20141218 pol fisforfundraising v1

Don Bosco Youth-Net ivzw Naamsesteenweg 37 B-3001 Heverlee Belgium

Tel.: +32(0)16.48.78.80 Fax.: + 32(0)16.48.78.90

Email: [email protected] Website: www.donboscoyouth.net

“F” IS FOR FUNDRAISING Overview of funding mechanisms for DBYN

and its member organisations.

ii

Colophon This is a publication of Don Bosco Youthnetwork of Salesian youth work offices and youth organBosco. The international secretariat of Don Bosco YouthCommission, through its “Erasmus+ projects and organisations involved in the field of nonworld.

The secretariat of Don Bosco Youththrough its 'European Youth Foundation '. organisations working on intercultural learning, antiof democracy.

This publication reflects the views only of the author, and the European Commission, nor the Council of Europe cannot be held responsible for any use which may be made of the information contained therein.

“F” Is For Fundraising

This is a publication of Don Bosco Youth-Net ivzw. Don Bosco Youth-Net ivzw is an international network of Salesian youth work offices and youth organisations which work in the style of don

The international secretariat of Don Bosco Youth-Net ivzw is financially supported by the European “Erasmus+ - Youth in Action’-programme. This programme supports youth

rganisations involved in the field of non-formal education in Europe and the rest of the

The secretariat of Don Bosco Youth-Net is also financially supported by the Council of Europe, through its 'European Youth Foundation '. This foundation supports youth projects and youth organisations working on intercultural learning, anti-discrimination, Human Rights and the promotion

This publication reflects the views only of the author, and the European Commission, nor the Europe cannot be held responsible for any use which may be made of the information


Net ivzw is an international isations which work in the style of don

Net ivzw is financially supported by the European programme. This programme supports youth formal education in Europe and the rest of the

Net is also financially supported by the Council of Europe, pports youth projects and youth

discrimination, Human Rights and the promotion

This publication reflects the views only of the author, and the European Commission, nor the Europe cannot be held responsible for any use which may be made of the information

iii

Table of Content Colophon ....................................................................................................................................................................... ii Table of Content ......................................................................................................................................................... iii List of Figures, Tables and Formulas ........................................................................................................................ v

List of Abbreviations ................................................................................................................................................. vii Diversification of Fundraising Methods ...................................................................................................................1

1. Introduction .....................................................................................................................................................1

1.1. Investigation of the current Income Situation ................................................................................3

1.2. The Importance of Diversification ....................................................................................................4

2. Possibilities of Fundraising ............................................................................................................................1

2.1. Public Sector Funding ...........................................................................................................................1

2.1.1. Subventions / Grants ...................................................................................................................1

2.1.2. Social Impact Bond (SIB) ............................................................................................................3

2.1.3. Monetary Fine Acquisition (MFA) ............................................................................................9

2.2. Private Sector Fundraising ................................................................................................................ 10

2.2.1. Venture Philanthropy (VP) ...................................................................................................... 10

2.2.2. Cooperate Social Responsibilities (CSR) ............................................................................. 13

2.2.2.1. Sponsoring .............................................................................................................................. 15

2.2.2.2. Corporate Giving ................................................................................................................. 16

2.2.2.3. Corporate Volunteering ..................................................................................................... 17

2.2.3. Microfinancing in Europe ......................................................................................................... 17

2.2.4. Charity Affinity Credit Card (CACC).................................................................................. 18

2.2.5. Payroll Giving ............................................................................................................................. 19

2.2.6. Cooperatives .............................................................................................................................. 19

2.3. Fundraising within society sector ................................................................................................... 20

2.3.1. Crowdfunding ............................................................................................................................ 20

2.3.2. Legate ........................................................................................................................................... 23

2.3.3. Social Media Fundraising (SMF) .............................................................................................. 24

2.3.4. Awards, Competitions and Prises ......................................................................................... 29

2.3.5. Merchandising ............................................................................................................................ 29

2.3.6. Fundraising Activities ................................................................................................................ 30

2.4. Fundraising through Foundations ................................................................................................... 31

2.4.1. Foundations and Philanthropy ................................................................................................ 31

2.4.2. Transnational Giving in Europe (TGE) ................................................................................. 34

3. Fundraising Management ...............................................................................................................................1

3.1. The Planning Process and its Components .....................................................................................1

