Sky's the Limit: Overcoming Obstacles, Embracing New Opportunities for Capital Campaigns

The idea of capital campaigns is alluring, but can seem daunting, can’t they? While it’s a wonderful thought to raise hundreds of millions of dollars for your nonprofit organization’s mission and cause, it’s like looking up at a skyscraper. How do we get there?

One of the biggest reasons why nonprofits aren’t launching capital campaigns is because it’s an overwhelming thought. While it may be overwhelming to look at the end goal, it’s not impossible or unattainable. With that said, capital campaigns are also not for every nonprofit.

According to Bloomerang, a capital campaign is an effort to raise a significant amount of money in a specified period of time. These campaigns are commonly known for acquiring or renovating a building; building a future endowment; and funding expensive equipment. And while hospitals and academic institutions are the biggest users of capital campaigns, other nonprofits utilize them, too: animal advocacy nonprofits; arts and culture nonprofits; environmental nonprofits; churches and other religious institutions; etc.

For example, Annie Wright Schools particularly fundraises through capital campaigns to help with the growth of a school—facilities and programming growth and scholarship money for students, Jennifer Haley, director of institutional advancement at Annie Wright Schools, told NonProfit PRO in an interview.

In their most recent—and successful—capital campaign, Annie Wright Schools launched a project to fund a new field, fund their new gymnasium and raise money for their scholarship endowment. The project was evenly split between the facilities and the endowment. They were looking to use 50 percent of the campaign in each of those areas and were able to do so.

“It took us about three years to do the full campaign from beginning to end, and we were actually able to in the end [due to] part of an estate gift that we received—we were able to go over goal about 50 percent,” she said.

The number of nonprofits launching capital campaigns has grown in recent years. “The Nonprofit Research Collaborative Fundraising Survey” reported that number has grown 34 percent since 2011. This shows that nonprofits are becoming more interested in capital campaigns and are implementing this powerful fundraising tool into their strategies.

There are various reasons why capital campaigns are beneficial to nonprofits. In interview with NonProfit PRO, Cary Lieberman, executive director of the Greenhill Humane Society, said, “Capital campaigns can potentially elevate the need for funding for the organization within the community. Sometimes they’ll draw a wider range of donors and supporters or elevate the commitment and involvement of donors and supporters into an organization. [Donors and supporters] identify that the cause they care about is something with permanence, and [capital campaigns] can help with that as well.”

Running into Obstacles Along the Way 

There are a number of reasons why capital campaigns can help a nonprofit’s cause and mission. Network for Good shares four:

• Improves donor relationships

• Establishes new donor relationships

• Increases levels of donor investments

• Offers opportunity for future sustained donor support

While the benefits of capital campaigns can be substantial, it’s never just sunshine and rainbows—there are plenty of obstacles along the way. The most biggest and most obvious obstacle is the capital campaign itself. The goal is usually much higher than anything that the organization has raised previously, which involves a higher level of commitment from donors. It’s difficult to find donors who are willing to support that infrastructure.

“We are a humane society, so our cause is all about caring for animals. And so, brick-and-mortar [projects] are not as ‘furry’ and ‘friendly’ as the cause itself, Lieberman said. “There is that challenge of identifying donors who are capable of giving in a larger capacity and who are willing to give that has a return that is not immediately obvious.”

And while, this is the Greenhill Human Society’s greatest issue, they are overcoming it one step at a time by implementing more face-to-face connection and direct asks. From trial-and-error, the organization found that online communications are not as effective when it comes to capital campaigns.

“It all falls down to making those personal connections, involving donors and
supporters on a very personal level and eventually raising the money that way,”
Lieberman said.

In capital campaigns, it’s an ongoing battle putting together materials in a way that entice the donors—making sure the campaign is presented in a way that entices the donor to give to. The battle here is making the campaign something that interests the donor, but not so wordy that you lose the donor’s interest.

“[What you want to have is] clean, efficient materials that are easy for donors to understand and what donors want to donate to,” Haley said.

But Haley advises that before putting together any materials for the campaign and figuring out the process for going through the campaign and segmenting donors, it’s even more important for nonprofits to make sure that their donor information is clean as possible. Because having up-to-date donor information is one of the biggest obstacles to putting together a capital campaign.

Don’t Overlook the Opportunities

Finding the right way to communicate to donors about your nonprofit’s upcoming project can be challenging, but there are
opportunities to show them why this project is important to your organization, why they should care about and how it will affect them in the long run. It’s imperative that you do not make them feel like you are only after their dollars, but instead, stress that any contribution that they decide to bring forward is highly appreciated.

The Greenhill Humane Society has launched three capital campaigns within the last 20 years. Lieberman recalls that its firstcapital campaign was the most successful, with a goal of less than $1 million.

“The cost of what the financial donors were asked to support was mostly equipment and things along those lines that could not be produced locally. It was successful in that it was done in a barn-raising [way]—that people really came forward with the materials and support they were capable of,” he said.

As previously mentioned, capital campaigns are seen as a daunting, unattainable task, which they absolutely are not. The key is to segment the campaign into different smaller tasks and tackle them in that way. Haley mentions that she believes the biggest misconception about capital campaigns is that they are complex and require a ton of time and staff to execute. And while, capital campaigns do require a large number of staff members and time to get done, it’s not unmanageable.

