by Clint Holden, M.A.
The universe of fundraising can be described by certain "principles" -- the non-negotiables of pursuing a prospective donor. Tested by experience, observation, and results, these eleven Governing Principles of Effective Fundraising will determine, to a large extent, the success of your Development efforts. If your capital campaign has stalled, your funding proposals routinely go unfunded, or your board has stopped working effectively, the rules described below may point you toward a solution.
Principle #1: There is No Individual or Collective “They” No group of individuals is sitting around waiting for you to contact them so that they can give. The idea of such a group or individual is a legend raised among leaders, board members, and volunteers. Capital campaign planning meetings, program development meetings, and fund development committee discussions are frequently dominated by the refrain "They will give." This is often spurred by the ministry’s own self-inflated belief that its mission and vision are more compelling than any other, and certainly, donor prospects will agree. Unfortunately, this myth is dangerous to sound organizational and fundraising practice and leads to two common misconceptions about prospective donors:
Prospect research, identification, cultivation, and solicitation are not necessary because “they” will give out of the goodness of their hearts.
“They” will contribute to the ministry’s cause because they have abundant resources to do so.
Implicit in this principle is the simple fact that anonymous individuals who have little or no connection to your school are not waiting in line to give you money. Yes, many people will invest in your ministry — if you give them a reason. But most individuals who are not connected to your organization in some fashion are not among those prospects. Principle #2: This is a Conversation Between Ministry and Funder Marketing is a conversation between someone with something to offer and someone interested in the thing that's being offered. Fundraising is simply a form of marketing in which the conversation is expressed in actions rather than words. The funder participates in this conversation by providing financial resources, credibility, and, sometimes, social or political connections. The Christian school seeking funding participates in the conversation by providing evidence that the value of what is being funded is needed. Either side may discontinue the conversation at any time. People who do not know your school will not invest in your mission. This is why fundraisers identify prospects, cultivate their interest, develop their connection to the organization, and then ask for that investment. Principle #3: Effective Fundraising is a Result of Telling Your Story Funders invest in ministries that can make a well-conceived case for support that includes clear goals and measurable outcomes. Telling your story involves more than making the case in a funding proposal or during a funder visit. Sharing how lives have been changed because of what you do is one of the most compelling opportunities you can share with a prospective donor. This principle tells us that we must take advantage of every opportunity to enhance the visibility of our ministries. You can have story without fundraising, but you can't have fundraising without story. Demonstrate your school’s story to your prospects through activities such as tours, special presentations, testimonies, press releases, etc. Any activity that puts a face on your school or illustrates your school with a personality can be considered “telling your story.” Principle #4: Effective Fundraising is a Result of Listening Much More than Talking A development officer’s aim should always be to listen first and listen 2-3x as much as she talks. Ask a leading question, then listen for the response. Sometimes this can be eerily awkward but just wait. If you ask, “Do you see yourself involved in this mission?” nothing else needs to be expressed. The question is clear, concise, and to the point. Overtalking can kill a donor’s interest. You should want to know more from a prospective donor each time you talk with them. If they want to know about you or your work, they will ask. Principle #5: People Give to People Fundraisers know that worthy causes alone, do not raise money. Presented as abstractions, they often raise more questions than they answer. That's why we say that people give to people. Humans are inherently social animals; we care about and spend enormous amounts of time and energy creating and maintaining social networks. If people give to people, then the role of the fundraiser is to create relationships. However, fundraisers must be careful. Friendships between fundraisers and prospects are usually fleeting, lasting only as long as the fundraiser is employed by that organization. Indeed, professional ethics dictate that the organization's prospects and donors stay with the organization, not with the fundraiser. The truly successful fundraising professional is able to establish relationships on behalf of the organization. Principle #6: Someone Must Ask for the Money Gifts are solicited; they do not come through a porthole. This simple fact is often the hardest one for fundraisers to embrace. Most often, fundraisers will do practically anything to avoid asking for the money. Sitting at the table with a prospect, having worked hard to make a compelling case for support, many a clear-headed fundraiser will neglect to say, "Now, Mary, we're talking about $50,000 a year for the next five years. Is this of interest to you?" As well, a grant writer will submit an elaborately detailed proposal without including a statement that says, "We are seeking an award of $100,000 for these purposes," leaving the reviewer to scratch her head and wonder, "How much do they want and for what purpose?" It is exceedingly rare for a prospective donor to offer an amount they would like to give to your ministry. It is the role of the fundraiser to ask for that amount. The key to success is to ask in a manner that respects both the donor and the gift. Principle #7: You Can Never Thank a Donor Too Much Expressions of gratitude are expressions of respect. Every appeal letter, every funding proposal, and every individual solicitation to a recurring donor should include a reference to his or her previous contributions of time, talent, or treasure. Here are a few good practices your ministry should consider establishing regarding gift acknowledgments.
Send an initial acknowledgment of a gift within forty-eight hours of its receipt.
Require more than one thank-you for gifts over a certain amount.
For all gifts that were solicited face to face or by a written proposal, the fundraiser should send an initial response, followed by a thank-you from the CEO a few days later. In some instances, the chair of the board might send a third thank-you a day or so after the CEO.
