Why Your Board Should Raise 10 Percent of Your Nonprofit’s Budget
It's no secret that nonprofits struggle with money. In fact, the Nonprofit Finance Fund's most recent State of the Nonprofit Sector Survey found that 41 percent of nonprofit respondents ran a deficit in 2012. If we really want to rewrite this rule for the nonprofit sector, we need to make some pretty big changes.
So here's a radical idea.
What if every nonprofit board was responsible for bringing in 10 percent of its nonprofit's annual operating budget?
That means that if your nonprofit's budget is $1 million, your board would be responsible for raising $100,000 each year. Board members could do that through a combination of give/get activities, meaning they could all write personal checks (at whatever level makes sense for them individually) and then use their unique skills, experience and networks to raise the remaining amount.
That's a crazy idea, right?
I don't think so. Here's why.
The board must really understand the money engine
A board of directors simply cannot separate itself from the financial engine of the nonprofit. The entire board must fully understand and contribute to how money flows to the organization. Board members cannot argue that money is the purview of the staff; money has to be part of the board's job. Until we make the board really participate in making the financial engine run, it won't be able to have substantive conversations about how to raise or spend that money.
The board must share the burden
I'm so tired of silly, small board fundraising goals. Does a 15-member board that brings in only $15,000 out of a $1 million budget really make a difference? Absolutely not. That's pennies. If board members are truly going to lead the nonprofit that they serve, they must share the financial burden. Ten percent of the operating budget starts to make a significant dent, so let's start there.
The board must tap in to its unique assets
I am not suggesting that we force every board member to ask individuals for money. Far from it. Rather, I'm arguing that nonprofits start getting really strategic about tapping in to each individual board member's strengths and assets in order to make a bold fundraising goal a reality.
But you can't just turn to board members and tell them to bring 10 percent in the door. Some things are going to have to dramatically change in order to make 10 percent a reality.
Here's what you have to do:
- Work one on one with each individual board member to create an annual plan for how he or she will meet his or her part of the goal.
- Give the board lots of different ideas for how it can meet the goal.
- Provide the training, materials and education they need to execute on that individual plan.
- Hold each individual board member accountable for his or her individual plans and goals, and check in every month to see how each board member is progressing.
- Have the board report at every meeting about its progress on the 10 percent goal.
If we really want to see a shift in how the nonprofit sector is funded, we need to make some pretty radical changes to business as usual. So start to entertain the idea. What would it look like if your board brought in 10 percent of your annual budget?