chapter TWENTY‐ONE
Building Major Donor Programs
The financial payoff in fundraising is regularly receiving large donations (or “major gifts”) from an ever‐increasing number of your donors. To build a major gifts program, no matter the size of the organization, a majority of staff, board, and volunteers must feel comfortable asking people for money in person (see Chapter Eight, “Getting Comfortable with Asking”). For many people, that comfort starts with being able to ask someone for $20 for a ticket to a special event or for $35 to become a member.
Some askers never move past that level of comfort, but if an organization is to grow and thrive, a reasonable number of board, volunteers, and staff must be able to ask for much larger gifts—$500, $5,000, $50,000, and even more.
A person doesn't have to like asking for money to be able to do it. Some of the most successful fundraisers will confess that they always feel anxious when asking for money. But they do it anyway, and sometimes their nervousness makes them prepare more thoroughly for the solicitation and feel even better about themselves and their group after they complete it.
Once it becomes part of the organizational culture to have a variety of board, staff, and volunteers willing to ask for large gifts, the organization must quickly develop a system for identifying prospective major donors and regularly soliciting such gifts. That system is a major donor program. Sometimes this system takes the form of a campaign, which mostly means that you establish a time frame in which you will intensively solicit major gifts. Major donor campaigns are discussed briefly later in this chapter, but you may also want to read the chapters in Part Five for more about the intensive campaign format.
Before beginning a major gifts program, your organization must make a number of decisions: how much money it wishes to raise from large gifts, the minimum amount that will constitute a major gift (in this book it is $250), how many gifts of what size are needed, and who will solicit those donations. In addition, you must decide what, if any, tangible benefits donors will receive for their gifts and what materials will be needed for the solicitors. Finally, the solicitors must be trained to ask for the gifts.
SETTING A GOAL
The first step in seeking major gifts is to decide how much money you want to raise from major donors. This amount will be related to the overall amount you want to raise from all your individual donors and can be partly determined on the basis of the following information. (For more on goal setting, see Chapter Twenty‐Nine, “Developing a Budget,” and Chapter Thirty, “Creating a Fundraising Plan.”)
Over the years fundraisers have observed that in a healthy organization, gifts tend to come in as follows:
- About 10% of the donors will give around 60% of the income.
- About 20% of the donors will give 20% of the income.
- The remaining donors will give 20% of the income.
As income and wealth inequality have increased over the past two decades, we see more organizations in which 1–2% of the donors give 80% of the income. This is an unhealthy situation. When you are overdependent on any one person or source of money, the loss of that person or source could be devastating for the organization. Organizations should strive to approximate the numbers shown here.
In a healthy organization, then, the majority of your gifts will be in small amounts, but the bulk of your income will come from large donations. Given that pattern, it is possible to project for any fundraising goal how many gifts of each size you should seek and how many prospects you will need to ask to receive each gift.
For example, if your organization must raise $100,000 from grassroots fundraising, you should plan to raise $60,000 (60%) from major gifts, mostly solicited personally; $20,000 (20%) from habitual donors, mostly solicited through mail or email, and regular special events; and $20,000 from people giving for the first or second time, solicited from mail and online appeals, speaking engagements, special events, product sales, and the like.
If you have 500 donors, then, expect that about 50 of them will be major donors (with the top five donors giving $5,000–$10,000), 100 or so of them will be habitual donors (with at least two dozen giving $250), and about 350 will be first‐ or second‐time donors or donors who only give to your special event, or donors for whom your organization is not a high priority The lowest major gift you request should be an amount that is higher than the amount most of your donors give but an amount that most employed people can afford, especially if allowed to specify it as a pledge that they fulfill over the course of a year. Even some low‐income people can afford to give $50 a month to one of two of their favorite organizations, which brings being a major donor into the realm of possibility for most of the people close to your organization. (See also Chapter Eleven on creating categories of donors.)
Some organizations try to avoid setting goals. They feel they will raise as much as they can from as many people as they can. This doesn't work. Prospects are going to ask how much you need; if this answer is, “As much as we can get,” your organization will not sound very well run. If prospects think you will simply spend whatever you have, they will give less than they can afford—or even nothing. Further, without a goal there is no way to measure how well the organization is doing compared to its plans. Just as no one would agree to build a house based on the instructions “Make it as big as it needs to be,” organizations can't be built on the premise, “We will raise whatever we can.”
