Transcript
WEBVTT
00:00:07.764 --> 00:00:10.226
Welcome to the Practice of Nonprofit Leadership.
00:00:10.226 --> 00:00:11.506
I'm Nathan Ruby.
00:00:11.506 --> 00:00:23.612
Well, here we are on day four of the 12 days of major gift fundraising, where we covered some prerequisites.
00:00:23.612 --> 00:00:38.929
By the time this series is over, I may be able to say prerequisites I got to choose an easier word next time but either way, prerequisites so that we are fully prepared to maximize our major gift program.
00:00:38.929 --> 00:00:48.182
Now one word of caution Don't overlook your organization's vision, mission, values and pillars.
00:00:48.182 --> 00:00:55.524
Resist the urge to just skip over that, because it might take a little bit of time and it's going to be a little bit of hard work.
00:00:55.524 --> 00:01:00.621
We spent time going over those things because it's important.
00:01:00.621 --> 00:01:02.384
Don't skip it.
00:01:02.965 --> 00:01:08.954
Okay, so today we are talking about identifying major gift prospects.
00:01:08.954 --> 00:01:14.992
So where do we find donors who have the potential for making larger gifts?
00:01:14.992 --> 00:01:20.634
Now, our output here today is actually a list, and that's it.
00:01:20.634 --> 00:01:24.631
When we're identifying prospects, the output is a list.
00:01:24.631 --> 00:01:27.421
We want to list one through 10 or one through 20.
00:01:27.421 --> 00:01:37.043
And it's a list of prospects who we think might give us a larger gift than our typical or regular donors.
00:01:37.706 --> 00:01:50.930
Now, before we get into that, into identifying and how we're going to pick those out, let's start with how do we define what a major gift is, and I do get asked this a lot.
00:01:50.930 --> 00:02:01.947
Whenever I'm talking about major gifts it's a question that comes up pretty frequently and the answer is there's really no hard or fast definition of what a major gift is.
00:02:01.947 --> 00:02:10.045
You, the executive director or the fundraiser, you get to define what a major gift is for your organization.
00:02:10.045 --> 00:02:17.186
Now there are some typical rule of thumbs that you could use to kind of help you figure out what that is.
00:02:17.186 --> 00:02:24.627
So one rule of thumb you could use is 10 times what your annual average giving is.
00:02:24.627 --> 00:02:35.259
So if you have, let's say, that your average gift is a hundred dollars, that's a pretty typical average of a hundred average gift of a hundred dollars.
00:02:35.259 --> 00:02:41.312
So if you were going to do 10 times that, then a major gift would be a thousand dollars.
00:02:41.312 --> 00:02:52.925
So anybody who gives you a gift over a1,000 would qualify to enter into your major giving program or your major giving process.
00:02:52.925 --> 00:02:54.427
$250.
00:02:54.427 --> 00:02:58.876
If that's your average gift, well then it's $2,500.
00:02:58.876 --> 00:03:02.506
So a 10X 10 times your regular gift.
00:03:02.506 --> 00:03:07.735
That is a way to define what a major gift is for you.
00:03:07.735 --> 00:03:13.451
Now another way, another rule of thumb, and there's not much science behind this.
00:03:13.451 --> 00:03:32.651
This is a little bit more on the art side of the equation, but I call it the holy smokes rule, and that is, if you get an envelope, you open the envelope, you pull out the check and, without even thinking, you utter the words holy smokes, then that's going to qualify as a major gift.
00:03:32.651 --> 00:03:33.933
So there you go.
00:03:34.000 --> 00:03:35.044
There's two rules of thumb.
00:03:35.044 --> 00:03:42.151
You get to set the number and don't get too wrapped up on it, because you can always change it later.
00:03:42.151 --> 00:03:43.775
You can raise it, you can lower it.
00:03:43.775 --> 00:03:44.555
This number is internal.
00:03:44.555 --> 00:03:45.122
It's something that you're always change it later.
