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Overview Of Fundrasing Methods


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Hong Kong University MSc degree course material on fundraising delivered on Feb 26, 09

Overview Of Fundrasing Methods

  1. 1. Overview on Fundraising Methods HKU Dept of Social Work and Social Administration   SW6218 Fund Raising and Proposal Development Feb 26, 2009
  2. 2. Vincent Law CFRE MInstF(Cert) <ul><li>Vice President, Association of Fundraising Professionals (Hong Kong Chapter) </li></ul><ul><li>Former Development Director of World Society for the Protection of Animals, Asia </li></ul><ul><li>Certified Fund Raising Executive, USA </li></ul><ul><li>Certificate in Fundraising Management, UK </li></ul><ul><li>Master Teacher, AFP Faculty Training Academy </li></ul><ul><li>Professional membership with AFP, CASE and Institute of Fundraising </li></ul><ul><li>BEng (Electrical) Imperial College, London, UK </li></ul><ul><li>MSSc (Psychology of Education), HK </li></ul><ul><li>EdD candidate in (Lifelong Education), Nottingham, UK </li></ul>
  3. 3. By end of lesson, you should be able : <ul><li>To describe the three components of institutional plans </li></ul><ul><li>To compare the three kinds of giving in the integrated development plan </li></ul><ul><li>To describe the three categories of solicitation methods in fundraising </li></ul><ul><li>To identify factors for philanthropic fundraising environment </li></ul><ul><li>To identify factors for successful fundraising events </li></ul>
  4. 4. Agenda <ul><li>Institutional Plans </li></ul><ul><li>Donor’s relations </li></ul><ul><li>Integrated Development Program </li></ul><ul><li>The Pyramid of Giving </li></ul><ul><li>Fundraising Methods </li></ul><ul><li>Successful fundraising elements </li></ul>
  5. 5. What is Fundraising? <ul><li>not just about $ $ $ !!! </li></ul><ul><li>About : </li></ul><ul><ul><li>Planning ( before campaign) </li></ul></ul><ul><ul><li>Marketing & Management </li></ul></ul><ul><ul><li>( during campaign) </li></ul></ul><ul><ul><li>Governance & Stewardship </li></ul></ul><ul><ul><li>( after campaign) </li></ul></ul><ul><ul><li>Ethics and Professionalism </li></ul></ul>
  6. 6. Why Plan? ” Those who fail to plan , plan to fail ” Benjamin Franklin 富蘭克林 (1706-1790)
  7. 7. Institutional Plans <ul><li>Strategic Plan </li></ul><ul><li>Development Plan </li></ul><ul><li>Marketing Plan </li></ul>
  8. 8. 1. Strategic Plan <ul><li>Values </li></ul><ul><li>Mission </li></ul><ul><li>Goals </li></ul><ul><li>Objectives </li></ul><ul><li>Market Research </li></ul><ul><li>Market Niche </li></ul><ul><li>Budget </li></ul><ul><li>=> Write Strategic Plan </li></ul>Roadmap to Attain its Vision
  9. 9. 2. Development Plan <ul><li>Case for support </li></ul><ul><li>Identify Donors </li></ul><ul><li>Conduct Research </li></ul><ul><li>Cultivate </li></ul><ul><li>Solicitate </li></ul><ul><li>Market Niche </li></ul><ul><li>Budget </li></ul><ul><li>=> Write Development Plan </li></ul>Relationship Building & Fundraising Programs
  10. 10. 3. Marketing Plan <ul><li>Market Research </li></ul><ul><li>Segmented Markets </li></ul><ul><li>Exchanges </li></ul><ul><li>Communication </li></ul><ul><li>Budget </li></ul><ul><li>=> Write Marketing Plan </li></ul>Understanding needs & Conveying Messages
  11. 11. Rosso’s Concentric Circles Henry Rosso and Associates, Achieving Excellence in Fund Raising: A Comprehensive Guide to Principles, Strategies, and Methods, San Francisco: Jossey-Bass Publishers, 1991, pg. 31. Donor’s Relations Clients Members Employees Volunteers General donors Former participants People with similar interests Manage-ment Staff Major Donors Board
