Photo Credit: quinn.anya
In my introduction post, I indicated we were just starting to think about fundrasing at Mach 30. That’s not exactly true. We’ve been talking about it for while. We are accepting donations, and have raised a little bit money.
We just can’t seem to build any momentum. Part of the problem is time. I’ve never seen a nonprofit with enough time and resources to do all that they wanted to do–and that problem is intensified in all volunteer organizations. This long to-do list makes it easy for the things we don’t really know how to handle to go from the back burner to being pushed right off the back of the stove.
I also don’t think it’s a matter of technical expertise. On the surface at least, none of the individual strategies nonprofits use to raise money seem especially difficult. When we talk about the need to raise money in board meetings we get very excited, we schedule meetings to decide how to move forward. This is where we get stuck. We start talking about fundraising, which leads to a discussion about target markets and then marketing in general. That discussion leads to a discussion of programing, and then we start drafting a budget. After an hour or so of that conversation, it’s hard to remember where we started. It is like grabbing a rope in the middle and then trying to follow it to the end, only to discover there is no end but rather a seamless loop.
In order to move forward, we need a concrete place to start.
My commitment
- Organize existing resources and fundraising ideas into a useful format
- Read Chapters 2-3 of the NOLO Fundraising Guide*
- Propose a concrete next step toward a concrete, actionable fundraising plan.
My question
How much organizational structure in terms of marketing, programing and budgeting needs to be done before launching a fundriasing campaign?
Your Turn
Where are you on your fundraising journey? Share your plans and ask your questions in the comments or on the Facebook page.
*We are also using the NOLO guide for How to Form a NonProfit Corporation and can’t say enough good things about the series.
Low Hanging Fruit Communications 
The amount of marketing, programming, budgeting and fundraising infrastructure you will need depends in large part on the amount of funds you need to raise. That being said, you don’t have to have every duck in a row before you start raising money! Especially as a start-up organization, there will be some heal-to-toe work. Afterall, you’ll need some money to pay for marketing and program costs. You do, however, need to be able to show donors what you plan to do with their money.
Whether you need to raise $10,000 or $1,000,000, it is important to have a detailed plan and budget for the organization. The budget should include fundraising, marketing and programming costs. When I am taking on a particular piece of the pie, such as fundraising, I like to have my own detailed fundraising budget so I can keep a close eye on where we are and how we’re doing.
I guess to really answer this question, I’d need a bit more information:
Do you have a strategic and/or program plan in place for the next one to three years?
What is your fundraising goal for this fiscal year?
Has everyone on the board already pledged (made a commitment to give) or made their charitable contribution?
Do you have a list of folks who have already given or are likely supporters?
Thanks Erica, for jumping in with two feet!
1)We did strategic planning for this year, and are scheduled to do it again for 2011. We are also in the midst of working on our 1023, so even if we didn’t need a plan and budget for fundraising, we would need it there.
2) We haven’t set yearly fundraising goals, because we hadn’t really finished the budget. We knew we were going to need about $500 for a lawyer so we ran a short campaign for that and raised the money quite quickly. I think this is where we get the most hung up. We are so used to working on the cheap/free we subconsciously reject ideas that will cost money. We are doing quite a lot of work right now, but most of it can be done for free, or with direct donations.
3) We are about 1/2 and 1/2 on this. The board is made up almost entirely of students and early career professionals. I think everyone will eventually make a donation, but they won’t be $10,000–or even $1000 a year. Can we make that work?
4) The people who have given right now are mostly us and our parents, and very close friends. We did each make a list of people we know who we believe would give a gift to the organization–but because the rest of the pieces weren’t in place, we never actually launched that campaign.
I’ve asked the other board members to participate here, so hopefully we’ll hear from them soon as well.
First let me introduce myself. I’m Greg, board member and community advocate for Mach 30. All of my experience has been technical and managerial so this fund raising activity is completely new to me too. I’m looking forward to learning from everyone.
Erica, thank you for your relevant and informative comments. It sounds like you have done this before! To give you some additional information, I can give my version of the answers to your questions. I’m sure the other board members will jump in if I miss something.
1) Strategic planning. Last year we were very good about doing the right amount of planning. We came up with a comprehensive list of activities and tasks that needed to be accomplished during 2010 and we’ve recently started thinking about a similar list for 2011. To me, it seems like we sometimes jump from the recent (1-year) plans to the much longer term (25 or 30-year) plans and it is difficult to nail down concrete ideas for the intermediate period.
2) Fund raising goals. Again this is not my area of expertise but I have started a list of things that may cost money. My question back to you is what constitutes a goal? Are “list of budget items”, or “having enough money in the bank to cover expenses” good goals?
