You Ready To Raise Money, con’t.6. Do your goals match your budget?7. Are your financial reporting systems in
place?8. Do you have a successful track record
of raising money?9. Are you accountable for your money?10. Can you demonstrate results?
Richard Male & Associates
http://www.richardmale.com
Positioning Your Organization
Communications Strategies to Effectively Compete
Susan Liehe, Senior Associate - RMA
Your donors/funders expect you to tell your story
Build board, employee, customer/client pride
You think you can do without it… until you can’t
Supports raising money: the “agrarian” metaphor
Why outreach matters
Key Messages
3-5 absolute essentials -- very short
Memorized, repeated (and repeatable)
“Elevator speech”
Gee whiz, who knew?
Myths and misconceptions addressed?
What is your brand, your promise
Roadmap for newsletter, email, speeches
Your different audiences
Employees
Donors and funders
Volunteers
Business owners
Other nonprofits
Civic clubs (Rotary)
Media
Customers, clients
Schools
Churches
Public speaking
Prepare a specific topic (NOT whole mission)
Outline – incl. opening and closing
Add data, stories, humor, rhetorical questions
Develop blurb, ppt, handouts, leave-behind
Rehearse to a strict 20 min. MAX
Practice and get feedback
Promote: hunger for well-presented, thoughtful content
Goal: 1 speech/month
Using the media
Do not fear a reporter calling
An investment in your “trust account”
Consider the power of ink, air, online (versus other
tools in your toolbox)
Volunteers, donors, clients, referrals…
Set a goal: one story pitched/month
What makes a great story?
Focus on one individual
Trends: doubled, up 36%, etc.
Facts, data, measured results
Apply large issue small example
Problem . . . Solution
Milestone (graduation)
1-2 resources cued up (not just you)
Successful media relations
Know the players – who, how, when
Know what they’re covering—big, recent pieces
Busy and competitive environment
“Right” point to hand off the material
The power of an exclusive
Access—make it easy and quick
Be a go-to person on more than just your org.
Send notes—links—etc.
Use Board “Ambassadors”
Key messages (training in small segments)
“Toolkit” of small, concise literature/materials
Fresh, credible data
Coach them in their own circles
(An engaged role: energizes and instills pride)
Compile periodic “outreach report” – see impact, see that it matters
Two points to ponder
Beware of emulating “Project Ozma”
“The greatest challenge in communication . . .”
IDENTIFYING THE FUNDING PIE
The advantages and disadvantages of each funding source
1. It’s an insurance policy – spread the risk2. Secret to financial stability and survival3. Communicating to multiple
constituencies, donors and stakeholders4. Alleviates the risk of one or a few donors
controlling the strategic direction of the organization
5. Strive for 70:30 ratio of controllable vs. uncontrollable income
Why diversify your revenue base?
Controllable
Fee for service / contractsMembershipsSmall donors under $100Large donors over $100Special events
Uncontrollable
Foundation grantsNational religious grantsCorporate donations
Richard Male & Assoc, Inc.
Controllable vs. Uncontrollable Income
ControllableEndowment / Wills / Bequests
Partnerships with Corporations
Earned Income and Entrepreneurial Ventures
UncontrollableUnited Way organizations
Government offices through RFPs
Service clubs
Richard Male & Assoc, Inc.
Controllable vs. Uncontrollable Income
Richard Male & Assoc, Inc.
Current Trends and Future Issues
Corporate philanthropic giving is flat; strategic marketing is the growth area.
Giving by individuals will increase at a moderate growth rate in proportion to the economy and the perceived optimism of the donor
Philanthropic trusts managed primarily by financial institutions are growing moderately.
Transfer of stock/real estate is a growth area – set up stock account
Country is aging.
Charitable trusts / donor advised funds are growing.
Foundation giving has increased by 28% since 1986, but decreased 2001-03. It is down now and expected to decrease further (up to
10-30%) in 2010-12.
Richard Male & Assoc, Inc.