  12. 12. Institutional Plans <ul><li>Strategic Plan </li></ul><ul><li>Development Plan </li></ul><ul><li>Marketing Plan </li></ul>
  13. 13. Integrated Development Program <ul><li>Annual Giving </li></ul><ul><ul><li>- annual operating costs </li></ul></ul><ul><li>Capital Giving </li></ul><ul><ul><li>- special projects </li></ul></ul><ul><li>Planned Giving </li></ul><ul><ul><ul><li>- financial buffer </li></ul></ul></ul>
  14. 14. The Pyramid of Giving
  15. 15. 1. Annual Giving <ul><li>“ Annual Giving is the primary fundraising method used to broaden support, upgrade levels, and provide operating support for ongoing programs” </li></ul><ul><li>can be Unrestricted (up to the board) or Restricted (for special projects) </li></ul>a) Definition
  16. 16. 1. Annual Giving <ul><li>Provide Income </li></ul><ul><li>Acquire Donors </li></ul><ul><li>Renew Donors </li></ul><ul><li>Cultivate Donors </li></ul><ul><li>Build Donor Loyalty </li></ul><ul><li>Identify and Involve Leaders </li></ul><ul><li>Identify Major Gift Prospects </li></ul>b) Purposes
  17. 17. c) Examples <ul><li>Flag Day </li></ul><ul><li>Credit Card </li></ul><ul><li>Monthly Donation </li></ul><ul><li>Raffle Tickets </li></ul><ul><li>Donation Box </li></ul><ul><li>Direct Mail </li></ul><ul><li>Sporting Events (e.g. marathon, tennis, bowling, golf Tournament ) </li></ul><ul><li>Online donation (e.g. facebook, second Life, twitter) </li></ul>1. Annual Giving
  18. 18. Red Cross – Flag Day
  19. 19. Po Leung Kuk – Credit card
  20. 20. WWF – Monthly Donation
  21. 21. World Vision – Gift catalog
  22. 22. SPCA - Petwalk
  23. 23. Oxfam – Musical Marathon
  24. 24. Senior Citizen Home Safety Association – Secret Angel Plan
  25. 25. 2. Capital Giving <ul><li>“ A capital campaign is an intensive, organized fundraising effort to secure philanthropic gifts for specific capital needed or projects within a specific time period.” </li></ul><ul><li>Requires careful study, planning and identification of potential donors </li></ul><ul><li>Lays groundwork for involving new volunteers and donors and sets stage for high annual giving levels </li></ul>a) Definition
  26. 26. 2. Capital Giving <ul><li>Obtain support for special needs of organization </li></ul><ul><li>Building Construction </li></ul><ul><li>Renovation </li></ul><ul><li>Equipment </li></ul><ul><li>Endowment Fund </li></ul>b) Purposes
  27. 27. 2. Capital Giving <ul><li>Major/ Leadership Gifts </li></ul><ul><li>Naming Rights </li></ul><ul><li>Grant </li></ul>c) Examples
  28. 28. HKU Foundation
  29. 29. HKU - Stanley Ho Alumni Challenge
  30. 30. HKU - Brick Campaign
  31. 31. 2. Capital Giving e.g. HK$10M Endowment Fund Gift Type Gift Amount # Gifts # Prospects Equaling Sub-Total Leadership HK$2,000,000 1 3 HK$2,000,000 HK$2,000,000   HK$1,000,000 2 6 HK$2,000,000 HK$4,000,000 Major HK$500,000 4 12 HK$2,000,000 HK$6,000,000   HK$250,000 6 18 HK$1,500,000 HK$7,500,000   HK$100,000 8 24 HK$800,000 HK$8,300,000 Special HK$50,000 12 36 HK$600,000 HK$8,900,000   HK$25,000 20 60 HK$500,000 HK$9,400,000   HK$10,000 35 105 HK$350,000 HK$9,750,000 General <HK$10,000 Many Many HK$250,000 HK$10,000,000
  32. 32. 3. Planned Giving <ul><li>“ Planned giving is a process whereby the donor and charity work together to achieve max. benefit for each party from a current or deferred charitable gift” </li></ul><ul><li>Integrated fundraising concept on </li></ul><ul><ul><li>Sound Personal and Financial planning </li></ul></ul><ul><ul><li>Estate planning </li></ul></ul>a) What is?
