Why Reinvent the Wheel?

One scenario I encounter in my interactions with community colleges is a tendency to want to invent advancement program activities from scratch. Why do so many community college development professionals figure that need to reinvent the wheel? I think it has something to do with the fact the many community college development professionals are relatively new to their roles. They may have a history in development, but they don’t have a history in the collegiate model of development, or in community college development shops.

The second reason they seem to lean toward going it alone is that they don’t consider how similar their institutions are to other community colleges. The gap between the highest performing community college advancement programs and those that have barely begun is astonishing. And those who are new to the game could save years of start-up time by systematically benchmarking with institutions that are relatively advanced in comparison.

It doesn’t do much good to benchmark with another institution that is new to the game. If you want to learn about alumni relations, find an institution that has a robust alumni relations program. How to find one or two? Check out their foundation websites. Talk to colleagues at conferences. Check in with the community college in your state system that is raising the most money. Sign up for CASE webinars.

The easiest way to get ahead is to imitate those who are ahead. The biggest obstacle to doing that is usually that the start-up institution has yet to commit the resources to achieving desired programmatic goals. There are no magic outcomes. Getting ahead in advancement requires investment in trained personnel and systems.

Many emerging advancement shops make piecemeal investments in desired outcomes and then wonder why achieving their goals comes so slowly.

If you want to see how the pros do it, benchmark against smaller or rural state college or university advancement programs. The assumption that holds community colleges back is that they think they have nothing in common with four-year college advancement. Nothing could be further from the truth. It is not so much a difference in kind as it is a difference of degree and type.

Alumni are alumni everywhere. The same fundamental dynamics are in play. Yes, the specific applications and solutions you choose will vary from the four-college program, but only incrementally. And the manner in which you tailor your alumni engagement effort allows for a significant level of creativity to flow into the mix. And that can be fun—and easier than reinventing the wheel.

If nothing else, benchmark with a four-year college on how they track their alumni. I have seen scores of community colleges struggle with this aspect of development readiness. Four-year colleges had to wrestle with the same questions. And once upon a time they had to invest in tracking their alumni or suffer depressed outcomes for years at a time.

So when it comes to keeping the wheels rolling smoothly, consider the value of not trying to invent them from scratch!

 

“Five Ideas for Fifty Thousand”—for the Community College with the Tiniest Shop—or One That Doesn’t Even Have a Shop

Rudimentary as this is, it outperforms the net on many special events

Employee Leadership Giving:  Even without a complete employee annual giving program, you can launch a giving initiative that focuses on the top leadership team of the college. Because these gifts can be in the $200 – $1,000 range, this simple effort can yield $5,000 to $10,00o.

Board Giving:  Every board should give at a rate of 100%. The board Ask should start at $1,000 and go up or down from there. Yield: $15,000

Grants:  Most community colleges have grant programs in place, upon which we can leverage new proposals to private funders using a standard template for operating or scholarship support. Yield: $10,000

President’s Personal Asks:  Every president knows 5 to 10 community leaders who can be approached directly for gifts. When the president asks, the importance of the initiative is reinforced. Yield:  $7,500

Board Asking Peers: Every board member knows one or two people who can be approached for a gift in the $100 to $1000 range. I call this an “Each One Ask One” campaign.   In my book, I discuss a more robust version of this approach in context of a board-initiated giving program. A single prospect, a single Ask, and a single follow-up on the part of the board member is all it takes. It is a way to build a volunteer culture and reinforce the importance of the mission to the board. Yield:  $7,500

Total Yield: $50,000

These techniques will work for a college that has little in the way of a fundraising program in place. If you need help, a consultant can help tailor the initiative to the needs of a particular college via a phone conversation with the chief development officer or president of the college.

It’s Time to Focus on Individual Giving

More than 80 cents of every dollar given to charity comes from individuals. In good times and bad, that figure remains remarkably constant. Historically, the precise number has hovered around 83 cents per dollar raised.

Community college fundraising, however, has tended to rely on institutional giving, primarily from business and foundations, for as much as two-thirds of philanthropic revenue.

