Raising Money In Challenging Times

436
-1

Published on

Published in: Business, Technology
0 Comments
0 Likes
Statistics
Notes
  • Be the first to comment

  • Be the first to like this

No Downloads
Views
Total Views
436
On Slideshare
0
From Embeds
0
Number of Embeds
0
Actions
Shares
0
Downloads
0
Comments
0
Likes
0
Embeds 0
No embeds

No notes for slide

Raising Money In Challenging Times

  1. 1. Raising Money in Challenging Times: Strategies & Ideas for Success Robert Shechter May 2009
  2. 2. <ul><li>Evaporation of $15 trillion in private family assets and wealth </li></ul><ul><li>Many charities will disappear/merge </li></ul><ul><li>Mortgage crisis </li></ul><ul><li>Banking failures </li></ul><ul><li>Madoff scandal </li></ul><ul><li>Failure of the automotive industry </li></ul><ul><li>9.4% unemployment </li></ul>The Bad News
  3. 3. What is the Economic Reality? Wall Street Journal – 3/30/09
  4. 4. What is the Philanthropic Reality? Wall Street Journal – 3/30/09 Source: Giving USA Spotlight, Issue 3 2008 Inflation-adjusted total giving amounts based on Giving USA records for 1967 to 2007. The black bars indicate years with a month or more of recession. Giving does not go down during all recession years. It rose or stayed stable (adjusted for inflation) in 9 of the 15 years on record with at least one month of recession.
  5. 5. What’s the Forecast for Philanthropy? Wall Street Journal – 3/30/09 Source: Giving USA Spotlight - 2008 “ Philanthropy in a Turbulent Economy” Cygnus Research – Jan. 2009
  6. 6. What’s the Forecast for Philanthropy? Wall Street Journal – 3/30/09 Source: Giving USA Spotlight - 2008 “ Philanthropy in a Turbulent Economy” Cygnus Research – Jan. 2009
  7. 7. Some things never change… Wall Street Journal – 3/30/09 Source: Giving USA Spotlight - 2008 Donor ranking of important factors when making a gift… Source: Bank of America High Net Worth Philanthropy Study 2008
  8. 8. And the reasons people contribute don’t change during a recession either… <ul><li>Desire to do something that “matters” and have an impact – desire for “meaning” </li></ul><ul><li>Leave a legacy – make a difference </li></ul><ul><li>Religious beliefs </li></ul><ul><li>Belief in the specific goals and benefits of the cause/initiative/project </li></ul><ul><li>Desire to be part of something greater than oneself </li></ul><ul><li>Desire to emulate others who give </li></ul><ul><li>Pressure from a peer to support a cause that’s important to that person </li></ul><ul><li>Desire to be perceived as having the assets/lifestyle of a prominent person </li></ul><ul><li>Ego </li></ul><ul><li>Income/estate/gift/capital gains tax benefits </li></ul>
  9. 9. Critical next steps… Wall Street Journal – 3/30/09 Source: Giving USA Spotlight - 2008 <ul><li>Steward gifts properly </li></ul><ul><ul><li>During a recession, it is more important than ever to thank donors </li></ul></ul><ul><ul><li>Recruiting a new donor is much more expensive than retaining existing donors </li></ul></ul><ul><ul><li>When the economy improves, donors are more likely to resume giving to orgs that have stewarded their gifts well </li></ul></ul><ul><li>Keep communicating with your best prospects even if they stop or reduce giving </li></ul><ul><li>Stay focused on your mission </li></ul><ul><li>Don’t stop asking </li></ul><ul><li>People who really care about your work and mission will try to find a way to give </li></ul>
  10. 10. What you should try to avoid … Wall Street Journal – 3/30/09 Source: Giving USA Spotlight - 2008 <ul><li>Special events </li></ul><ul><ul><li>In tough economic times, donors can become downright angry if their money goes toward some fancy event rather than directly to the organization/program </li></ul></ul><ul><ul><li>For necessary events, look for low cost options that focus on substance and mission </li></ul></ul><ul><li>Major donor acquisition initiatives </li></ul><ul><ul><li>People will be less likely to support unfamiliar organizations </li></ul></ul><ul><ul><li>Work on re-engaging lapsed donors and energizing top performing segments </li></ul></ul><ul><li>Across the board staff cuts </li></ul><ul><ul><li>The economy will eventually improve </li></ul></ul><ul><ul><li>Re-staffing and training could take six months to a year </li></ul></ul><ul><li>Cutting back on donor relations activities </li></ul>