“The big thing is to break it down into chunks that are manageable, so when you’re looking at your donor data, you’re segmenting those donors into chunks that make sense. The creation of a committee that is made up of a variety of constituents also help,” she said. “Segmenting out in that way just breaks the workload down, and the committee is able to focus on areas that makes sense for them.”

Nonprofits should not miss an opportunity to collaborate with funders that are potentially interested in projects that they are undergoing. The trick is to get out there and find those organizations that are willing to collaborate with your nonprofit on its capital campaign.

While there is a plethora of information out there—from books to conferences—about capital campaigns, Lieberman recommends receiving an evaluation from a professional.

“I think that, often in our eagerness to move forward as necessary in a volunteer basis, it might be easy to ignore that these are very serious and very difficult long-term campaigns,” he said.

Donor Communication Is Key

At the end of the day, the most important success factor in capital campaign is your relationship with your donor. How they feel about you, your nonprofit and your nonprofit’s mission, goals and initiatives will be reflected on how they give to your organization. And that can be heavily weighted on the way you and your nonprofit communicate with them and how that communication makes them feel—hopefully appreciated and one-of-a-kind. Furthermore, transparency and honesty will create a stronger bond with your donor, as they will trust you to be up-front with them.

“I would say the absolute most important thing in a capital campaign and in nonprofit work is solid communication with supporters and people who care about the mission in that, even in times of struggling in the middle of a capital campaign, the most important thing to do is be clear and honest with the people who have been both supporting the campaign and may be potentially support the campaign in the near future,” Lieberman said.

Piggybacking off that, Haley adds that it’s important to tailor your nonprofit’s messaging to your donors. While there are donors who will understand your standard messaging about the campaign, there are other donors out there who want to learn and understand why this is important to them and how it will be reflected in your campaign.

“Certain people who are just passionate about particular things, and if you can target your messaging for those individuals, I think you’ll have much more success in the long-term,” she said.

Although face-to-face interaction is the most positive and effective form of donor communication, nonprofits should also take advantage of the other forms of communication—email, social media, etc. Haley adds, “In the digital world that we’re living in today, not every donor wants to get the pretty glossy campaign packet. There are other vehicles for reaching audience, so I think tailoring the message and approaching them in a way that is for them is definitely the way to go.”

She also recommends putting together a customized committee that is tailored to and will be the most beneficial for the project that your nonprofit is raising money for.

Other Methods to Consider

Even though you are in the business of fundraising, or what I like to refer as social good, nonprofits can be ran and managed like a business after all, so it’s important to think of your nonprofit and your capital campaign as a brand—and promote it as such!

In John Haydon’s blog post titled “Capital Campaign Fundraising: 4 Steps to Nonprofit Success,” he notes that capital campaigns and your nonprofit should be promoted as separate entities. “Create a capital campaign fundraising brand that can stand on its own, while highlighting your nonprofit’s mission. To achieve this delicate balance, incorporate this foolproof strategy into your budding campaign,” he advises.

And that foolproof strategy is keeping is simple and stupid—by going back to the basics and making sure you’re promoting your campaign in a clean and eye-catching way, without adding too many flashy details.

Next, don’t negate feasibility studies! They can be an effective and surefire way to gauge how successful your capital campaign can and will be. You’ll get to hear from people who will be directly connected to your organization and its campaign—donors, supporters, board members—and it will give them a chance to share their opinions with you, which will show them that you value their feedback. Added bonus: It will boost your relationships.

The information you gather from your feasibility study will give you the opportunity to incorporate another tactic—developing a gift range chart. According to Bloomerang, gift range charts will show your board how the organization will achieve the capital campaign’s goal, which include how many prospects to reach out to and how much to ask of each of those prospects.

Recently, Andrea Kihlstedt, founder of Capital Campaign Masters, recently wrote a blog article titled “A Great Way to Help Your Donor Decide on the Right Gift,” where she had this to say about gift range charts: “Gift charts help you could see just how many gifts you’d need from how many donors to get to your goal. But you can use that same little chart to help your donors figure out how much they want to give.” To read the full blog and to see an example of a gift range chart, please visit goo.gl/G3xLxS.

If your capital campaign is to fund a large project—such as building a new building—it’s worth considering developing partnerships with corporations and businesses. These corporate partnerships benefit both your nonprofit and the partnering business. While your nonprofit receives additional funding for its campaign, the partnering business invests in something that will benefit them in the long run.

For example, back in 2014, Oregon State University received a $590,000 grant from the Walmart U.S. Manufacturing Innovation Fund created by Walmart and the Walmart Foundation. This grant was used to accelerate manufacturing in the U.S.

“We are excited to support the development of innovative solutions, which we hope will unlock new opportunity for manufacturing in this country,” Kathleen McLaughlin, president of The Walmart Foundation, said in press release.

Sometimes, large projects such as capital campaigns can be a huge undertaking, and you’re going to need an extra set of eyes, hands and perhaps a brain! Another option to consider when planning a capital campaign is to call in an expert. Hiring an outside consultant to help you plan your capital campaign can be extremely helpful. There may be things you’re forgetting and not even thinking about that a captial campaign consultant can help you with. According to a NonProfit PRO contributed article by Mark Bergethon, founding principal of Convergent Nonprofit Solutions, the benefits of hiring outside counsel are that it maximizes results, minimizes burden and gives nonprofit leaders more free time. Read the full article at goo.gl/7rZt6U.

Implementing these ideas into your strategy will take that overwhelming overall capital campaign fundraising goal and break them into manageable segments that suddenly seem very manageable.