DECIDING HOW MANY GIFTS AND WHAT SIZE
It would be great if you could say, “Well, we need $60,000 (60% of our goal of $100,000) from 10% of our donors, so that will mean 50 people giving $1,200 each.” But it is unlikely that 50 people will behave the same way—some will give more, and most will give less.
Given this reality, fundraisers have made a second observation: for the money needed annually from individual donors, you need one gift equal to 10% or more of the goal, two gifts equal to 10% (5% each) or more of the goal, and four to six gifts providing the next 10% of the goal. The remaining gifts needed are determined in decreasing size of gift with increasing numbers of gifts. Let's imagine an organization that needs to raise $100,000 from a variety of individual donor strategies. Using the pattern just outlined, $60,000 will be raised from gifts of $500 or more. Their gift range chart will look something like the example shown here.
| Major Donor Gift Range Chart | |||
|---|---|---|---|
| Number of Gifts | Size of Gifts | Total | |
| Major Gifts | 1 | $10,000 | $10,000 |
| 2 | 5,000 | 10,000 | |
| 4 | 2,500 | 10,000 | |
| 20 | 1,000 | 20,000 | |
| 20 | 500 | 10,000 | |
| Total Major Gifts | 47 gifts | $60,000 | |
The most important and useful part of the chart is the top part, which plots sizes and number of major gifts, but the chart should not be seen as a blueprint. If an organization has one donor who can give 15% of the goal, then ask for that; in that case, you will need fewer gifts at the lower end of the chart. An organization in a rural community may not be able to generate the number of gifts needed, so it will have to get fewer gifts at larger sizes.
The Gift Range Chart is like a map drawn on a napkin—it is not to scale, and few campaigns wind up having every gift fit exactly into every category. But it is an important planning document and is helpful for testing the reality of a goal. For example, if your goal is to raise $500,000, but the biggest gift you can imagine receiving is $1,000, then you will probably have to lower your goal. The chart is also helpful for board members and other volunteer solicitors who may have difficulty imagining raising $500,000 but can imagine 30 people giving $500 each.
HOW MANY PEOPLE TO ASK
Every fundraising strategy, presuming it is done properly, has an expected rate of response. For major gifts, when the gift is requested by someone who knows the potential donor, knows the prospect believes in the cause, and feels reasonably certain the prospect could give the amount of money being asked, the expected response rate is 50%. However, of the 50% of prospects who do say yes, there is a further 50% chance that they will give less than the amount requested.
With this understanding, for every gift you seek through personal solicitation, particularly at the upper reaches of the chart, you will need at least four prospects—two will say yes and two will say no. Of the two who say yes, one will give a lesser amount than requested. The prospects for higher gifts who say yes but give less than asked nonetheless help fill in the number of gifts needed in the middle and bottom ranges of the chart, so you will need only two or three new prospects for every gift needed in those ranges. Overall, look for about three times as many prospects as gifts needed. For the $100,000 goal, then, the top portion of the chart would be expanded to include numbers of prospects.
| Major Donor Gift Range Chart with Number of Prospects Needed | |||
|---|---|---|---|
| # of Gifts | Size of Gifts | # of Prospects | Total |
| 1 | $10,000 | 4 | $10,000 |
| 2 | 5,000 | 8 | 10,000 |
| 4 | 2,500 | 16 | 10,000 |
| 20 | 1,000 | 40 | 20,000 |
| 20 | 500 | 40 | 10,000 |
MATERIALS FOR MAJOR GIFT SOLICITATION
In addition to the gift range chart and a list of prospects, two more elements need to be in place before your organization can begin to solicit major gifts: materials, both virtual and physical, that describe your work and how to make donations; and people to solicit the gifts.
