This article is republished with permission from Blue Avocado, the practical and readable online magazine of Nonprofits Insurance Alliance, for nonprofits. Subscribe free by visiting www.blueavocado.org.
Time is the most precious commodity in fundraising, especially when you are leading or part of a small but mighty development team. Knowing where to best invest your fundraising time is critical to success, yet it can be one of the hardest aspects of strategic fundraising because there are so many worthy ways to spend your energy.
Many smaller groups believe that focusing on major donors who can give bigger gifts, instead of communicating with a larger number of lower-capacity donors makes great sense, especially if they have a strong network of prospects to try and tap. But how do you go after these "big fish" when you have a tiny team?
I currently serve as the Major Gifts Officer for the Colburn School, a world-class music and performing arts institution based in Los Angeles. Our fundraising team of 10+ is much larger than the three people that comprised my team at artworxLA, where I served as the Development and Communications Director for four years. Even though my staff there consisted of only two part-time people in addition to me, we succeeded in cultivating about 100 "major" donors.
Fundraising in both environments has been surprisingly different, and both present their own challenges, advantages, and disadvantages. For this article, I wanted to share perspectives that would be most relevant to a small team of fundraisers and that also draw upon the best practices I have utilized in my current work. I also drew upon resources that have been written by fundraisers across the field of philanthropy and fundraising.
No matter the size of your fundraising team, it is vital to understand your donor base, spend quality time with major donor prospects daily, and steward major donors long after first gifts are made to achieve fundraising success.
Let's break it down. Here are six strategies that can help you when embarking on major donor cultivation, even if your development department is tiny.
Every nonprofit defines what constitutes a major donor differently, and that definition should come from understanding the existing donor base you have and the places where a gift can make the biggest impact.
As a starting point, you can draw a line easily: Calculate what level of contribution puts a donor in the top 10 percent, and then classify that as a major donor. Perhaps more importantly, ask yourself where a major gift could best be leveraged. Why should or would a major donor support your nonprofit?
Spend time analyzing the behavior of current donors over time by looking at the data you have on them. This can be challenging and may require significant time to do well, especially for small nonprofits. Data on donors might be inconsistent or missing altogether; reporting might not be easy to generate; or your database software might not be easy to use. If it is possible to run accurate reports, the time invested can yield valuable long-term strategic results.
Here are the questions that you will want to address through whatever data you do have on donors:
Darian Heyman's recent Blue Avocado article on data elaborates nicely on how to use data to gain more insight on your donor base.
Cultivating big donors requires investing time to build deeply authentic relationships. Set realistic expectations and plan to spend a lot more time one-on-one with prospects. Take the long view by strategically inviting donors and prospects to events or behind-the-scenes experiences that bring them into deeper contact with the impact of your nonprofit and those you serve. Plan for the time it will take to send prospects materials and reports after you meet them to deepen the conversation, and don't assume that even when properly stewarded, big bucks will flow right away. Even when engaged effectively, donors can take months if not years to make a major gift, so set realistic expectations.
Another great long-term strategy for building strong relationships — although admittedly one that requires an investment on your end — is to ask your donors how they'd like to interact with you, and then build the partnership on their terms. Many are more likely to keep donating and even increase their contributions if they're asked how frequently and via what mode (email, direct mail, phone, meetings) you should keep them abreast of your work, and in particular of the impact their support makes possible.
Start by building a highly customized three-year plan for your top donors. This will serve as the basis of your major donor strategy. Here are some questions to consider in building this plan:
Involve your board members in these key touchpoints, as outlined by Holly Hall in a great article entitled Special Treatment: A Veteran Fundraiser's Advice on How to Raise the Largest Gifts. Stewardship after major gifts is one of the easiest, most effective ways to get your board involved with fundraising. Research (PDF) points to a 200 percent increase in lifetime donor value if they receive a thank-you call from a board member within 48 hours of their gift!
Practice key conversations by role playing with your staff and refining your collective ability to pivot a conversation toward asking for a major gift. The key skill your team needs to refine is how to frame an ask around impact versus need, and how to clearly articulate how that gift might be used. A good resource for developing this skill set is The Generosity Network: New Transformational Tools for Successful Fund-Raising by Jennifer McCrea. The Stanford Social Innovation Review website also offers a wide range of resources on best practices when fundraising.
Develop simple but well-designed digital and physical communication pieces that clearly express the areas of need for major funding and the impact it will unlock, as well as pointing to the impact of current giving and recognizing the major donors already making that possible. These materials should be prepared and accompanied by well-composed, personalized letters for specific donors. Take the time to deliver these communication pieces strategically to prospects in a one-on-one setting and be sure to patiently answer questions and follow up in a timely manner.
Just as big fish start as small ones, major donors first come to most nonprofits as small, grassroots supporters with capacity. As such, while your focus may be on advancing key prospects using the tips shared above, hopefully this does not occur at the expense of alienating smaller contributors.
Pay close attention to first-time donors who start by making small gifts. Be intuitive about when best to ask them to upgrade their annual giving. Identify simple template communications that you can use to efficiently keep them posted on your progress and the impact they make possible and develop a long-term strategy for their involvement.
Create events and opportunities where current major donors can meet smaller, newer ones. Find ways to engage smaller donors in more than just giving. Identify volunteer opportunities, committees, or events where they can be involved more deeply, as volunteers are four times as likely to donate, and when they do, they give ten times as much!
For more on grassroots fundraising, check out anything written by the guru of the field, Kim Klein, or check out the Grassroots Fundraising Journal, which she started.
Cultivating big donors is a process and journey and can be extremely rewarding when done patiently and strategically. Building long-term, authentic relationships based on trust and care is one of the most fulfilling ways to fundraise. Donors become dear friends and can even grow to be like family members when they are cultivated in this way. The impact can be tremendous and transformational for both the donor and your organization!