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Fundraising in a Challenging Economy
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  • The Foundation Center’s Training Programs
  • I’m going to start with something you already know: this is a difficult economy for everyone, and that includes those seeking to raise funds for nonprofit organizations. The truth is, however, that during tough times our constituents may well need our services more than ever. We just saw that fact reinforced by the number of you who raised your hands during the mini-poll. It is our job to continue to deliver our programs and services to address the needs of the community. And many of these needs may now be even more urgent than in the past. So no matter what, we have to find ways to raise funds and to generate revenue, if we are going to fulfill our mission. In this class we are not going to recommend one single strategy as a “magic bullet” that is a perfect fit for every nonprofit. Rather this class is designed to provide a framework to help you think through your fundraising efforts in light of truly challenging circumstances. Much of the recommendations and tried and true advice we plan to share with you today will stand you in good stead, even in better times. So now is a good time to learn about them. We will begin with the thought process you and your board will want to engage in so that you can prepare your nonprofit to tackle fundraising in the current climate. This will involve taking stock of your mission and core services in light of the economy, and fully engaging your board in the process. You might recognize that this particular process isn’t really that different from sound fundraising practice in general, but it is critical under the circumstances. Then, for each major funding stream that supports your budget, we will discuss the changes we foresee in the current funding environment and examine ways in which you can refocus your fundraising approaches. T here is no question that the current economy is affecting how and how much donors— both individuals and institutional funders—give, and we need to adapt our approaches to these changes. Along with taking a careful look at approaches to various funding sources, we will also explore a few additional strategies you might want to consider to position your nonprofit to survive, and perhaps even thrive, in this economy. Throughout, we’ll mention Foundation Center resources and other services that might help you.
  • Lost sources of funding Lost earned income Fewer programs and services Reduced staff Reduced salaries More time devoted to fundraising Increased demand for our services New programs introduced to address the impact of the crisis on our community New collaborations with other nonprofits New/additional funding received to address needs related to the economy Before we begin, I’d like to see a show of hands—how many of your organizations are being affected by the economic downturn? Let’s see how the economic downturn has affected your organization. I’d like to see a show of hands—[Read each possibility from the slide]. Anybody has any other examples—positive/negative impact—to share? As we see from your responses, the economic situation is affecting all of us in different ways.
  • Positioning Your Organization for Fundraising in the Current Economic Climate Let’s look at the critical ingredients you need to have in place so that you can prepare your nonprofit to take on fundraising in this climate. If you have taken any of the Foundation Center’s other classes, you will remember us talking about the importance of conducting a critical assessment of your organization before you do any fundraising. This process is often referred to as an assets inventory of your organization. It means taking stock of what your nonprofit organization is all about, including your mission, core programs and services, the populations you serve and how you serve them, your history, track record, leadership and their contributions, etc. Does this sound familiar? If not, we strongly recommend that you take our Introduction to Fundraising Planning class or webinar for a more in-depth discussion of these topics. Taking this kind of careful look at your organization, its mission, leadership, and activities, is a first step that all nonprofits seeking to raise funds from foundations should do. So let’s proceed to highlight a few elements that are especially pertinent in light of the current climate and talk about how to position your organization for fundraising.
  • Let’s review the characteristics of successful nonprofit organizations: A vital mission : This is a statement of the needs and problems your organization exists to address. The mission statement answers the question, “Why.” Along with it, you will also include general goals and objectives for your organization, the “what” and “how.” Capable leadership: Governance : the board of directors is responsible for governing your organization. How well do they exercise appropriate oversight? Management: your paid staff and other volunteers who run the organization day-to-day. How qualified are they? Programs and Services : Your organization’s programs should be relevant to the needs of the community you serve; they have to be in high-quality and well-regarded by the community; and they have to be in line with your organization’s mission statement. Operations and support systems: How well does your organization deliver its programs and services? Do you have the necessary support systems in place to assure the effective delivery of these services? Successful nonprofits regularly examine whether they are meeting desired goals and objectives. Constant planning and evaluation are just part of the process of Organization Rededicating Itself to its mission and services. Facilities : need to be adequate for the organizations scope and the nature of its work Finances : Nonprofits today require reliable and diverse revenue streams and a sound accounting management system. History of the organization: This may present some problems for new nonprofits because you have no or very little track record. But foundations look for successful organizational history. Then how do you deal with this issue? One way is by demonstrating you have a strong and committed board with solid track records and a sound financial plan. Another way is to have an executive director with experience and credibility. All of the above are the key characteristics of successful nonprofit organizations. Again, when you approach foundations for funding, they will look for those characteristics in your organizations. Without them, they are not likely to fund you regardless of how strong your proposal is. Starting from the next slide, we will go over in greater detail some pertinent issues so that you can begin to assess your own readiness for foundation fundraising.