Philanthropic TrustsThe Hidden Pockets of Money
Managed by trust departments at Financial Institutions
Use banking relationships to gain access
Smaller grants – under $10,000
Richard Male & Assoc, Inc.
Philanthropic TrustsThe Hidden Pockets of Money
Purpose – can be used for general operating funds
Generally long term support
Local / Regional Congregation
Judicatory / Diocese
National Denomination / Religious Foundations
Richard Male & Assoc, Inc.
Strategies For Religious Funding
Strategies For Religious Funding Lay involvement Meet with Minister, Priest, Rabbi Get support from local congregation Build support among the lay volunteers Advertise in congregation bulletin and newsletter Network through your constituency Be visible with a congregation National denominational funds Religious foundations
Richard Male & Assoc, Inc.
New Corporate Philanthropy
ProductEndorsement
MembershipsPhilanthropy
Service
Endorsement
MarketingIn-Kind:• Volunteers
• Product/Services
• Tech. Assistance
• Matching Gifts
Sponsorships/
Events
Two Vehicles of Giving:• Corporate Giving Programs• Corporate Foundations/Trusts
Richard Male & Assoc, Inc.
Richard Male & Assoc, Inc.
Corporate GivingDon’t Just Think of Money
There are THREE primary ways in which corporations can help your organization
1. Financial
Gifts-Traditional Philanthropy (Corporate Foundations) Memberships Marketing (Corporate Giving Programs)
• Products Sponsorships (special events) Endorsement of Services Matching Gifts
Corporate GivingDon’t Just Think of Money
2. In-Kind Gifts / Product Contributions
• Office Equipment• Computers• Furniture• Consumer Goods• Printing• Use of Facilities • Donations for Raffles (products or services)• Advertising (newspapers, TV &
in-house/external corporate publications)
Richard Male & Assoc, Inc.
Richard Male & Assoc, Inc.
Corporate GivingDon’t Just Think of Money
3. Employee Involvement
• Computers/Technical • Marketing/Public Relations/Media/Design• Legal (incorporation, bylaws, personnel
policies, tax questions) Financial (budgeting, financial planning)
• Board of Directors• Committees (standing committees/committee
assignments)
Com
mun
ityC
ustomer
Employee
The Corporate Triangle
Product Donations by Major Corporations in 2002
Richard Male & Assoc, Inc.
376.6
288283
179
151
91.5
6051.6
33 30.725.325.220.519.914.414 13.3
0
50
100
150
200
250
300
350
400
$ M
illion
s
Pfizer
Bristol Meyers
Merck
Microsoft
Johnson & Johnson
IBM
Safeway
Kroger
Hewlett Packard
Sears
Minnesota Mining
AT&T
Home Depot
Intel
Phillip Morris
Sara Lee
Cisco Systems
Raising Money From Private Foundations
Fund programs, projects and capital campaigns
Good for start-up programs
Average three-year cycle
Try community foundations first
Types of Foundations
Private Family Foundations: Staffed
Private Family Foundations: Unstaffed, Family/Independent foundations
Richard Male & Assoc, Inc.
Foundation News / Information / Funding Websites Guide Star
http://www.guidestar.org Foundation Center
http://www.fdncenter.org Philanthropy News Network
http://www.pnnonline.org Colorado Grants Guide
http://www.crcamerica.org
Richard Male & Assoc, Inc.
Foundation News / Information / Funding Websites Council on Foundations – Affinity Groups
http://www.cof.org
National Council of Nonprofit Associations
http://www.ncna.org Rich Tips
http://www.richardmale.com
Richard Male & Assoc, Inc.
Foundation News / Information / Funding Websites
The Chronicle of Philanthropy
http://www.philanthropy.com
Non-Profit Timeshttp://www.nptimes.com
Richard Male & Assoc, Inc.
Richard Male & Assoc, Inc.