3.1.1. Setting Goals to Identify a Plan .................................................................................................2

3.1.2. Strategic Planning .........................................................................................................................3

3.1.3. Operational Planning: ..................................................................................................................4


iv

3.2. Controlling within the Fundraising Process ....................................................................................5

3.2.1. Strategic Controlling ...................................................................................................................5

3.2.2. Operational Controlling .............................................................................................................7

3.2.3. SWOT Analysis and Portfolio of current Income Sources ............................................. 10

3.2.3.1. Analysis of Potential Sources with Subjective Portfolios ............................................ 13

3.2.3.2. Segmentation of Income Sources towards Geographical Areas ............................... 15

4. Conclusion ...................................................................................................................................................xvii

Annex I: Potential Contacts of Fundraising Methods ...................................................................................... xix

Annex II: Facts and Figures .................................................................................................................................. xxiii Bibliography .............................................................................................................................................................. xxv

v

List of Figures, Tables and Formulas Figure 1: Distribution of Current Financial Sources 2004-2013 .......................................................................3

Figure 2: Development of Income Sources 2004-2013.......................................................................................4

Figure 3: Diversification and its Effect on Risk ......................................................................................................5

Figure 4: Seven Steps to Question whether SIB is Appropriate .......................................................................3

Figure 5: Decision Making Schema for Choosing an Adequate SIB..................................................................4

Figure 6: Special Purpose Vehicle Delivery Structure .........................................................................................6

Figure 7: Streamlined Delivery Structure of a SIB ................................................................................................7

Figure 8: Lead Delivery Agency Delivery Structure of a SIB .............................................................................8

Figure 9:Development Process of a Social Impact Bond ....................................................................................9

Figure 10: Models of European Philanthropy...................................................................................................... 11

Figure 11: Positioning Venture Philanthropy in the Investment Landscape ................................................ 12

Figure 12: Stakeholders and their Role in Venture Philanthropy .................................................................. 13

Figure 13: Triple Bottom Line of Corporate Social Responsibilities ............................................................ 14

Figure 14: Crowdfunding Market Share in Europe ........................................................................................... 21

Figure 15: Business Models Based on Purpose of Crowdfunding .................................................................. 21

Figure 16: Donation Pyramide (small) .................................................................................................................. 24

Figure 17: Functionality of Donation Platforms ................................................................................................. 27

Figure 18: Functionality of Activist Fundraising .................................................................................................. 27

Figure 19: Functionality of Affiliate Shopping ...................................................................................................... 28

Figure 20: Relative Share of Grant-making Foundations within each Country .......................................... 32

Figure 21: Distribution of Foundations' Support by Fields of Interest in 13 EU Member States ........... 33

Figure 22: Transnational Giving Process 1: Donor Donates to European Organisation ......................... 35

Figure 23: TGE Process 2: European Organisation Addressing Donors ..................................................... 36

Figure 24: Planning Levels and Intervals ..................................................................................................................1

Figure 25: International Statement of Ethical Principles in Fundraising ...........................................................3

Figure 26: Product Life Cycle ....................................................................................................................................4

Figure 27: Boston Consulting Group Matrix (BCG-Matrix) ..............................................................................6

Figure 28: BCG Matrix: Portfolio of Current Funders of DBYN 2013........................................................ 12

Figure 29: Fundraising Methods: Risk vs. Potential Reward ............................................................................ 13

Figure 30: Fundraising Methods: Time and Return on Investment ............................................................... 14

Figure 31: Categorisation of Fundraising Methods according to Geographical Areas ............................. 16

Figure 32: Annex II: Crowdfunding Platforms Acting Worldwide ............................................................. xxiii


vi

Table 1: Forms of Project-oriented Subventions ..................................................................................................1

Table 2: Characterisation of Sponsoring ............................................................................................................. 16

Table 3: Required Resources and Time of Crowdfunding Actions ............................................................... 22

Table 4: Division of Social Media Fundraising Methods ................................................................................... 24

Table 5: Questions to Answer within Direct Emailing .................................................................................... 26

Table 6: Fundraising Activities ................................................................................................................................ 30

Table 7: Framework of the SWOT Analysis .........................................................................................................5

Table 8: Framework of the PEST Analysis .............................................................................................................6

Table 9: Annex I: Programmes of Microfinancing in Europe ........................................................................ xix