  • Let us begin with your organization’s mission. Why is it that we always begin with the mission statement when we talk about nonprofits? It’s because a mission statement describes the purpose of the organization, answering the question “why does your organization exist?” Your organization’s mission statement should guide the actions of your organization, spell out its overall goals, provide a sense of direction, and form the basis for decision making at all levels of management. As funding dollars become scare and service demands go up, you need to focus on your mission more than ever. Your constituency may turn to you for additional help as they navigate these troubled waters. You need to let your mission guide everything you do and remain true to it. We often advise novice grantseekers about the danger of “chasing dollars.” If you apply for grants to do what a funder wants you to do rather than what you believe you need to do, just because money is available, that will lead you down the path of “mission drift.” The same concept applies here. If you are merely reacting to the immediate service demands arising from the current economic circumstances without keeping your mission front and center, it will also lead you down the path of “mission drift.” The Foundation Center’s Training Programs
  • We realize that the current financial conditions have resulted in great hardship and suffering for many people. And we don’t mean to belittle that in any way. But in every crisis there may actually lie a hidden opportunity, especially for nonprofits seeking to raise funds to respond to increased demand for their services or those whose mission places them front in center in serving those most impacted by the economy. Now is the time to ask yourself: what about your mission, your activities or the audiences you serve makes you particularly relevant in times of economic need? For instance, if your organization’s cause is offering employment services, providing housing, operating a soup kitchen, or contributing to community development, your work is crucial under the current circumstances, and may well be perceived by funders as such. Under those circumstances, you should be prepared to capitalize on your mission in proposals to funders. The economy may actually represent an opportunity for your organization. Don’t waste that opportunity. As an example, the Foundation Center’s mission is to strengthen the nonprofit sector by advancing knowledge about philanthropy. Like everyone else we are experiencing many financial challenges, but at the same time have capitalized on the economic downturn as an opportunity for us to highlight the philanthropic response through our Focus on the Economy efforts. We have begun tracking real-time grants in earnest, and delivering the latest news, commentaries, and advice and training for nonprofits. What if your cause relates to things like the arts, environment, or animal welfare that don’t seem at first glance particularly relevant in times of economic strife? It’s quite possible that whatever your mission, your services may still have special meaning to your audiences in this climate. Your challenge along with your board’s is to try to determine what that connection might be and to emphasize that aspect of your operations when approaching funders. Let’s take a few minutes now to jot down your thoughts on your mission and its relevance to the current economy. How might you capitalize on the current economy? What opportunities do you see for your organization? These ideas will come in handy since your supporters and funding prospects you approach will want to know how vital your programs really are. Organizations that position themselves as useful in times of crisis may actually find themselves the recipient of more grant dollars, not fewer. The Foundation Center’s Training Programs
  • Next, let’s discuss your organization’s core services and programs. If your organization has been in operation for some time, it may have grown to provide an array of programs and services. Take a hard look at your organization’s activities: what are the core services that you provide to fulfill your mission? What activities are critical? This is an important point to keep in mind when trying to raise funds during an economic crisis. Your priority should be on raising funds to support the most important mission-critical, core activities of your organization, while meeting the needs of the community you serve. Along the same line of thoughts, ask yourself: who benefits from your organization’s core programs and activities? Who needs those services most right now, and what are their most urgent needs? Do you have a good handle on exactly what impact your organization has on those who benefit from your services? This is the kind of data you should be collecting at any time, but it is crucial now because your donors are also looking for ways to invest their more limited giving wisely. And they will be particularly impressed by groups that are poised to deliver top notch and efficient services to audiences they care about. This is another way to position your organization to have a competitive edge in fundraising in the current economic climate. I am going to give you a couple of quiet minutes now so that you can think about which of the program services and activities you currently provide are mission-critical, core activities, the populations you serve, and how your programs make a difference in their lives. The Foundation Center’s Training Programs
