Any Nonprofit Can Rock Major Gifts With These 9 Tips (Part 1)
It simply makes sense to follow the money.
Where is it? Let’s begin with that elephant-shaped piñata in the middle of the room. It’s filled with the majority of all philanthropy. Yup! It’s right inside. You’ve got to figure out how to get the goodies out of it or you’ll just be scrambling for spare change.
The most recent data from Giving USA shows 72 percent of gifts come from living individuals and an additional 8 percent from bequests. That’s 80 percent of all giving coming from people! Not foundations. Not businesses. Not government.
And major gifts is where the real money is. Two-thirds of all household charity in the U.S. comes from the top 3 percent of U.S. households.
This is your elephant.
How do you get inside?
Any organization, large or small, can do this. You just need to know the secrets to success.
Nine Secrets to Major Gift Fundraising Success
- The Right Prospects for You
- The Best Case for Support for this Campaign
- A Gift Chart Tied to Your Fundraising Goal
- A Cultivation Plan for Each Prospect
- The Right Solicitor(s)
- The Right Decision-maker(s)
- The Prepared Solicitor(s)
- Honest Assessment of What Success Will Look Like for Your Organization
- Honest Assessment of What Success Will Look Like for Your Donor
1. The Right Prospects
You can’t begin without defining what a “major gift” is for your organization. (For some it’s $250, for others it’s $1,000, $10,000, $100,000 or more). The easiest place to begin is to look at anyone who makes a gift higher than your average gift.
Once you’ve got your number, then you need three things, known as LIA, to make someone a viable candidate: (1) Linkage to your cause (e.g., they’ve given before, they’ve been a client or patron, they know one of your board members, etc.); (2) Interest in your cause, and (3) Ability to give.
- Action Tip: Don’t just start with the rich folks in your community. If I had a nickel for how many times I’ve sat in a campaign screening session and folks in the room have named the wealthiest person in the community as the go-to prospect, I’d be a wealthy woman. Seriously! Just because someone has capacity doesn’t mean he or she interested in your cause, or even that they’re philanthropic. Similarly, just because he or she is passionate about your mission doesn’t mean they have the resources to make a major gift.
- Action Tip: Begin with your “insiders”—current and past board; current major donors; staff; volunteers; members; service users; close friends of insiders. Who is currently giving at or near this amount? Could they give more? You may not know now, but that’s what you’re screening for. What you do know is that they have linkage and more than a passing interest. Two out of three ain’t a bad place to start.
- Action Tip: Move on to others who have at least two of LIA. Begin to “qualify” these folks by (1) using research and (2) reaching out to see if they respond to relationship-building moves. Getting major gifts relies on building relationships, but only about a third of your initial list of major-gift prospects will be interested in building a relationship with you. If they’re not going to “play,” putting them in your major-gift portfolio will waste your time.
Secret: Your prospect list will account for 80 percent of your success with major gifts fundraising. So it pays to spend time building and honing this list.
2. The Best Case for Support for This Campaign
Will your prospect readily understand why you’re asking? The prospect must feel their gift is essential in order to create a valued outcome—something they care about as much as you do. Remember, major gifts is not about “money.” It’s about outcomes. Making something happen that otherwise wouldn’t. Don’t just say “Last year you gave $500. Will you give $1,000 this year?”
The best case for support incorporates storytelling:
- Share the need. (“Once upon a time ...”)
- Show how you address need. (“These bad things happened, and this was what was done to improve the situation ... then more bad things happened ... conflict/band-aid, conflict/band-aid ... bringing you to today.)
- Show how the donor can create a happy ending.
Your story should demonstrate what would happen if your nonprofit ceased to exist. Or, if the program for which you’re seeking funding doesn’t come to fruition. If your prospect feels you’re simply asking for money, he or she cannot make a passionate, values-based gift.
- Action Tip: The prospect must feel the amount you’re asking is the right amount. There’s a concept in Judaism known as t’rumah. Loosely translated, it means “a gift from the heart that’s enough to get the job done.” It comes from the story of the delivery of the Ten Commandments. Beforehand, Moses came to the people and asked them to donate to build an ark worthy of receiving such a gift. They were told precisely what was needed. Nothing more. Nothing less. What was needed was “enough” to get the job done. Your donor wants to know what will be enough. What will your entire project cost? Then the donor can figure out where he or she fits within the scope of the impact you want to make possible.
Secret: Your case for support should be specific and outcome oriented. Because “we want as much money as we can possibly raise” is not inspiring. Who doesn’t? But why should your donor give to you (as opposed to someone else), and why should he or she give this amount?
3. A Gift Chart Tied to Your Fundraising Goal
Most organizations simply do not have a large enough donor base (or mailing list) to be sustainable without major gifts. So it pays to figure out precisely how you can get to your goal. A formal gift chart, which you can use for an annual as well as a more formal capital campaign, outlines at the outset how many donors you’ll need, and at what levels, to reach your goal.
If you have a $500,000 annual giving goal chances are good you’re not going to get there with 50,000 $10 donors. You’ve probably heard of the Pareto Principle (aka the 80/20 Rule) as it applies to fundraising. It states that 80 percent of your fundraising will come from 20 percent of your donors. These days, I find it to be closer to 90/10. In some cases, it can be as much as 97/3.
- Action Tip: I actually think it’s not a bad idea to share your gift chart with your major donor prospects regardless of whether you’re in a capital campaign. Annual campaign donors also like to know where they stand. And your board members should understand this as well. They’re your leaders. If they aren’t leading, how can you expect others to give passionately? If you need board members to give $1,000 gifts, and they’re giving $100 gifts, you’re dead in the water. Nothing demonstrates this quite as simply and clearly as a gift chart.
Secret: A serious successful major gift fundraising program has goals and prospects to meet those goals. Simply asking random people for big bucks is not a major gifts strategy. It’s a shot in the dark. The fundamental reason you need to have this gift chart is the same as the reason you need to have any type of plan. Or, to paraphrase Lewis Carroll, if you don’t know where you’re going, you’ll very likely get there.
4. A Cultivation Plan for Each Prospect
Your next step is to move your prospect down the road through a series of donor experiences that engage passions and get him or her primed to make an investment. The Paul Masson wine brand had a great 1970s marketing campaign that said: "We will sell no wine before its time.” Ask no donors before their time! You’ll know when they’re ready if you’ve created a personalized “moves management” plan for each individual in your major donor portfolio.
I adhere to the “Goldilocks Model.” You’ll know their time has come only if you’ve been getting to know them through a planned series of cultivation “moves.” People generally move along a continuum, from interest, to awareness, to engagement, to investment.
- Your prospect won’t be ready if you’ve done too little. If someone has an interest in a cause similar to yours, but knows nothing about you, it’s a bit too soon to ask. Would you take a first date on an overnight to a ski lodge? Enough said.
- But folks can get to the investment stage fairly quickly, especially if they already have strong connections to you, so you don’t want to do too much.
- That’s where many nonprofits go awry. They have a hard time mastering just right cultivation. They cultivate, and cultivate and cultivate—and never get to the ask. This is something you want to avoid at all costs. It’s a waste of your time, and it’s very confusing to your prospects. At some point, they expect to be asked.
Secret: Put in place a "just right" plan. Monitor it. Don’t get prospect “A” right up to the threshold; then ignore him or her and move on to prospect “B.” When you’ve made all the moves you planned, it’s time for the ask.
You’re not quite ready to shake that piñata. Not yet. But you’re getting close! In Part two (next week) we’ll look at the final five secrets you need to make your major gifts program a success.