The first element of fundraising success begins with defining your nonprofit as a solid organization. Is this still valid today?
Even before the momentous events of 2020, the world-wide pandemic, and last summer’s civic disruptions there have been a growing number of voices that are challenging the status quo of accepted best practices. Our daily discussions have changed to include social justice, public health and virus mutations. So how is this affecting nonprofit organizations?
The first element of fundraising success begins with the nonprofit organization itself: what it does, how it describes its purpose, and how it differentiates itself in the philanthropic arena. Historically, we have advised our nonprofit clients to highlight their capabilities and accomplishments to demonstrate that they are a solid organization worthy of a donor’s philanthropic investment. We define a solid organization, as follows:
Element #1. A solid organization
While it may seem obvious, it must be emphasized that people generally prefer to invest in successful organizations — those they know will use their money wisely, and continue to serve the community well for many years to come. That’s one reason that “established” organizations raise a great deal more money than those which are lesser-known. The “mainline” organizations have simply been around long enough, and provided quality service to enough people, to earn and keep the community’s trust and confidence.
If an organization is contemplating a capital campaign or a new major gifts initiative, then, it should be able to demonstrate that it is:
- Providing a needed service, with quality and reliability
- Led by competent and respected professionals and volunteers
- Financially sound and well-managed
- Known and valued in the community
Can we still say that the established and solid organization is raising more money? By some accounts, philanthropists, foundations, and corporations have devoted more than $10 billion in the past year toward racial justice programs, and are supporting many newly-created organizations and initiatives. Observing recent events it may seem that disruption, activism, and new are more important organizational attributes than established, successful and effective.
Why do we still believe that being a solid organization and providing a needed service while being financially sound is an important ingredient for future success?
The objective to define your nonprofit as a solid organization originates from a marketing and sales perspective. The guiding concept is that the solid organization is more capable of future success which distinguishes it in a competitive marketplace and leads more readily to an awareness of, admiration for, and support from a constituency of donors. Just as an investor works to carefully evaluate how they invest their assets; it is also true that donors will seek the best and most effective organizations for their largest philanthropic gifts.
Some nonprofit industry disrupters are challenging the status quo of social policy and suggesting that donors have too much influence over organizations. Instead nonprofits should be more focused on what is best for constituents, and the community; moving from a donor-centric model to a community-centric policy. But this presupposes that the donor is more motivated by the influence that they may obtain, rather than the impact of their gift.
Today, we are also witnessing both demographic and technological change at a more rapid pace. Millennial donors are engaging in new ways of giving back which frequently highlight socially rewarding media platforms that aggregates their giving and preempts any direct relationship with the charity, nor presumably any consideration for whether or not they are giving to a solid organization.
Further change is certain as technology, culture and societal norms evolve the way donors give. Does this mean the donor of tomorrow will let some thing or someone else decide who receives their benevolence? Regardless of the “how” of engagement, we still believe it’s about the “what” of impact.
We believe that donors will continue to make their own decisions, and seek to balance sound economic judgement with a genuine desire to resolve societal issues. We are also confident that there will be a high level of competition for the attention and loyalty of donors, and that these same donors will want to be confident that their chosen organizations will do what they say they are going to do.
It is still critically important to demonstrate that your nonprofit is a solid organization, well-managed and financially sound. However, this will require you to continuously question, prove, and demonstrate your relevance to donors in light of societal issues that came to the forefront in the past 16 months. New does not equal better and established does not equal inconsequential.
Adherence to your mission and serving your constituents with quality and reliability will distinguish you as a solid organization in an increasingly competitive fundraising environment.
So what has changed? We believe that the lens through which donors view your organization is changing and continues to evolve, which will be explored in our next blog entry.
Working transparently and honestly to define your solid organization as one that: provides a needed service, with quality and reliability; is led by competent and respected professionals and volunteers; is financially sound and well-managed; and, known and valued in the community will lead to more successful and effective fundraising.