  • As we know the board is the public face of an organization and its governing body. In troubled times, steps your board takes to face the crisis head on can go a long way toward ensuring that your nonprofit remains solvent. Remember that 100% board involvement (both participatory and financial) is always important, but is even more critical now. Reaffirm the role of the board. The board’s primary function is to protect the organization’s mission and make sure that it continues to exist to carry it out. In light of the current economy, it is extremely important that your leadership think strategically about the organization’s goals strategies and activities, its relationships with external stakeholders, and that the board has a firm handle on your current finances. Your board requires information from staff—statistics, financial data, and updates on programs and outcomes-- all necessary so that the board can do its job. [adapted from : Facing the Financial Crisis: 10 Smart Things Your Board Can Do Now – publication of BoardSource.] There are certain activities that your board of directors can engage in in response to the current economy. - Consider scheduling additional board meetings, in person or by telephone, to discuss your organization's short-term strategy. And be sure that a review of long-term strategies is on the agenda. - Assess cash availability if your revenue is tied to market fluctuations; make sure that your cash, investments, or reserves are some place safe, and that you are getting the best possible return under the circumstances Obtain renewed commitment from board members. The current economy can serve as a catalyst for your board members to renew or even increase their financial commitment to your organization. Involve the board in fundraising/donor engagement. Board members must step up to the plate and ensure that they are full, committed partners with staff. In addition to making their own financial contribution, all board members should be active ambassadors and “friend-raisers” and they should help others understand and value the services you provide, keeping them in great demand. The Foundation Center’s class, Your Board and Fundraising, provides instruction in increasing board engagement. The Foundation Center’s Training Programs
  • Fundraising is the next critical element in positioning your organization to survive and thrive in the current economic climate. Now is not the time to hunker down and wait for the storm to pass. If your organization is going to survive, fundraising should be one of your top priorities. It is not an area to cut back in your budget, if you can avoid it. In fact, you may have to expand your fundraising efforts in order to deal with the economic climate. Don’t let fear freeze you into inaction. And don’t assume the worst. Keep on asking. If you don’t ask, nobody is going to give to you! First, you may need to refine your message. We’ve already covered the basics when we talked about your mission, core services, and board involvement. Now more than ever, you must make sure that the public, donors and prospective donors fully understand the key role you play in the community. Be specific. Clearly articulate your value proposition. What is your role in the community? What is the value you bring? Why is your nonprofit indispensable in this economy? How are you addressing the challenges? Ask yourself, “What fundamental message must our constituents and donors remember about us during these times and moving forward?” Keep in mind that with their own funds restricted, prospective supporters may need even greater and more persuasive detail than they did in the past before they make the decision to support you. Offer donors a compelling reason to give. G. T. Smith, A well-known fundraising expert and author, is quoted as saying: "Donors don't give to institutions. They invest in ideas and people in whom they believe." Your task is to provide a rationale for people to invest in your nonprofit organization. Tell stories they can empathize with, show photos, videos, or other illustrations of your nonprofit at work, or have someone share a personal testimony of the benefits s/he received from your work. You need to be highly responsive and transparent with your donors, but at the same time you don't want them to think that your organization is on the brink of going out of business. Talk frankly about the challenges you face and what your organization is doing to provide services and programs in this time of need. Focus on results. Demonstrate that you are doing your part by making difficult decisions to trim program and staff and in general to operate more efficiently. Next, ask yourself: who are your strongest supporters? Who are your most loyal supporters? Who among your supporters will be most upset if your organization goes under? Take whatever steps you need to so as not to lose those supporters—make sure they know what you need to continue the services that you provide, and that they already value. Remain in contact with these donors, and keep them informed about what’s going on in your organization (more tips on this later). You want to keep these “supply lines” open. Those that know and care about what you do will be essential to helping your organization in a time of need. Address their fears about the economy directly and openly. Say: “Here is how we plan to survive this crisis.” Be aware that, even among your strongest supporters, some will disappear, some will give less, and some may actually give more. You are likely to need to identify new funding sources, or new ways of working with the funding sources you already have. But this is not the time to experiment with an entirely new approach to fundraising. Given the limited resources you can invest in fundraising activities, you should not stretch yourself too thin. You need to focus on the tried and true funding streams that have worked in the past because that’s where you are most skilled and experienced. If you are going to be branching out to new funding sources or adopting new mechanisms, particularly those with which you have little experience, tread lightly and choose the area in which your organization has a reasonable hope for success. This is a good segue way to the next part of the class. The Foundation Center’s Training Programs
  • In the next half an hour or so, we will discuss major funding streams for most nonprofits one at a time. We will share with you what we know about the current funding environment and how it is likely to be impacting each one, and we will talk about specific approaches you can take to adapt your fundraising efforts accordingly. As already mentioned, THIS IS PROBABLY NOT THE TIME FOR EXPERIMENTING. If you have experience in raising funds from a particular source, knowing the current state of affairs for each type of funder and strategies that you can use when approaching them will help you sharpen your own approaches. If you’ve never attempted particular methods of fundraising before, you may want to begin to learn more about them first. If you are going to add new funding streams, think carefully about which one or two might be a good supplement to your current fundraising strategies, and which might position you better for the future.
