session 3 -- january 13, 2010 richard male and associates for the trinidad community foundation

FUNDRAISING AND RESOURCE MOBILIZATION

Session 3 -- January 13, 2010Richard Male and Associatesfor the

Trinidad Community Foundation

THE PRESENT SITUATION

Fundraising in 2010: Challenges and Opportunities

The Flow of Charitable Gifts Historically: Where the Money Comes From

Bequests

Corporations

Foundations

Individuals

Foundations12%

Bequests8%

Corps5%

Individuals76%

Source: The Chronicle of Philanthropy

The Flow of Charitable Gifts

Historically: Where the Money Goes

Education

Health

Human Services

Religious

Other

Source: The Chronicle of Philanthropy

Other 34%

Education 14%

Health 9%

Human Services 8%

Religious 36%

What is the current economic and political situation in 2010?

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What is the economic and political situation in 2010? Most challenging time in my 40 years Still very likely to see 20% of nonprofits

(grassroots) go out of business during this “Great Recession”

Economy is as volatile as a tornado: there is no way to predict where it will touch down, how much damage it will do or when the clouds will part

Every state but three ran a deficit in 2009--and for many, these challenges will likely increase in 2010 6

Pressing issues facing grant-seekers/educational organizationsEmerging trends Many private foundations are trying to

hold their giving steady for 2010, but likely will decrease grant funding

Foundations likely to reduce giving in 2010 and 2011 significantly unless the stock market dramatically increases

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Pressing issues facing grant-seekers/educational organizations Foundations likely to make grants

primarily to existing grantees Significant number of foundations

shifting their grant making to basic needs, emergency and human services

Foundations likely to shift some of their dollars to general operating support instead of program dollars

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Impact on individual donations Individual donor giving is based on the

psychology of how the donors are feeling about their retirement income, financial portfolio, value of their house, job and future. All indicators remain low.

Individuals likely to give 25%-33% less in 2010. Individuals more likely to give to existing

organizations they know and have strong relationships and involvement with.

Individual gifts likely to be spread over greater periods of time.

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Impact on corporate resources for grant-seeking and educational institutions Most corporations give 1% of pre-tax

earnings; this have been relatively flat since 1985

Corporate sponsorships and the use of marketing dollars are likely to continue--but at reduced levels

Corporations will become even more selective and “bottom-line oriented” than in the past

Giving of volunteer time and in-kind product will increase more than giving dollars

10

Impact on government contracts and grants 75% of the 1 trillion dollars going to

nonprofit organizations throughout the United States yearly comes from government sources

With almost every state running a deficit, sales tax revenues are down. Income taxes will be lowered and corporate taxes will decrease

A likely upturn in government support can be expected in 2011

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Still, there is reason to be hopeful during these times1. Americans are incredibly generous people who will

continue to give when “touched” and when consistent trust is built

2. People are still giving, but at reduced levels3. Charities and needs are becoming increasingly more visible4. Conducting educational sessions for your donors will

become even more important5. Some aspects of the economy are growing – tied to

stimulus funding and economic trends, with health care likely to provide new revenue streams

6. We will come out of these hard times more educated and stronger

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ARE YOU READY TO RAISE MONEY?

A checklist of the essential pieces you need in place

Financial Self-sufficiency

9. Evaluation / reporting

8. Execution of the plan

7. Infrastructure: designatedstaff / resources / database

6. Resource DevelopmentPlan / road map

5. Trust / accountability / teamwork

4. Strong programs / compelling need

3. Leadership withinorganization

2. Commitment from board and staff

1. Desire to become self-sufficient

What It Takes

Are You Ready To Raise Money?1. Clear sense of mission?2. Are your programs strong?3. Is your leadership active and

engaged?4. Are you in touch with your

constituency, members or clients?5. Is there a working partnership

between staff and leadership?

Are You Ready To Raise Money, con’t.6. Do your goals match your budget?7. Are your financial reporting systems in

place?8. Do you have a successful track record

of raising money?9. Are you accountable for your money?10. Can you demonstrate results?

Richard Male & Associates

http://www.richardmale.com

Positioning Your Organization

Communications Strategies to Effectively Compete

Susan Liehe, Senior Associate - RMA

Your donors/funders expect you to tell your story

Build board, employee, customer/client pride

You think you can do without it… until you can’t

Supports raising money: the “agrarian” metaphor

Why outreach matters

Key Messages

3-5 absolute essentials -- very short

Memorized, repeated (and repeatable)

“Elevator speech”

Gee whiz, who knew?

Myths and misconceptions addressed?