00:03:45.122 --> 00:03:45.225
You can raise it, you can lower it.
00:03:45.225 --> 00:03:46.164
This number is internal.
00:03:46.164 --> 00:03:48.893
It's something that you're using in-house.
00:03:48.893 --> 00:03:53.788
You're not publishing this, you're not putting it into a newsletter or an email.
00:03:54.411 --> 00:04:09.384
And what we're looking to do here by defining a major gift amount, is that we're looking to set a threshold so we know which donors are going to go into the major gift process and which donors are not.
00:04:09.384 --> 00:04:28.975
So effectively, we are sorting donors You're going over here, you're going over here and it doesn't mean that we're treating one group better and one group worse, but we are going to treat one group different than the other group.
00:04:28.975 --> 00:04:37.468
We are treating the groups differently and we need to know who's going to go into which group, and by setting a major gift level.
00:04:37.468 --> 00:04:43.225
That is your, that's your decision point of whether they're going into this group or that group.
00:04:43.225 --> 00:04:45.170
So that's how we do that.
00:04:45.170 --> 00:04:54.367
Now, I don't want you to be confused on this and I don't want you to overthink this, so if this doesn't make sense, send me an email.
00:04:54.367 --> 00:04:57.153
My email is going to be in the show notes for this episode.
00:04:57.153 --> 00:05:01.410
Our Tim's and my emails contact information is always in the show notes.
00:05:01.410 --> 00:05:07.750
If this doesn't make sense to you or you want to talk a little bit more about it, shoot me an email and we'll talk through it.
00:05:07.750 --> 00:05:09.680
I don't want you to be confused by this.
00:05:09.680 --> 00:05:12.247
So if you've got questions, send me an email.
00:05:12.247 --> 00:05:17.350
I'll be happy to talk through with you and help you get it set right for you and your organization.
00:05:17.350 --> 00:05:28.149
Okay Now, yesterday, in day three, at the end of the show, I asked a question of where did you think your, where do you think your major gift donors are going to come from?
00:05:28.209 --> 00:05:28.350
What?
00:05:28.350 --> 00:05:31.603
Where do you think the best prospects will be?
00:05:31.603 --> 00:05:34.507
Where will you find them for your major gifts program?
00:05:34.507 --> 00:05:38.194
Well, the answer is individuals.
00:05:38.194 --> 00:05:47.877
Individual donors are always going to be your best source of prospects for major gift donors.
00:05:47.877 --> 00:05:52.728
Now, year after year after year after year, for decades.
00:05:52.728 --> 00:06:04.685
When they do, when the national, they have national research organizations and they do you know the year of giving 2023, 2022, what, what you know, every year they do these things.
00:06:04.685 --> 00:06:14.553
And then there's always a pie chart of where are charitable gifts coming from individuals, corporate grants, they have different categories.
00:06:14.553 --> 00:06:28.636
Almost always, individuals are about 70%, sometimes 71, 72, 73, 68, 69, 70, right at the 70% mark for decades, and they are it's not even close.
00:06:28.636 --> 00:06:35.892
By far the most funding for your organization is going to come from individuals.
00:06:36.454 --> 00:06:38.726
Now, there may be some exceptions.
00:06:38.726 --> 00:06:46.511
You may be an organization that is heavily grant funded through state grants, and okay, so your funding is grant funding.
00:06:46.511 --> 00:06:57.632
But when it comes to pure charitable gifts, pure charitable funding, it is going to be the individuals are going to be your best source of major gift prospects.
00:06:57.632 --> 00:07:06.088
Now, another caveat to that is you may have a in a strong relationship with a corporation or a foundation.
00:07:06.088 --> 00:07:21.391
You may have a board member who is the owner of the largest company in town, or might be the president or the vice president have access, and that's totally awesome, and if you have that, you absolutely want to pursue that.
