Most nonprofits live or die with fundraising. But for many of us, the idea of asking somebody for thousands of dollars can make your stomach tie up in knots.
How about you? Do you avoid making an ask for as long as you can and only see it as a necessary evil? Relax. There’s a bit of a science to the art of fundraising.
Consider the following scenario. This isn’t a hypothetical — it’s a real life, real time situation from some folks that have asked me for help.
It’s time for you to play consultant. What would YOU do?
Here’s the set up:
- You run a small, brand new organization
- No development director
- 4 board members
- $400K budget
- Last year, your biggest donor gave $20,000. But this guy could write a check with ease for hundreds of thousands of dollars. Maybe even a million.
You have an urgent need — your organization’s work is tied to the school calendar and your plans call for increased staff by September. You estimate that you need $300,000 by July 1. Your board is engaged and has written checks. You have identified $100,000, but these are soft commitments.
You’re considering asking your big donor for $250,000. You’ve been thinking about it for some time but have no clear strategy.
Then you get an email that makes your heart skip a few beats.
He’s in town this Saturday and asks you to dinner. He says he wants to hear more about what’s going on with your organization. You have three days.
What would you do?
Take a moment now. Stop here and comment (if you like) before continuing to my answer. I would love that. Then, come back here and read on so we can compare notes.
Click here to enter your comments (scroll down to the bottom of the page.)
You could also discuss this scenario as an exercise at your next development retreat (hope you are having one soon!)
Ready? OK, let’s compare notes.
STEP ONE: DROP EVERYTHING AND HUDDLE
Done correctly, this one gift would almost double your full year budget. You don’t want to screw it up. Under no circumstances can you wing this. Take everything else off your list. Then call a meeting or conference call with the people in the organization who know him and know the importance and urgency of the work.
STEP TWO: REVIEW WHAT YOU KNOW
Dedicate the time needed to do the following homework:
- How did this donor come to you in the first place?
- Was a specific ask made for a specific amount? Was it a more general request for support? Unsolicited?
- What kind of interaction has this donor had with the organization’s work since his gift? Does he feel informed and appreciated? Or has he been out of the loop since his check cleared?
- Where else does this donor give money? Include political dollars and alma mater giving. Google is your friend here.
Now look at your data. Analyze, synthesize, and reach some conclusions about size of gifts and areas of interest.
STEP THREE: WHAT IS THE SELL AND WHO MAKES IT?
The Pitch. Regardless of whether you are asking someone for $1,000 or $250,000, you need a clear, compelling pitch. It needs to be:
- Tangible and
- You have to include a goosebump moment
If the donor has given in the last year, don’t even put your napkin on your lap before (a) thanking him and (b) telling one story that exemplifies the successes of the past year — a story that would not have happened without that $20,000 gift.
The “sell” is tailored based on what you have learned in step 2. Be nimble. You may find out new information that re-shapes your thinking before you actually ask.
The Messenger. If his connection to the organization is personality driven (let’s say a relationship with the founder), let the founder drive the conversation. But bring a number of people so that the donor recognizes that the organization is bigger than its founder and that its founder has used his funds to build a kick ass team. Include the board chair – if s/he is impressive, committed, and has financial skin in the game. No more than a 3:1 ratio at the ask.
Making the urgency case. This can be tricky if it’s not about bricks and mortar. As mentioned, this org has set its sights on starting a hiring process by July 1 in time for the school year. Without this, it will lose an entire school year for a group of kids who badly need these services. “And we have empirical quantitative data that illustrate that these services work.”
What you learned
- The donor has been reasonably well stewarded over the last year. Could have been better.
- The donor gave $20K when asked generally to make a contribution.
- The donor has no specific passion for issues of childhood education; he gave because of a personal relationship to the E.D. They’ve known each other forever. The donor admires the E.D. for following his passion and is impressed with what he has done with so little money.
Time to ask
I used to joke that my Development Director would ask while she was checking her coat if she could – just to get right to it. I never ask until all the cappuccinos are placed.
Learn more about “The Perfect Fundraising Lunch” (also applicable for dinners)
What would I do? I would shoot big. I would have my board chair talk about the board’s commitment, his own personal giving, the soft commitments secured to date. The goal is to raise $300K by July 1 and close to $1 million by 12/31. The more money raised now, the more training and the more folks can be in classrooms by September. I’d also say that the money includes funds for a strategic assessment of the program with an eye toward managing rapid growth without sacrificing impact.
If the money allows expansion into one new city, tell him so. Try to figure out one big thing in the $250,000 range that he can hang his philanthropic hat on.
I would use the “white horse” strategy. “You, Mr. Donor, have the opportunity, thanks to your good fortune, to make a lead gift that could move our work from four cities to eight. That could allow us to move now so we don’t miss a full academic year.”
I would tell him that the goal for July 1 is actually $500,000 and that you have soft commitments for $100K. Ask him for a $300,000 gift and ask him to allow you to use it as a match to ensure the soft $100K and the remaining $100K to be identified.
Why would I tell Mr. Donor the goal is higher than it really is? You don’t have to. But it’s not often that you get the exact amount you ask for from a high-end donor.
Totally disagree. Just go for it. Maybe he made his money in a start up. Position him as an angel investor or the guy riding in on the white horse. Or if he is a leverage kind of guy, use a matching strategy. Remember: this donor admires the E.D. Now he can admire his guts, his passion and the boldness of his ask.
And never ever forget. You are not wrenching a check out of this guy’s hands. Your job is to ask and it is his job to decide.