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We’re small. Can we really launch a major gifts program?

by Diane Remin
Posted in Major Gifts Major Gifts Program Smaller nonprofits

Let’s start with the basics: What is a major gifts program?  At the end of the day, it’s simply in-person meetings with carefully chosen prospects with the ultimate goal of securing sizably larger gifts.

No donors?  Stop right here. 

Your major gift prospects are:

  1. Enamored with your cause and engaged with your organization, e.g., attend programs/events, volunteer and/or otherwise connect to your nonprofit. 
  2. Have enough money to make what your organization decides is a major gift.  Notice that I didn’t say “rich” or “wealthy.” Enough is, in fact, enough—an important distinction for smaller organizations, in particular, where major giving levels do not have to be in the stratosphere to have significant impact.

For smaller organizations, a major gift may be $2,500 per year for four years for a total of $10,000.  If your operating budget is $250,000, ten of these donors produce $25,000 annually—that’s 10% of your budget! (Yes, I do have a bias for multi-year gifts, especially for smaller organizations.)  Or, maybe your operating budget is $2M and you have donors capable of making gifts of $25,000, $50,000 or $100,000+.

What do you need to launch a major gifts program? 

  1. Existing donors, e.g., annual fund, membership
  2. Program parameters, e.g., minimum gift amount and donor recognition plan
  3. Your story, told in a compelling way
  4. Additional information about the donors you identify as prospects (prospect research)
  5. Techniques to “set-up the meeting” and “make the ask”
  6. Willingness to pick up the phone
  7. A system to record donor information and track progress
  8. Passion/enthusiasm about your organization

How do you identify your major gift prospects?

You are looking for your actively engaged, financially capable donors (this includes board members!) It is possible to have your donor list “screened” to identify prospects you may not be aware of. It’s a valuable service, but it adds expense. You may well be able to launch your program with the donors you identify internally.

How do you learn more about your major gift prospects?

  • By talking to them:  A visit to a prospect’s home or office is the picture worth 1,000 words. This is an information-gathering visit, not an asking visit. You are getting to know the prospect better and vice versa. You’re asking lots of questions.  You’ll write-up meeting notes.  You’ll assess if the prospect is ready to be asked or needs more “cultivation.”
  • By researching publicly available information. Welcome to the world of “prospect research,” or learning everything you can about your prospective major gift donors. The idea is to assemble a comprehensive picture of your prospects: financial position, inclination to give and degree of connection to your nonprofit.

Prospect research resources include:

Many organizations have moved ahead with cursory research. It is not “best practice” and there is the risk of leaving money on the table. That said, do the best you can. 

Where do you learn the techniques for making the “ask”?

  • Google—you’ll find lots of information and training programs
  • AFP (Association of Fundraising Professionals) conferences, workshops and trainings  www.afpnet.org
  • At MajorDonors.com, we know a thing or two

To launch a successful major gift program, you must be trained and willing to meet with your prospective major donors. There is no escaping this!

Major Gifts Program bottom line: 

Know your prospects, meet with your prospects, ask your prospects. You’ll need some time, some research, some training and lots of enthusiasm.

Pick up the phone!

by Diane Remin
Posted in Major Gifts Making the Ask

Major gifts are all about building personal relationships with prospective major donors. So…

 If your inclination is to write a letter -> Pick up the phone.

 If your inclination is to print a brochure -> Pick up the phone.

 If your inclination is to send an email -> Pick up the phone.

 If your inclination is to produce a newsletter -> Pick up the phone.

 If your inclination is to slice your donor database every which way -> Pick up the phone.

 If your inclination is to have a staff meeting (you really hate picking up the phone).

 You need to meet with your prospects. 

Practice works!

If the thought of picking up the phone and setting up a meeting (and that’s all you want to do on the phone—set up a meeting) gives you angst, take away the pressure. Put your major gift prospects aside and practice on three mid-tier donors who have been supporting you for several years. Select any three. Pick up the phone and make an appointment.  No expectations. These are practice visits. Your only objectives are to:

  • Thank the donor for his or her support (that’s easy).
  • Learn more about the donor (ask questions and listen).
  • Conclude the meeting with an announced follow-up plan (which may be anything from, “Thank you for taking the time. It’s so valuable to meet with our supporters and find out first hand what they are thinking. We look forward to your continued support” to agreement on a follow-up step, e.g., “So I’ll call you next week with the answer to that question.  Is mid-week a good time?” 
  • Record your notes from the meeting.

If these “practice donors” ask you if you are meeting with them to ask for money, you can honestly say, “no.”  And once you say “no” to these “practice donors” or anyone else, do NOT make an “ask” during the visit.

 Get comfortable meeting with your donors. 