Table 10: Annex I: List of Crowdfunding Platforms ......................................................................................... xix

Table 11: Annex I: Networks of European Foundations ................................................................................. xx

Table 12: Annex I: Online Auction Platforms ................................................................................................... xxi

Table 13: Annex I: List of Donation Platforms .................................................................................................. xxi

Table 14: Annex I: European and International Networks of Cooperatives ............................................ xxii

Table 15: Annex II: Valuation of Fundraising Methods: Return we give and Resources we need ...... xxiv

Table 16: Annex II: Valuation of Fundraising Methods: Security of Financial Resources and Output xxiv

Table 17: Annex II: Valuation of Fundraising Methods: Risk and Potential Reward ............................... xxiv

Formula 1: Response Rate .........................................................................................................................................7

Formula 2: Avarage Donation Rate .........................................................................................................................7

Formula 3: Average Lifetime Value ..........................................................................................................................8

Formula 4: Prospective Lifetime Value ....................................................................................................................8

Formula 5: Production Costs per Donor ...............................................................................................................8

Formula 6: Return on Investment (ROI) ................................................................................................................9

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List of Abbreviations CACC Charity Affinity Credit Card Cf. Compare CFP Crowdfunding platform CoE Council of Europe CSR Corporate Social Responsibilities DBYN Don Bosco Youth Net EACEA Education, Audiovisual and Culture Executive Agency EDF European Development Fund EFC European Foundation Centre e. g. For Example ENGO Environmental non-governmental Organisation EU European Union EYF European Youth Foundation GAS Google AdSense GNI Gross National Income ICA International Cooperative Alliance ISO International Organisation for Standardization LDA Leading Delivery Agency LTC Lifetime Costs LTV Lifetime Value MFA Monetary Fine Acquisition MFF Multiannual Financial Framework NA National Agency NGO Non-Governmental Organisation NPO Non-Profit Organisation N.U. Name Unknown p. Page PLC Product Live Cycle ROI Return on Investment SE Social Enterprise SH Stakeholder SIB Social Impact Bond SMF Social Media Fundraising SMN Social Media Network SPV Special purpose vehicle TBL Three Bottom Line TGE Transnational Giving Europe US United States VP Venture Philanthropy YiA Youth in Action (Erasmus+ Programme of the European Union)

Introduction

1

Diversification of Fundraising Methods

1. Introduction The non-profit sector is growing as never before. More and more people with fewer opportunities have needs and therefore non-profit organisations (NPO) try to meet their obligations and provide new opportunities in order to give support, stability and show them new chances. While the number of non-profit organisations is consequently growing accordingly there is a higher demand for resources. The effect of the economic crises restricts governmental assets so that subvention and grants are shrinking in their amount. NPOs have to seek for other solutions and sources to fulfil their missions and to meet peoples’ needs. As a non-profit organization Don Bosco Youth Net has the problems like many others. With only few income sources, we are highly dependent on them and sometimes we have to scale down our own priorities to the priorities of those budget lines. This document was written to give basic information about the possibilities we haven’t considered so far, in order to change the current situation. To become financially independent and generate income is not as easy as it may sound. But with close cooperation and a guideline to follow it will be possible to integrate those aims into our organisational goal system and out of it to develop new strategies. In other terms, by reading this report one will find new approaches based on economical and financial perspectives and decide from a new point of view how to gather resources for different needs. Fundraising in this sense is the process of gathering financial and non-financial resources for social purposes and for covering operating costs. It is a spread field which offers a huge number of methods within different segments such as public, private, and social. Traditionally fundraising was the method of asking for donations on the street or at peoples’ doors. But with technological and economical changes new methods turned out and improved rapidly over the last years. The application of new instruments will equip us with more autonomy and the skill of adapting our organisational needs to further changes within the fundraising sector. Diversification on the other hand has the aim to guide and interlink new applied methods and thereby prevent drastic influences on our financial situation. This financial strategy is risk management which usually is used within the stock market and provide more security and return to the investors. In the first place diversification would give us more scope for financial income and provide the opportunity of expanding within the European social sector. But also its research about the most suitable mixture of financial instruments is informative for in order to be successful in relying on new sources. This paper is partly based on the theory of diversification which is tailored for the fundraising methods The paper is structured in three parts: The first part is a research which provides insights about the current income situation of DBYN. It shows the distribution of or income generated during the last 10 years. Moreover it demonstrates the development of the major lines and describes the risk and the possibility to decrease it by implementing the diversification strategy. Diversification itself is the process of distributing the non-systematic risk over more than one fundraising method and thereby to increase income possibilities. As the expenditures have risen slightly over the last years we have to procure a higher amount of money in order to cover them.