Descriptive Materials
It goes without saying that every organization needs a useful, up‐to‐date website with information delivered through pictures, graphics, and even short videos, in addition to text. But for major donors, solicitors need some actual materials that can be printed, or can be easily sent as an attachment to an email. Some organizations create a brochure aimed at a major donor audience, but many eschew that expense in favor of simple, standard sheets of paper with background information related to asking for a gift, including “Frequently Asked Questions” about the current program or campaign, a copy of the gift range chart for the current campaign, and a list of what the money will buy. These materials can also be attached to an email. If they are printed, they are put into an attractive folder with a picture or the logo of the organization on the front. Each sheet includes the website so people can easily give online, but the packet also includes a return envelope for the many people still using checks. Because these materials will be used primarily in personal solicitation, they should focus on ways for the donor to make thoughtful gifts. For example, encourage people to make a monthly pledge, and describe the tax advantages of giving highly appreciated assets.
The information in the packet is essentially a published, though perhaps condensed, version of your case statement (discussed in Chapter Three). It also helps volunteer solicitors by giving them something to leave with a donor and to refer to if they forget some information they meant to impart. Make sure all your materials encourage the donor to visit you online, and make sure that information about how to give and choices about giving are completely clear.
Solicitors
Finally, since we are asking major donors to make thoughtful gifts, we want to ask them personally, either face‐to‐face or by videoconference, for these donations. You'll need a core team of people willing to do the soliciting. Some of these people should be members of the board of directors, but the board's work can be augmented by other volunteers. These solicitors should all be trained in the process of asking for money (see Chapters Eight and Nine). They do not have to have previous experience in asking for major gifts, nor do they need to know many prospects personally. But they must be donors themselves, and the donation they are making must feel significant to them.
KEEPING IN TOUCH WITH MAJOR DONORS
One of the most frequent complaints from major donors is that organizations treat them like ATMs—they punch in the amount they want and then walk away until they need money again. Keeping donors interested in your group requires showing some interest in them, particularly why they are interested in your group. To give major donors this extra attention takes work, but it is work worth doing for several reasons: first, because it is courteous; second, because it brings donors closer to the work of your group, making them potential activists or advocates; and third, because it will bring in more money.
In addition to asking major donors to renew or increase their gifts, you should be in contact with them two or three times a year. You will want to be in touch with some donors more often, depending partly on the size of their gifts and mostly on their personality and expressed level of interest. Remember that major donors are a good source of feedback, advice, and volunteer energy, as well as a source of introductions to other potential major donors.
There are several easy ways to keep in touch that make major donors feel personally appreciated and that do not cost the organization much in time or money. You can choose from the suggestions here or develop your own system, but be sure to put a system in place.
Send a Holiday Card During December. The card should wish the donor happy holidays and be signed by the chair of the board, a board member with a personal relationship to the donor, or the executive director or another staff person who knows the donor. If possible, the signer should write a brief note on the card. The card goes alone—no return envelope, no appeal letter. (You may also send major donors a year‐end appeal in a separate mailing.) Unless your organization is religiously identified, make sure the card has no religious overtones, including cultural Christian overtones such as Santa Claus, elves, or Christmas trees. The same applies to the postage stamp you choose. Even if your relationship to the donor is entirely online, send a printed card if you have a street address. Very few people dislike receiving personal mail, and many people who grew up with snail mail miss the personal notes and letters that have been largely replaced by email.
Attach a Personal Note to Your Annual Report Or a Personal Email with a Link to the Report on Your Website. All donors should receive a copy of your annual report. You can put it on your website and send an email with a link to the report and a brief note thanking donors for all they have done to make the work reflected in the report possible. For the major donors with whom you correspond by snail mail, send a printed copy of the report and a personal note. The note can be on a sticky note and does not have to be long. Say something like: “Because you have been so important to our success, I thought you'd be interested in seeing this year's report,” or “I hope you are as proud of our work as we are—your gift helped make it possible.” It doesn't matter if you don't know the donors—a personal note shows that they are appreciated. If you know that something in your report will be of particular interest, note that: “Shakira, that program you asked about is featured on page five,” or “Fran, check out the photo on the back inside cover.” The notes are written by staff, board members, or volunteers who have relationships with these donors.
Note in your paper report that the report is also posted on your website and encourage donors to send that link to friends and colleagues. The paper copy may well grace the coffee table or magazine rack in the waiting room of an office. The annual report is a very important piece of communication. Even the smallest nonprofit should budget some money so that the report looks attractive, including having some photos, and is well written.