Affinity Group Websites From www.cof.org Grantmakers for Children, Youth &
Families http://www.gcyf.org/
Asian Americans/Pacific Islanders in Philanthropyhttp://www.aapip.org/
Disability Funders Networkhttp://www.disabilityfunders.org/
Grantmakers in Health http://www.gih.org/
Richard Male & Assoc, Inc.
The Advantages and Disadvantages of FundersFoundationsAdvantages
1. Larger Sums of Money2. Not much paperwork3. Will fund special projects, programs, capital4. Good ‘positioning’ $’s5. High cost / benefit
Disadvantages 6. Takes a long time – up to 12+ months7. Good for only 3 years with exceptions8. Over dependence on large grants9. Usually does not fund admin expenses
Richard Male & Assoc, Inc.
The Advantages and Disadvantages of FundersCorporationsAdvantages
1. Self interest2. Receive money over long periods of time3. Good to leverage other private money4. In-kind donations and product donations5. Good introduction to the wealth in your community
Disadvantages6. Can be nickled and dimed to death7. Small amounts-if given through the giving program8. Not always responsive to new and controversial issues
Richard Male & Assoc, Inc.
ChurchesAdvantages
1. Best donors in America2. Long term sources of income3. Involvement of membership4. Donated services5. High leverage-good potential with other church money (national)6. Jumpstart to planned giving7. Access to key people8. Moral credibility9. Historically very supportive of poor people’s issues
Disadvantages10. Long time to receive money11. Must have support locally from religious leaders12. Generally small amounts
The Advantages and Disadvantages of Funders
Richard Male & Assoc, Inc.
GrassrootsAdvantages
1. Involves membership2. Recruits new people3. Demonstrates involvement when approaching
corporations, foundations and churches4. Good ‘positioning’5. Corporate sponsorship
Disadvantages6. Takes staff / volunteers7. If not planned well, cost benefit ratio too low
The Advantages and Disadvantages of Funders
Richard Male & Assoc, Inc.
Donors – Small & LargeAdvantages
1. Reliable over long run2. Introductions to friends-increase network3. Short timetable 4. 80+% of donations come from individuals5. Basis of planned giving, endowment and
large gifts
Disadvantages6. Direct mail is expensive and requires long
term7. No obvious disadvantages with donors
The Advantages and Disadvantages of Funders
Richard Male & Assoc, Inc.
Entrepreneurial OpportunitiesAdvantages
1. Long-term sustainable income2. Contact with new markets3. Can raise private dollars to cover start-up costs4. Can fit into the mission
Disadvantages5. 2 – 3 year business model6. Requires business plan & start-up costs7. High mortality rate8. Requires marketing & business savvy
The Advantages and Disadvantages of Funders
KEY PRINCIPLES OF FUNDRAISING
Richard Male & Assoc, Inc.
10 Key Principles to Successful Fund Raising1. People give to other people—the
relationship is key
2. The proposal is only 10% of the grantseeking process
3. People give because of self interest
4. Find the “key person”
5. Money follows people
Richard Male & Assoc, Inc.
10 Key Principles to Successful Fund Raising6. When asking for money, be specific on $
$$, purpose and timeline
7. Plan ahead: raising money takes time
8. Diversify
9. Market and sell your organization
10. Fund-raising is an everyday art
LEADERSHIP ROLESIN FUNDRAISING
1. To help motivate others to be involved2. To ask members to donate to the
organization on a yearly basis3. To address the board contract and
make people accountable for fulfilling the contract
4. To accompany the Executive Director on “asks” and funder interviews
5. To be a role model volunteer in fund-raising 58
Roles of the Board Chair in Fundraising
6. To coordinate the efforts of the Development Committee with the whole Board
7. To lead the Board8. To allow other opinions to be
expressed and invite all members to participate
59
Roles of the Board Chair, con’t.
The Board is responsible for the financial well-being of the organization.
It’s easier to approach foundations, corporations and individuals if the Board is committed.
Boards develop and ensure the passage of strategic plans and annual operational plans—including resource development.
