For Nonprofits Change Will Do Them Good

The 2013 State of the Sector Survey, conducted by the Nonprofit Finance Fund, has a wealth of data regarding where nonprofits are today – and more importantly – where they are heading. Today I want to focus on the survey question pertaining, “Finance & Operations Actions in the Last or Next 12 Months," and in particular the 39% which answered yes to “Change the main ways in which you raise & spend money” in the last or next 12 months. While 39% is impressive, what I found even more striking was the year-over-year change – 15%. Clearly nonprofit leaders are getting tired of doing the same things and being disappointed when they don’t get different results. What kinds of changes can we expect? A clue is the number one answer – “Attend conferences or network to build relationships.” People are hungry for answers, but they are also looking for fresh ideas and perspectives (or at least 58% of them are). The 46% planning...
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Unrelated Income and the Unexpected Consequences to Your Mission

The IRS report on unrelated business income at colleges and universities reminded me of the potential perils of creating revenue from activities unrelated to your mission. I am not thinking about the tax consequences; I will leave that to the folks in Washington. I am pondering the consequences to the mission, and by association, fundraising. This issue first came to my attention while I was working with a well-known university. We were discussing the giving patterns of affluent alums when a major gifts officer lamented about people who only made a gift in a year when they went on the alumni trip. These were not ordinary trips. They were 10-14 day adventures combining exotic locations and encounters with famous people. Faculty who were experts in the areas being explored rounded out the experience. Soon after this I was at a museum delivering their screening results and heard the same comment. Edu-cations had become all the rage and it certainly made sense for the...
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Philanthropist Speaks and Fundraisers Would Do Well to Listen

The reaction to the Dan Pallotta TED talk has been cause for hope and frustration: Hope, as people begin to accept philanthropy as we have known it is broken; frustration, with so many defending the past for fear of an unknown future. Reading the back-and-forth about Pallotta’s presentation I’m reminded of the scene in Annie Hall where Woody Allen becomes so fed up with a person in line pontificating about Marshall McLuhan’s work he brings McLuhan out of the shadows to confront the man.   For all the people believing Pallotta is off track (and his rocker) I give you the opinion of a well-known philanthropist: “We need to better comprehend this environment and learn how to participate in it. The arts are slow at developing donors online, where much fundraising now happens. We have been slow to attract the new money—the hedge fund and social-media crowds, the new inheritors of wealth. We need these people in the arts, but we are not getting...
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Free Range Donors

Fundraisers love to fight over who “owns” a donor. In the nonprofit world the battle is between direct response and major gifts with some organizations throwing in membership to liven things up. Behind the castle walls of education there is the eternal struggle pitting friendraising (alumni relations) and fundraising (advancement). I have found in working with people who give of their time and/or treasure they don’t like the term donor (makes them think of missing kidneys and blood loss), so I’m thinking the idea of being “owned” would not go over well either. Sears once thought if you wanted appliances, toys or hardware they owned you. GM and Ford at one time were so thoroughly convinced of their ownership of car buyers they treated Japan more as a novelty than a competitor. Home Depot, Toys R Us, and Toyota are among the many companies born in no small part because of the arrogance of the former leaders of their industries. As fundraising bumps...
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Time for a Mission Underwriters Laboratory

For returning readers you know I'm pushing hard to make the mission the center of the social sector universe and pushing back even harder on the idea of cost-of-fundraising. When you push you get push-back, and some of it has been around the challenges of measuring the mission AKA impact. The difficulty of evaluating impact may well be the reason the watchdog groups like Charity Navigator went for the easy math and created the whole cost-of-fundraising farce. Certainly the IRS 990 doesn't help. It tells as much about what an organization does as the 1040 tells about you and me. What if there was a place that looked only at the mission the way the Underwriters Laboratory only looks at products? The UL doesn't give a wit if the company is profitable. It simply wants to know if the product does what it says it does, and whether it is safe. Here is their mission statement:   Dedicated to promoting safe living and working...
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Cost-of-Fundraising is the Kryptonite of Philanthropy

When the conversation turns to cost-of-fundraising I can almost hear the collective sigh of missions across the globe. It is a knowing sigh, one that understands when the focus is on quantitative measures, the qualitative aspects of missions suffer. The cost-of-fundraising madness is truly the kryptonite of philanthropy. It turns the mission from a bold and daring venture into a meek shadow which only comes to life as a photo in direct mail or a website surrounded by copy extolling the virtue of how little was spent to send the photo or to receive an online donation. If you have been reading this blog lately you know I’m on a bit of a rant about the need to move away from the transaction-based culture of giving to a mission-based culture of philanthropy. Making this move will require that cost-of-fundraising be encased in lead and buried in the cave with other ideas which seemed good at the time, but not so much on...
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Donor Retention – All You Need Is Love

At some point during the 9 WOW Institutes I was a part of my great friend and colleague Jay Goulart would say, “It’s all about the love.” A lot happened during those 4 day-experiences in beautiful Henniker, New Hampshire, but when all was said and done it really did come down to love; loving your donors; loving your mission; loving what you do; and equally important is for you and your team to love being at your organization. If you nailed the love, then you had the opportunity to create a culture of philanthropy that turns donors into lovers of your mission. But how do you measure love? Is it money? Time? Those certainly can be indicators of commitment, but people can, and do, give of their time and treasure without so much as a smile on their faces. Rather than love, fundraisers can use guilt, peer-pressure, or a sense of obligation. Do any of those warm your heart? There are a number...
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The Mission Demands Fundraisers (of All Persuasions) Come Together

When your father is a fundraiser, and that fundraiser is Doug Lawson who wrote Give to Live, you are definitely going to have a bias towards major gifts. I don’t believe it is just pride talking that my father is one of the best face-to-face askers on the planet, and I’m sure as you read this he is either asking or on a plane to an ask. In this environment I grew up thinking if you needed a million dollars for your cause then you found a person with a million dollars to support it. This simple idea led me to create a series of donor profiling and screening companies the last 25 or so years. Early in my career I met Roger Craver who can write direct mail copy which almost puts the money in the envelope all by itself. For Roger if you need a million dollars get 50,000 to give $20 each. Then you have 50,000 supporters who...
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