 You may even find that you enjoy it!

Giving is good for your health!

by Diane Remin
Posted in Major Donors Major Gifts Making the Ask

Science, lots of science, tells us that giving is good for your health.

The good feeling you get when you volunteer or write a check to a cause you care about is very real and physiologically based. Altruistic behavior has been scientifically shown to stimulate the brain’s reward/pleasure center and strengthen the immune system, to cite two examples. The result is better health, including less stress, anxiety and depression.

In a 2006 study, magnetic resonance imaging (MRI) was used to track brain activity of subjects who were presented a variety of scenarios that involved accepting monetary pay-offs vs. making contributions to real-life charities.

The study is titled, “Human fronto-mesolimbic networks guide decision about charitable donation” by Jorge Moll et al and appeared in Proceedings of the National Academy of Sciences of the United States of America (PNAS), October 17, 2006, vol 103, no 42.

The researchers surprise is reflected in the last line of the introductory blurb: “Remarkably, more anterior sectors of the prefrontal cortex are distinctively recruited when altruistic choices prevail over selfish material interests.”In more accessible language, given that humans are wired for self-preservation, it is unexpected that the altruistic choice (the choice to donate) not the selfish choice (the choice to keep the money) lights up the portion of the brain associated with primary rewards such as food and sex.

In a 1988 study, psychologist David McClelland found that even thinking about doing good had a positive impact on the immune system. Let’s repeat this one: The mere act of thinking about doing good had impact. Wow! In what has become known as the “Mother Teresa effect,” Harvard students watched a film of Mother Teresa caring for orphans in Calcutta. The students who watched the film had significant increases in the protective antibody salivary immunoglobulin A. Furthermore, the immunoglobulin A remained high for over an hour after the film when students were asked to focus on loving or being loved. The study, “The effect of motivational arousal through films on salivary immunoglobulin” by David McClelland et al, appeared in Psychology and Health, Vol. 2, pp. 31-52.

To those of us volunteering and donating, this evidence is not surprising. Scientists are beginning to document what we’ve known all along, but couldn’t really explain.

I wrote this blog entry, in part, for everyone out there who hates to ask for major gifts. Perhaps it’s time to reconsider that stance.

Science tells us that making a major gift to a cherished cause produces health benefits that emanate from primal places deep in the brain.

Create a positive primal experience for a donor. Just ask!

Every “no” is a “yes”

by Diane Remin
Posted in Major Gifts

Oh my goodness, a prospective donor said, “no.” Not a “no” that turns out to be an objection that you can resolve. A “no” that’s a “no.” A goose egg.

Do you take it personally? No you don’t.

Why?

It’s a numbers game.

In sales parlance, a “no” triggers a “next.” That’s right. “Next.” Move on to the next donor.

On to the next major gift solicitation

No one bats 1,000. In fact, it turns out that major gift fundraising “ask” averages are not very different from Major League Baseball batting averages: going 1 for 3… that’s batting a very respectable .333. Baseball players can’t wait to get back to the plate after a strike out. They live by, “next.”

No strike-outs? No home runs either.

Everyone has a Major Gift Ask RatioSM

A key number in major gift fundraising is the major gift ask ratio: the number of prospective major gift donors (prospects) you’ll ask compared to the number who say, “yes.”

The fundraising profession has researched lots of major gift campaigns and uncovered industry-wide prospect-to-donor ratios. In a $100,000 campaign, for example, you’ll want at least one $25,000 gift—25%-50% of the goal. Obtaining this gift will require anywhere from four to five “asks”—a ratio of 4:1 or 5:1. You will need to ask four or five prospects to secure this gift. As the gift sizes decrease, the ratio falls, working its way down to 2:1.

For starters as a smaller organization, expect to make two or three “asks” to get the major gift

So, depending on how aggressive your “asks” are in relation to prospective donor capacity, you should expect—yes, expect—to make anywhere from two “asks” to five “asks” to get the gift. That’s to hit a specific gift level. Many of these prospects who don’t give you what you ask for are not at zero—they will give you a smaller gift. But even at the more modest “ask” levels, anticipate a 2:1 ratio. There are still plenty of “no’s” in that ratio.

If you are a board member who wants to secure three gifts for your organization, plan on making at least six asks.

Every “no” is a “yes”

On the journey to three gifts, you will make at least six asks. A “no” is one of the six. As an added bonus, every “no” is part of a conversation, and every conversation deepens the relationship. So there’s always a benefit, no matter the dollar outcome of the meeting.

Goals are essential! The goal is not to achieve a 100% “yes” rate. We’d all fail. No one would go to bat.

As a smaller nonprofit just starting a major gift program, consider setting a goal to meet with a certain number of major gift prospects.

The money will follow.