1

Raising Money in Tough Times

2

INTRODUCTION

3

BIG GIFTS 2008• $1.0 million to Rhode Island Foundation from

Henry SharpeHenry Sharpe.• $6.0 million to Alvin Ailey American Dance

Theatre from Glorya KaufmanGlorya Kaufman• $10.0 million to Boys Scouts of America from

Edward H. Arnold, retired chairman of Edward H. Arnold, retired chairman of Arnold LogisticsArnold Logistics

• $25.0 million to Princeton HealthCare System Foundation from David AtkinsonDavid Atkinson

• $5.0 million to PlaNYC from David RockefellerDavid Rockefeller

4

BIG GIFTS 2008• $5.2 million to University of Michigan from

Mildred Dorothy Summer, former university Dorothy Summer, former university librarianlibrarian

• $3.5 million to Jacksonville Humane Society from the Boyd FamilyBoyd Family

• $5.0 million to Suffolk County Community College Foundation from AnonymousAnonymous

• $10.0 million to Nature Conservancy and African Wildlife Foundation from Dennis J. Dennis J. Keller, CEO and Chairman of the Board of Keller, CEO and Chairman of the Board of DeVry University, IncDeVry University, Inc..

• $25.0 million to Children’s HealthCare of Atlanta from Joseph H. Moss, retired pilotJoseph H. Moss, retired pilot

5

We are just…

A small Club we can’t raise money like a hospital or a university

6

THEIR SECRETS

Develop a solid Case For Support Recruit Quality Leaders True and meaningful

INVOLVEMENT of the “right” people ASK (personally, face-to-face) ASK again.

The Cliff Notes….The Cliff Notes….

7

THANK YOU!

8

Introducing 10 Ways to Guarantee Failure

and the Solutions to Prevent them

9

10

1.1. Stop AskingStop Asking

“With the stock market suffering and donors losing a great deal of money, how can we continue to ask for donations?” - Club CPO

11

Solution to Not AskingSolution to Not Asking

ASK Consistently When you stop asking for donations, you

express to your supporters that you do not need money or that your Club’s mission is

not as pressing as other organizations.

12

2. Postpone2. Postpone

“Because of the economy, our development chair wants to postpone the capital campaign that we have been planning for 2 years. Our study indicates that our donors are ready to give. What should I do?”-Dir. Of Dev.

13

Solutions to PostponingSolutions to Postponing

•Continue the solicitation process This will ensure that when a donor is able, you will be higher on a donors' philanthropic priorities list when the economy and/or stock market turns around.

•Conduct a campaign strategy feasibility study Interview potential major donors and leaders. Their opinions, their thoughts and their comments about where the Club’s project fits in their philanthropic priorities means more than any economic indicator ever could to the success of a campaign.

14

3. Blame the Economy3. Blame the Economy

“I just found out that because the economy is so bad, our funding is just about done and our Club will close in three months. What can I do?” - Program Director

15

Solutions to Blaming Solutions to Blaming the Economythe Economy

•Obtain financial support from 100% of your board members

•Make sure you have a diversified base of support from individuals, foundations, corporations, and government sources

•Ensure that your Club has a budget, plans to meet the budget, and a contingency plan to implement if in any two months actual income falls below projections.

16

4. Only Look 4. Only Look “out there“out there””

“Our community has been hit hard by the economy. Where can I find a list of national foundations that will support my Club?” – Club board member

17

Solutions to Only Solutions to Only Looking “out there”Looking “out there”

Club’s best sources for financial support are:

1. Current and Former Board members2. Board committee members3. Current donors and volunteers 4. People that your board members are willing to

contact 5. People that your current donors are willing to

contact 6. Local foundations with an interest in kids 7. People that have attended your special events 8. People in your community that give to other youth

service organizations

18

Solutions to Only Solutions to Only Looking “out there”Looking “out there”

•Cultivate your current donors for larger gifts in your community.

•Involve your staff in researching and identifying Club donors who have the capability of giving more and involve the board in strategies for involving these donors more with the Club. 

Remember, someone who has already contributed to your Club is much more likely to give than any other

kind of prospects.

19

5. Not Reminding5. Not Reminding

“We met with a local corporation in January and got a commitment for $50,000 this year. It is December and we have yet to see the check. We know the company is struggling and has had layoffs. What should we do…write it off?” – Dev. Dir.

20

Solutions to Not RemindingSolutions to Not Reminding

Remember, you should contact the donor about their committed gift, a minimum number of times as there are

digits in the gift.

