The Ten Immutable Laws of the Fundraising Universe
I’ve learned that certain “laws” describe the universe of fundraising, much as certain provable statements describe the physical universe. Tested by experience, observation, and results, these laws determine to a large extent the success of our efforts. If your capital campaign has stalled, your funding proposals routinely go unfunded, or your board has stopped working effectively, the laws described below may point you toward a solution.
Law #1: No group of individuals is waiting to give (also known as the Law of the Nonexistent They).
The idea of such a group is a legend raised to the status of myth among board members, executive management, and volunteers. Capital campaign planning meetings, program development meetings, and fund development committee discussions are frequently dominated by the refrain “They will give.”
Unfortunately, this myth is dangerous to sound organizational and fundraising practice because it leads to two misconceptions: 1) prospect research, identification, cultivation, and solicitation are not necessary because they will give out of the goodness of their hearts; and 2) although we are too _______________ (poor, overcommitted, overworked, fill in the blank) to contribute to our cause, they are perfectly positioned with abundant resources, time, and energy to ensure its success.
Anonymous individuals who have little or no connection to your organization are not waiting in line to give you money. Organizations must rely on “we” — that is, you and I and those willing to join us. And if we have only ourselves and those whom we can convince to join us, then we had better get started.
Law #2: Fundraising is a conversation between funded and funder.
Fundraising is simply a form of marketing in which the conversation is expressed in actions rather than words. The funder participates in this conversation by providing financial resources, credibility, and, sometimes, social or political connections. The nonprofit organization seeking funding participates by providing something of value, be it a social service, a solution for a critical community need, or a seat at the policy table. The Nonexistent They are not party to the conversation between organization and funder, and thus will not invest in your mission.
The conversation between funders and fundraisers is how communities hold nonprofit organizations to account. The community, represented by individual donors or institutions, directs its philanthropic resources to organizations it deems to be effective and accountable and withholds its resources from those it deems to be less effective or accountable.
Law #3: Effective fundraising is a result of telling your story.
Telling your story involves more than making the case in a funding proposal or during a funder visit. We must take advantage of every opportunity to enhance the visibility of our organizations. And visibility, in this context, is just another word for publicity. As the saying goes: “You can have publicity without fundraising, but you can’t have fundraising without publicity.” Publicity includes press releases, newsletters, annual reports, annual appeals, audio-visual aids, and every other form of printed or produced collateral. Having your board chair call a foundation to introduce your nonprofit is a form of publicity; arranging to have exhibiting artists meet your supporters at the local art event is a form of publicity; getting your supporters to tour the new hospital wing is a form of publicity. Any activity that puts a face on a community need, illustrates your mission in human terms, or otherwise imbues your organization with a personality can be considered publicity.
Law #4: People give to people.
Rare is the seasoned fundraising professional who has not observed this law in action. Fundraisers know that worthy causes alone — “feed the hungry,” “shelter the homeless,” “care for the sick” — do not raise money. Presented as abstractions, they often raise more questions than they answer.
Humans are inherently social animals, spending enormous amounts of time and energy creating and maintaining social networks. If people give to people, then the role of the fundraiser is to create relationships. However, fundraisers must be careful. Friendships between fundraisers and prospects are usually fleeting. The truly successful fundraising professional is able to establish relationships on behalf of the organization that continue well beyond his or her departure from the organization.
Law #5: Someone must ask for the money.
This simple fact often is the hardest one for fundraisers to accept. Sitting at the table with a prospect, having worked hard to make a compelling case for support, many a clear-headed fundraiser will neglect to say, “Now, Harriet, we’re talking about $50,000 a year for the next five years. Can you do that?” Or a grantwriter will submit an elaborately detailed proposal without including a statement that says “We are seeking an award of x dollars for y purposes,” leaving the reviewer to scratch her head and wonder, “How much do they want and for what?” It is the role of the fundraiser to seek the gift.
Law #6: An organization cannot thank a donor enough.
Expressions of gratitude are expressions of respect. Every appeal letter, every funding proposal, every individual solicitation to a recurring donor should include a reference to his or her previous contributions of time, money, and advice. A good policy is to send at least initial acknowledgement of a gift within forty-eight hours of its receipt, and to require more than one thank-you for gifts over a certain amount. For larger gifts, the development officer should send the initial typed response, followed by a thank-you from the CEO a few days later; for really significant gifts, the chair of the board might send a third thank-you a day or so after the CEO. Earnest and sincere gratitude is not overkill.