This means that opportunity abounds when it comes to donor cultivation of individuals. The sector would do well to refocus much of its attention and investment in advancement to target individual major gift prospects. This means that the major gift officer position needs to become the norm in two-year college advancement shops.

Many shops are too small to succeed in this regard. And these two- or three-professional shops often have several thorny issues that tend to be endemic. They are:

  • The chief development officer (CDO) is too wrapped up in administrative duties and meetings to meet with prospects.
  • The program has a special events focus that occupies most of the staff for most of the year.
  • Foundation staff is preoccupied with a portfolio of activities that are relatively ineffective from an ROI perspective.

Classic donor pyramid logic informs us that we need to expand the base and move ‘em up. That means we need to focus primarily on individuals. We need to test the commitment level of loyal Annual Fund donors by cultivating them to make special gifts—that giving category one step up from their baseline Annual Fund gift amounts. This often means gifts of $1,000 to $5,000. They are not quite major gifts. Nor are they gifts for which you just send out a personalized letter if indeed they are a stretch commitment for the donor.

We need to remember that stretch capacity and stretch commitment are two different things. It is hardly rocket science to observe that donors who have the capacity to give at a higher level but don’t simply don’t have the commitment, the donative intent. We foster the commitment by cultivating special gifts as if they were major gifts. And, with time, and attention, and properly qualified prospects, they will.

So if I was setting up a major gifts program in a college that is still testing its individual giving prospects, I would have my major gifts officer take a portfolio of some special gift prospects in addition to his or her bona fide major gifts prospects.

The takeaway? People step up to the plate when they are asked to do so, in the context of mutually informed conversations, (not necessarily pitches) where the donor’s wide world of philanthropic opportunities is acknowledged and respected. Very often, the key to a donor’s interest is not what you say, but in how you listen and respond in such a manner that shows that you really did listen.

It’s an advancement perspective that is refined by constant practice. If the advancement staff is only making, in the aggregate, two or three face-to-face donor contacts a week, it will be mighty hard to build the necessary momentum for an institutional major gifts emphasis.

But the time for such a focus has arrived throughout the sector, and you can’t argue with the reality that the real money is in the hands of individual donors.

Sixteen Things to Look For in a College Foundation Form 990

One reason to review a college foundation Form 990 is to verify that the foundation actually does what it says it does—a useful thing to know for grantmakers, development audits, benchmarking, and prospective executives.

Here are 16 issues a Form 990 can help address:

  1. Do the numbers on the Form 990 support the amounts shown elsewhere?
  2. Personnel expenses paid for by the foundation (Usually the college pays for personnel expenses.)
  3. Outside fundraisers or fundraising consultants paid by the foundation
  4. College payments made to the foundation
  5. Endowment information, including decreases in endowment balances that may reveal the foundation is not properly managing endowments
  6. Event revenue and expenses paid by foundation, including grosses & nets (This can be tricky and requires reading the entire return.)
  7. Five-year history of fundraising revenue
  8. Diversification of revenue (you’ll get a partial picture)
  9. Two-year trend in grants amounts paid to college
  10. Program areas of grants to college
  11. Total foundation expenses
  12. Revenue less expenses
  13. Existence of uncommon organizational practices, revenue streams, and operations
  14. Number and names of board members
  15. Unrelated business income
  16. Investment management fees

On Colleges with Advancement Issues

When I talk to college presidents at colleges with dormant or underperforming advancement programs, they are quick to express their commitment to advancement and their good intentions for improved performance. Unless this stated interest is matched with institutional commitments to meet quantifiable metrics, however, the prognosis for improved performance is weak.

Fund raising is hard work. Most nonprofits excel at it only when their survival depends in some measure on their success in this arena. For those that don’t perceive fundraising to be an essential, core activity of the college, promoting culture change from the outside is extremely difficult. If a college tells you they are serious about fund raising but leaves the chief development officer position open for a year, the inertia speaks louder than words.

When a dysfunctional advancement program is an issue, what motivates a change in institutional behavior is real need, a commitment to change, the implementation of real metrics, and evaluation of outcomes. That, and the personal involvement of the president, who must invest time, cultivate prospects, and be prepared to make a few asks.