  • Current environment Decline in first-time givers Decline in direct mail responses for some organizations More giving in smaller amounts Most not changing overall giving Recent studies have shown that: During recessions: There is often a decline in first-time givers (although loyal donors continue) Direct mail response may decline for certain organizations (museums/arts/environment) but holds steady for others (seniors/religious/poverty) [CDR Fundraising Group Analysis (Fundraising in difficult times)] Some other notable findings: More people may be giving but in smaller amounts . [ Chronicle of Philanthropy, Donors are Plentiful: Reasons for Optimism in Hard Times, 2/26/09] However, studies have also shown that giving priorities don’t radically change during recessions. A surprising number of individuals continue to give at the same level, or even increase their giving. When queried, most people say that the recession will not affect their giving. [Cygnus Applied Research study, “Philanthropy in a Turbulent Economy” of January 09 survey polled 17,365 who were previous donors 52% said their gifts would be the same as last year, 17.5% said they were planning to give less. Of those planning to give the same amount 50% said that they would compromise their own needs to maintain giving levels. ] So knowing all of this, what strategies should you employ if you intend to raise funds from individuals? The Foundation Center’s Training Programs
  • Depending on which of these categories your prospect falls into, it will require different search strategies as well as different approaches for the ask. Unlike foundations and corporations, there is no central source of information or database listing the giving interests of individuals. You can’t expect to automatically go online and find a list of willing, ready and able donors. Even more importantly, when you can find information on an individual’s giving history, this information does not include how to approach this individual.   Because we are individuals our giving is personal reflecting our unique interests. The closer a person is to your organization, the more likely he/she will give. You picture a series of concentric circles (target)—and you’re starting in the center (bullseye) with those you already know about. The Foundation Center’s Training Programs
  • You’ll remember that we talked about the importance of keeping your strongest and loyal donors “in the fold.” For individual donors, your job is to keep in close contact with them, and give them a variety of opportunities to be connected to you. Remind them frequently why the work of your organization is important. Clearly articulate the merits of funding your organization in even greater and more persuasive detail than in the past. You need to be responsible, transparent, and honest with your donors, but you don't want them to think that your organization is in danger of going out of business. Talk about the challenges and what your organization is doing to provide services and programs. Talk about audiences you know the donor cares about and how your are helping them. Emphasize the results. Let these donors know that you are spending their money wisely. Demonstrate that you are doing your part by trimming programs and staff. Enhancing your donor relationships is key. Here are some ways to do that: Prioritize: Who are the top 50 people who are most important to your organization? What action steps you can take to increase their donations? How can you ramp up their involvement with your organization? Reach out to long-term supporters for increased contributions. Encourage your mid-range donors to stretch to a new giving level. Consider more flexible payment structures for donors (extend payment periods to all donor categories). Convert annual donors to monthly donors . Experience has shown that they keep giving longer than those who give less frequently. Invite lapsed donors to events, membership programs and other activities even if they can’t give this year. Keep even your past supporters involved. [Suggestions adapted from Kim Klein, “5 Tips for Nonprofits to Survive & Thrive Now and Into the Future,” Grassroots Fundraising Journal March/April 2009] Since individual giving is among the most reliable source of support, if you are not currently seeking funding from individual donors, it would be wise to at least consider this approach. And remember when it comes to individual donors, you should always begin with your closest connections—board members, volunteers, and others directly related to your organization – before broadening your approach to the community at large or to the general public. The Foundation Center’s book Securing Your Organization’s Future and our class Introduction to Fundraising Planning provide additional information on starting an individual donor program.
