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Invest in major donor fundraising, or at least don’t disinvest

Recently I’ve heard of major donor fundraising roles being made redundant because ‘philanthropists won’t want to give now’.  I’ve heard numerous cases of hard-fought investment for major gift programmes being reversed, and I’ve been asked by fundraising leaders, Managers, CEOs and fundraisers how they can make the case for major donor fundraising right now.

So I’ve collated some of the great evidence and research (with particular thanks to Rogare, Giles Pegram CBE, Mark Phillips and Bluefrog Fundraising) – I hope it helps you in these conversations. 

1. Let’s start with the basic truth: you cannot raise large gifts without investing

All organisations are having to make incredibly tough decisions. Yet why cut spend that will generate income? The charities who have retained or increased major donor fundraising resource have already had positive conversations with high-net-worth individuals. They are getting support even when they’re not direct COVID response charities. Like the fundraiser I’ve been coaching who got a meeting with a venture capitalist within 2 weeks of lockdown (they’d been trying for the previous 12 months with no success). Or the regional charity that has secured their largest-ever gift. Or the CEO who secured £200k of pledges within 5 days.

As Giles Pegram CBE has frankly stated:
“Once all this is over, however long that might be, there will be two different groups of charity. The ones that have invested in their fundraisers, who have then in turn been able to spend time and creative energy keeping engaged with their supporters: making them even more loyal than before. And those that haven’t….The first group will have a considerable advantage over the second group, and so, quite quickly, be able to raise more money and help more beneficiaries.”
(you can Giles’ full blog here)

Because how are we going to raise more without investment?! Major gifts can be transformational for your cause. Return on investment for an established major donor programme can be 9:1 within 2 years and you should be able to break even or return 2:1 in the first year. However, one of the biggest reasons I see for the failure of organisations to raise large gifts from major donors is a lack of consistent investment. Fundraisers are in post for 6 months and then their post is cut; a donor is sent a thank you card for their £50,000 gift but the resource isn’t there to do anything else (and the donor unsurprisingly stops giving).

One of the biggest reasons I see for the failure of organisations to raise large gifts from major donors is a lack of consistent investment. Fundraisers are in post for 6 months and then their post is cut; a donor is sent a thank you card for their £50,000 gift but the resource isn’t there to do anything else.

The current disinvestment we’re seeing is painfully familiar to many of us.  When I was at Unilever we would never have dreamed of cutting investment in a product line, whilst still expecting the same sales. We certainly wouldn’t have planned for growth without investing.  So why should we think it’s possible in the third sector?  Are we saying that we’re cutting investment and we’re happy to see income decrease?

To raise large gifts, you need dedicated resource. If you’re getting rid of it, or not investing in it to start with, you need to start lowering your income forecasts now.

2. The wealthiest have more financial resilience

“Our wealthy donors will also be struggling. We don’t want to be seen to be ‘capitalising’ on the situation.”Sound familiar? Well, let’s look at some evidence:

  • Giving by the wealthiest is often elastic.  Research by Dr Beth Breeze, Director, Centre for Philanthropy at the University of Kent, shows that major donors will often add new charities to their portfolio of giving (rather than have a ‘one in, one out’ policy and a fixed giving budget).
  • After the Global Financial Crash, in 2008 major donor income held up, with some donors increasing giving.*** Similarly now, many major donors’ investments and industries are being shaken by this global pandemic. This means some high-net-worth individuals might not be in a position to give today, but that doesn’t mean they won’t give later in the year when they have more certainty over their businesses and affairs. If you’re not having conversations now though, why would they give to you in 6 or 12 months time?
  • Those conversations need to be happening. The wonderful thing about major donor fundraising is that we’re not sending a mailing to thousands of individuals. Instead we’re understanding each individual’s position (or we should be). A CEO I’ve been working with spoke to a major donor in the construction industry; from that conversation he realised how uncertain the donor’s business was (the CEO, therefore, didn’t make an ask). A fundraiser I’ve been coaching called a long-standing major donor two weeks into lockdown and had an incredibly positive conversation.  In it, the donor volunteered that she was worried about her investments-she declared without prompting that she wouldn’t be giving right now but would keep the charity in mind for a few month’s time, (since then both charities have raised individual gifts of between £10k and £75k from other donors and have had more positive contact from those that couldn’t give.)
  • We need to understand that, “even in a recession, not everyone is going to be affected, and we need to be aware that some people are going to be better off following the lockdown.“** This is particularly true for the wealthiest in our society.