Visionary leadership on the part of the president can—and should—jump-start the whole process.

 

Repositioning for Fundraising

It was 20 Years Ago Today…

See if this article of mine originally published in 1994 by Nonprofit Management Strategies remains relevant today. I am struck by how many of the principles presented here made it into Fundraising Strategies for Community Colleges eighteen years later. Can you recognize any organizations you know in the advice below?

Repositioning for Fund Raising

Loss of Government Funding Often Sparks Attempts to Enter the Fundraising Market

You are the executive director of a small agency that historically has not raised much in the way of private funds. You have just been notified that long-held government funding will be lost or curtailed. After the initial panic wears off, you take a deep breath and resolve—once again—to approach the board about the need to raise funds.

Just don’t overlook the need to reposition the agency for fundraising.

Organizations that ask themselves, “Why can’t we raise funds?” often overlook one obvious answer: government funding.

Like an I.V. in a patient’s arm, government funding is an artificial-life support compared to fundraising in the private sector. Yet there’s no problem until it’s cut off.

In the book Nonprofits for Hire (Harvard U Press), authors Steven Rathgeb Smith and Michael Lipsky assert that governmental funding now accounts for roughly half of all social service agency income. They estimate the amount of governmental funding to be in the range of $15 billion a year.

Can this amount of money change nonprofit organizational culture? The answer is, “You bet!”

“Is he knocking government funding?” you ask.

Only to the extent that government funding breeds an organizational culture of indifference to fundraising. And that, unfortunately, is a common occurrence.

The reason not to engage in fundraising is, of course, it’s too hard. And organizations that have failed in past attempts to raise funds know better than anyone how hard it can be.

Repositioning 101

Repositioning involves three elements:

  1. Make your own commitment. (You. The executive director.)
  1. Give volunteer leadership a stake. (Here comes the culture change…)
  2. Enlist your board of directors. (They may never forgive you, but they will respect you.)

The Executive Director’s Commitment

A note to the executive director: You are the fundraiser in-chief. It’s your responsibility to:

  • Educate yourself.
  • Get serious about fundraising.
  • Develop a realistic plan to reposition the agency.
  • Cultivate volunteers everywhere you go.

Volunteer Leaders Are Made Not Born

Certainly one of the most fascinating elements of philanthropy is the human drama of volunteer relations, and the leader of any nonprofit organization has got to be good at it.

Many seasoned professionals will tell you the most satisfying part of their job consists of the many and varied relationships they enjoy with their volunteers. So how do you and your organization take advantage of this? You know the old saying about business—“location, location, and location.” With volunteers, it’s “cultivation, cultivation, and cultivation.”

The Board of Directors: They Really Will Forgive You

Here’s a premise you may not like: It is the responsibility of the executive director to manage the culture and performance of the board of directors.

And a premise they may not like: Repositioning for fundraising nearly always requires significant change at the board level.

Significant change at the board level is accomplished via the Alpha and Omega of board building: the nomination process and evaluation process. These processes belong to the board, but are managed in part by the executive director.

You can be successful without a high-powered board in the traditional sense of the term. There are many wonderful organizations out there proving it every day.

But you cannot be successful without the attention—and involvement—of your board. The trick is in finding the right roles for committed, trained board members to play. And of course, everybody gives.

Here are 12 keys to board success:

  1. The board must establish the repositioning effort as the number one or two priority of the organization. The effort must be characterized by measurable goals and accountability for performance.
  2. Find your potential board president and work for his or her advancement to that position. Lobby.
  3. Educate the board as to the principles of fundraising. Use outside counsel.
  4. Define “Give, get, or get off” and enforce it. This means offering nonperformers an “out” such as your new “advisory council.”
  5. Recruit strategically.
  6. Seek commitment, time, talent, connections, influence, and money.
  7. Without commitment, the other resources are wasted.
  8. Define expectations up front. Be firm. Be clear.
  9. Cultivate those who really interest you. Their time should be worth your time.
  10. Make a compelling case for the need and the mission.
  11. Giving begins with the board. Make it your first campaign.
  12. No one is exempt. All trustees must feel some involvement with the fundraising process.