  • If you’re planning on fundraising from individuals by means of special events, here are a few things to think about during a time when people might look askance at any expenses that could be perceived as lavish: Partnering with other charities will lessen fundraising costs and collectively may attract more contributions, provide more public awareness and publicity than doing it on your own. (More about collaboration in a few minutes.) Today no one wants to appear frivolous with a donor’s dollars or to seem insensitive to the suffering of others. Less fancy, stripped-down events with fewer dollars spent on decorations, food and drink, or extras may be necessary. If you’ve never tried a particularly ambitious event, this may not be a good time, unless you’ve got a good handle on the costs. If you’ve never tried events at all, low-budget efforts (bake sales, car washes, dinner parties) are easier. Lowering entry prices for your event may be risky, since it may become the new norm. First look at cutting expenses before decreasing ticket prices. You may want to consider tier pricing, given the shaky economy, but focus on encouraging those who can afford the top tier to continue giving at that level or to subsidize others. Since this is not a good time to experiment with new events given, try to come up with creative ways to spruce up tried and true events that have worked in the past.
  • Current donors Take advantage of their increased receptivity to communication Investigate any new initiatives/priorities Prospects Research thoroughly Utilize board connections As with individual funders, your goal is to keep connected with the foundations with which you already have relationships, and to be diligent in researching those that might be connected with you in the future. Foundation program officers have been reporting increased receptivity to communication with grantees regarding their response to and strategies to address the economic downturn. Reach out to your current donors: Let them know how the economy is affecting your community and your organization. Ask whether they are anticipating any changes in funding directions, and try to get a sense of the possibilities for renewal or even for increased support for your organization. If you hear that the timing isn’t right now, find out when you can come back and raise the issue of support again. Adopt the attitude that you are all in this together. You should try very hard to be aware of any new initiatives or changes in funding priorities of your established donors. The Center’s Economic Crisis web page has a resource detailing the latest statements from a group of larger foundations on their giving changes due to the economy. Be sure to keep in touch with foundations with whom your organization has pending proposals: Ask what is the status? Find out if there changes to their decision process. When might you expert to hear the outcome? If you’ve never secured foundation funding before, this may not be the best time to try, unless, as we noted earlier, your mission puts you squarely among those whose programs are very relevant to the downturn, e.g. you provide services to people who have lost their jobs or their homes. If that is the case, indeed this may be a good opportunity to add foundations to your funding roster. Otherwise, keep in mind that many foundations are limiting their new grants. Although getting a grant may not be a likely scenario, now may be the time to cultivate new donor relationships so that you will have an advantage when they are ready to take on new grantees once again. Thorough research and board connections are critical in this scenario. Foundation Directory Online is a helpful tool for this type of donor cultivation. The Foundation Center’s Training Programs
  • Looking at foundation giving, there’s not a lot of great news: Foundations have lost 20-30% of their assets. A few foundations were severely affected by the Madoff scandal. Many are curtailing gifts to new nonprofits in order to support those they are already committed to, and two-thirds say that they expect to reduce the size and/or the number of grants in 2009 ( Foundations Address the Impact of The Economic Crisis). The Foundation Center has identified a number of factors lessening the impact on overall foundation giving during past downturns, including : An increase in the number of new foundations (over 31,000 in just the last 10 years). Donors to foundations continuing to contribute substantial gifts and bequests to foundations Many foundations setting the percentage of giving in a given year based upon the average value of their assets over a 2-5 year period The response from foundations to the current economic situation has varied (see Economic Crisis web page): As an expression of commitment to their recipients, some foundations have indicated that they will give nonprofits more for operating expenses. Some foundations have increased their payout rate (the percentage of their assets that they typically give away) to provide needed resources to communities and organizations they have long supported. Others have decided to exceed their established payout amount to honor multiyear commitments already agreed upon Some are refocusing their program areas to address current needs Many staffed foundations are taking steps to reduce their own administrative costs rather than their grant programs.
  • The Foundation Center’s Training Programs While most U.S. corporations have been hard hit by the economy and many report significant losses, this is not universally true across the board. For example, those that specialize in inexpensive consumer products still needed in a lean economy have been impacted less than others. The lesson here is to know your corporate funder and conduct thorough research on their current status and giving patterns. Recent studies by the Conference Board examine the impact the economy has had on corporate donations: 45% have reduced their contributions, 16% are considering cuts. However, even in hard-hit sectors, corporations may still be looking for ways to connect to the charitable interests of their employees. For example, 45% in the study said that they are planning to encourage more employee volunteerism. Source: Conference Board, 2009 Corporate Philanthropy Agenda Although times are tough, corporations are likely to continue to view partnerships with nonprofits as valuable, since they know that these partnerships can have a positive impact on their bottom-line.