2

For this purpose the second chapter inform about potential fundraising methods which are divided into for sectors. Depending on further researches and goals, we have the possibility to work with instruments either from the public, the private, the society or the foundation sector. A closer look into fundraising will show that there are more opportunities, which are not described within this document, due to its limited extent. A company itself has first to identify its needs towards resources and based on them develop strategies that will facilitate to concentrate on the most suitable sources and the extent of their application. The development of strategies and the associated application of fundraising require specific guidance. The third chapter touches fundraising management and describes the leading aspects. The entire process is summarised in two parts: first the planning process including the development of goal sets, strategic and operational planning and second it introduces a continuous controlling process which also consists strategic as well as operational controlling. A further research of current sources and the DBYN itself provide information for new strategies and at the same time it gives indication about approaching both the management and the controlling processes. As a result fundraising methods are positioned into portfolios which categorise the instruments by their returns, risks, durations and geographical reach. As such they enable to define the flexibility and adaptability of the sources and facilitate decisions based on strategies and needs NPOs.

Introduction

1.1. Investigation of the current Income Situation Currently DBYN is dependant of just a few budget lines. Our expenditures, which include both project and administrative costs, are financed through the Erasmus+ Youth in Action Programme of the European Union and the Council of Europe through the European Youth Foundation, and membership fee through our 13 members. We have build up an expertise in these budget lines, but at the same time we are too much dependent on them. If a project application fails, it creates problems for our work plan. Next to this we are sometimes forced in having to scalepriorities to the priorities of those budget lines. And finally,political period comes to an end, the priorities change, as well as funding possibilities. Therefore we need to explore new budget lines and diversify our grant applications accordingly. Some figures should show the current situation of the financial sources and also compare it over the last years in order to identify possible disruptive factors to be able to intervene right in time.

Figure 1

‘Figure 1: Distribution of Current Financial Sources 20income sources. It is clearly represented that subventions have the biggest share of the total income budget. But also revenues from membership fees have a significant quota. With 32 % it makes one third of all financial resources. The low level of diversification is really dangerous due to the high extent of risk of getting nothing. If once one of those applicatiohave difficulties to cover its expenditures.

1 Own research based on financial reports (2004

Distribution of Financial Sources

nvestigation of the current Income Situation

Currently DBYN is dependant of just a few budget lines. Our expenditures, which include both e costs, are financed through the Erasmus+ Youth in Action Programme of

the European Union and the Council of Europe through the European Youth Foundation, and membership fee through our 13 members. We have build up an expertise in these budget lines, but at the same time we are too much dependent on them. If a project application fails, it creates problems for our work plan. Next to this we are sometimes forced in having to scalepriorities to the priorities of those budget lines. And finally, budget lines are limited in time. When a political period comes to an end, the priorities change, as well as funding possibilities. Therefore we need to explore new budget lines and diversify our grant applications accordingly.

he current situation of the financial sources and also compare it over the last years in order to identify possible disruptive factors to be able to intervene right in time.

1: Distribution of Current Financial Sources 2004-2013

: Distribution of Current Financial Sources 2004-2013’ shows the breakdown of DBYNs income sources. It is clearly represented that subventions have the biggest share of the total income

ut also revenues from membership fees have a significant quota. With 32 % it makes one third of all financial resources. The low level of diversification is really dangerous due to the high extent of risk of getting nothing. If once one of those applications will be rejected, the network will have difficulties to cover its expenditures.

Own research based on financial reports (2004-2013)

32%

49%

19%

Distribution of Financial Sources 2004-2013

Membership Fee

Subvention

Others

3

nvestigation of the current Income Situation

Currently DBYN is dependant of just a few budget lines. Our expenditures, which include both e costs, are financed through the Erasmus+ Youth in Action Programme of

the European Union and the Council of Europe through the European Youth Foundation, and membership fee through our 13 members. We have build up an expertise in these budget lines, but at the same time we are too much dependent on them. If a project application fails, it creates problems for our work plan. Next to this we are sometimes forced in having to scale-down our own

budget lines are limited in time. When a political period comes to an end, the priorities change, as well as funding possibilities. Therefore we need to explore new budget lines and diversify our grant applications accordingly.

he current situation of the financial sources and also compare it over the last years in order to identify possible disruptive factors to be able to intervene right in time.