What is your brand, your promise

Roadmap for newsletter, email, speeches

Your different audiences

Employees

Donors and funders

Volunteers

Business owners

Other nonprofits

Civic clubs (Rotary)

Media

Customers, clients

Schools

Churches

Public speaking

Prepare a specific topic (NOT whole mission)

Outline – incl. opening and closing

Add data, stories, humor, rhetorical questions

Develop blurb, ppt, handouts, leave-behind

Rehearse to a strict 20 min. MAX

Practice and get feedback

Promote: hunger for well-presented, thoughtful content

Goal: 1 speech/month

Using the media

Do not fear a reporter calling

An investment in your “trust account”

Consider the power of ink, air, online (versus other

tools in your toolbox)

Volunteers, donors, clients, referrals…

Set a goal: one story pitched/month

What makes a great story?

Focus on one individual

Trends: doubled, up 36%, etc.

Facts, data, measured results

Apply large issue small example

Problem . . . Solution

Milestone (graduation)

1-2 resources cued up (not just you)

Successful media relations

Know the players – who, how, when

Know what they’re covering—big, recent pieces

Busy and competitive environment

“Right” point to hand off the material

The power of an exclusive

Access—make it easy and quick

Be a go-to person on more than just your org.

Send notes—links—etc.

Use Board “Ambassadors”

Key messages (training in small segments)

“Toolkit” of small, concise literature/materials

Fresh, credible data

Coach them in their own circles

(An engaged role: energizes and instills pride)

Compile periodic “outreach report” – see impact, see that it matters

Two points to ponder

Beware of emulating “Project Ozma”

“The greatest challenge in communication . . .”

IDENTIFYING THE FUNDING PIE

The advantages and disadvantages of each funding source

1. It’s an insurance policy – spread the risk2. Secret to financial stability and survival3. Communicating to multiple

constituencies, donors and stakeholders4. Alleviates the risk of one or a few donors

controlling the strategic direction of the organization

5. Strive for 70:30 ratio of controllable vs. uncontrollable income

Why diversify your revenue base?

Controllable

Fee for service / contractsMembershipsSmall donors under $100Large donors over $100Special events

Uncontrollable

Foundation grantsNational religious grantsCorporate donations

Richard Male & Assoc, Inc.

Controllable vs. Uncontrollable Income

ControllableEndowment / Wills / Bequests

Partnerships with Corporations

Earned Income and Entrepreneurial Ventures

UncontrollableUnited Way organizations

Government offices through RFPs

Service clubs


Controllable vs. Uncontrollable Income


Current Trends and Future Issues

Corporate philanthropic giving is flat; strategic marketing is the growth area.

Giving by individuals will increase at a moderate growth rate in proportion to the economy and the perceived optimism of the donor

Philanthropic trusts managed primarily by financial institutions are growing moderately.

Transfer of stock/real estate is a growth area – set up stock account

Country is aging.

Charitable trusts / donor advised funds are growing.

Foundation giving has increased by 28% since 1986, but decreased 2001-03. It is down now and expected to decrease further (up to

10-30%) in 2010-12.


Philanthropic TrustsThe Hidden Pockets of Money

Managed by trust departments at Financial Institutions

Use banking relationships to gain access

Smaller grants – under $10,000


Philanthropic TrustsThe Hidden Pockets of Money

Purpose – can be used for general operating funds

Generally long term support

Local / Regional Congregation

Judicatory / Diocese

National Denomination / Religious Foundations


Strategies For Religious Funding

Strategies For Religious Funding Lay involvement Meet with Minister, Priest, Rabbi Get support from local congregation Build support among the lay volunteers Advertise in congregation bulletin and newsletter Network through your constituency Be visible with a congregation National denominational funds Religious foundations


New Corporate Philanthropy

ProductEndorsement

MembershipsPhilanthropy

Service

Endorsement

MarketingIn-Kind:• Volunteers

• Product/Services

• Tech. Assistance

• Matching Gifts

Sponsorships/

Events

Two Vehicles of Giving:• Corporate Giving Programs• Corporate Foundations/Trusts



Corporate GivingDon’t Just Think of Money

There are THREE primary ways in which corporations can help your organization

1. Financial

Gifts-Traditional Philanthropy (Corporate Foundations) Memberships Marketing (Corporate Giving Programs)

• Products Sponsorships (special events) Endorsement of Services Matching Gifts


2. In-Kind Gifts / Product Contributions

• Office Equipment• Computers• Furniture• Consumer Goods• Printing• Use of Facilities • Donations for Raffles (products or services)• Advertising (newspapers, TV &

in-house/external corporate publications)