  • Current environment Some companies have taken a hit, but not across the board Fewer and smaller cash grants Partnerships with nonprofits still perceived as valuable While most U.S. corporations have been hard hit by the economy and many report significant losses, this is not universally true across the board. For example, those that specialize in inexpensive consumer products still needed in a lean economy have been impacted less than others. The lesson here is to know your corporate funder and conduct thorough research on their current status and giving patterns. Recent studies by the Conference Board examine the impact the economy has had on corporate donations: 45% have reduced their contributions, 16% are considering cuts. However, even in hard-hit sectors, corporations may still be looking for ways to connect to the charitable interests of their employees. For example, 45% in the study said that they are planning to encourage more employee volunteerism. Source: Conference Board, 2009 Corporate Philanthropy Agenda Although times are tough, corporations are likely to continue to view partnerships with nonprofits as valuable, since they know that these partnerships can have a positive impact on their bottom-line. The Foundation Center’s Training Programs
  • The Foundation Center’s Training Programs If your volunteers or board members are affiliated with a company—work to secure a connection with that company. Through these personal connections you might be able to form new relationships with companies in your community, with newly-formed companies, companies with a new presence, or companies you may have overlooked in your prior prospect research efforts. Perhaps more research is necessary. Even companies that are not doing well may be willing to consider new, usually non-cash (or “in kind”), ways to support your organization. Can they offer your organization products or employee volunteer time? What can you offer in return? A primary driving force behind corporate giving is how that giving benefits the company’s commercial goals. Corporations are looking for nonprofits that can help them improve their public presence in the marketplace. Emphasize how giving to you benefits their interests. For more on this topic take the Foundation Center’s new e-course Introduction to Corporate Giving?
  • According to a March 2009 study by Civic Enterprises entitled: “ The Quiet Crisis: Impact of the Economic Downturn on the Nonprofit Sector” A substantial majority of nonprofits receive government funding, usually from states. The recession, however, has led 44 states and the District of Columbia to anticipate budget shortfalls for the remainder of their fiscal years…. These gaps in funding are likely to total almost $350 billion by the end of fiscal year 2011. It is hoped that the economic recovery plan and additional bills President Obama has been signing into law will make those cutbacks less severe than they would otherwise have been. However, their exact impact is unclear. It is vitally important to keep connected to the latest information on Stimulus funding and how to it may be accessed at state and local levels. Essential web sites for information include Recovery.gov and USAspending.gov (two main federal websites related to the recovery). Each state also has its own web site focused on funds available statewide. The Center now has a new site where you can explore these and the best ARRA resources: http://maps.foundationcenter.org/economic_crisis/stimulus/.
  • We’ve already shared a number of strategies to revitalize your organization’s fundraising in difficult economic times. What else might you do, given the challenges of the current economy?
  • There are many reasons why you may want to consider using technology for fundraising and supporting activities: To draw new audiences to your cause : Internet use continues to grow and the adoption rate by people 55 years of age and older increased by 20% last year. Technology allows you to attract younger generations as well. There are many social networks on the Internet, including Facebook, Myspace, Digg, Change.org, Twitter and Linkedin, just to name a few. With these networks, you can draw new audiences you wouldn’t normally attract from your usual sources. To acquire new donors : Use of technology allows you to diversity your traditional methods of acquiring new donors. Many nonprofit organizations rely on the same strategies for year after year.  In an economic downturn, you have to become creative in order to distinguish yourself from other nonprofits. Taking advantage of social networks or blogs offers another outlet for promoting your nonprofit without having to leave the confines of your office. According to the Target Analysis Group benchmarking study, the number of online donors grew 101% over the past three years, compared to a 6% growth rate for traditional donors. To make donating to your nonprofit easy . - Add a “donate now” button on your web site. - Set up a system to enable your organization to receive automatic monthly online contributions - Join a charity support site for online donations, such as Network for Good, JustGive, Paypal Standard To show that your organization is up-to-date. Some suggestions for using technology more effectively: - Keep your web site updated regularly so that return visitors always have something new to read - Offer opportunities for visitors to forward content from your web site to friends. This allows them to become cheerleaders for your organization and allows you to capture their contact information. To send targeted communications : keep donors informed through your web site and emails regarding the ways that your nonprofit is managing resources and meeting urgent needs in the community. Make your stories compelling: use the visual elements of a web page to make donors want to learn more about your nonprofit, Creative ways to tell your stories include storybanking (allowing your audience to “bank” their success stories by posting them online at your web site), videos, testimonials from those served, successful fundraising stories, etc.