  11. 11. Strategy #1… Wall Street Journal – 3/30/09 Source: Giving USA Spotlight - 2008 <ul><li>Prospect amongst executives and owners in recession-proof businesses… </li></ul><ul><ul><li>Bankruptcy attorneys </li></ul></ul><ul><ul><li>Corporate restructuring attorneys </li></ul></ul><ul><ul><li>Luxury retail </li></ul></ul><ul><ul><li>Discount retail </li></ul></ul><ul><ul><li>Healthcare </li></ul></ul><ul><ul><li>Beauty and cosmetics </li></ul></ul><ul><ul><li>Repair services </li></ul></ul><ul><ul><li>Tax accountants </li></ul></ul><ul><ul><li>Waste collection </li></ul></ul><ul><ul><li>Rental property owners </li></ul></ul><ul><ul><li>Debt collection </li></ul></ul><ul><ul><li>Healthcare </li></ul></ul><ul><ul><li>Alternative energy </li></ul></ul><ul><ul><li>Rental property owners </li></ul></ul><ul><ul><li>Food and Grocery </li></ul></ul><ul><ul><li>Education </li></ul></ul><ul><ul><li>Funeral homes </li></ul></ul><ul><ul><li>Government </li></ul></ul>
  12. 12. Strategy #2… Wall Street Journal – 3/30/09 <ul><li>Get networked… </li></ul><ul><ul><li>Firstgiving.com </li></ul></ul><ul><ul><li>Bringlight.com </li></ul></ul><ul><ul><li>Sixdegrees.org </li></ul></ul><ul><ul><li>Yourcause.com </li></ul></ul><ul><ul><li>Yahoo for Good </li></ul></ul><ul><ul><li>Zazengo.com </li></ul></ul><ul><ul><li>Razoo.com </li></ul></ul><ul><ul><li>Socialvibe.com </li></ul></ul>
  13. 13. Strategy #3… Wall Street Journal – 3/30/09 Source: Giving USA Spotlight - 2008 <ul><li>Make a commitment to world-class donor service… </li></ul><ul><ul><li>Be accessible and respond quickly </li></ul></ul><ul><ul><li>When a donor complains, focus on saving the donor, not the gift </li></ul></ul><ul><ul><li>Don’t put any prospect/donor on hold – ever </li></ul></ul><ul><ul><li>Don’t ever allow a meeting with a prospect/donor to be interrupted </li></ul></ul><ul><ul><li>Don’t ever allow a prospect/donor’s phone call to sit overnight unreturned </li></ul></ul><ul><ul><li>Don’t make a prospect/donor wait in the reception area for more than 3 minutes </li></ul></ul><ul><ul><li>Be honest – if we mess up, just explain and apologize. Donors will appreciate this. </li></ul></ul><ul><ul><li>Be cheerful and helpful </li></ul></ul><ul><ul><li>Be personal and personable </li></ul></ul><ul><ul><li>When donors call, they should get a real human voice </li></ul></ul>
  14. 14. Strategy #4… Wall Street Journal – 3/30/09 Source: Giving USA Spotlight - 2008 <ul><li>Stay the course in cultivating prospects </li></ul><ul><li>Continue to utilize all the traditional cultivation methods… </li></ul><ul><ul><li>Introduce them to your leadership, board members, and existing donors </li></ul></ul><ul><ul><li>Send holiday, sympathy, and anniversary cards </li></ul></ul><ul><ul><li>Send personal notes of congratulations for accomplishments </li></ul></ul><ul><ul><li>Send thank-you notes for referrals </li></ul></ul><ul><ul><li>Ask for their advice in their area of expertise </li></ul></ul><ul><ul><li>Arrange for your existing donors to call, write, or visit prospects regularly </li></ul></ul><ul><ul><li>Inform them of new initiatives and opportunities to give </li></ul></ul><ul><ul><li>Send them clippings regarding their own interests, along with a personal note (sports, theater, music, literature), and certainly if/when they or their company is mentioned in the news </li></ul></ul><ul><ul><li>Take them out to events they will enjoy </li></ul></ul><ul><ul><li>Feature them in your internal publications </li></ul></ul>
  15. 15. Strategy #4…continued… Wall Street Journal – 3/30/09 Source: Giving USA Spotlight - 2008 <ul><ul><li>Invite them to speak or give a seminar in their area of expertise to your other prospects, donors, administration </li></ul></ul><ul><ul><li>Ensure that ORGANIZATION leadership makes regular periodic contact after they meet with the prospect </li></ul></ul><ul><ul><li>See things through the prospects eyes: </li></ul></ul><ul><ul><ul><li>Determine his needs and desires </li></ul></ul></ul><ul><ul><ul><li>Figure out his concerns </li></ul></ul></ul><ul><ul><ul><li>Probe for giving clues </li></ul></ul></ul><ul><ul><ul><li>Understand what he’s willing to invest in </li></ul></ul></ul><ul><ul><li>Place prospect on board or committee </li></ul></ul><ul><ul><li>Introduce prospect to people who have benefited from your programs </li></ul></ul><ul><ul><li>Ask prospect to host a high-end reception </li></ul></ul><ul><ul><li>Visit with prospect at home, office, restaurant Note: this is a VISIT, not a meeting or an appointment. A meeting is for negotiating contracts and an appointment is for the dentist. A visit is pleasant, positive, happy, and an opportunity for the donor to invest in changing lives. </li></ul></ul>
