Want more donations to your nonprofit? Try seeing things from a donor’s point of view.
As someone who began her career as a fund raiser and migrated to become a funder as head of a large corporate foundation, I have a somewhat unique vantage point on the struggle many nonprofits endure when engaging funders and major donors to support their cause. In speaking with executive and development officers who are charged with fundraising, I find it most helpful to convey some simple principles that I applied to maximize the return on the time and energy I put into achieving optimal fund development results.
Individual donations provide the lion’s share of support to grassroots causes, exceeding 80% of all non-governmental income. Yet many organizations struggle to successfully engage prospects because they haven’t taken the time to see things from their point of view.
Nonprofits tend to look at gifts from this perspective: We have a worthy cause; we have financial needs to sustain the organization and advance the cause; we know of someone with money who can support this cause if we just can get to them.
By contrast, donors tend to look at gifts from this perspective: We have money; we have certain priorities that come from our values; we want to maximize our return on our investment and the impact we can have placing finite resources.
Marrying these somewhat disparate perspectives is the art of fundraising, but the caveat for nonprofits is that not all donors will prioritize or align with your cause; and the biggest No-No in fundraising is to put your cause forward without finding the connective tissue between the cause and the prospect. Casting your bread upon philanthropic waters and seeing what happens just won’t cut it in a world where limited resources and changing tax laws are dramatically shifting charitable giving.
So, if tossing out your cause as your first move is not the smart play in fundraising, what is the critical first step to bring your nonprofit into focus for a donor? RESEARCH! RESEARCH! RESEARCH!
Three critical elements to close
Visualize this: It takes three critical elements to close a gift—think Hand-Head-Heart:
- Hand is the capacity to give
- Head corresponds to the interest in the field
- Heart is the desire to contribute
While this may seem obvious, it is amazing to me how few leaders of nonprofits fully grasp the power of researching all three elements before pitching a prospect.
Most nonprofits think that a donor’s capacity is easy to assess. Not so. A 990 or Wealth Engine report only reveals so much. Gauging capacity requires understanding how much wealth is liquid and accessible. For instance, I knew a very successful businessman in his eighties who owned a large, highly appreciated company, but who plowed every penny he had back into the business and had little liquidity to show for his apparent wealth. In short, capacity is not just a matter of wealth—it is whether that wealth is available for a real-time gift or perhaps a more creative solicitation strategy.
It will come as no surprise that the businessman—having devoted himself exclusively to making the business grow—had no interest in causes whatsoever. He was a clean slate when it came to philanthropic interests. That would indicate he was ripe for any cause, right? Not!
How to get a donor to sign
So how do we gauge and strengthen a prospect’s interest in our field? In order to get a donor to sign on the dotted line, your nonprofit has to put forward both an intellectual and emotional case. Our hard-nosed businessman had no wife, no kids, and no outside interests or activities. (This is a true story!) Finding connective intellectual and emotional tissue between him and a cause would be no small feat.
The critical component to finding this connectivity is to listen. Listening to the prospect can provide clues, and also listening to those close to him, such as his financial advisor and attorney. The goal of this research is to understand what drives the donor. Elements in this case that may prove relevant include the business that the man had invested his life in and his history — where he grew up and his education. By way of example, the businessman was known to have grown up extremely poor—he was a self-made man. He was also a devout Catholic and had an affinity for dogs. Any information you can gather before the fact makes a difference in how you present your case.
The most critical step
Finally, the most critical step in successful fundraising is to craft a strategy to connect the dots between the capacity, the interest in the nonprofit mission, and the potential emotional connection to your cause. From this research, a strategy can be made to approach the donor with a gift opportunity that ideally advances his or her vision of what the world should be.
In the case of the businessman, we were able to carefully thread the needle through his capacity, life story, interest, and heart. We structured a charitable remainder annuity trust whereby he benefitted from the sale of his business with a generous income stream during his life and upon his death, the estate valued at more than $15M went to our hospital to support pediatric care, including a groundbreaking pet therapy program. If we hadn’t listened to his unique situation and then come up with a solution that spoke to his hand, his head, and his heart, we never would have proposed something so unusual and I have no doubt we would have failed to secure this critical support.
The next time you’re putting together your fundraising strategy, look through both your and their perspective. Keep in mind the simple principle of Hand-Head-Heart to ensure you deploy resources wisely and approach individuals and foundations that align with the three elements to maximize return on your fundraising initiatives.
Paula Golden is President of the Broadcom Foundation. She initiates innovative partnerships with universities, nonprofits, and non-governmental organizations (NGOs) to create equitable access to STEM education, close the STEM education gap for young women and the underserved, and ensure that young people are STEM literate with the necessary skills to succeed in 21st century STEM careers. She is a leader in the National STEM Funders Network and STEM Education Ecosystem Initiative that create collaborations among formal and informal STEM educators throughout the United States. As a former host of community cable programs, Emmy finalist, TEDx presenter, and blogger for the Huffington Post, Paula promotes communication as a critical tool in STEM education.