Finding Major Gift Donors – Profile of the American Millionaire

Everyone knows someone who is capable of making a major gift. I can’t tell you how often I’ve heard trustees and volunteers tell me they don’t know anyone capable of a gift of $25,000 or more. Images are conjured up of mansions, exotic sports cars, and lavish lifestyles. “I don’t run in those circles,” they tell me. According to The Millionaire Next Door (Stanley and Danko, 1996)—most millionaires don’t either.

Stanley and Danko conducted research on America’s wealthy to establish a profile to better market upscale products. Their surprising results have propelled The Millionaire Next Door (1996) to the bestseller list and have unwittingly inspired many ambitious Americans to emulate the behaviors described in the book. They have debunked the stereotype of the jet set rich to tell us most millionaires in America are much like you and me—just wealthier.

For development professionals, having a profile of the American millionaire is an immense help in identifying new major gift prospects. If you haven’t read the book yet, a brief summary of key findings are presented below. It might be the closest thing you will find to Cliff Notes.

Profile of the Typical American Millionaire:

  • 57 years old, married, 3 children
  • Two-thirds are self employed
  • Work 45-55 hours per week
  • Median income of $131,000
  • Median net worth of $1.6 million
  • Modest home (half have lived in the same home for more than 20 years)
  • No inheritance of funds or business
  • Inexpensive clothes
  • 20% are retired
  • Drive 3-5 year old American made car
  • Avid collectors of coupons
  • Very, very frugal
  • Just in case you missed the last line…Very, very frugal

According to the research, many people who appear wealthy often are not. Their expensive homes and luxury cars are often accompanied by massive debt. Their disposable income and cash reserves are modest and often “stretched thin.” The millionaires described by Stanley and Danko live modestly and well below their means. Your fishing buddy or friend across the street may be sitting on a pile.

The obvious and important lesson here is that we all know people who have the capacity to make a major gift. Debunking the popular images of wealth propagated by the media through movies, news, and corporate marketing opens the mind to greatly expanded opportunities. Finding out who has significant financial resources is the first item of business.

Major gifts are defined differently in terms of dollar range, but most will begin at the $10,000 or $25,000 level depending on the size of your organization and history of development activity. The purpose of a major gift, however, does not vary: A major gift is a one-time gift commitment to fund projects above and beyond operational support (even if pledge payments are spread over several years). Your prospect should be defined as someone who is capable of a major gift and who is connected to your organization and/or sympathetic to your mission and work.

Don’t limit your search to those people on your mailing and donor list. Consider people who have the capacity to give at the level you seek and higher, and who you (or others) believe would be sympathetic to your mission and work.

Although many people may fund a project, they all have different motivating factors influencing their gift. Do your homework to identify people in your community who have means and find what they support and why. Could your organization be a match? In building your prospect list consider:

  • Your Constituencies (alumni, patients, campers, etc.)
  • People Connected to Your Consistencies (parents, grandparents, children, etc.)
  • People Sympathetic to Your Mission and Work (friends and soon to become friends)
  • Local Businesses and Vendors
  • Corporations
  • Foundations

Unfortunately, there is no top-secret black book with the names and addresses of all the best major gift prospects available with stars rating each. You’ll have to create your own. Look to the following people to help you in your search:

  • Trustees
  • Staff
  • Current Donors
  • Volunteers
  • Community Leaders
  • Your Constituents

In addition to these subjective resources, there are a variety of outside sources for information on individuals, corporations, and foundations. Many of these are free and easily accessible with an Internet connection. Search engines such as Google may seem mundane, but they can often turn up good background information on a person. Of course, corporations and foundations often have their own websites, with biographical information on their management, directors, or trustees. Some government websites are also good for research. Probably first among these is the searchable Edgar database maintained by the Securities and Exchange Commission.

There are also a number of paid services for research. Among these are Dun and Bradstreet, Lexus Nexus, Standard & Poor’s, Taft, and Who’s Who. Prospect research is an industry unto itself, and there are skilled professionals in that arena who could no doubt substantially build upon this list.

With suggestions from the sources presented above you will have a foundation for your prospect list. Augment your information with new details acquired through interviews, cultivation visits, and screening and rating sessions. A screening and rating session is when you convene a group of connected people to review your prospect list to gain new information and insights and to acquire additional names. Information gathered through the meeting must remain highly confidential. This must be made clear to the participants to gain the information you seek. Methods for gathering information include:

  • Reviewing Donor and Mailing Lists
  • Interviewing Trustees, Staff, Volunteers, Community Leaders, and Constituents
  • Holding Screening & Rating Sessions
  • Cultivation Visits

Below are some well-known and not-so-well known suggestions to keep in mind when building or expanding your major gift program:

  • Your best prospects are often current donors. Do not exclude anyone because they have “done so much for us already.” It is both presumptuous and foolish to make giving decision for others. They give because they care. Let them decide what is reasonable.
  • Ask your best donors who else might be capable of major gift support and ask them to help open the door.
  • Some of your best prospects are right in front of you. Don’t overlook your volunteers and staff members. Their hearts are with you and they, or their families, may have great resources to share if asked.
  • Do not discount or disqualify anyone as a major gift prospect just because they are not connected to your organization. If they are sympathetic to your mission and work they might help if asked by the right person for the right opportunity.
  • Categorize your prospects into a top 50, top 25, and top 5 list. Gather all the pertinent (and appropriate) information you can.
  • Write out your objectives and plan, establish a timetable, and execute!

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