00:07:21.391 --> 00:07:30.492
But again, for most of you the vast majority of you your best prospects are going to be individuals, and so that's where the low hanging fruit is.
00:07:30.492 --> 00:07:39.315
So that's what we're going to focus on as we're talking about our setting up, our major gift prospects and today, specifically talking about how do we identify them.
00:07:39.978 --> 00:07:42.865
So here we go.
00:07:42.865 --> 00:07:55.833
We want to look for people who are effectively raising their hand saying come talk to me about a larger gift, come talk to me about being part of your major gift program.
00:07:55.833 --> 00:07:58.867
And so how do people raise their hands?
00:07:58.867 --> 00:07:59.427
All right?
00:07:59.427 --> 00:08:01.461
Well, there's three different ways that they do that.
00:08:01.461 --> 00:08:13.209
One is what I want you to do is I want you to take your donors and add up their total giving for the last three years.
00:08:13.209 --> 00:08:18.161
Add it all up, I don't care where it came from.
00:08:18.161 --> 00:08:21.526
They may have sent a check in a direct mail letter that you sent them.
00:08:21.526 --> 00:08:25.232
They may have bought four tickets to your gala.
00:08:25.232 --> 00:08:28.882
They may have won a silent auction bid.
00:08:28.882 --> 00:08:33.191
They may have given online, I don't care where it came from.
00:08:33.191 --> 00:08:38.563
I want you to add up everything that they've given over the last three years.
00:08:38.563 --> 00:08:46.952
Then rank those donors from number one through number 10, 15, 20.
00:08:46.952 --> 00:08:53.308
I wouldn't go any more than 20 for this, 10 to 15 is probably more reasonable.
00:08:53.308 --> 00:08:55.234
So what does that look like?
00:08:55.234 --> 00:09:02.490
So let's say Joe and Sandy Blake, and they gave from all their sources over the last three years.
00:09:02.490 --> 00:09:05.916
They gave a total of $10,200.
00:09:05.916 --> 00:09:09.903
Okay, that's your top donor over the that three-year period.
00:09:09.903 --> 00:09:12.028
So they go into the number one slot.
00:09:12.028 --> 00:09:16.904
Number two, uh, let's see John and, uh, susan McIntyre.
00:09:16.904 --> 00:09:22.623
Uh, and they gave from all sources, all the, all the things that they gave to you over the last three years.
00:09:22.623 --> 00:09:25.687
Let's just say $9,000 over the last three years.
00:09:25.687 --> 00:09:27.669
They're your number two donors.
00:09:27.669 --> 00:09:35.892
So they go into the second slot and you go one, two, three, four, five, all the way down to 10 or 15, whichever ones that you want to do.
00:09:36.740 --> 00:09:41.417
A couple of questions that come up usually when I talk about this why three years?
00:09:41.417 --> 00:09:50.764
Well, we are looking for a pattern and we're looking for a recent pattern and we're looking for consistency.
00:09:50.764 --> 00:09:59.025
So we want somebody who is giving in a pattern, giving consistently and giving relatively currently.
00:09:59.025 --> 00:10:15.221
So if you have a donor who gave 15 years ago but they haven't given in the last three years, I'm not saying that they're not a prospect or that we couldn't bring them to be a prospect, but that's not where we want to start.
00:10:15.221 --> 00:10:22.426
We want to start with our most current donors that are giving consistently, that are our biggest donors.
00:10:22.426 --> 00:10:24.231
All right, so that's what we're looking for.
00:10:24.231 --> 00:10:33.668
So if somebody's giving every year for three years and they've got this total, that's what we're looking for they're raising their hand, saying come talk to me, all right.
00:10:34.070 --> 00:10:40.243
Well, what if I don't have any donors that have given, you know, $10,000 over three years?
00:10:40.243 --> 00:10:43.245
What if I don't have donors that are that big of donors?
00:10:43.245 --> 00:10:45.128
Doesn't make any difference.