Overkill? Ask yourself this: "If this donor stops giving, can we replace the gift?" In cases where the answer to that question is "no" then earnest and sincere gratitude is not overkill. Good donor relations must give sincere devotion to the words "thank you." Organizations understand that their donors usually have a plethora of funding options from which to choose. If you want to be one of their top choices, keep your ministry name in front of them as often as you can and say “thank you” more than you think you should. Principle #8: Seek Investments, Not Gifts When a school says to a prospective donor, "Please invest in our vision so that together we can accomplish such-and-such outcome" — it invites the donor to share responsibility for the desired outcome. By wording requests for gifts with verbiage about “investment” rather than “donation,” the school is articulating what it believes is the value of the requested gift and treats the donors in a manner not merely as a source for funding, but as a donor in the future of the ministry. Principle #9: Donors Donors are Developed, Not Born (The Five I’s) All donors have three characteristics in common: a connection to your ministry, interest in its success, and the ability to give. The process of nurturing these three characteristics is called "donor development." That's why most fundraising functions in ministry organizations are grouped under the rubric of "development." And the best way to describe the process of moving an individual to the point of making a gift is using a model known as the "Five I’s of Donor Development:" Identification, Information, Interest, Involvement, Investment. Development professionals must think about donors and prospects as operating within Circles of Influence. The closer to the center of the circle a person gets, the greater the influence that a person may have on a ministry and, conversely, the greater the influence the ministry may have in that person’s life. To illustrate, draw a small circle on a sheet of paper. Next, draw three concentric circles around that circle. The furthest circle from the center is populated by DONOR POSSIBLES — individuals you believe to have possibilities for becoming prospects and donors. The world is full of Possibles. To turn them into Prospects, however, you have to identify their connection to, interest in, and ability to give to your ministry. If they show interest in “possibly” supporting your ministry they are now a bonafide Prospect! The second furthest circle from the center is occupied by DONOR PROSPECTS — individuals or institutions that have shown interest in supporting your organization. Prospects need information about your organization as much as you need information about them. Once you understand their interests, and they yours, you can begin to make deeper connections to grow them toward becoming a Donor. The first closest circle from the center is occupied by DONORS — people or institutions that have a connection to your organization and contribute regularly to its mission. The center circle is your DONOR STAKEHOLDERS — so-called because these donors take a personal stake in the success of your organization. They are your closest allies and ministry promoters. People tend to become involved in that which interests them. And investment follows involvement as surely as night follows day. The "Five I’s" remind us to focus our efforts on moving each occupant of a "circle" closer to the center. In this way, Donor Possibles become Donor Prospects who become Donors, who become Donor Stakeholders. As donors move closer to the "inner circle," their gifts will grow. No one invests all of his or her money in a single stock or company. But, by the same token, no donor makes his or her largest investment in a ministry with his or her first gift. By establishing a strong connection with donors, we develop their interest in our ministry’s success and enhance their desire to give. As you continue to match the needs of your school with the interest of the donors, your donors will often continue to make larger gifts. As giving occurs, your attention turns to stewardship and maintaining donor satisfaction with and involvement in your ministry. Principle #10: Fundraising Out of Desperation is Futile Contrary to what many people believe, contributions of cash are rarely offered because an organization is desperate. Desperate organizations are often perceived to be unstable, incapable of doing the work, and just plain bad investments. The successful ministry, in contrast, can tell a story characterized by accomplishment, sound financial management, and visionary leadership. "We need money" is rarely compelling enough to convince a prospect to offer his or her support. Instead, your grant proposals, appeal letters, and kitchen conversations must say in no uncertain terms, “We have a vision we believe matches your passions and we want to know if you will join us!” A support case that speaks only to the misery of your constituency will often backfire. People, being people, tend to become resentful when they're made to feel guilty. Take care that your prospects do not become so numbed by the magnitude of the problem that they miss the real improvements created by your efforts. Donors will give year after year, in increasing amounts, if you can convince them that you have a plan and the leadership and financial means to execute that plan. Principle #11: The Certainty of Uncertainty In the best of circumstances, people will do what they please. Fundraising is the act of establishing and strengthening relationships between prospective donors and your ministry. But, because humans just may be the most unpredictable species in the world, fundraising is anything but an exact science, and its immutable rules are, well, mutable. Given this most basic fact of the fundraising universe, our only recourse as fundraisers is to "trust the Lord even more!" Perseverance, not speed, will win this race.
On your best day, when you've spoken all the golden words you know, when you've matched the right gift to the right prospect for the right cause and had the right person ask... people will do what they please.
The Certainty of Uncertainty helps even the most seasoned fundraisers and development officers accept the rejections that are an inevitable aspect of their job. In fundraising, such rejections are rarely, if ever, personal. In fact, "no" is often a veiled request for more information. If a prospect says "no," don't be afraid to ask "why?" Knowing the reasons behind that "no" will prove invaluable the next time you make your case to that same donor. What Now? The work of Development can never be excused as, "a necessary evil," or treated as though - "we can just get someone to do it."
Development done right will produce the right results to help grow your ministry. The investment of time to learn valued principles such as are listed here will bring long-term rewards. Don't be tempted to short-cut the process and principles needed to be successful in this crucial function of your school. Keep learning. Keep growing.
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Our DevRx Coaching will enhance your training by walking with you through a step-by-step process to begin or restructure your Development department. We will help you take a detailed look at your current processes, analyze donor perceptions and guide your Development team (no matter how small!). Authored by Clint Holden © SchoolRIGHT, LLC., unless otherwise specified. All rights reserved.