For Example:

$50,000 Commitment = minimum 5 times

After Initial Meeting/Ask

• Follow Up letter• Phone Call

• Follow Up letter• Phone Call

• Face to face Solicitation

21

6. Act without a plan6. Act without a plan

“Our Club will be doing a capital campaign for about $1,000,000 within the next six months. With the economy so tight, how do I justify a $10,000 to $20,000 expense for a feasibility/planning study?” –CPO

22

Solutions to Acting Solutions to Acting Without a PlanWithout a Plan

Invest in creating a plan or strategy for each action

Conduct studies to support and direct your plan of action

When you fail to plan, you plan to fail

23

7. Stop Planning…7. Stop Planning…

growing, inspiring,

motivating…or making

your case for support.

24

Solutions to Stop Solutions to Stop Planning…Planning…

•Distinguish your Club from other organizations in need of money•Inspire your donors with exciting PLANS•Motivate your paid and volunteer staff with a clear cut PLAN to achieve your Club’s visions and dreams•Ensure your Club has a strategic PLANNING Process in place and is regularly monitoring and highlighting its implementation•Continue making your case for support.

25

8. Rely on 1 Source8. Rely on 1 Source

“Our local Club receives over 50% of its operational budget from a local foundation. The foundation has indicated to us that we are at risk of failing the public support test. What do they mean?” Dir. Of Dev.

26

A recent IRS ruling shows…A recent IRS ruling shows…

"The Tax Code requires organizations seeking

treatment as public charities based on the nature of their funding to demonstrate annually that over the past four years they have received at least one-

third of their total support in contributions from the general public. The proportion of this public support can drop as low as 10 percent of total

support (the total of all public support, plus endowment and other income) if the charity meets a

facts-and-circumstances test that suggests it is trying to increase public support.”

27

Solutions to Relying on Solutions to Relying on 1 Source1 Source

•Look within and throughout your current donor pool•Increase your Grant/Donor Search•Identify other organizations/companies that currently support other projects or organizations that serve kids•Try a Challenge Gift strategy

28

Challenge Gift StrategyChallenge Gift Strategy

•With a Challenge gift strategy, a Club can encourage donations for new donors and/or increased giving from current donors. •A challenge gift can come from one donor or more donors. •Its purpose is to match new or increased gifts to the Club in a given timeframe. •In tough economic times, a challenge gift can help put the focus on something exciting. •Challenge gifts usually come from donors who are met face-to-face and who like the idea of helping to secure more support for the Club.

29

9.9. Believe in RainbowsBelieve in Rainbows

“We are 45% short of our fundraising goal. If we can get 1,000 people to give us $100 each, we will make it! What kinds of strategies could help us reach 1,000 donors?” –Anonymous

30

Classic Rainbow StrategyClassic Rainbow Strategy

To raise $100,000

Based on Fundraising research, you need 3 prospects for each gift or 3,000 prospects

Research also shows you need 1 volunteer for every 5 prospects 600 volunteers or 600

volunteers

Looks like a lot of work!

31

A Better StrategyA Better StrategyAsk people to give according to

their ability 1 gift at $25,0002 gifts at $10,0003 gifts at $5,0004 gifts at $2,50010 gifts at $1,50010 gifts at $75010 gifts at $50025 gifts at $100 = $100,000 65 gifts TOTAL65 x 3 = 195 prospects195 prospects/5 = 39 volunteers

32

A Better StrategyA Better Strategy

Same Results Less Stress!

33

10. Forget Stewardship10. Forget Stewardship

“How do you repair donor trust and support if your Club missed thanking a donor after they made a significant contribution. We just found the error – 1 year after the gift was made.” – New Development Director

34

Forgetting StewardshipForgetting StewardshipThe Index of National Fundraising

Performance Reports:

Donors declined a median -1.0% from 2006 to 2007

Retention rates have been essentially flat for the past two years

Revenue growth in 2006 and 2007 was almost entirely due to increases in revenue per donor, not more donors

Copyright 2008, TARGET ANALYTICStm

35

Solutions to not Forgetting Solutions to not Forgetting StewardshipStewardship

How and when you say “thank you” will impact whether or not your

donors will give again.

If your Club fails to thank donors properly, you could be sending donors a message that their gifts

were not important to you or that your record

keeping is not up to standard.

36

Solutions to not Forgetting Solutions to not Forgetting StewardshipStewardship

Ask the staff about the process for thanking donors. This process should include:

Adequate resources to do thank donors in a timely fashion (less than a week after the gift is made)

Creating accurate personal reports that are readily available and consistently given to significant donors.

Financial reports and 990 forms that adequately reflect the Club’s activities as many foundations and other significant donors may review 990 forms before making their giving decisions.

37

THANK YOU!