20131

’ shows the breakdown of DBYNs income sources. It is clearly represented that subventions have the biggest share of the total income

ut also revenues from membership fees have a significant quota. With 32 % it makes one third of all financial resources. The low level of diversification is really dangerous due to the high

ns will be rejected, the network will

Membership Fee

4

Especially if we have a look on the development of the two main sources over the last ten years, which are shown in ‘Figure 2: Development of Income Sources 2004fees are declining and subventions are increasing. It follows that the network is dependent on the subventions. In a worst case situation the loss of subventions would cause illiquidity.

Figure 2

1.2. The Importance of Diversification The previous chapter showed that the network is extremely dependent on only few financial sources. To avoid the risk of being unable to cover entiportfolio and seek new possibilities which will provide us additional resources. To put it briefly, diversification offers the opportunity of increasing the return and/or reducing the risk. However, to reach the effect of a declining risk while mixing up different fundraising methods one precondition must be considered: the instruments have to correlate in a negative manneroccasion, like elections, crises and others affect one fundraisidifferent method, which is affected in the opposite way. To distinguish are two kinds of risk: - Systematic risk: This type of risk affects the whole

risk as it is almost impossible to forecast and to avoid it completely. It cannot be reduced through diversification or hedging.

- Non-systematic risk: This risk refers to each method of fundraising. It is also known as the diversifiable risk, which can be reduced or completely elapplying different fundraising methods, the network will be less affected by decisions which have an effect on the income sources.

‘Figure 3: Diversification and its Effect on Riskimportant to use more than one source at the same time. The data used in the graph bases on assumptions and the figures of the financial report for the year 2013.

2 Own research based on financial reports (2004

€ 0

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Development of Income Sources 2004


Especially if we have a look on the development of the two main sources over the last ten years, : Development of Income Sources 2004-2013’, we see that membership

fees are declining and subventions are increasing. It follows that the network is dependent on the subventions. In a worst case situation the loss of subventions would cause illiquidity.

2: Development of Income Sources 2004-20132

The Importance of Diversification

The previous chapter showed that the network is extremely dependent on only few financial sources. To avoid the risk of being unable to cover entire costs we need to diversify our fundraising portfolio and seek new possibilities which will provide us additional resources. To put it briefly, diversification offers the opportunity of increasing the return and/or reducing the risk. However, to

e effect of a declining risk while mixing up different fundraising methods one precondition must be considered: the instruments have to correlate in a negative manner. That means if a special occasion, like elections, crises and others affect one fundraising method negatively, there must be a different method, which is affected in the opposite way.

To distinguish are two kinds of risk:

This type of risk affects the whole fundraising market. We will always face this possible to forecast and to avoid it completely. It cannot be reduced

through diversification or hedging. This risk refers to each method of fundraising. It is also known as the

diversifiable risk, which can be reduced or completely eliminated through diversification. By applying different fundraising methods, the network will be less affected by decisions which have an effect on the income sources.

: Diversification and its Effect on Risk’ shows the declining of risk and thus why it is so important to use more than one source at the same time. The data used in the graph bases on assumptions and the figures of the financial report for the year 2013.

Own research based on financial reports (2004-2013)

Development of Income Sources 2004

2013

Membership Fee

Subvention


Especially if we have a look on the development of the two main sources over the last ten years, ’, we see that membership

fees are declining and subventions are increasing. It follows that the network is dependent on the subventions. In a worst case situation the loss of subventions would cause illiquidity.