even in a recession, not everyone is going to be affected, and we need to be aware that some people are going to be better off following the lockdown. [Mark Phillips]

3. Major donors will give IF they’re asked when it’s right for them, AND for a cause they care about

There are no wrong or right causes to be fundraising for right now with major donors (or indeed through other types of fundraising.) Your supporters cared about animals, the future of the planet, their local community, cures for diseases etc before Coronavirus.  They will care now.  “If it mattered before COVID-19, it still matters now”**.

Interviews with donors show that as life starts to return towards ‘normal’ with lockdown lifting, donors want leadership from the causes they care about.**  They want to know how they can make a difference.

“..because research shows that most people only give to charity if they’re asked to do so, charities have a duty to their beneficiaries to ask for support. A lack of action sends a message to a charities’ beneficiaries that they are not important.”*

Philanthropy means love of humankind and Dr Beth Breeze’s interviews with hundreds of philanthropists (in her book Richer Lives: Why Rich People Give) demonstrates the enrichment that high-net-worth individuals gain from giving large sums of money to make a difference; including from their relationships with charities, and from knowing they are a part of creating positive change. This is more relevant than ever, with the growing problems in society becoming more and more apparent.

Dr Jen Shang’s research, the world’s only philanthropic psychologist, shows us that charities are in a unique position to build deep connectedness with their donors. The one on one relationship building that major donor fundraising involves, when it is invested in, gives us a tremendous opportunity to develop these relationships for lifelong giving, at high levels.

The one on one relationship building that major donor fundraising involves, when it is invested in, gives us a tremendous opportunity to develop these relationships for lifelong giving, at high levels.

Charities that have invested in this area are seeing donors accept invitations for the first time to on-line events, where they’re becoming engaged and connected to the charity and seeing the difference the charity is making. There have been on-line question and answer sessions about conservation, virtual tours of medical research labs, and concerts to highlight the power of music for vulnerable people. High-net-worth individuals are engaging, and many are giving.

High-net-worth individuals are the people that could enable your cause to survive and to thrive. If we want to partner with them to make the change in society we all work day in day out to achieve, then let’s get back to the basics:

We need to invest in our major donor fundraising or accept a potentially terminal decline in income.

Photo of Louise, charity fundraising consultant

Louise Morris is Founder of Summit Fundraising. She’s a major donor fundraising specialist who’s worked with over 100 charities helping them raise large gifts.

*Advocating for fundraising during emergencies. How to respond to arguments that fundraising is ‘inappropriate’ during the Coronavirus pandemic. Rogare the Fundraising Think Tank.(June 2020) Available at https://df618d67-1d77-4718-ac14-01d78db8f9d0.filesusr.com/ugd/8bc141_fcc30817df7a4b4dbd26c72f1df089bf.pdf Rogare report 

** The Time for Leadership, Giving in the Time of Coronavirus. Mark Phillips and BlueFrog Fundraising. (July 2020) Video available at https://queerideas.co.uk/2020/07/the-time-for-leadership-giving-in-the-time-of-coronavirus.html 

***Tomorrow’s Philanthropist, Barclays Wealth, (July 2009) available at http://doingmorethatmatters.com/wp-content/uploads/2013/09/Barclays-Wealth-Tomorrows-Philanthropist_us.pdf

This was posted on 15 July 2020.

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