00:10:45.128 --> 00:10:45.948
It is.
00:10:45.948 --> 00:10:47.309
The concept is the same.
00:10:47.309 --> 00:11:04.168
If your top donor gave $10,000 or $5,000 or $2,500 or $1,000 or $500, doesn't make any difference the size of the gift it is, you just rank your donors one through 10, one through 15.
00:11:04.168 --> 00:11:07.640
So it works with large, with big amounts, but it also works with smaller amounts.
00:11:07.640 --> 00:11:10.625
What if I don't have three years of data?
00:11:10.625 --> 00:11:19.427
I had one organization I worked with a couple of years ago and they had no data at all.
00:11:19.427 --> 00:11:24.224
They've been an organization for years and years and years and they had no giving data whatsoever.
00:11:24.224 --> 00:11:25.485
So it does happen.
00:11:25.505 --> 00:11:30.975
You may not have a database, you may not have all of this nice data easily accessible.
00:11:30.975 --> 00:11:35.288
And I will say if you don't have three years, use what you have.
00:11:35.288 --> 00:11:39.102
If you only have a year, go with a year.
00:11:39.102 --> 00:11:40.667
If you have two years, go with two.
00:11:40.667 --> 00:11:41.570
If that's all you have.
00:11:41.570 --> 00:11:43.869
If you don't have any data, that's probably beyond the scope of our series that we're in.
00:11:43.869 --> 00:11:47.244
If you don't have any data, that's probably beyond the scope of our series that we're in.
00:11:47.244 --> 00:11:54.748
If you don't have any data, send me an email, reach out to me, and I've got some suggestions for you to help you get started.
00:11:54.748 --> 00:11:57.462
But that's outside of our conversation today.
00:11:57.462 --> 00:11:59.269
So use the data that you have.
00:12:00.052 --> 00:12:03.822
Number four what if I have more than three years of data?
00:12:03.822 --> 00:12:06.710
You may have 15 years going back in the database.
00:12:06.710 --> 00:12:09.807
For now, we're going to stick to the three years.
00:12:09.807 --> 00:12:21.351
Just use the three years for now, and then, as we get more advanced, as you go through the series here and then you go through the donors that we're going to be talking to, that you're going to be talking to, we can.
00:12:21.351 --> 00:12:22.585
We can expand that.
00:12:22.585 --> 00:12:24.144
We could get a little bit more advanced as we.
00:12:29.296 --> 00:12:34.488
So we've got our donors that have our one through 10 or one through 15, whichever you want to do.
00:12:34.488 --> 00:12:36.663
So we have those donors on a list.
00:12:36.663 --> 00:12:56.706
The second thing that we're looking for for people raising their hand saying come talk to me, is I want you to go through that, through that list not the 10 or 15 people that you've already, uh, that you've already got on your list other people than them and look over those three years and look for things that stick out.
00:12:56.706 --> 00:13:12.585
Um, so, if your number one donor is $10,000, that over the that they gave each year for the three years, but you have a donor, uh, two years ago who gave uh, $4,500.
00:13:12.585 --> 00:13:19.442
Um500, and your list of of that we went through with your that gave each year for three years and those top donors.
00:13:19.442 --> 00:13:23.303
So you know your top donor was 10, 10,200.
00:13:23.303 --> 00:13:24.727
What do we have?
00:13:24.727 --> 00:13:27.344
That was the let me go back up here that was the Blakes.
00:13:27.344 --> 00:13:28.681
They were 10,200.
00:13:28.681 --> 00:13:38.186
We had the McIntyres at 9,000 and we went down and your 10th donor was let's just say, for easy math, it was $5,000 was your 10th donor.
00:13:38.186 --> 00:13:42.947
But you had a donor two years ago who gave $4,500.
00:13:42.947 --> 00:13:53.086
So they wouldn't show up on your first list because they didn't give each of the three years and they didn't give enough to make it up into that top 10.
