In the last month I have spoken with the chief fundraisers of four nonprofit organizations, all of whom told me that they need to add to their donor pools, and fast.
According to research from mid-June by the Charities Aid Foundation America, only one-third of nonprofit leaders expect that their nonprofit will still be operational a year from now if things remain the same. Another third are fairly certain they will be closed, and the final third just aren’t sure.
If you’re in either of the latter two categories, like the four nonprofit leaders I spoke with, you’re greatly concerned about identifying donors that will help you weather this storm and get your organization beyond it.
There are overarching fundraising strategy issues to identify and resolve that may differ from organization to organization, of course, but from a prospect development standpoint, here is some of the advice I gave them:
You can’t ask people for money if you can’t contact them
If you don’t have up-to-date information on your donors, now is a good time to spend very little money to get it. If you already send out bulk mailings, ask your mailing vendor to give you a quote for a National Change of Address (NCOA) update. Depending on your situation and budget, update the last 5 or 10 years of your SYBUNTs (those who have given in some year but not this one) to discover where they are.
If you don’t have money for a wealth screening, consider analytics
Fundraising analytics, data insight, fundraising data science…whatever you want to call it, analytics can help you identify great future donors that are already warm prospects. It doesn’t have to be expensive because you don’t have to append outside data – you can use what you’ve already got.
Who looks most inclined to give soon? Who has been quietly putting up their hand that they want to be noticed? Which are the donors that have been increasing their gift every time they give? What regions or programs or sectors should you concentrate on? Analytics can provide a lot of great prospects on a tight budget.
If you have money for wealth screening and it’s been a while, you should really do one
If you did a screening before February, all of the stock and business and real estate information is going to be skewed. I don’t need to tell you that people are in a very different financial position now than they were 9 months ago but for some people at the top of the wealth scale, their wealth has actually increased. If your nonprofit is one of their top-priority philanthropic causes, you don’t want to miss knowing this.
And further to that point: those under the 1% (but still affluent) have been strongly supporting causes over the past 8 months that they care about most. If someone has given to your nonprofit since February (and it’s not a memorial gift), you can bet that your cause is in the top three-to-five on their priority list. A wealth screening can help you pull out the person who gave $250 but could give $25k.
Most wealth screening companies provide information on a person’s past philanthropic giving, and that can be incredibly helpful when you’re trying to prioritize your time and effort to see what a donor’s interests are and what their largest gifts elsewhere have been. However, wealth screenings can be a waste of money (here’s how), so you want to avoid those pitfalls at all costs.
Go outside your base as Plan B, not Plan A
I always recommend exhausting every effort to find great prospects in your own database before combing the hills externally. Unless you personally know every single person that you raise money from and you contact them every month, you have to remember that (especially now) situations change. Companies thrive and companies go under. Through it all though, if someone has given to your nonprofit before, they’re already part of your family of donors. You don’t have to convince them of the importance of your mission – they’ve already bought in.
That said, if you don’t have a fundraising database, if you’re working for a startup nonprofit, or creating a brand-new program that has a different focus from your main mission, that’s obviously a different situation. That’s when elbow-grease prospect identification makes sense.
Elbow-grease research is kind of a slog, but it can be worth it in the right circumstances. Our method starts with an organization’s board, well-connected and committed volunteers, and other community champions. We build out their networks and family ties to find others they’re connected to who look likely to have a philanthropic interest in the cause. That way (we hope) we’re identifying “warm” prospects – people to whom they already have a connection via a friendly introduction.
We also look for institutional partners – companies, family and community foundations, larger endowment-based foundations, and even municipal sources to determine who gains directly or indirectly from our client organization’s presence in the community, region, or world.
We explore who benefits financially, spiritually, reputationally, socially, or materially from that nonprofit’s existence? Does the nonprofit raise the status of a community? Educate workforce toward a particular skillset or industry? Contribute to lower crime in an area? Bring in increased foot traffic to a nearby store? Who benefits from those things?
I know, that’s a slightly different angle from the norm, but I think it helps to turn the page to read the print upside down sometimes, don’t you?
Of course, we also look for institutional prospects in the “normal” way – to see which have included specific interest areas in their giving statements, or have given to a similar mission in the past.
These are just a few of the ways we (and you) can identify new donors.
The most important thing, though, is to have a plan in place for what you’re going to do next. Are fundraisers at your organization excited to make contact with new prospects? Or will those great future donors remain uncontacted? If so, your prospect research time and effort is better spent elsewhere.