The previous chapter showed that the network is extremely dependent on only few financial re costs we need to diversify our fundraising

portfolio and seek new possibilities which will provide us additional resources. To put it briefly, diversification offers the opportunity of increasing the return and/or reducing the risk. However, to

e effect of a declining risk while mixing up different fundraising methods one precondition . That means if a special

ng method negatively, there must be a

. We will always face this possible to forecast and to avoid it completely. It cannot be reduced

This risk refers to each method of fundraising. It is also known as the iminated through diversification. By

applying different fundraising methods, the network will be less affected by decisions which have

’ shows the declining of risk and thus why it is so important to use more than one source at the same time. The data used in the graph bases on

Development of Income Sources 2004-

Membership Fee

Subvention

Introduction

5

Assumptions: Secure Income: 80% of membership fees in 2013 10% of other income sources of 2013 Unsecure Income: Total income reduced by the secure income Systematic Risk: 20% Unsystematic Risk: Total income in % minus secure income in % divided by

the amount of methods Because the retained risk is evenly distributed on different fundraising methods, the non-systematic risk drops while the amount of methods increases. The return increases insofar, that with a growing number of methods the possibility of receiving a higher amount of resources is growing, too. Still it is not possible to avoid the complete risk. Besides before reaching this effect, an organisation has first to investigate fundraising methods, and implement fundraising management in order to find the best suitable instruments by comparing relevant factors of each method.

Figure 3: Diversification and its Effect on Risk3

3 Own Research based on Financial Report 2013

0%

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30%

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60%

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80%

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100%

0 3 4 5 6 7 8 9 10 11 12

Ris

k

# of Fundraising Methods

Diversification and its Effect on Risk

Systematic risk Non-systematic risk

Possibilities of Fundraising

2. Possibilities of Fundraising

2.1. Public Sector F

2.1.1. Subventions / Grants A subvention is financial support from etaken from taxes and is forwarded to a third party for implementing projectssociety which cannot be done by the government itself. A subvention whether covers the expento the structure of an organisation (covering operating costs of a NPO e.g. wages) or project based (covering the costs linked to a project). Within the last years subvention tend to be projerather than structure-oriented. If it is a project-oriented form of subventionbelow explains all three shortly.

Table

The European Union is organizing its subventions in seven years periods by developing a multiannual financial framework (MFF). The MFF is a framework for the working period of the current financial programme from 2014 until 2020. That means that within this setting up common policies, the funded areas, amount of financial resources defined by the “ceiling”, etc. This long-term vision is very important for potential beneficiaries of EU funds, coauthorities as well as national treasuries.

Shortfall financing

• covering the gap between the eligible expentditure and the existing/borrowed capital


Public Sector Funding

Subventions / Grants

A subvention is financial support from either local, regional or national government. This money is taken from taxes and is forwarded to a third party for implementing projects with a positive effect on

be done by the government itself. the expenditures either fully or partly. Both types can be either related

to the structure of an organisation (covering operating costs of a NPO e.g. wages) or project based (covering the costs linked to a project). Within the last years subvention tend to be proje

oriented form of subvention, it can again be divided in three categories. The graph

Table 1: Forms of Project-oriented Subventions

The European Union is organizing its subventions in seven years periods by developing a multiannual financial framework (MFF). The MFF is a framework for the working period of the current financial

2020. That means that within this framework the European Union (EU) is setting up common policies, the funded areas, amount of financial resources defined by the

term vision is very important for potential beneficiaries of EU funds, cos well as national treasuries.

Fixed amount financing

• fund a fixed amount of financial resources; NPO can keep the remained amount, but has to carry the difference in case of higher expenditures

Shared financing

• financing only a percentage of the whole amount

1

ither local, regional or national government. This money is with a positive effect on

. Both types can be either related to the structure of an organisation (covering operating costs of a NPO e.g. wages) or project based (covering the costs linked to a project). Within the last years subvention tend to be project-oriented

it can again be divided in three categories. The graph

The European Union is organizing its subventions in seven years periods by developing a multiannual financial framework (MFF). The MFF is a framework for the working period of the current financial

is framework the European Union (EU) is setting up common policies, the funded areas, amount of financial resources defined by the

term vision is very important for potential beneficiaries of EU funds, co-financing

Shared financing

financing only a percentage of the whole amount


2

The MFF is structured into six categories (headings4) of expenses concerning different areas the EU wants to fund. - Smart and Inclusive Growth

� Competitiveness for growth and jobs: includes research and innovation; education and training; trans-European networks in energy, transport and telecommunications; social policy; development of enterprises etc.

� Economic, social, and territorial cohesion: covers regional policy which aims at helping the least developed EU countries and regions to catch up with the rest, strengthening all regions' competitiveness and developing inter-regional cooperation.