In the for-profit world, good customer-relations managers are famous for their maniacal devotion to the words “thank you.” They understand that their costumers usually have a plethora of options from which to choose. The same holds true for non-profits.
Law #7: Seek investments, not gifts.
Making a gift to a nonprofit organization is nearly always seen as an investment by the funder or donor and almost never understood as such by the organization. When an organization asks for a gift the organization, whether it knows it or not, is seeking a one-sided exchange of values. In contrast, when an organization seeks an investment it invites the donor to share responsibility for the desired outcome. By changing the paradigm, the organization alters both the perception of the ask and the manner in which donors are treated.
Law #8: Donors are developed, not born.
All donors have three characteristics in common: a connection to your organization, interest in its success, and the ability to give. The process of nurturing these three characteristics is called “donor development.” That’s why most fundraising functions in nonprofit organizations are grouped under the rubric of “development.” And the best way to describe the process of moving an individual to the point of making a gift is using a model known as the “Five Eyes of Donor Development.”
The world is full of possibilities. To turn those possibilities into prospects, however, you have to identify their connection to, interest in, and ability to give to your organization. Prospects, in turn, need information about your organization as much as you need information about them. From information comes interest — that with which we become familiar. People tend to become involved in that which interests them. And investment follows involvement as surely as night follows day. Thus, the “Five Eyes” remind us to focus our efforts on moving each occupant closer to the organization. In this way, possibilities become prospects who become donors.
As donors move closer to the “inner circle,” their gifts will grow. By establishing a strong connection with donors, we develop their interest in our organization’s success and enhance their ability (desire) to give. As we continue to match the needs of our organization with their needs, donors will continue to make larger gifts, until they make the ultimate gift. Then our attention turns to stewardship and maintaining their satisfaction.
Law #9: Fundraising out of desperation is futile.
Contributions of cash are rarely offered because an organization is desperate. Desperate organizations are often perceived to be unstable, incapable of doing the work, and just plain bad investments. The successful organization, in contrast, is able to tell a story characterized by accomplishment, sound financial management, and visionary leadership.
Of course, all organizations raise money out of need. By itself, however, “We need money” is rarely compelling enough to convince a prospect to offer his or her support. Instead, your grant proposals, appeal letters, and kitchen conversations must say, in no uncertain terms, “We’re winners! We can do the job! Back us!”
A case for support that speaks only to the misery of your constituency will often backfire. Take care that your prospects do not become so numbed by the magnitude of the problem that they miss the real improvements created by your efforts. Donors will give year after year, in increasing amounts, if you convince them that you have a plan, and the means to execute that plan.
Law #10: In the best of circumstances, people will do what they please (also known as the Law of Uncertainty).
Fundraising is the art of establishing and strengthening relationships between prospective donors and your organization. But because humans just may be the most unpredictable species in the world, fundraising is anything but an exact science, and its immutable laws are, well, mutable. To quote one of my mentors, Sy Seymour: “On your best day, when you’ve spoken all the golden words you know, when you’ve matched the right gift to the right prospect for the right cause and had the right person ask…people will do what they please.” Given this most basic fact of the fundraising universe, our only recourse as fundraisers is to “keep on keeping on.” Perseverance, not speed, will win this race.
The Law of Uncertainty helps even the most seasoned fundraisers and development officers accept the rejections that are an inevitable aspect of their job. In fundraising, such rejections are rarely, if ever, personal. In fact, “no” is often a veiled request for more information. If a prospect says “no,” don’t be afraid to ask “Why?” Knowing the reasons behind that “no” will prove invaluable the next time you make your case to that donor.
I hope the laws described above provide you with some insights into the unique and always fascinating dynamics of fundraising. A solid understanding of those dynamics will help you to develop fundraising programs that bear fruit and secure a strong financial future for your organization.
Carl Richardson has taught board development, strategic planning, fundraising, grant writing, and other nonprofit management topics for the University of New Hampshire Continuing Education Services, Brown University Learning Communities, the American Association of Grants Professionals, and the National Society of Grant Writing Professionals. This article is reprinted with permission from the Philanthropy News Digest, an online publication of the Foundation Center.