  • Consider joint programming with other organizations Contract out for certain projects/programs Use others’ services to obtain mutual benefit Join a nonprofit association for special membership benefits Now is the ideal time to reach out and form strategic partnerships with other nonprofits that could bring in a new constituency, or support one of your weaker program areas. Ask yourself: Who in my community is performing similar services? Can costs be reduced through partnerships? If so, consider joint programming with another organization with similar programs (along with collaborating on joint grant proposals) or contract your services out to the other organization. Bartering arrangements and using one another’s services could also benefit both parties. Funders trying to pinch pennies themselves are likely to look favorably on strategic partnerships and collaborations that maximize outcomes. Also, if you aren’t a member of your local nonprofit association [give your local nonprofit association as an example], now is actually a good time to join. Yes you have to pay membership dues, but you may well receive discounts on services or products, e.g. health insurance. Here are some examples of successful strategic partnerships: a youth organization has acquired a pool of 50 dedicated volunteers through a strategic partnership with a large church; an outdoor wilderness program has formed a strategic partnership with a boys and girls club that already has funding to pay for program activities; an organization that builds libraries for children in Ethiopia has developed a solid relationship with Rotary Clubs International to provide funding and access to books. To encourage nonprofit collaboration Lodestar Foundation and AIM Alliance created The Collaboration Prize to “to maximize the growth and impact of philanthropy”. They seek to support collaboration to increase impact and eliminate duplication, identify collaboration models and, build an information base of effective models. You can find their website on the resource list.
  • Now may also be the time to look at combining forces with another group that shares common interests and values, or affiliating with another organization in order to share resources and costs. Could you split rental space with another group similar to your own? Are there administrative and program costs that could be dramatically reduced through collaboration? Outsourcing certain expenses is another option to consider. Financial management, human resources, and technology support represent good opportunities for outsourcing solutions. Is this the time to think about a strategic merger? Mergers in the nonprofit sector are often pursued only in time of severe distress. And typically this is a fairly drastic decision to make and not always the most popular one among an organization’s leadership. Still there exist a few incentives to do it, and there are “matchmakers” who can help. Today many donors have expressed a strong interest in mergers among nonprofits offering similar services in the same locale to similar audiences. It just makes sense when resources are scarce. Foundations are more likely to reward nonprofits that put aside the personal egos of their leadership for the benefit of their shared constituencies. Some corporate donors may perceive a larger nonprofit serving a bigger audience as the result of a merger or affiliation as offering a bigger bang for their contributions dollar. If you decide to take this route, begin with an honest assessment of the pros and cons, and seek advice from those who have done it. Done right, mergers have many advantages: - Provides more robust and diverse services - Avoids duplication of services - Create programmatic and operational efficiencies - Saves money - Attracts new or increased funding Here’s one example: The merger between The Door and University Settlement. The Door was one of the country’s premier youth agencies, providing 12 to 21-year-olds with comprehensive, confidential, and cutting-edge services. It had robust youth programs, but lacked infrastructure. University Settlement was a reputable and strong settlement house offering various social services, but its reach was limited to the lower east side of Manhattan. Recognizing what they could offer one another, the two organizations underwent a year-long strategic merger process. The Door is now a vibrant, independent subsidiary of the Settlement. Through this alliance, the University Settlement obtained citywide reach and national standing in the field of youth services.
  • Let’s review what we’ve covered in the last hour. We began the session by discussing critical elements you must have in place so that you can prepare your nonprofit to take on fundraising in this difficult climate. Best practices for any time, but more important than ever in this economy are: - Stay true to your mission in a challenging economy and capitalize on the special relevance to your audiences. - Focus on your mission-critical core activities. You need to make decisions strategically with your mission as the compass point. Look beyond simple survival. Decisions you make today should help your nonprofit move forward as financial conditions improve. - It will be extremely difficult for your organization to “survive and thrive” if your board members are not 100% committed to keeping the doors open—and to helping you grow stronger. Reaffirm the role of the board, obtain their renewed commitment, and involve them in fundraising and donor engagement. Under their leadership, staff, board, and volunteers should all work together: All hands on deck! - Fundraise, fundraise, fundraise. If you don’t ask, you don’t get. Keep your strongest supporters “in the fold” and concentrate your efforts on your best, most loyal funding streams. Carefully consider new funding sources and methods. Next, we spent time looking at ways that you can adapt your fundraising approaches to the current environment. We examined each funding stream, discussed what the current environment looks like for each of them, and thought through how to adapt your approaches to give your organization an edge. Our review of fundraising strategies introduced approaches that will serve you well any time, not just during a crisis. Finally, we highlighted a few other considerations for your nonprofit to ensure that you succeed, such as wise use of technology, collaborations, possible strategic alliances and mergers. Now that concludes our presentation. Sooner or later, the recession too will end. Until then r emain positive and continue to do excellent work in your community!