3) I like that you mentioned buy-in when discussing fund raising. In the near term, this is a good way to kick-start the process. This may help short circuit the chicken/egg problem where supporters don’t donate without some prior examples of work done, and without funding we have problems developing any tangible progress. In the long term, we are going to need much larger quantities of funding than any small number of individuals can donate. It sounds like there is no what to get there without starting at the beginning. That’s us, the board members of Mach 30.
4) Yes, and for the sake of transparency we are following a process learned from an “Introduction to Fund raising Planning” workshop that a board member attended last summer. He posted a summary of what he learned, and that’s what we have been working. http://mach30.org/blogs/jrs/2009-07-13-notes-from-introduction-to-fundraising-planning-workshop
Mach 30 is a fascinating organization. Given it’s focus on the future, I can understand why it would be difficult to keep your focus to the year ahead. Your organization operates in a field where my knowledge — at best — merely scratches the surface. As a result, I have a hard time visualizing what kinds of programs your organization will offer. As you do hold programs, make a big splash about them on the website to help folks like me understand what your organization is doing.
So, I think it would be a helpful exercise for your board to really identify what some of the programs are that you would like to offer, both in the near term and over the long term. The conversations you are having about what the organization will look like thirty years from now are not at all a waste of time. Instead, I think they are probably a very good starting point. If you know what you want to accomplish by 2040, you can start taking steps towards those goals and create some logical building blocks. Perhaps your first year you host a program each quarter, which helps you build your audience and also helps build relationships with individuals and organizations you will work with in the future.
As for the fundraising goal, challenge yourselves to set an annual fundraising goal for the entire fiscal year. The goal need not be limited to what you will spend on programs, services or vendors in that fiscal year. That goal can include raising a reserve fund or raising funds for a future program that will require a significant investment. You don’t need to stop fundraising once you’ve reached your goal either — nonprofit does not mean not profitable! Additional funds that are raised can be invested in an endowment or put into a reserve fund to help the organization grow.
There is nothing wrong with getting work done on the cheap . . . that is, until you start to shy away from anything that costs money. Especially if that thing that costs money is right in keeping with your mission. Nonprofit organizations seem especially prone to operating from a culture of scarcity rather than abundance. I know this sounds a little out there, but developing that mentality early will likely have long-lasting effects on the organizational culture — and not all of those effects will be good.
Seek a balance in getting things done on the cheap and paying for goods, services or programs that will help advance your mission. Also, remember that if you receive a donation of goods or services — and those goods or services help the bottom line of your budget — those are an in-kind donation and the cost of the goods or services should be in your expense budget with the donation of those goods or services in your income budget. That will help you all see that you already are spending money!
One question Greg asked is “What constitutes a goal?” Your fundraising goal should be a solid number, say $25,000. In determining that goal, you will probably have a list of budget items and you will most definitely want to have enough money in the bank to cover expenses! Does that help?
OK, next up is board giving. I very strongly believe that every board member — regardless of ability — should make a donation to the organization he or she is helping to lead. It’s much easier to ask others to join you in supporting the organization than it is to ask the to support it when you don’t. I recognize that board members do a lot of work as volunteers, but volunteer service is not a charitable contribution — and if that’s what you’re asking others to do, than you really do have to do it first.
As for the size of the donation, it should, in my opinion, be “significant” to the individual making the gift. My personal rule of thumb is that I make the largest donation to those organizations on whose boards or committees I serve. Some organization set a required goal that board members must either give or get in order to serve on the board. That is certainly an option, but not one that really resonates with me personally.
I have worked with organizations that serve people who are well below the poverty level and have some of their constituents on the board. At the board level, everyone is asked — and expected — to make a financial contribution. The $5 that the organization received from one of their clients on the board was much more significant to that individual (and to the organization) than many of the much larger gifts from wealthier board members. So, Maureen, you can absolutely make it work with gifts that vary greatly in size. Not every trustee has to make a gift of $1,000 or more. It is much more important that each person make a financial contribution.
On the last note, I’d say keep building the list of individuals who have given (the IRS will want you to keep those files for 7 years) and those who are likely to support your organization. For now, you can certainly keep this information in a simple excel spreadsheet. But eventually, you will want a donor database with a bit more flexibility. One possible resource to look into is SalesForce. Their foundation (www.salesforcefoundation.org) donates the platform to nonprofit organizations. And, this is a database that is in one centralized location — the cloud. I’ll confess that I don’t really understand what cloud computing is, but I like the concept and know that it is right up your alley!
Erica,
This is a TON of excellent information. I’m going to have to read through it several more times to digest all the tidbits. We certainly have a bunch of new topics for discussion.
Thanks for sharing.