Report Successes During the Year. If you have positive press coverage, if you win a victory in your organizing or litigation efforts, if you are commended by a community group, service club, or politician, take the opportunity to send a special letter to major donors telling them of the event. If possible, include a copy of the article or commendation. This letter does not have to be personalized.
Note a Donor’s Accomplishments. If you learn that someone graduated from college, won an award, had a baby, or got a new job, send a card or congratulatory email. Don't spend a lot of time trying to learn this kind of information but pay attention and respond when the information comes your way. If you know a donor's birthday, you can send a card then, too. If you have your donor's email address, you can send e‐cards to save postage.
Include Brief Personal Notes with All Mailings. You can include a brief note with anything major donors will be receiving anyway, such as invitations to special events or announcements of meetings.
Include Major Donors in Some General Mailings. Although you will probably not send major donors all the requests for extra gifts that you send to the rest of your donor base, when a mail appeal is particularly timely or concerns a specific issue that will be interesting to them, include major donors in the mailing. You can always put a sticky note on the mailing that says, “This is just FYI.” Ditto for e‐appeals: the subject line for major donors can be “Just FYI.”
Just Send a Quick Email. You will be in touch with many of your major donors by email when you are requesting a renewal. So that your email messages to donors are not always about money, from time to time, drop them a brief note or forward something that you think they will be interested in seeing.
By keeping in touch with your major donors, you will lay the groundwork necessary to approach them for renewals of their gifts in the second year and a request to increase the size of their gifts the third year. Even if no one in your organization has ever met these major donors and their gifts came unsolicited, through personal notes and letters you will begin to build a rapport that will enhance the interaction when you meet them in the future.
RENEWING MAJOR DONOR GIFTS
The process for approaching major donors to renew their gifts will vary depending on the amount they have given. This section describes how to ask for renewals of various size gifts.
Gifts of $250 to $499
These gifts are the smaller end of major gifts, and many organizations do not include these donors in their major gifts programs. However, many of these donors may be stretching to make this size gift and need a little more personal attention than donors giving less. Near the anniversary of the donor's gift, send an email (or letter) asking them to give again. In the email, describe the highlights of the year just passed and attribute some of that success to the donor's gift. Whenever possible, use stories to illustrate your work rather than simply narrating one dry fact after another. One paragraph should be devoted to the needs of the coming year. The next paragraph asks the donor to renew their gift. The letter should ask for the same size gift as the donor gave the previous year, which both reminds the donor of the amount of their last gift and shows that your organization keeps careful records. Offer to talk if the donor would like, but include the link to the website so they can give online. If you have sent a letter, then include a return card (reply device) and return envelope.
Gifts of $500 to $999
Use the format for gifts up to $500, but after about 10 days, if you have not had a response, follow your letter or email with either another email or a phone call. The phone call will go something like this:
“May, this is June calling to follow up on my letter. Do you have a few minutes right now?”
“Yes, June. It's lovely of you to call. Congratulations on your good work.”
“Thanks, May. As you well know, we couldn't do it without donors like you, and I wanted to tell you a little more about the campaign we are launching this month. [Two to three sentences at most.] It is a logical extension of the work we have been doing.”
SILENCE—Let May talk. What June says next will depend on May's response. If she says, “I like that—it makes sense,” then June can say, “Will you be able to help us again this year with $500?” If May has questions, June can answer them and then ask for the gift.
June can then thank May for renewing her gift and ask if she has any other questions or tell her something that wasn't in the letter (but be brief!). The whole interaction will not take more than five minutes unless May has some questions. Obviously, if May has a lot of questions or disagrees with the direction the organization is going, June will not ask for another gift, but might set a time for a longer conversation.
June will very likely get May's voice mail, and her message will be essentially the same: “May, this is June calling to follow up on my email. I just wanted to thank you again for your support last year, and ask you to consider giving again this year. I will try you again on Wednesday.”
After two attempts, and if a donation has not come in, return to email and say, “Dear May, Would love to talk with you about our work, but I know you are really busy. Do you have any 10‐minute windows in the next day or two?”
Many times these interactions will be completed by email, with May responding: “I am drowning in work, but want to help. Remind me in a month.” If used well, email is a great boon to donor solicitation.
