The Business of Fundraising

The numbers are self evident. More Americans these days are supporting nonprofit causes both financially and with their time than ever before. We are a multi-billion dollar industry that forms a vital component of our nation’s strength. And survey after survey shows that we are the most generous nation on Earth.

Yet despite the importance of the nonprofit sector, I fear that there continues to be a lack of business sense in what we do. Too often I’ve heard peers say that they’re expecting a gift because the donor owes it to the organization, or that the mission of the nonprofit is so important that donors will give without being asked. Despite the fact that we are involved in a nonprofit industry, it is still a business — and our business is selling our cause to donors and potential supporters.

With this in mind, I always take time at the beginning of each year to reflect on the previous year and look at lessons learned.

Lesson 1: Don’t underestimate the intelligence of your donors.
The typical American is being inundated with more messages today than ever before. And often what they are hearing from the media about nonprofits is not positive: misuse of funds, scams, donor intent being ignored and worse. Donors are asking more questions about how their gifts are being used and are more cautious about making gifts. They are being turned off by the “gift is due” or “account is lapsed” treatment they are receiving from many of the organizations they choose to support.

To differentiate themselves in this very competitive market for charitable gifts, organizations have to be proactive in communicating with supporters. Tell them exactly how you are using their gifts. Be as open and honest about your mission and accomplishments as you can. Your supporters aren’t just a source of funds, but rather they are a committed partner of yours and should be treated as such. If you insult their intelligence by treating them otherwise, they will abandon you.