Focus On: Major Gifts: Take A Lesson from the Old School
That dream. We’ve all had it: You’re back in school, sitting down to take the final exam, and you haven’t attended a class all semester. And the exam is on advanced Russian or trigonometry … or nuclear physics.
That’s how it can feel to walk into a major-gift meeting without being properly prepared. It’s that make-it-or-break-it moment, the final exam that will decide your grade.
The importance of individual major gifts to your nonprofit organization’s success cannot be overestimated. Individuals make up the largest portion of givers — more than 75 percent of charitable giving in the United States. And the best fundraisers will tell you that the success of a major-gift ask is grounded in the research — the preparation — that came long before.
It’s the homework, stupid
A wealthy and successful corporate leader has agreed to meet with you, your CEO or the board chairman, and she knows what’s on your mind. Having afforded you some of her precious time, she’s entitled to ask some questions, and you’d better have the answers.
You’re looking for a six- or seven-figure gift, and she’ll want to know about your program’s budget, projections for the particular project you’re discussing and who’s given already. How will her gift be recognized? Is that the most suitable naming opportunity for her? She very well could want to explore alternatives for lower-level gifts; are you prepared to discuss them? Or have the leaders of your organization decided they’re so sure of the appropriate gift level that you must keep her focused on that number?
Of course, you arrived at that number by doing your homework. The amount of information publicly and legally available about donor prospects — information from Google to LexisNexis and everything in between — is staggering. Do you know her history of giving — not just to your institution, but to others? What about important financial developments for her corporation, her family or for her personally?
Does she ever give to bricks-and-mortar campaigns or only to endowments or programs? Does she appreciate recognition in her own name, or has she given in memory of her parents? Does she like to be seen as a leader, or should you have other gifts in place before you approach her?
Why you did those papers
Teachers know that research projects help students develop a knack for exploring a subject more thoroughly. Digging into a subject beyond commonly held assumptions provides historical perspective and sometimes fresh information. But you have to go to the right sources.
In the case of a capital campaign, the critical information you will need before ever approaching a single prospect for a major gift can be found by going to the source with the help of a planning and feasibility study.
For example, the CEO of a large nonprofit was about to launch a campaign for a high-profile capital project that seemed to have strong support from its constituency. In fact, several board members had signaled their openness to considering a major gift. He was surprised when it was recommended he do a feasibility study. “I know my donors,” he said.
Perhaps. But the value of a feasibility study is that it affords donors the opportunity to speak to a third party about their willingness to support a particular project.
It’s amazing how quickly individuals will open up and reveal themselves and their opinions during an interview. Indeed, donors, board members and volunteers often welcome the opportunity to vent, in a confidential interview, on issues where they feel their concerns have gone unheeded. The organization should consider this a golden opportunity to address internal weaknesses or practices that might have deterred donors.
In one recent instance, a donor specified three reasons why he would not make a gift to his alma mater. Once those items were addressed, he made a million-dollar contribution.
Keep showing up
Even students for whom academics don’t come easily will find that they can succeed if they demonstrate to their professors that they care — by making it to every class, asking questions, showing that what the professors are taking the time to teach is important to them. It’s the same with donors.
Oddly enough, though, some fundraisers take the opposite approach, especially in a struggling economy, and pay less attention to their donors.
“Times are tough,” you hear over and over from development directors. “Major gifts are dropping off.” Maybe, some say, it’s just a difficult time for fundraising.
Indeed, times are tough, but what does that actually mean in terms of people?
Individuals’ paper assets may lose value, but 80 percent of individual giving is out of income, not assets. Still, what you’re seeing is belt-tightening among large and small donors alike.
Giving essentially is flat nationally, and some sectors of the nonprofit world also have been hit hard by government and foundation cutbacks. But this is no time to sit back and watch. Instead, nonprofits need to engage in continuous cultivation.
Take a fresh look at your current pool of major donors. Ask yourself honestly what each donor has received from you over the past year — reports, letters, thank-you notes, your time, your president’s time, etc.
Go down the list again and ask yourself whether you’ve asked enough of your donors. Have they been invited to take leadership positions? Do they sit on boards of prospective foundations? Have they been asked about planned giving? Can their companies become involved? Leave no stone unturned.
Then, make a plan to revisit each major donor. This can range from taking the top donors to dinner on down to creating an in-house e-mail list to keep them updated with a bit more information than they would find in your regular newsletter. That is to say, turn your donors into “insiders” — people who feel they have a continuous stake in your organization. Position fundraising as part of the solution. At a time when everything is negative, a large gift or two can be extremely positive.
Ask for help
Don’t forget to enlist help in this effort; continuous cultivation also should be job No. 1 for the president, the board chairman and even the program directors. This is serious business. In these difficult times, key programs or even your organization’s entire mission could be at stake. Make sure everyone is on board.
Remember the importance of thanking your donors repeatedly. Even if they’re finding it difficult to be philanthropic in this economy, let them know you haven’t forgotten their previous support. When the tide turns, they’ll remember how much they were appreciated even when times were lean.
It’s a fact of fundraising life that people give to people; everyone knows that maxim. But it could be amended to say that people give to people who understand them, who care about them, who respect them and who reward them. If major donors are responsible for funding your organization’s mission, they deserve all that … and more.
But I don’t feel so good …
A young staffer went out to interview a donor for an important feasibility study. Before even leaving on the trip, he learned one of the first rules: Even though he was suffering from a bad cold, the work had to be done. So, he flew to the donor’s city, rented a car and proceeded to the home of the donor, who clearly had forgotten about the interview and wasn’t there.
When the donor finally arrived, he was quite apologetic — and was clearly impressed that the young man took the cause so seriously that he’d waited several hours in his car. Not only did the donor complete the interview that day, he made a financial commitment, one that was well above what the organization had hoped for.
No one is suggesting that sick staffers should drag their germs into the office and take down their whole team, but one secret of successful fundraisers is the passion behind their work.
On days when it takes that much more effort to step up to the task at hand, they remember that what they do will mean that many more wishes granted for sick children, scholarships for struggling youths, and dollars to fight hunger and disease.
Taking the test
When it comes down to it, you’d be surprised how many gifts have been left on the table because leaders were afraid to ask for them. They procrastinate in making calls and in setting appointments, and when they finally get to the solicitation, they don’t put a specific gift amount on the table. The most successful fundraisers are those who continually review priority prospects and requests under consideration, and diligently pick up the phone and call each of them to set up or follow up on a visit. If they don’t have an opportunity to see the donor, they make one — and they don’t wait for the prospect to read their minds. You know the famous quote about missing 100 percent of the shots you never take: You have to ask.
And if you fail, try again
In fundraising, “no” often is the first step to “yes,” and when you’re turned down for a major gift, it’s important to rededicate your efforts and find out how that donor could be turned around. It might have been a long-ago slight — perhaps under a previous administration — and you could have the perfect opportunity to make amends. Or the donor might have personal reasons why he can’t make a gift of the size or in the form that you seek. If that gift or pledge can be structured in a way that suits the needs of the donor and his family, you might find that you ace the next try.
Patience; a belief in the cause; the willingness to endure boredom and discomfort; and even the possibility of rejection are all part of the equation. Those who believe they have found the single best way to change the world for the better, who have the discipline to be positive and to persist, whether through tried-and-true strategies or the courage to be creative, will come through with flying colors.
Mike Hoffman is founder and CEO of Changing Our World, Inc., a full-service, national consulting firm that helps organizations achieve their philanthropic goals. E-mail him at email@example.com