In the past, I have written about basic principles that are critical prerequisites for nonprofits in need of financial support. In this article, I’ll delve into the mechanics of running a fundraising effort by looking at four categories of fundraising: direct appeal / pledging, professional programs, self-directed programs, and grants.
Direct appeal / commitment. With this type of fundraiser, you are literally asking people to give money to your organization, either through an individual donation or a pledge. This is the simplest and most direct method of financing your nonprofit and should be a component of most financing plans. However, to be effective, you need to be able to clearly articulate the purpose of your program and why someone should support it. This requires your program to be a more attractive target for someone’s giving than any other cause. After convincing someone to donate, you need to maintain a constant flow of communication with your donors, keeping your program in front of them on a regular basis if you want them to continue to support you. That can be done through a variety of creative methods, one of the best being monthly newsletters. Technology has made it much easier and cheaper than it used to be. Instead of the hassle of dealing with printed material and shipping costs, you may want to consider a number of online bulk email tools that allow you to send out newsletters, promotions, and more. via email. They all come with pre-designed templates that make it easy to create engaging communications. Another often overlooked tactic is sending a receipt / thank you letter for every donation, not just at the end of the year. Just remember that donor cultivation is a never-ending process. As soon as you start letting that slide you will see your bracket slide with it.
Professional programs. This is an event- or program-based fundraiser that includes hiring a fundraising professional. These types of programs can be very effective in raising large sums of money in a relatively short period of time. They can also be very good at exposing your organization to a much wider audience fairly quickly. Examples can include golf tournaments, candy sales, carnivals, etc. Another positive aspect of this approach is that the fundraising company you hire brings most of the creativity to the table. There are great prepackaged campaigns that are completely turnkey. You provide volunteers and the fundraising company provides the expertise. Recently, my daughter’s school held a “fun run” event in which children ran around a 1/16 mile track. They worked for several weeks getting sponsorships back from parents, grandparents, and anyone else they could corner long enough. The event was totally turnkey. I was very impressed with what this company was able to do. The kids even received daily prizes for signing up sponsors. It was a very fun and high energy event for the kids. My daughter had a great time! But better yet, the school raised a good sum of money. Most fundraising companies are paid by charging a reasonable percentage of the loot, although some do charge a flat fee. However, hiring a professional requires homework on your part. Fundraising companies are not all the same. Many are just above being considered a scam, and some charge extortion rates. Always, always consult a company you are considering. Talk to nonprofits that have used them. Make a Better Business Bureau inquiry. All it takes is hooking up with a bad fundraising company to really damage your organization’s reputation. Also look for hidden overhead costs above the company fee. It’s not impossible for a fundraiser to cost more than it earns. Just know what you’re getting into.
Self-directed programs. These are similar to professional programs, except that your organization takes care of everything. This has its pros and cons. On the positive side, it can be less expensive than hiring a professional and can allow for more flexibility than a prepackaged program. On the downside, it generally requires a lot more effort on the part of the organization and its volunteers. Additionally, the administrative cost of creating the necessary materials from scratch can sometimes be more expensive than the economies of scale associated with a prepackaged arrangement. However, some fundraising programs lend themselves better to doing it yourself. Another example from my daughter’s school is the semester children’s consignment sale. It is a huge success in the community and generates net income of around $ 100,000 a year. The PTO does all the work … and trust me, it’s a lot of work. Dozens of volunteers are needed and planning for the next one begins immediately after the last one is finished. But it is extremely successful and profitable. The key to any self-directed program is to make the effort to get it right. Without half efforts. One of the reasons Girl Scouts are so successful is because their cookie sale is legendary for its efficiency and, well, great product. You can do it too. Shows like this, well done, don’t even feel like a fundraiser for their fans. They will be waiting for the next one. Just prepare to work hard. It can really be worth it.
Financing grant. This is such a misunderstood topic that it hardly belongs in this article. In fact, here we are only going to scratch the surface. Grant financing is unlike any of the above. It typically involves applying for funding from a foundation or government agency, often with no personal relationships involved. Contrary to what some unscrupulous freelance “grant writers” may tell you, it is very difficult to get and maintain. You should have established a successful program that a donor will want to help you improve. Initial financing is almost non-existent. Also, grants should never replace previous efforts. We have seen organizations fortunate enough to raise large funds and then completely neglect the grassroots. There is no faster way to self-destruct. When the organization loses its funding, as often happens, there is no community support to keep it running. We are not against grant funding. It can be a great resource for you. Be realistic about it. Thoroughly research agencies and foundations that support causes like yours. Hire an experienced grant writer or learn how to do it yourself. Be careful … good grant writers are expensive. If you get a quote that sounds too cheap to believe, it probably is. Also, prepare for rejection … a lot. It can be one of 100 or more organizations competing for the same funding. It could take years of trying or you may never succeed. One of the best tips we can give is never to rely on grants as the primary source of support for your organization. Eventually you will be disappointed.
There is much more that could be said. Many books have been written on each of these topics. The goal is for you to think about the ways your nonprofit can successfully tackle the monster you are funding.