  33. 33. 3. Planned Giving <ul><li>Secure gifts at a higher level </li></ul><ul><li>Provide financial cushion </li></ul><ul><li>Provide donor additional vehicles for giving from current assets </li></ul>b) Purposes
  34. 34. 3. Planned Giving <ul><li>Legacy / Bequest / Wills / Estate </li></ul><ul><li>Type of Bequests </li></ul><ul><ul><li>Specific </li></ul></ul><ul><ul><li>Residual </li></ul></ul><ul><ul><li>Contingency </li></ul></ul><ul><li>Types of planned gifts </li></ul><ul><ul><li>Cash </li></ul></ul><ul><ul><li>Real Estate </li></ul></ul><ul><ul><li>Stock, Bonds </li></ul></ul><ul><ul><li>Art </li></ul></ul><ul><ul><li>Rare Books </li></ul></ul><ul><ul><li>Life Insurance </li></ul></ul>c) Examples
  35. 35. Tung Wah Group Hospitals – Property Donation
  36. 36. WSPA – Legacy
  37. 37. Adventist Hospital - ways of giving
  38. 38. Fundraising Methods <ul><li>Individual (Personal) solicitation </li></ul><ul><ul><li>Face to Face </li></ul></ul><ul><ul><li>Telephone </li></ul></ul><ul><ul><li>Direct Mail </li></ul></ul><ul><li>Group solicitation </li></ul><ul><ul><li>Special Events </li></ul></ul><ul><ul><li>e-Philanthropy </li></ul></ul><ul><li>Organization solicitation </li></ul><ul><ul><li>Clubs and Associations </li></ul></ul><ul><ul><li>Business and Corporations </li></ul></ul><ul><ul><li>Foundations </li></ul></ul>
  39. 39. 1a) Individual - Face to Face <ul><li>Most effective form of fundraising </li></ul><ul><li>Asking for major gifts is difficult but practice makes perfect </li></ul><ul><li>Select the right person to ask </li></ul><ul><ul><li>an influential person who knows the prospect </li></ul></ul><ul><ul><li>a volunteer peer of the prospect. </li></ul></ul><ul><ul><li>a board member who knows the prospect. </li></ul></ul><ul><ul><li>CEO of the organization. </li></ul></ul><ul><ul><li>anyone who has a connection </li></ul></ul><ul><li>Must not be afraid to ask ! </li></ul>
  40. 40. 1b) Individual - Telephone <ul><li>Phonathon : make calls to ask for gifts </li></ul><ul><li>To acquire, renew & upgrade donors </li></ul><ul><li>To gather information </li></ul><ul><li>Often combined w/direct mail campaign </li></ul><ul><li>Popular with educational institutions (use students or alumni callers) </li></ul><ul><li>Paid callers / Volunteer callers </li></ul>
  41. 41. Ways to use Telephone for Annual Giving <ul><ul><li>Calls to acquire 1 st time donor </li></ul></ul><ul><ul><li>Thank and acknowledge </li></ul></ul><ul><ul><li>Lapsed donor calls </li></ul></ul><ul><ul><li>Follow up on invitations to activities and special events; also encourage attendance. </li></ul></ul><ul><ul><li>Membership calls, to invite and renew memberships. </li></ul></ul><ul><ul><li>Club or group calls to retain interest and participation. </li></ul></ul><ul><ul><li>Upgrade calls, to invite a larger gift </li></ul></ul>
  42. 42. 1c) Individual - Direct Mail <ul><li>Most impersonal </li></ul><ul><li>Least efficient type of fundraising methods </li></ul><ul><li>Package </li></ul><ul><ul><li>Outer envelop </li></ul></ul><ul><ul><li>Cover Letter </li></ul></ul><ul><ul><li>Enclosure </li></ul></ul><ul><ul><li>Response form </li></ul></ul><ul><ul><li>Return envelop </li></ul></ul>
  43. 43. 2a) Group - Special Events <ul><li>Raises public awareness of organization </li></ul><ul><li>Good public relation tools </li></ul><ul><li>Gives visibility </li></ul><ul><li>Helps cultivate prospects and donors </li></ul><ul><ul><li>Attracts new, interested people </li></ul></ul><ul><ul><li>Provides socializing function </li></ul></ul><ul><ul><li>Helps raise funds for annual giving programs and special projects </li></ul></ul>