Board members jointly demonstrate that fundraising is organizational rather than an individual responsibility.
60
Board Members and Fundraising
1. Identify potential prospects2. Door openers—set up coffee, b’fast, lunch; write
email and make phone calls to make the introductions
3. Strategists4. Attend coffees, luncheons, and funding interviews5. Writing thank-you notes6. Hosting small events—house meeting, BBQ at
your home7. Asking for money8. Recruiting committee and board members
61
Roles of the Board Members in Fundraising
9. Make an individual financial commitment prior to asking others to give
10. Always playing the role of Ambassador in the community
11. Uphold a Board Contract: Define what is expected of each
member Define fundraising expectations Define goals for the Board 62
Roles of the Board Members in Fundraising, con’t.
ELEMENTS OF A FUNDRAISING PLAN
1. Introduction
2. Background
3. Case Statement
4. Demographic Research – External Analysis
64
Plan Elements
5. SWOT Analysis6. Organizational Development / Analysis7. Demographic Research – External
Analysis8. Funding history9. Funding strategy10. Structure—specific initiatives
65
Plan Elements, con’t.
TIPS AND STRATEGIES TO CONSIDER
1. Make it personal and stay in touch with your major donors.
2. Don’t rely as much on direct mail either for acquiring new donors or for getting relatively new donors to renew their support.
3. Expect foundation funding to continue to be lower as foundations’ investment portfolios recover from the hit
4. Create reasons to communicate with all your donors more regularly.
67
10 Tips on Fundraising in a Down Economy
5. Redefine your major donors downward so you have a larger base of “high touch” donors.
6. Focus more on “a few major donors” and increase the personal time you spend with them.
7. Rely less on corporate philanthropy and more on corporate sponsorship and marketing dollars.
68
10 Tips on Fundraising in a Down Economy, con’t.
8. Increase your fundraising capabilities and infrastructure.
9. Increase opportunities for your donor prospects and your donors to become involved.
10. Develop contingency plans that answer all of the “what if” questions in terms of reduced revenue.
69
10 Tips on Fundraising in a Down Economy, con’t.
1. Re-engage former donors--look through the lapsed alumni and donors
2. Work with your fundraisers and development professionals in designing overall fundraising “care and feeding programs”
3. Seek matching funds whenever possible4. Host breakfast meetings once a month5. Concentrate on statistics, results and impact6. Keep media informed as much as possible
70
10 Timeless Fundraising Tips
7. Make it easy for donors to give8. Collect as much background and
biographical information as possible9. Cultivate small donors with the same
passion as major gifts10. Donors are looking for real
involvement and less “checkbook philanthropy”
71
10 Timeless Fundraising Tips, con’t.
10 Timeless Fundraising Tips, con’t.
7. Make it easy for donors to give8. Collect as much background and
biographical information as possible9. Cultivate small donors with the same
passion as major gifts10. Donors are looking for real
involvement and less “checkbook philanthropy”
72
Strategy Summary: MAJOR DONORS
Individual giving is down 25-33% in recession
Gifts are more likely to be spread out over time
Individual ‘psychology’ and optimism is key
73
Strategy Summary: DIRECT MAIL
Avoid over-reliance; also can be expensive
Success is critically linked to data management in the long term
Not a replacement for personal meet-ups, “high touch”
74
Strategy Summary: PRIVATE FOUNDATIONS
Overall funding levels are down and not likely to return in near future
More likely to fund existing, known programs
Shift to basic needs
Invest time now in building personal relationships for the future
75
Strategy Summary:
CORPORATIONSMatch their brand and interestsThink marketing—not philanthropyInvolve their employees in your
organizationsMore “bottom-line” oriented than everRemember, support is more than just
money
76
Strategy Summary: FAITH-BASED
Start local
Be visible with the congregation
Meet with clergy leadership
Connect with lay leadership
77
Q&A / EVALUATION
THANK YOU
Richard Male & [email protected]