00:13:53.086 --> 00:14:01.706
But they gave a significant gift 4,500 is a pretty good gift within that same three-year period.
00:14:02.768 --> 00:14:23.663
I want to talk to them, you want to talk to them, and so you want to add them to this list because there could be, there could be something in there that you know, maybe they got an inheritance, or maybe they sold a business and or maybe they, you know, uh, I don't know who knows what happened, but if they obviously have some capacity.
00:14:23.663 --> 00:14:25.547
So we want to talk to those folks.
00:14:25.547 --> 00:14:31.927
So let's say, you know, I would say three, four, five, probably no more than five.
00:14:31.927 --> 00:14:37.239
Um, so we'll, you know, let's put five, we'll say five, put five of those If you could find them.
00:14:37.239 --> 00:14:38.743
If you only find two, then it's two.
00:14:38.743 --> 00:14:40.895
You know, it is what it is.
00:14:40.895 --> 00:14:42.097
So that's.
00:14:42.158 --> 00:14:47.149
Our second way is looking for abnormally large gifts over the last three years.
00:14:47.149 --> 00:14:57.043
And then the third way that we're looking for people to raise their hand is donors that have significant connection to the organization.
00:14:57.043 --> 00:14:59.842
Now I call these our wild cards.
00:14:59.842 --> 00:15:11.628
Now they are not on the list because of their robust giving in the past, but we still want to talk to them because of their strong connection with the organization.
00:15:11.628 --> 00:15:13.461
Now, what does that look like?
00:15:13.461 --> 00:15:14.602
What would this that look like?
00:15:14.602 --> 00:15:16.916
What would this donor look like?
00:15:17.256 --> 00:15:21.806
So they probably respond to every Facebook post you make.
00:15:21.806 --> 00:15:26.221
They like your pictures, they make comments, they engage with you on social media.
00:15:26.221 --> 00:15:32.101
They show up at the gala and maybe they bring their neighbors with them or they bring somebody with them.
00:15:32.101 --> 00:15:35.128
They respond to their, to your direct mail.
00:15:35.128 --> 00:15:43.985
Maybe they don't respond to every direct mail piece, but for sure you know they're going to respond to at least one every year and you probably know which one they're going to respond to.
00:15:43.985 --> 00:15:46.340
They've been around forever.
00:15:46.340 --> 00:15:47.203
They show up.
00:15:47.203 --> 00:15:48.981
They're probably a volunteer.
00:15:48.981 --> 00:15:54.200
They may be a volunteer if you have a volunteer program, and so they are.
00:15:54.200 --> 00:15:59.863
They are a major champion, they're a major supporter and you know that you can count on them.
00:16:00.375 --> 00:16:22.008
So in this group we are not necessarily like I said, we're not necessarily putting them on here, because we think that they have capacity to make gifts or make larger gifts, have capacity to make gifts or make larger gifts, but they are so passionate about what you do and so excited about the organization, we want to talk to them as well.
00:16:22.008 --> 00:16:24.455
So let's say I don't know.
00:16:24.455 --> 00:16:25.496
Let's say another five.
00:16:25.496 --> 00:16:28.605
And again, if you only have three, then it's three.
00:16:28.605 --> 00:16:39.961
If it's four, it's four, but I would pick five, kind of shoot for that and see where we go, okay, so those are the three things that we're looking for.
00:16:39.980 --> 00:16:46.745
So number one was um donors that had given, your top donors that have given each year for the last three years, ranked one through 15.
00:16:46.745 --> 00:17:03.216
Number two our donors who have made a significant uh gift that up in the last three years, as I'm not going to say a strange gift, that's not it, but just where you say, wow, look at that, that's interesting.
00:17:03.216 --> 00:17:05.080
So we got five of those.
00:17:05.080 --> 00:17:12.866
And then we got five of our oh my gosh, these donors, they love us, they show up, they're our biggest champions, we want five of them.