3. Employee Involvement

• Computers/Technical • Marketing/Public Relations/Media/Design• Legal (incorporation, bylaws, personnel

policies, tax questions) Financial (budgeting, financial planning)

• Board of Directors• Committees (standing committees/committee

assignments)

Com

mun

ityC

ustomer

Employee

The Corporate Triangle

Product Donations by Major Corporations in 2002


376.6

288283

179

151

91.5

6051.6

33 30.725.325.220.519.914.414 13.3

0

50

100

150

200

250

300

350

400

$ M

illion

s

Pfizer

Bristol Meyers

Merck

Microsoft

Johnson & Johnson

IBM

Safeway

Kroger

Hewlett Packard

Sears

Minnesota Mining

AT&T

Home Depot

Intel

Phillip Morris

Sara Lee

Cisco Systems

Raising Money From Private Foundations

Fund programs, projects and capital campaigns

Good for start-up programs

Average three-year cycle

Try community foundations first

Types of Foundations

Private Family Foundations: Staffed

Private Family Foundations: Unstaffed, Family/Independent foundations


Foundation News / Information / Funding Websites Guide Star

http://www.guidestar.org Foundation Center

http://www.fdncenter.org Philanthropy News Network

http://www.pnnonline.org Colorado Grants Guide

http://www.crcamerica.org


Foundation News / Information / Funding Websites Council on Foundations – Affinity Groups

http://www.cof.org

National Council of Nonprofit Associations

http://www.ncna.org Rich Tips

http://www.richardmale.com


Foundation News / Information / Funding Websites

The Chronicle of Philanthropy

http://www.philanthropy.com

Non-Profit Timeshttp://www.nptimes.com



Affinity Group Websites From www.cof.org Grantmakers for Children, Youth &

Families http://www.gcyf.org/

Asian Americans/Pacific Islanders in Philanthropyhttp://www.aapip.org/

Disability Funders Networkhttp://www.disabilityfunders.org/

Grantmakers in Health http://www.gih.org/


The Advantages and Disadvantages of FundersFoundationsAdvantages

1. Larger Sums of Money2. Not much paperwork3. Will fund special projects, programs, capital4. Good ‘positioning’ $’s5. High cost / benefit

Disadvantages 6. Takes a long time – up to 12+ months7. Good for only 3 years with exceptions8. Over dependence on large grants9. Usually does not fund admin expenses


The Advantages and Disadvantages of FundersCorporationsAdvantages

1. Self interest2. Receive money over long periods of time3. Good to leverage other private money4. In-kind donations and product donations5. Good introduction to the wealth in your community

Disadvantages6. Can be nickled and dimed to death7. Small amounts-if given through the giving program8. Not always responsive to new and controversial issues


ChurchesAdvantages

1. Best donors in America2. Long term sources of income3. Involvement of membership4. Donated services5. High leverage-good potential with other church money (national)6. Jumpstart to planned giving7. Access to key people8. Moral credibility9. Historically very supportive of poor people’s issues

Disadvantages10. Long time to receive money11. Must have support locally from religious leaders12. Generally small amounts

The Advantages and Disadvantages of Funders


GrassrootsAdvantages

1. Involves membership2. Recruits new people3. Demonstrates involvement when approaching

corporations, foundations and churches4. Good ‘positioning’5. Corporate sponsorship

Disadvantages6. Takes staff / volunteers7. If not planned well, cost benefit ratio too low



Donors – Small & LargeAdvantages

1. Reliable over long run2. Introductions to friends-increase network3. Short timetable 4. 80+% of donations come from individuals5. Basis of planned giving, endowment and

large gifts

Disadvantages6. Direct mail is expensive and requires long

term7. No obvious disadvantages with donors



Entrepreneurial OpportunitiesAdvantages

1. Long-term sustainable income2. Contact with new markets3. Can raise private dollars to cover start-up costs4. Can fit into the mission

Disadvantages5. 2 – 3 year business model6. Requires business plan & start-up costs7. High mortality rate8. Requires marketing & business savvy


KEY PRINCIPLES OF FUNDRAISING


10 Key Principles to Successful Fund Raising1. People give to other people—the

relationship is key

2. The proposal is only 10% of the grantseeking process

3. People give because of self interest

4. Find the “key person”

5. Money follows people


10 Key Principles to Successful Fund Raising6. When asking for money, be specific on $

$$, purpose and timeline

7. Plan ahead: raising money takes time

8. Diversify

9. Market and sell your organization

10. Fund-raising is an everyday art

LEADERSHIP ROLESIN FUNDRAISING

1. To help motivate others to be involved2. To ask members to donate to the

organization on a yearly basis3. To address the board contract and

make people accountable for fulfilling the contract

4. To accompany the Executive Director on “asks” and funder interviews

5. To be a role model volunteer in fund-raising 58

Roles of the Board Chair in Fundraising

6. To coordinate the efforts of the Development Committee with the whole Board

7. To lead the Board8. To allow other opinions to be

expressed and invite all members to participate

59

Roles of the Board Chair, con’t.