- Sustainable Growth, Natural Resources: includes the common agricultural policy, common fisheries policy, rural development and environmental measures.

- Security and citizenship: includes justice and home affairs, border protection, immigration and asylum policy, public health, consumer protection, culture, youth, information and dialogue with citizens.

- Global Europe: covers all external action ('foreign policy') by the EU such as development assistance or humanitarian aid with the exception of the European Development Fund (EDF) which provides aid for development cooperation with African, Caribbean and Pacific countries, as well as overseas countries and territories. As it is not funded from the EU budget but from direct contributions from EU Member States, the EDF does not fall under the MFF.

- Administration: covers the administrative expenditure of all the European institutions, pensions and European Schools.

- Compensations: temporary payments designed to ensure that Croatia, who joined the EU in July 2013, does not contribute more to the EU budget than it benefits from it in the first year following its accession.

- There is a long list of possible subventions offered by the EU, which is divided by areas5. For further information and updates it is recommended to visit the website of the European Union: http://ec.europa.eu/budget/mff/index_en.cfm

4 Cf. N.U. (1): direct citation of the following headings: http://europa.eu/rapid/press-release_MEMO-13-1004_en.htm 5 List of possible subventions: http://ec.europa.eu/budget/mff/programmes/index_en.cfm


2.1.2. Social Impact Bond (SIB) A recent development in funding strategies is the Social Impact Bond (SIB). A‘Pay for Success Bond’ or a ‘Social Benefit Bond’, is a contract with the public sector in which a commitment is made to pay for improved social outcomes that result in publicsuch SIB is an investing model to attract private capital for social policies Before choosing a mode of SIB and apply it, a company should check whether a SIB is an appropriate funding model. For this there are seven steps which sho

Figure 4: Seven Steps to Question whether SIB is Appropriate

We distinguish three types of SIBs, whereupon each type overlaps with a special kind of delivery structure. Delivery structure is the way to whi - Philanthropic SIB: Within this model funds are raised through philanthropic sources, invested

through a special purpose vehicle (SPV) which is sub(NPO). At the same time there is a contract with a central or local government that regulates the repayments to the investors based on the outcomes of the project.

- Public sector SIB: In this variant of SIB, local authorities borrow financial resources on existing markets and/or using their own assets to fund projects. They receive the money from the government step by step for each achieved milestone. This model is generally used by authorities that work on its own, with a local partner e.g. another NPO, or in partnership with onauthorities.

- Commercial SIB: This model bases on commercial investments. A new asset class which has been created can now be invested in by banks, pension funds and others. Those developed asset classes (SIBs) are then invested in many different payment by results, or payment linked to outcomes

6 Cf. Barcley and Symons, p. 3 7 Source: own design based on Mulgan, p. 228 Cf. Mulgan, p. 8 f.

The project is preventive and

sufficient funding is currently

unavailable

The project improves social

wellbeing and prevents an

undesirable outcome

The specific impact of the

project is quantitative

Social Impact Bond (SIB)

nt in funding strategies is the Social Impact Bond (SIB). A Social Benefit Bond’, is a contract with the public sector in which a

commitment is made to pay for improved social outcomes that result in publicSIB is an investing model to attract private capital for social policies6.

Before choosing a mode of SIB and apply it, a company should check whether a SIB is an appropriate funding model. For this there are seven steps which should be considered.

: Seven Steps to Question whether SIB is Appropriate7

We distinguish three types of SIBs, whereupon each type overlaps with a special kind of delivery structure. Delivery structure is the way to which the government reimburses the investor/s.

Within this model funds are raised through philanthropic sources, invested through a special purpose vehicle (SPV) which is sub-contracted to a non

there is a contract with a central or local government that regulates the repayments to the investors based on the outcomes of the project.

In this variant of SIB, local authorities borrow financial resources on existing using their own assets to fund projects. They receive the money from the

government step by step for each achieved milestone. This model is generally used by authorities that work on its own, with a local partner e.g. another NPO, or in partnership with on

This model bases on commercial investments. A new asset class which has been created can now be invested in by banks, pension funds and others. Those developed asset classes (SIBs) are then invested in many different SPVs with contracts with public bodies involving payment by results, or payment linked to outcomes8.