  44. 44. Po Leung Kuk - Annual Dinner
  45. 45. 2b) Group – ePhilanthropy <ul><li>Commonly used term for online donation </li></ul><ul><li>Integration is the key to success </li></ul><ul><ul><li>followed by traditional fundraising methods </li></ul></ul><ul><li>Relationship building is the central theme of e-Philanthropy </li></ul><ul><li>Technical issue </li></ul><ul><ul><li>Make sure good Security (SSL) </li></ul></ul><ul><li>Marketing issue </li></ul><ul><ul><li>drive traffic to your website </li></ul></ul><ul><ul><li>landing page </li></ul></ul>
  46. 46. UNICEF - Online Donation
  47. 47. 3a) Organization – Clubs / Associations <ul><li>Types of clubs and associations </li></ul><ul><ul><li>Service clubs (e.g. Lions Club, Rotary, JC ) </li></ul></ul><ul><ul><li>Professional and trade associations </li></ul></ul><ul><li>Motivation </li></ul><ul><ul><li>Special interests (e.g. Lions and blindness) </li></ul></ul><ul><ul><li>Business or social concerns of members </li></ul></ul><ul><li>Strategies </li></ul><ul><ul><li>Join club </li></ul></ul><ul><ul><li>Introduce through member </li></ul></ul><ul><ul><li>Educate club about your organization </li></ul></ul>
  48. 48. 3b) Organization – Business/ Corporations <ul><li>Types of business/ corporation support </li></ul><ul><ul><ul><li>Big or small </li></ul></ul></ul><ul><ul><ul><li>Banks, department stores or ? </li></ul></ul></ul><ul><li>Motivation of business support </li></ul><ul><ul><ul><li>Corporate Social Responsibility programs </li></ul></ul></ul><ul><ul><ul><li>Good for community or business </li></ul></ul></ul><ul><li>Strategies </li></ul><ul><ul><ul><li>Invite them onto the Board </li></ul></ul></ul><ul><ul><ul><li>Seek in-kind gifts then recognize the business </li></ul></ul></ul>
  49. 49. 3c) Organization – Foundation <ul><li>Types of foundation support </li></ul><ul><ul><ul><li>Company-sponsored or Private (family) </li></ul></ul></ul><ul><li>Motivation of foundation support </li></ul><ul><ul><ul><li>Community Support (e.g. UBS and community service) </li></ul></ul></ul><ul><ul><ul><li>Historical roles (interest of founders) </li></ul></ul></ul><ul><li>Strategies </li></ul><ul><ul><ul><li>Research the foundations </li></ul></ul></ul><ul><ul><ul><li>Approach a foundation through personal contacts </li></ul></ul></ul>
  50. 50. Factors for Philanthropic Fundraising Environment <ul><li>Donor focus </li></ul><ul><li>Target Cases, Constituent/ Methods </li></ul><ul><li>Strategic Communications </li></ul><ul><li>Stewardship </li></ul>
  51. 51. Factors for Successful Fundraising Events <ul><li>Careful Planning </li></ul><ul><li>Realistic Budget / Timetable </li></ul><ul><li>Strong Volunteers </li></ul><ul><li>Identify Target Audience </li></ul><ul><li>Good Publicity </li></ul><ul><li>No Conflict of Date </li></ul><ul><li>Good contract w/Sponsors & Guests </li></ul>
  52. 52. Websites <ul><li>Association of Fundraising Professionals </li></ul><ul><li> </li></ul><ul><li>Institute of Fundraising, UK </li></ul><ul><li> </li></ul><ul><li>Certified Fund Raising Executive </li></ul><ul><li> </li></ul>
  53. 53. Suggested Reading <ul><li>AFP First Course in Fundraising </li></ul><ul><li>AFP CFRE Review Course </li></ul><ul><li>Greenfield, James M. The Nonprofit Handbook. 3 rd ed. John Wiley & Sons 2001 </li></ul><ul><li>Buchanan, Peter McE. Handbook of Institutional Advancement. 3 rd ed. CASE 2000 </li></ul>
  54. 54. <ul><li>Thank you !! </li></ul>