The Board is responsible for the financial well-being of the organization.

It’s easier to approach foundations, corporations and individuals if the Board is committed.

Boards develop and ensure the passage of strategic plans and annual operational plans—including resource development.

Board members jointly demonstrate that fundraising is organizational rather than an individual responsibility.

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Board Members and Fundraising

1. Identify potential prospects2. Door openers—set up coffee, b’fast, lunch; write

email and make phone calls to make the introductions

3. Strategists4. Attend coffees, luncheons, and funding interviews5. Writing thank-you notes6. Hosting small events—house meeting, BBQ at

your home7. Asking for money8. Recruiting committee and board members

61

Roles of the Board Members in Fundraising

9. Make an individual financial commitment prior to asking others to give

10. Always playing the role of Ambassador in the community

11. Uphold a Board Contract: Define what is expected of each

member Define fundraising expectations Define goals for the Board 62

Roles of the Board Members in Fundraising, con’t.

ELEMENTS OF A FUNDRAISING PLAN

1. Introduction

2. Background

3. Case Statement

4. Demographic Research – External Analysis

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Plan Elements

5. SWOT Analysis6. Organizational Development / Analysis7. Demographic Research – External

Analysis8. Funding history9. Funding strategy10. Structure—specific initiatives

65

Plan Elements, con’t.

TIPS AND STRATEGIES TO CONSIDER

1. Make it personal and stay in touch with your major donors.

2. Don’t rely as much on direct mail either for acquiring new donors or for getting relatively new donors to renew their support.

3. Expect foundation funding to continue to be lower as foundations’ investment portfolios recover from the hit

4. Create reasons to communicate with all your donors more regularly.

67

10 Tips on Fundraising in a Down Economy

5. Redefine your major donors downward so you have a larger base of “high touch” donors.

6. Focus more on “a few major donors” and increase the personal time you spend with them.

7. Rely less on corporate philanthropy and more on corporate sponsorship and marketing dollars.

68

10 Tips on Fundraising in a Down Economy, con’t.

8. Increase your fundraising capabilities and infrastructure.

9. Increase opportunities for your donor prospects and your donors to become involved.

10. Develop contingency plans that answer all of the “what if” questions in terms of reduced revenue.

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10 Tips on Fundraising in a Down Economy, con’t.

1. Re-engage former donors--look through the lapsed alumni and donors

2. Work with your fundraisers and development professionals in designing overall fundraising “care and feeding programs”

3. Seek matching funds whenever possible4. Host breakfast meetings once a month5. Concentrate on statistics, results and impact6. Keep media informed as much as possible

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10 Timeless Fundraising Tips

7. Make it easy for donors to give8. Collect as much background and

biographical information as possible9. Cultivate small donors with the same

passion as major gifts10. Donors are looking for real

involvement and less “checkbook philanthropy”

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10 Timeless Fundraising Tips, con’t.

10 Timeless Fundraising Tips, con’t.

7. Make it easy for donors to give8. Collect as much background and

biographical information as possible9. Cultivate small donors with the same

passion as major gifts10. Donors are looking for real

involvement and less “checkbook philanthropy”

72

Strategy Summary: MAJOR DONORS

Individual giving is down 25-33% in recession

Gifts are more likely to be spread out over time

Individual ‘psychology’ and optimism is key

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Strategy Summary: DIRECT MAIL

Avoid over-reliance; also can be expensive

Success is critically linked to data management in the long term

Not a replacement for personal meet-ups, “high touch”

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Strategy Summary: PRIVATE FOUNDATIONS

Overall funding levels are down and not likely to return in near future

More likely to fund existing, known programs

Shift to basic needs

Invest time now in building personal relationships for the future

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Strategy Summary:

CORPORATIONSMatch their brand and interestsThink marketing—not philanthropyInvolve their employees in your

organizationsMore “bottom-line” oriented than everRemember, support is more than just

money

76

Strategy Summary: FAITH-BASED

Start local

Be visible with the congregation

Meet with clergy leadership

Connect with lay leadership

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Q&A / EVALUATION

THANK YOU

Richard Male & [email protected]

session 3 -- january 13, 2010 richard male and associates for the trinidad community foundation

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