Gifts of $1,000 or More
Send a much briefer letter telling the donor you would like to visit in person (or via a virtual meeting platform if geographic distance is an issue) and that you will phone to set up a time. If you are simply asking for a renewal, the telephone request for a meeting will often go like this:
“Frank, this is Earnest. Did you get my email?”
“Yes, it came yesterday.”
“Great. Can we get together some time to talk about the possibility of you renewing your gift?”
“You don't need to visit me for that. I'll be happy to renew.”
In this exchange, even though he is planning to renew his gift, Frank may still feel pleased that he was given this attention. Again, the interaction is very brief. If Frank does want to meet, he will be drawn even closer to the organization and you will have a chance to see how your group appears to someone who is thoughtful about how much money to give you.
Some major donors will prefer email to phone follow‐up, and your entire conversation may be done by email. Or you could see if they are open to meeting virtually.
WHEN TO ASK FOR MORE
Two questions often arise: How many times should you ask donors to renew their gift at the same amount before asking for an upgrade? And similarly, once the gift is upgraded, what is the appropriate amount of time before asking for another upgrade? The answer to both questions is simple: know your donor. The sooner you meet the donor and learn more about them, the sooner you will have a sense of whether they like to be visited, whether they are giving to their capacity and cannot give more right now, and whether there is anyone else in their household who should be included in the solicitation.
Of course, you can't know all your major donors right away, and some you may never meet. When you don't know, follow this formula: invite the gift, and if successful, the following year ask for a renewal, the third year ask for an upgrade. If you receive a larger gift after asking for an upgrade, ask for a renewal of that gift the following year, and the next year ask for a gift that is larger by one‐third. Then repeat the cycle: for a couple of years ask for a renewal and then another upgrade, and so on. If the donor stays at the same level, keep asking for more unless you have information that the donor is giving as much as they can afford.
In addition to this formula, use common sense. If someone gives you $10,000, you may need to wait to ask for a renewal for a few years before asking for more. You can always add the phrase “or more” onto any request you make if you really don't know how much more to ask for.
Of course, your organization must be able to justify needing more money, and that need must be expressed to the donor in a compelling way by putting it into programmatic terms. Hiring another staff person, for example, is not compelling; serving 20 more children (what the additional staff person is needed for) is.
STRUCTURING YOUR PROGRAM AS A CAMPAIGN
Most organizations build their major gifts program into their individual donor efforts, and seeking major gifts is an ongoing program, with different volunteers helping at different times. However, major gifts solicitation can be done in the form of a campaign—that is, with a formal beginning and ending time, specific materials, and a special committee. The advantages of running a campaign is that it begins and ends. You can't keep putting off asking someone because there is a goal and it must be reached by a certain time. It also means that major gifts solicitation doesn't hang over your head all year long, even though, of course, you are open to asking for and receiving large gifts anytime.
To run a campaign, take all or part of the 60% of your entire individual donor goal and make a plan to raise it in six weeks. Pull together a committee of motivated people, either let them choose their prospects or give them a list, and give them some materials to use. The materials need to emphasize the timeliness of the campaign—“We need to raise $50,000 in six weeks to ensure that our summer programs continue to be affordable to our constituents.” Short campaigns appeal to competitive people because they are almost like a game—you will win if you meet the goal in the time allowed. They also appeal to people who hate asking for money because the end is in sight. They are very intensive and not easy for organizations with few or no staff. If you do run a campaign, make sure it ends when you say it will. If you can't raise the money in six weeks, it is unlikely you can raise it in seven. Cut your losses and, without guilt or shame, look at why you fell short. Was the goal too high? Did the volunteers have enough preparation? Were the prospects sufficiently vetted or were they just names on a sheet of paper? If you do succeed, think about what you did right, and remember to do that again.
THE HARDEST YEAR
In planning to add a major gifts component to your fundraising, keep in mind that the first year of recruiting major donors may be the hardest. Do not set your goals too high; you don't want volunteers to be demoralized by failing to reach an unrealistic goal.
The most important step to take in a major gifts program is to start. Even if you have only one prospect, ask that prospect. If the largest gift you can imagine someone giving is $250, start by asking for $250. A major gifts program builds on itself; simply establishing the groundwork for the program will begin the process of getting major gifts.