After years of working with nonprofit organizations on “major gift campaigns” to build buildings, to secure endowments, or to fund other significant projects with hefty budgets, I’ve learned if a nonprofit organization is able to answer a few simple questions prior to embarking upon the campaign, they are more likely to succeed.
Yes, it is true I have seen a few nonprofits tackle a capital fundraising effort after being told by respected professional advisors they have absolutely no chance of succeeding! And, in fact, some HAVE succeeded. As President Abraham Lincoln (1809-1854) once said,
“The probability that we may fail in the struggle ought not to deter us from the support of a cause we believe to be just.”
But more often than not, a little advance consideration about where your organization stands vis-a-vis a potential major gift effort will save you time, money and potentially, embarrassment.
Ted Grossnickle formulated a list of basic questions your organization should ask before launching a major gift campaign for the Association of Fundraising Professionals. The link has been taken down by AFP, but happily I copied it below before they did so.
1. Your nonprofit is needed. The organization is actively making a difference in the community and can make an even bigger impact in the future.
2. Your nonprofit is known and respected. The community knows about your organization, and when you recruit board members, they consider it an honor to be asked.
3. Your nonprofit is focused and healthy. The organization has a practical strategic plan that fits with a capital campaign. The organization is financially healthy, meaning it has a balanced budget, access to credit, and financial and audit records that are in order.
4. You have a base for fundraising. A strong corps of annual donors exists, and you have had success with increasing gifting levels by active stewardship.
5. Your board of directors is ready. Each member of the board makes an annual gift to the organization, and many have made additional special or extra gifts. Board members understand what a campaign would require in terms of their own individual and collective financial support and time. The board is willing to help cultivate and solicit gifts, and each member has helped identify one or two donors that can make a gift for the campaign. The board has put a development committee in place, and board champions are advocating for fundraising.
6. The staff leadership is ready. The CEO is respected by staff, board, donors, clients and the larger community, and willing to commit time to working on the campaign. The organization either has a full-time development director or has addressed which staff member will be responsible for the campaign. The CEO and board have secured campaign counsel, or addressed why they are not hiring counsel.
7. You’ve done your homework. The organization knows what it needs to raise funds for, can articulate the outcomes and has a written and refined case for support. A feasibility study has been conducted to test the case before going forward with a campaign, and you’ve set a realistic campaign goal.
> A personal caveat, if and when you conduct a feasibility study, be sure the people doing it are a good fit and that they communicate comfortably and well with your donors and potential donors. See additional discussion about feasibility studies at the conclusion of this page.
8. You can effectively tell your story. You have a written plan to communicate your campaign and its key messages. Staff and board members can tell the organization’s story and communicate why a campaign is necessary.
> I would add to this, your plan should make use of multiple channels of communication, including social media. In fact, I can’t think of a better way to support the “public portion” of a major gift campaign – which traditionally falls at the conclusion of the effort – than by using social media. You might also consider developing and using specially-tailored “apps,” both for use by “insiders” during your major gift campaign, and for the general public as the campaign moves into its final phase.
9. You can spend money to raise money. The organization has identified a budget for a campaign and has allocated funding for it. The budget includes funds for donor recognition and communication, training and materials, counsel and equipment. It also has a provision for travel and meals.
And, most importantly,
10. Your campaign is important, exciting and will make a difference! Your board and staff are excited about what this campaign can mean. You can create important changes in people’s lives if you succeed in raising the funds.
~ A basic definition of capital campaigns may be found on About.com. “A capital campaign is a time-limited effort by a nonprofit organization to raise significant dollars for a specific project.” Click on the link to read more.
~ Jay Love of Bloomerang has posted, “5 Lessons Learned While Chairing a Capital Campaign” (February 11, 2013). He provides excellent advice.
~ The Nonprofit Assistance Group has prepared a helpful capital campaign check list that you might find of help.
~ The Nonprofit Times provides a wealth of assistance on their website under, “Capital Campaigns.” “Capital campaigns are intensive fundraising efforts that are meant to raise a specific amount in a given period for a specific project. The goal of these campaigns is to meet the various asset-building needs of a nonprofit. These projects can include renovation, building an endowment, purchasing land, or acquisition of equipment. There are multiple types of capital campaigns, but the best known is the traditional (or classic) campaign. This type of campaign is generally related to renovation or construction. The time frame of a typical campaign is several years, and involves fundraising techniques such as direct solicitation. In addition to the enormous growth in a nonprofit’s infrastructure, capital campaigns have the benefit of raising public awareness of the organization’s cause, and will often bring in new volunteers. All of these things will help future fundraising efforts.”
~ Peter Heller has written for Philanthropy Journal, “Avoiding Capital-Campaign Mistakes.” “There are many motivations for giving, yet at the core of a successful charitable relationship is the fact that a nonprofit has told its story passionately and has inspired a donor.”
~ Jim Shapiro was written a helpful article, “Major Gift Fundraising Focus” for Better Fundraising for All (April 17, 2013). “… we should focus a majority of our fundraising energy on developing a major donor plan/system that works. If you don’t have an actionable Major Donor program you are literally leaving money on the table that you could be using to further your mission.”
~ Zimmerman Lehman has its on take on capital campaigns. Click to reach Ten Steps To Success.
I have been helped teach the CFRE Review Course for the Association of Fundraising Professionals in Texas, which is designed for those studying to take the fairly daunting examination in order to become a Certified Fund Raising Executive (CFRE). One topic covered covered during this study course is the feasibility study. I beg to differ with my colleagues regarding this aspect of capital campaign planning.
Although AFP and other nonprofit professionals insist that prior to launching a major gift campaign, organizations absolutely must conduct feasibility studies, my personal experiences reveal that while these studies can be helpful, if they are not thought through well in advance, they can throw a perfectly good campaign completely off track.
I have seen some studies peg a proposed campaign as a failure, and the organization subsequently go on to attain stellar success. I have seen feasibility studies predict outrageous success – which the organizations themselves did not believe – and they wisely curtailed their ultimate goals substantially to better match reality. Last but not least, I have seen consulting firms hired who did not have the hoped-for rapport with the civic leaders they interviewed, and the final results where therefore inconclusive.
In these instances, consulting firms were paid large sums to conduct the studies, when those funds would have been better spent paying a full-time campaign coordinator to actually get into the trenches, develop and implement their campaigns.
On occasion, you will find nonprofit organizations whose leadership decides to go ahead with a major gift campaign, knowing in the end they may not reach the ultimate fundraising goal. But they want to try, anyway. Knowing the risk, why not let them? An additional concern is the admonition that all nonprofits must conduct an advance feasibility study too strongly feeds the consulting industry.
One successful feasibility study I helped advise as a volunteer was for a nonprofit that was one division of a larger, national organization. I suggested they hire their own people from another region to conduct the feasibility study. By internalizing the process, this helped ensure that those conducting the study had the nonprofit’s interests foremost in mind. Yet, because they did not know the donors and thought leaders in this particular community, the interview team could still be objective (an essential aspect of conducting a meaningful study). They were also well-versed in the organization’s mission and success stories, being employees of the nonprofit, but in an entirely different region. Last but not least, they were more conservative about their expenditures to conduct the research. This worked extremely well.
On a final note, I have actually built a career repairing and implementing capital campaigns that had terrible feasibility study experiences; I really do know what I am talking about. Cheers!