Michael J. Worth presents to United Way NCA partners on fundraising and understanding donors. Learn more about United Way NCA events for our partners: http://www.unitedwaynca.org/events/members

1. Planning for Successful Fundraising
Michael J. Worth
June 12, 2013

2. Philanthropy overview
Understanding donor motivations
The fundraising process
The fundraising team
Fundraising strategies
The fundraising plan
Today’s Agenda

3. Purposes of Philanthropy, 2011
Total $298.42 billion
(% of total to each purpose)
Religion
32%
Education
13%
Human services
12%
Health
8%
Public-society
benefit
7%
Arts, culture,
humanities
4%
International
affairs
8%
Environment,
animals
3%
Foundations
9%
Other
4%
SOURCE: Giving USA, 2012

4. Sources of Philanthropy, 2011
Individuals
73%
Foundations
14%
Bequests
8%
Corporations
5%
SOURCE: Giving USA, 2012
Total $298.42 billion
(% of total from each source)

5. Flow of Philanthropic Funds
(Based on Frumkin, Strategic Giving, 2006)
Living
individuals
Estates
Corporations
Private
foundations
- Independent
- Family
- Corporate
- Operating
Public
charities
-Federated
funders
-Community
foundations
- Charitable gift
funds
DONORS INTERMEDIARIES
Nonprofit
organizations
and institutions
RECIPIENTS

6. Understanding Donor Motivations
Corporations
Business strategy and goals
Foundations
It’s the business they’re in
(and they have their own priorities)
Individuals
Complex and mixed motives
“The heart leads the mind where reason
points the way.”
Harold J. Seymour
Designs for Fund Raising, 1966

7. Individual Donor Types
(Prince and File, The Seven Faces of Philanthropy, 1994)
Communitarians 26.3%
Devout 20.9%
Investors 15.0%
Socialites 10.8%
Re-payers 10.2%
Altruists 9.0%
Dynasts 8.3%
Interview with philanthropist Conrad Prebys

8. The Fundraising Pyramid
CORPS 7-8% INDIVIDUALS 85%
FOUNDATIONS 7-8 %
Constituency
First-time donors
Regular donors
Major gift donors
Principal gift/ultimate
gift donors
Direct
response:
Mail, phone,
Internet
Cultivation/
personal
solicitation
Cultivation/personal
solicitation/
gift planning

9. The Fund Raising Cycle
Define
the case
Identify
prospects
Cultivate
relationship
Solicit the
gift
Acknowledge
gifts,
recognize
donors
Steward the
gift and
relationship
Step 1 Step 2 Step 3
Step 4Step 5Step 6

10. Fundraising begins with a case for support
Relates to a cause larger than the organization
(It’s not about you!)
Describes achievable goals
Justifies financial needs in terms of impact
Uses stories and examples
Warms the heart and stirs the mind
Creates urgency

11. Fundraising is a team effort
Volunteer Leaders (Board)
owners, blockers, runners
President/Director/CEO
manager, runner
Chief Development Officer
coach, quarterback, runner

12. Worst Case Scenario (All too common)!
Board “gives their time”
Organization has no plan, no goals, no
prospects— “we just need money!”
“Maybe Bill Gates…”
CEO “too busy” to raise money
Trouble on the board
Trouble between CEO and board
“We just need someone energetic
with a nice personality to go out and
raise money.”
Development staff responds
appropriately to this scenario

13. TYPE OF FUNDS SOUGHT LIKELY GIFT SOURCES
CURRENT SUPPORT
Unrestricted/general support Individuals
Local and family foundations
Businesses (usually as sponsors)
Program/project support Foundations
Businesses
Individuals (especially investor/
entrepreneurial donors)
CAPITAL
Physical capital
(buildings, equipment)
Individuals
Foundations (rarely)
Businesses (sponsorships in
certain situations)
Financial capital
(endowment)
Individuals
Foundations (rarely)
Businesses (very rarely)