00:17:12.866 --> 00:17:16.198
Love us, they show up, they're our biggest champions, we want five of them.
00:17:16.198 --> 00:17:16.699
Okay, so where are we?
00:17:16.699 --> 00:17:17.180
What do we have here?
00:17:17.180 --> 00:17:20.885
We have 10 to 15 in our first group, five and five.
00:17:20.885 --> 00:17:29.467
So now we've got 20 to 25 prospects on our list, and that's what we were looking to do.
00:17:29.467 --> 00:17:32.420
We were looking in the identification process is we?
00:17:32.420 --> 00:17:39.865
Our output was to create a list of prospects that we now could take through the rest of the major gift process.
00:17:39.865 --> 00:17:41.816
So we're off to a good start.
00:17:42.317 --> 00:17:45.942
Now remember when it comes to fundraising.
00:17:45.942 --> 00:18:01.045
Fundraising is about relationship and relationships between the donor and the organization, and relationships between the donor and the organization and relationships between the donor and someone within the organization.
00:18:01.045 --> 00:18:05.906
Now, maybe that someone in the organization is you as the executive director.
00:18:05.906 --> 00:18:07.954
You own the relationship with that donor.
00:18:07.954 --> 00:18:12.083
Or it could be a board member, or it could be another donor.
00:18:12.083 --> 00:18:22.896
It doesn't matter who has the strength of the relationship, as long as they have a relationship with someone in the organization and with the organization itself.
00:18:22.896 --> 00:18:26.364
That is where your best major gifts come from.
00:18:26.364 --> 00:18:38.763
So the deeper the relationship, the closer the donor is with you in the organization or with someone in the organization, the closer you're going to get to the maximum gift for that donor.
00:18:38.763 --> 00:18:41.449
Okay, so well.
00:18:41.449 --> 00:18:44.603
Hey, we have our list of 20 to 25 prospects.
00:18:44.603 --> 00:18:49.237
We achieved our goal for this, and that's pretty cool, isn't it?
00:18:49.237 --> 00:18:51.303
Yeah, it is so all right.
00:18:51.884 --> 00:19:01.628
Next, what we have to do next is we have to qualify those process, those prospects, to see who is most likely to give a major gift.
00:19:02.516 --> 00:19:04.361
Will they all write a big check to you?
00:19:05.545 --> 00:19:08.393
Oh, maybe, I don't know they might.
00:19:08.393 --> 00:19:10.398
Given enough time, they may all 25.
00:19:10.398 --> 00:19:20.788
You may have done such a good job with your identification, that all 25 of them is going to write you a check, well above the level that you have set as a major gift.
00:19:20.788 --> 00:19:37.209
But probably a little more reasonable to assume is that a handful of those 25 will write you a check now or relatively soon, at a level that you probably haven't even dreamed of.
00:19:37.209 --> 00:19:52.789
And so our job next, then, is to identify, or to figure out, of those 25, who are the most likely to give now or relatively soon, and how do we get in front of them.
00:19:53.171 --> 00:19:55.699
So that's what we're going to be talking about next Tomorrow.
00:19:55.699 --> 00:20:11.118
We're going to be talking about qualification, and so taking our list of 25 and then prioritizing those 25, qualifying them as the most urgent to the least urgent, and that's what we're going to do tomorrow.
00:20:11.118 --> 00:20:14.635
So, excited about that, I hope you're enjoying this.
00:20:14.635 --> 00:20:20.969
Again, if you have questions, if something's not making sense, shoot me an email.
00:20:20.969 --> 00:20:22.357
I will answer your questions.
00:20:22.357 --> 00:20:28.401
I want to make sure that you're tracking with this and that you're on the right page as we move forward with this.
00:20:28.401 --> 00:20:30.965
So excited to get to tomorrow.
00:20:30.965 --> 00:20:32.409
I'll see you then.
00:20:32.409 --> 00:20:35.924
That's all for today, until next time.