  • Transcript

    • 1.
      • Andrea Snyder (410)396-5320
      • [email_address]
      • Twitter: grants_pratt
    • 2.  
    • 3. How Can You Use the Grants Collection?
    • 4.
      • How to position your organization for fundraising to survive and thrive in the current economic climate
      • How to adapt your fundraising approaches to the current environment
      • Additional considerations to assist your organization to succeed
      • Helpful resources
    • 5. http://www.flickr.com/photos/estebando/3696424041/in/pool-stimulus2008
    • 6. Positioning for Fundraising Success in the Current Economic Climate
    • 7.
      • http://flickr.com/photos/jeffhester/2434283985/
    • 8. http://www.flickr.com/photos/jazz/4104233135/ Mission
    • 9.  
    • 10. Core Services & Programs
    • 11. Board of Directors
    • 12. Keep Fundraising
    • 13. Raising Funds in a Challenging Economy
    • 14.  
    • 15.  
    • 16.
      • Currently give or have given. May be ready to increase donation.
      • Have never given but have personal relationship with organization.
      • Have similar interests but no personal connection.
    • 17. Creating Prospect Lists
    • 18.
      • Portico
      • http://indorgs.virginia.edu/portico/
      • APRA
      • http://www.aprahome.org/researchlinks/index.html
      • David Lamb’s Prospect Research Page
      • http://www.lambresearch.com/index.html
    • 19.
      • Stay in touch
      • Communicate the challenges as well as what you are doing to mitigate them
      • Emphasize the results
      • Ensure financial transparency
      • Build on/enhance donor relationships
    • 20.
      • Special events
      • Try joint events with other nonprofits
      • Consider simpler events
      • Lower your expenses, not ticket prices
      • Stay with what worked in the past
    • 21.
      • http://flickr.com/photos/wonderlane/2362777515/
    • 22.
      • Current environment
      • Most foundations lost 20–30% of their assets
      • Giving is likely to continue to decline next year
      • How foundations respond will vary
    • 23.
      • Finding Funders (Foundation Center)
        • http:// foundationcenter.org /funders
      • Guidestar
      • www.guidestar.org
      • Google
      • The News
    • 24.
      • Current environment
      • Some companies have taken a hit, but not across the board
      • Fewer and smaller cash grants
      • Partnerships with nonprofits still perceived as valuable
    • 25.
      • http://flickr.com/photos/pbo31/2403049863
    • 26.
      • Seek out any and all contacts at corporations
      • Ask for “in-kind” gifts
      • Explore corporate volunteer programs
      • Emphasize how giving to you benefits the corporation and its customers
    • 27.  
    • 28.
      • Budget shortfalls have led to funding declines
      • Stay abreast of pending legislation
      • Keep an eye on opportunities under the Stimulus package
      • For more information:
      • http://maps.foundationcenter.org/economic_crisis/stimulus/
    • 29.
      • Federal (U.S.) government
      • www.grants.gov
      • State (Maryland) government
        • Governor’s Grants Office
        • http://www.gov.state.md.us/grants.html
        • Maryland Red Book
          • http://www.mdredbookonline.com
    • 30. Other ideas….
    • 31.  
    • 32.
      • http://www.flickr.com/photos/johnspooner/2199685678/
    • 33.
      • Share office space with another organization
      • Share the costs of maintenance activities with others in the same building
      • Utilize outsourcing solutions for back office operation
      • Consider a strategic alliance or merger
    • 34.
      • http://www.flickr.com/photos/mrtea/2114891329/
    • 35.
      • http://flickr.com/photos/poppywright/266201478/
    • 36.
      • Andrea Snyder
      • (410)396-5320
      • [email_address]
      • Twitter: grants_pratt

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