Tips to Keep Your Fundraising Efforts Out of the ER
I received an email from the executive director of a small social-services nonprofit on the West Coast. She related to me an all-too-familiar tale of woe.
Despite the fact that her organization's mission is a worthy one and that good outcomes are being achieved, the organization has been, in her words, "going from acute condition to near crisis and back again." The driving force in this situation is the sudden — but not unexpected — revenue loss of about half of the operating budget.
The executive director points to the ending of a three-year grant along with an ongoing search for the proverbial funding "silver bullet." In her defense, she inherited this situation a little over a year ago.
The executive director continues on in her detailed description of the situation, and there is, indeed, a lot going on in the small nonprofit — too much to be addressed in a single article.
My initial response to her was focused on a couple of points:
- Funding from grants — private or public — is rarely, if ever, a workable strategy for creating a sustainable revenue stream.
- Extricating the organization from the downward spiral it appears to be in is possible but will likely require both a significant change in fundraising approach and a retrenchment in delivered services while fundraising program capacity is being expanded.
Building an ongoing, sustainable funding base takes both time and effort. There are simply no shortcuts. The principles of strategic fundraising are well-known, and although every situation has its own particulars, the effort of creating a stable level of funding will fall within these known fundraising truisms.
Getting an organization — especially such as this one, which reaches out to people in crises — to strategically retreat and regroup is very difficult. The metaphor I used in my response to this dedicated executive was the example of the flight attendant who instructs you to put your own oxygen mask on first before helping another should the cabin decompress. There's a reason for that. And it's life and death, for both you and the person you would help.
The executive director felt her top need was additional staff since she is "the only staff available to handle donor development and fundraising responsibilities." What caught my eye was there was no mention of her governing board. When I responded that it is the board's responsibility to insure adequate resources for staff to deliver the mission effectively, the executive responded that she is well aware of the role of the board in fund development. She stated that her biggest challenge is in convincing board members of this.
The role of board leadership in this particular situation is critical. The executive's response of the need to convince her board as to its role opens up a lot of other thoughts. We'll leave some of those for another time.
To recap, I believe that the situation described by the executive is solvable — but not without investing time and effort, and enduring some short-term pain. It remains to be seen what will actually happen.
Creating and maintaining a sustainable funding base almost always includes a healthy and growing fundraising outreach to individual donor-investors. These are people who are emotionally committed to your cause or organization. You work to engage these individuals in a myriad of ways but fundamentally always treat as partners in the fulfillment of your mission.
I want to thank the hardworking and well-motivated executive director who shared her situation. I hope that the challenges she is facing will resolve themselves in a productive, positive way. Perhaps her situation and my response to it will serve to spark action in other organizations.
In these columns we address real-life obstacles and challenges that nonprofits face in creating sustainable funding to deliver their missions and achieve their goals.
I want to hear from you concerning your particular situation and the difficulties you face in developing sustainable revenue streams. Email me, and I'll give you a quick response. I'll choose some of these thorny obstacles to share, along with my insights, in upcoming columns.
Whether your organization is small or large, well-heeled or struggling from day to day, you'll benefit immeasurably from taking a good, hard look at whether your organization spends more of its time in the fundraising emergency room or makes planned visits to the wellness clinic. You'll learn what sends you to the emergency room and how not to go there — anymore than you absolutely must.
We'll be tackling the real and practical issues you face in creating a revenue stream that enables your organization to fulfill its mission and its aspirations. I firmly believe that sustainable, scalable philanthropic revenue is within the reach of every nonprofit organization.
An internationally recognized philanthropy and fundraising thought leader, Larry C. Johnson trains the staff and volunteers of worthy causes to achieve real impact through the creation of reliable, growing revenue streams. He emphasizes principles before methods as the key to long-lasting success. He stresses the simple, the practical and the joyful.
Larry is the founder of The Eight Principles, the premier brand for educational products and services in relational fundraising and philanthropy. The Eight Principles provides digital education, live workshops and structured coaching to nonprofit organizations.
Author of the award-winning book, "The Eight Principles of Sustainable Fundraising," AFP named Larry Outstanding Development Executive in 2010. The Wall Street Business Network ranks him in the Top 15 Fundraising Consultants in the USA. Larry is a graduate of Yale University. Larry speaks widely and serves on numerous nonprofit and corporate boards, including The Philanthropy Council of The Carter Center, the philanthropy of the 39th President of the U.S.