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CASE: Given the uniqueness of community colleges and the diversity of individuals they serve, why do you think they should adopt techniques used by four-year institutions?
Klingaman: My nine-year experience as campaign director at a two-year technical college proved to me that the paradigm works. That said, two-year colleges need to adapt techniques used by four-year institutions before they adopt them. My book covers these adaptations in detail. But when you look at academic fundraising as a whole, the techniques of the private primary and secondary education sectors share much in common with collegiate fundraising. The core is the academic fundraising model. One big difference between two-year and four-year experiences is the degree to which people remain loyal to their alma maters. I advise two-year colleges to help their alumni celebrate academic beginnings as well as graduations.
CASE: You note that you’re often shocked to hear about the state of many community college fundraising programs, which you say go through the motions without achieving defensible outcomes. Why do you think community colleges should pay more attention to metrics like return on investment? And, with this shift, what else about their fundraising culture should change?
Klingaman: Metrics begin with mission and stewardship. If we are going to devote precious resources to two-year college advancement, we should adhere to standards that exist throughout the nonprofit sector. Fundraising costs should not exceed 25 percent to 30 percent of gross fundraising revenues, and it doesn’t matter if the college is paying the foundation program expenses. It’s not what shows up on the Form 990; it’s what we know to be the real ROI on development dollars spent. That’s stewardship. What gets measured gets done, and what gets done, gets noticed. Colleges that can show significant ROI on their advancement programs will thrive for the reasons that all well-resourced philanthropic missions do.
The degree of culture change required depends on baseline advancement performance. But if you want to create a high-performing advancement program raising a million or two million dollars a year, it will have to become a top five, or better, top three priority of the leadership culture.
CASE: You suggest that a community college designing a development program should avoid holding gala events and instead focus on establishing an annual fund. Why do you think this is a better investment? Also, when are events appropriate as a fundraising tool?
Klingaman: An annual fund is a better investment from an ROI standard. You have to take personnel costs into account when you evaluate development performance. If you are tying up three or four months around an event, the real net plummets. When you look at the performance of a major gifts program, you calculate the investment of staff time against the revenues. In addition, the opportunity cost of events is exceedingly high. You displace a range of other giving opportunities when you focus on events, including employee annual giving, giving clubs and major gifts. It’s more productive to lead with the mission, cultivate personally and close gifts where you can put 100 percent of the gift toward the mission. Then thank people at a recognition event.
Events are appropriate as a fundraising tool when they augment mature programs, serve niche needs and can be proven not to cannibalize other, more potentially productive programs. But if you are relying on events, the more successful they are, the more dependent on them you become.
CASE: You write that, ideally, a community college should make development “a top-three institutional priority” and that its president and foundation board should lend active support to the development initiative. Why is this kind of institutional and personal commitment important for development success?
Klingaman: Development must be a top priority of the institution to overcome the inertia that surrounds nascent, or stagnant, programs. Fundraising—development—is hard work. I always say you don’t do it unless you have to. Without a significant leadership commitment on the part of the president, the leadership team and the foundation board, you end up, even under the best of circumstances, with a staff-driven program that raises perhaps 50 percent of your potential. Or you revert to special events. But the involvement and active interest of the president is key, absolutely key. Any college that wants to raise a million dollars a year—and up—must have an escalating commitment from the president. Think 15 to 20 percent of the president’s time—and that’s for starters.
For many colleges, meaningful advancement is a challenging new world. But the proven effectiveness of leading with mission, creating personalized cultivation, building a diversified program, and closing gifts to support essential programs remains viable regardless of the intrinsic challenges experienced by the sector. It’s a new frontier, but public secondary education is joining the fray, and it will be a more competitive universe in the future. The two-year sector needs to claim its rightful place in the philanthropic world because its mission as the gateway to the middle class is so essential.