My last post before Christmas raised the issue of adhering to donor wishes, and given most people’s understandably imperfect knowledge of every charity, questioned whether the "donor always does know best". Since this generated some interesting conversations, and ultimately a question of what might be done to address the issues raised, today I’m revisiting this topic.
One conversation was effectively about what is known as the "Charity starvation cycle". This is the process where either due to the Charity’s desire to see every penny raised go to programs, or due to a lack of donor support for infrastructure and capacity (or a combination thereof), charities are "starved" of the basic necessities to effectively and efficiently run their operations. This harms long-term sustainability and even the actual impact of the very programs that are being supported so aggressively. One suggested solution was to aggregate infrastructure and capacity needs to make them more interesting to donors.
The other conversation was about donors, and in particular the expectations of donors of larger gifts as compared to annual campaign or "smaller" donors. We all know that different things motivate different donors to give, but the point was made that larger donations often come with expectations. Special recognition might be part of it (e.g. naming rights within Capital Campaigns, etc.), but it was argued that primarily larger donors primarily expect more "impact" from their gift. The sense was that their goal is to be "transformational", hoping to move the Charity to entirely new heights or in new underserved directions. The suggestion was that unless the annual campaign and "smaller" donors took care of the infrastructure the charity couldn’t expect these larger gifts.
And to a point I agree. By definition annual campaigns are all about funding the day-to-day operations of the charity. Yet if the annual campaign is only enabling the charity to live "hand to mouth" are they forever trapped without access to "big" gifts?
Obviously there are other fundraising streams to consider, and creative tools generate more revenue from existing streams. But I believe even within this big donor / small donor paradigm there is the potential to break out of this box. While I was with Junior Achievement we were successful in receiving a significant multi-year corporate gift that included infrastructure funding elements required to help implement the desired programs. I appreciate this isn’t exactly the same as an individual donor making a transformational gift, but there are applicable insights.
First, fundraising is a relationship game. You need to get to know your prospect long before they become a donor, and that allows for two-way communication, including discussing the existing capacity of your charity. In our case we were able to show we were very lean already, and without support for capacity we wouldn’t be able to act on the gift. Thus, in some rare cases a charity may have to walk away from gifts that don't include the right balance of support, or are simply unexecutable at the time. And I note as a sidebar that this can actually be a big positive in the long run: http://www.dwb.org/news/article.cfm?id=1644&cat=field-news
Second, truly deep donor relationships allow for education. This opens a whole new avenue for skilled fundraisers. I believe there’s an opportunity for good communication to show prospective donors of larger gifts how part of their gift can have even more impact – be even more transformational – if some portion of their gift goes to infrastructure and capacity building. So it need not be about aggregating the infrastructure needs or trying to ‘sexy’ them up in some way: simply being clear on the need can go a long way. Certainly that was my observation of the corporate gift we received.
Deep relationships. Solid communication. Complete transparency. Doing these things takes time, time that may not be cost-effective with every donor. But ultimately it’s the charity’s responsibility to help donors of all sizes to understand the charity's unique needs. And this is a key part of the solution to finding the way out of this particular box.
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