Ira S. Robbins wrote in Fundraising: A Crucial Role for Board Members:

“The first responsibility of a board member, of course, is for himself or herself to make a contribution. It may be a large amount or small, but giving is of great importance.”

Nine Handy Maxims by Which to Survive & Thrive

  1. It is not sufficient to preserve the status quo.
  2. Success on a modest fundraising project is better than failure on a large one.
  3. Avoid committees where possible.
  4. Get out of the office.
  5. Fundraising performed in the context of a cohesive plan wastes no effort.
  6. Grantwriting is not fundraising.
  7. Board giving is the cornerstone of all giving.
  8. Give yourself two years.
  9. The truth about fundraising is that it’s hard—but it’s worth it!

The Scholarship Recognition Event: an Essential Cultivation Tool

One thing I’ve learned in 25 years of raising funds is that a little recognition goes a long way.

Hundreds of two-year colleges have had success bringing scholarship recipients together with the donors who funded the scholarships through a scholarship recognition event.

But make sure that donors are connected with the students they have helped to support, and that students themselves are doing the talking from the podium. Just vet them and coach them in advance, and keep the remarks short. Three minutes will do. The goal, as one foundation board member put it to me: not a dry eye in the house.

Have some donors onstage to speak, too. Unless there is a strong narrative arc in the remarks five minutes can seem like an eternity (particularly true when administrators are doing the talking!).

One nice touch when you don’t have too many students in attendance: have them receive scholarship certificates, convocation style, where each is called in turn to the podium to shake the hand of the president and a donor and receive the certificate.

Don’t forget to pair scholarship recipients and donors at their tables.

And whatever you do, put the mission first.

Don’t Overlook Employee Annual Giving

One of the most reliable Annual Fund methods is employee annual giving. Who better to understand the critical importance of support to the college than those who are closest to your students? Employee annual giving can play a role in the fundraising plan of every college.

Consult Fundraising Strategies for Community Colleges for a thorough presentation of a proven employee campaign model. Many colleges have found they can raise $25,000 to $50,000 per year—and more—for the Annual Fund through employee annual giving.

The only caveat is, make sure to seek community support with the same intensity you use to win employee support. Employees are, after all, somewhat a captive market.

The Role of Grants in the Annual Fund

While grants are often not renewed on an annual basis, they are an important source of annual operating income and scholarship funds in college Annual Fund programs. When one funder cycles out the mix a new one is found. And some funders do support colleges with annual grants over long periods of time.

Some colleges raise as much as one-quarter of their Annual Fund goal through renewable annual or multi-year grants. Either way, multiple-year grant funding will provide you with a stable funding base from which to cultivate funders for future grant awards. And Annual Fund grants for operating or scholarship support can be based on a boilerplate grant proposal template.

But be sure to call the foundation program officer or corporate giving officer before you write. A few strategic questions can save both parties valuable time.

The Two Most Important Gift Levels for the Annual Fund

The two most important gift levels in a community college Annual Fund are the $1,000 and $5,000 levels. Why? A combination of fiscal impact and relative availability. For example, aggregated $500 gifts don’t have enough impact and $10,000 gifts are too rare in the two-year college prospect universe. Classify $1,000 and $5,000 gifts as special gifts and cultivate them as an Annual Fund priority.

The most efficient way to reach your Annual Fund goal may be through special gifts. You might think of special gifts simply as larger than average Annual Fund gifts and smaller than major gifts.

Although there are several methods by which to raise special gifts, personal asks usually work best. Who should ask? The president, the chief development officer, development staff, foundation board members, senior leadership, and volunteers.

Variations on this theme include strategies such as Board-Inspired Giving, which relies on personal letters from board members to their peers followed by face-to-face or telephone follow-up by board members.

Certain donors respond well to personal letters followed by a phone call, just as they do in scholarship program solicitations. This technique, a variation on the scholarship ask, or the giving club ask, can be an effective way to raise special gifts.

Time-tested advancement practice holds that organizational and community leaders who “tell the story” and “ask for the order” are the most successful fundraisers and this is most definitely true with special gifts.