  16. 16. Strategy #5 Wall Street Journal – 3/30/09 Source: Giving USA Spotlight - 2008 <ul><li>Be rigorous about prospect research </li></ul><ul><ul><li>You don’t have the time or resources to chase ghosts </li></ul></ul><ul><ul><li>You must determine the prospect’s </li></ul></ul><ul><ul><ul><li>Giving capacity </li></ul></ul></ul><ul><ul><ul><li>Inclination to give (in general and your org in particular) </li></ul></ul></ul><ul><ul><ul><li>Links/connections/relationships </li></ul></ul></ul><ul><ul><ul><li>(WealthEngine is the best tool for this–subscription-based) </li></ul></ul></ul><ul><ul><li>Your best donors are already in your database </li></ul></ul><ul><ul><li>Time spent researching and qualifying a prospect is time saved in pursuing the unqualified </li></ul></ul><ul><ul><li>Just because someone is wealthy doesn’t mean they will give you anything </li></ul></ul><ul><ul><li>90% of the money comes from 10% of the people </li></ul></ul>
  17. 17. Strategy #5…continued Wall Street Journal – 3/30/09 Source: Giving USA Spotlight - 2008 <ul><li>Be rigorous about prospect research </li></ul><ul><ul><li>Researching Individuals </li></ul></ul><ul><ul><ul><li>Ziggs.com </li></ul></ul></ul><ul><ul><ul><li>Zoominfo.com </li></ul></ul></ul><ul><ul><ul><li>Zabasearch.com </li></ul></ul></ul><ul><ul><ul><li>AMA Physician Select </li></ul></ul></ul><ul><ul><ul><li>AIM Docfinder </li></ul></ul></ul><ul><ul><ul><li>Martindale & Hubbell (Lawyers) </li></ul></ul></ul><ul><ul><ul><li>FindLaw (Lawyers) </li></ul></ul></ul><ul><ul><ul><li>Hoovers </li></ul></ul></ul><ul><ul><ul><li>Federal Election Commission </li></ul></ul></ul>
  18. 18. Strategy #5…continued Wall Street Journal – 3/30/09 Source: Giving USA Spotlight - 2008 <ul><li>Be rigorous about prospect research </li></ul><ul><ul><li>Real Estate valuations… </li></ul></ul><ul><ul><ul><li>NETRonline.com </li></ul></ul></ul><ul><ul><ul><li>Zillow.com </li></ul></ul></ul><ul><ul><ul><li>Yahoo Real Estate Home Values </li></ul></ul></ul>
  19. 19. Strategy #5…continued Wall Street Journal – 3/30/09 Source: Giving USA Spotlight - 2008 <ul><li>Be rigorous about prospect research </li></ul><ul><ul><li>DonorSearch.net – records of previous gifts </li></ul></ul><ul><ul><li>Biography.com </li></ul></ul><ul><ul><li>Salary.com </li></ul></ul><ul><ul><li>Guidestar </li></ul></ul><ul><ul><li>NOZASearch.com </li></ul></ul><ul><ul><li>Foundationcenter.org </li></ul></ul><ul><ul><li>Publicrecordcenter.com </li></ul></ul>
  20. 20. Fundraising 101…Remember? Wall Street Journal – 3/30/09 Source: Giving USA Spotlight - 2008 <ul><li>Salary represents 10 percent of net worth </li></ul><ul><li>Stock holdings represent 30-35 percent of net worth </li></ul><ul><li>Real estate holdings represent 20-25 percent of net worth </li></ul><ul><li>Prospects have the capacity to give about 5 percent of net worth (or known assets) to charity (in a single gift or over five years) </li></ul><ul><li>An annual fund gift represents about 10-20 percent of a prospect’s major gift capacity </li></ul><ul><li>Prospects have the capacity to give 10 percent of the value of stock options of $1 million or more to charity </li></ul>
  21. 21. Conclusion Wall Street Journal – 3/30/09 Source: Giving USA Spotlight - 2008 <ul><li>The best time to raise money is when you need it </li></ul><ul><li>The reasons people give, do not change during a recession </li></ul><ul><li>Philanthropy will decline, but not dramatically </li></ul><ul><li>We need to work much smarter than before </li></ul><ul><li>We’re here to help: </li></ul><ul><li>Rob Shechter – 917-226-3997 [email_address] </li></ul>

×