14. METHOD/CHANNEL ADVANTAGES DISADVANTAGES
DIRECT MAIL Inexpensive
Creates a visual image
Long life
Can communicate complex
message
Easily ignored, lost in clutter
Requires donor initiative
Limited ability to personalize
PHONE Two-way communication
Can negotiate gift
Can tailor message to individual
Immediate gift (credit/debit card)
More expensive than mail
Barriers (caller ID, cell phones)
Intrusive
PERSONAL SOLICITATION Focused attention of prospect
Includes nonverbal cues
Builds relationship
Expensive
Low volume
EVENTS Visibility/involvement
Point of entry for new donors
Not usually cost/beneficial
(hidden costs)
Often no connection to the case
No proportional giving
INTERNET/WEB/SOCIAL MEDIA Inexpensive
Can personalize/segment
message
Interactive/relationship building
Leverage relationships
Email list maintenance
Barriers (e.g., spam filters,
overload)
Website is passive
Possibly intrusive
TEXT Inexpensive
immediate response
Limited content
Intrusive

15. Giving Channels
SOURCE: TargetAnalytics, 2011
Direct mail still largest source of total gifts
Direct mail still largest source of new donors
Online largest source of new donors under age 65
Online giving growing rapidly as percentage of new and regular donors
Significant generational change

16. Donor Strategies
AFFILIATION
(Inclination)
CAPACITY
Upgrade
annual
giving
Top
prospects
for
major
gifts
Annual
giving,
but
manage
costs
Prospects
for
projects
SOURCE: Adapted from Blackbaud

17. Planning With the Gift Chart
What is our current pattern of gifts?
What gifts are needed to reach higher goals?
Are these gifts available ? (Do we have the prospects?)
What are alternative strategies
(larger base, new donors, upgrade current donors, major gifts, etc.)?
What are the most promising sources
(individuals, corporate sponsor, foundations)?
What are the best methods to use?
(mail, phone, Internet, events, etc.?)
Who needs to do what to make this happen?
What will we need to spend?
Gut check: Can this be done or do we need to change our goal?

18. Using
the
Gi+
Range
Chart
Total
raised
now
$1
million,
goal
to
increase
to
$2
million
Range
#
gi)s
now
Total
in
range
now
($1
million)
#
gi)s
needed
($2
M
goal)
Total
In
range
needed
($2M
goal)
200,000
0
0
1
200,000
150,000
0
0
1
150,000
100,000
1
100,000
2
200,000
75,000
2
150,000
3
225,000
50,000
3
150,000
5
250,000
25,000
5
125,000
8
200,000
10,000
10
100,000
20
200,000
5,000
20
100,000
40
200,000
1,000
50
50,000
75
75,000
<1,000
1,125
(Avg.
$200)
225,000
1,500
(Avg.
$200)
300,000
TOTAL
1,216
$1,000,000
1,655
$2,000,000

19. ELEMENTS OF A FUNDRAISING PLAN
Background
Analysis of past/current support
By market
Individuals (by affiliation: board, member, former client, etc.)
Businesses/corporations
Foundations
Other (sponsoring church, intermediary, etc.)
By purpose (operating, capital, endowment)
By program (annual fund, campaign, planned giving, etc.)
By channel/method
Direct mail
Phone
Internet
Events
Personal solicitations
Proposals

20. ELEMENTS OF A FUNDRAISING PLAN
Background
Current expenditures
By category
Personnel
Materials and supplies
Travel and entertainment
Etc.
By program
By method/channel
Current return on investment (by program, method)
Benchmarking data (if available)
How and from whom do other organizations like us raise money?
What resources do they expend (staff, budget, etc.)?
Trends in giving (in relevant marketplace)

21.
ELEMENTS
OF
A
FUNDRAISING
PLAN
ObjecHves,
Strategies,
Goals
ObjecHves,
for
example:
Acquire
new
donors,
broaden
base
Upgrade
current
donors
Increase
corporate
support
Increase
foundaHon
support
Strategies,
for
example:
Increase
mailings
Increase
number
of
personal
solicitaHons
Engage
more
board
members
Write
more
proposals
More
(or
fewer)
events
Goals
(dollars
and
donors):
By
market
(consHtuency)
By
program
By
channel/method
(direct
mail,
Internet,
phone,
events,
etc.)
By
gi)
level

22.
ELEMENTS
OF
A
FUNDRAISING
PLAN
ImplementaHon
Specific
acHviHes
(mailings,
events,
etc.)
Timetable/calendar
Budgets
ResponsibiliHes
(CEO,
staff,
board,
etc.)
Performance
metrics

23. Resources
Association of Fundraising Professionals
http://www.afpnet.org
Board Source
http://www.boardsource.org
Partnership for Philanthropic Planning
http://www.pppnet.org
Michael J. Worth & Associates, LLC
http://michaeljworth.com