Fundraising 101 : 10 Things You Need to Know About Capital Campaigns

Launching a capital campaign, even in the best of times, is something that requires a good deal of courage and conviction. If you've ever been through one, you know what we're talking about! Given the current financial situation, it's not surprising then that many nonprofits are shelving their big fundraising plans in anticipation of the happier, more stable financial times that are surely coming … at some point in the future.

The problem is that everyone has a different idea of when that "future" will occur. The truth is, while some organizations are wise to hold off, others might be missing opportunities. Even the economy doesn't change the fact that individuals and organizations want to respond to the challenges of our time by making a difference with time and/or money. There is no way to know what the future holds, but each organization should use this time to communicate its values and show appreciation to its donors.

The following 10 key points address issues that are essential to conducting an effective fundraising campaign.

1. Take a disciplined, realistic approach to planning
Devote the time and energy necessary to thoroughly develop a vision for the future and plan (involving key stakeholders early on) for what it will take to actualize that vision. Once those elements are defined, testing the appeal with a broader group — some who know the organization and others who are less familiar with it— to determine what resonates and which individuals will support it is invaluable. You might need to adjust your own expectations, and you might discover you need to explore a variety of funding options, including phasing.

2. Make the case
Know why this capital campaign is integral to your mission and the people you serve, and why it has to happen now. In this environment, where people already feel strapped for cash, organizations have to cross an even higher bar in making their cases for gifts — communicating a compelling vision that has a sense of boldness and urgency. Include details about how this campaign will move the organization to the next level (and affect those served) and why action must be taken now.

People give most generously because they believe that their gifts will make a difference and that their gifts are significant, regardless of size. Crafting impact statements that are more specific will help make the opportunity real to the potential donor.

3. Create a (simple) shared process for case development
The board does not necessarily have to be involved in the writing of it, but board members should be invited to give feedback. Board and staff leadership must have unity around the case to ensure that they are equal advocates of it, bringing their collective passion and energy.

4. Leverage your human capital
Getting volunteers involved can take time, but it's worth it — so start early. Think about using this as an opportunity to engage younger individuals, as well. Use this human resource to broaden your reach. Some members will want to host cultivation or stewardship events. Others might hold key relationships that they're willing to access on the organization's behalf. Invite leadership volunteers to assist the organization by taking on four to five existing or new relationships with major givers that they will lead in cultivating with the ultimate goal of major-gift solicitation. Consider using some of the new technology options to keep people informed and engaged.

5. Build your pipeline
Spend time now cultivating new relationships and renewing your relationships with existing donors before you're in the middle of the campaign. We find that it takes a larger prospect-to-donor ratio to obtain the gift. Plan accordingly. As individuals begin to make commitments to the campaign, consider inviting them to cultivation events for new donors, using current donors to tell why their gifts are important. Building a sizable pipeline of prospects who have many opportunities to feel connected to the organization is one of the best ways to prepare for a campaign.

6. Get to know your donors
These days, individuals typically give to their top three nonprofit organizations, and give less frequently (if at all) to organizations that fall outside those parameters. When you get that first meeting with a potential donor, don't ask for a gift. You are building a partnership. Learn about the potential donor and what his goals are; give him time to get to know you and the organization and why this campaign is important to his community.

7. Adjust timing expectations
Gifts are being given, but many are taking longer to get and are less than originally expected. Many individuals are trying to predict what the market will do to determine whether they will make gifts and the size of the potential gifts. Initial gifts to the campaign are not necessarily the last gifts. We find that five-year payouts for major-gift donors are becoming the rule rather than the exception. Be flexible with donors around timing; some donors may need to ease in to their giving. Enable donors who desire to be supportive but cannot give cash right now to make deferred gifts that will be used in the future. Or allow a portion of their gifts to be allocated to capital and endowment needs.

8. Plan for stewardship
Stewardship is one of those things that many nonprofit organizations feel they already do well, but the messages we hear repeatedly from donors are often the opposite. Be disciplined about stewardship — develop a plan, assign responsibilities, hold people accountable. Once someone contributes, keep her informed on a regular basis about the campaign progress and how her funds are already changing the lives of those the organization serves and inspiring other donors to follow her lead.

9. Continue to evaluate your progress, and keep the big picture in mind.
Be disciplined about monitoring the campaign process, campaign progress-to-goal and priorities. The development team should meet regularly to discuss portfolios and review pipeline reports. Your chief development officer should meet regularly with the chief executive and chief financial officer to review campaign reports on fundraising progress and project costs to ensure that goals are realistic. If a campaign is not comprehensive, creating a complementary relationship between the annual fund and capital campaign will be necessary.

10. Be courageous!
In these difficult economic times, there are not many capital campaigns occurring, which means there is less competition for significant charitable dollars. At the same time, there are individuals who are still giving lead and major gifts. Is there ever a good time to fundraise? Any time you have a compelling case is a good time. 

Thomas Mesaros is president and CEO of The Alford Group. Reach him at tmesaros@alford.com.  Cate Fox is a consultant at The Alford Group. Reach her at cfox@alford.com. 

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