Source: own design based on Mulgan, p. 22

A sufficient number of people

will benefit from the project

and the impact is measurable

It is possible to identify a

government (local, regional,

national) that first will

achieve savings or decreased

costs as the result of the

project

Accumulated costs for the

project are lower than the

accruing savings for the

government

It is possible that either the

local, the regional or the

national government would

enter the arangement to

payout investors after

achieving the social impact

A SIB MAY BE AN

APPROPRIATE

3

SIB, also known as a Social Benefit Bond’, is a contract with the public sector in which a

commitment is made to pay for improved social outcomes that result in public sector savings. As

Before choosing a mode of SIB and apply it, a company should check whether a SIB is an appropriate

We distinguish three types of SIBs, whereupon each type overlaps with a special kind of delivery ch the government reimburses the investor/s.

Within this model funds are raised through philanthropic sources, invested contracted to a non-profit organisation

there is a contract with a central or local government that regulates

In this variant of SIB, local authorities borrow financial resources on existing using their own assets to fund projects. They receive the money from the

government step by step for each achieved milestone. This model is generally used by authorities that work on its own, with a local partner e.g. another NPO, or in partnership with one or more

This model bases on commercial investments. A new asset class which has been created can now be invested in by banks, pension funds and others. Those developed asset

SPVs with contracts with public bodies involving

It is possible that either the

local, the regional or the

national government would

enter the arangement to

payout investors after

achieving the social impact

A SIB MAY BE AN

APPROPRIATE

FUNDING

METHOD

4

A simple decision making schema help

Figure 5: Decision Making Schema for C

For a better understanding of all structures it is needful to clarify the main actorswithin this area. - Service Provider: A service provider is nothing else than a NPO developing and implementing

projects for the reachability of social impact.- Service User: This is the group which participates in projects, in other terms using the service

of the provider. - Social Investors: Those actors are financing the project and

interested in both social return and financial yield.- Government: To understand as the local, regional or national government that is saving money

if projects will be successful. It is the guarantor for reimbursements for investors. A government does not carry the financial risks of failures.

9 Source: own research based on Mulgan p. 8 f.10 Cf. Weber p. 7


A simple decision making schema helps to choose the right SIB for the planned project.

: Decision Making Schema for Choosing an Adequate SIB

For a better understanding of all structures it is needful to clarify the main actors

A service provider is nothing else than a NPO developing and implementing reachability of social impact. This is the group which participates in projects, in other terms using the service

Those actors are financing the project and usually carrying its risks. They are n both social return and financial yield.

To understand as the local, regional or national government that is saving money if projects will be successful. It is the guarantor for reimbursements for investors. A government

ancial risks of failures.

Source: own research based on Mulgan p. 8 f.


the right SIB for the planned project.

hoosing an Adequate SIB9

For a better understanding of all structures it is needful to clarify the main actors10 and their tasks

A service provider is nothing else than a NPO developing and implementing

This is the group which participates in projects, in other terms using the service

carrying its risks. They are

To understand as the local, regional or national government that is saving money if projects will be successful. It is the guarantor for reimbursements for investors. A government


5

- Service support organisation: It is an outside company which is responsible for the organisation, coordination, and supervision of the SIB process.

The initial point of applying a SIB for fundraising is coming from the NPO by creating the idea of a social project with a positive social outcome. Afterwards it is their task to find both a social investor and the willingly government. There are two variants how the service provider can approach its action: - First find a social investor who agree and trust in the prearranged goals. During or after this

process the government should be included to complete the contract and apply the SIB. - or first contact the competent authority which is ready to pay back the invested money including

a financial return. Following a letter of intent (LoI) about the project and conditions would help to address, attract, and to corporate with a suitable investor.

The ideal case would be if both alternatives would occur at the same time. During the contract process a delivery structure can be negotiated. The philanthropic SIB overlaps with the SPV delivery structure11 (also called the contractual structure): In the beginning of this delivery structure social investors have to build up a special purpose vehicle or organisation respectively. SPV e.g. a Ltd. Company is a legal entity which is created by investors to fulfil specific objectives. Usually those are used for structured finance of projects. It assures a balanced paying system of projects and protects the investors from bankruptcy as within a SPV they do not adhere with private assets.12 In this case social investors fund a SPV to forward financial resources to the service providers. Alike it acts as a bearer which is responsible for a proper execution of the whole SIB programme.

11 Cf. Mulgan, p. 12 12 Cf. N.U. (3)

6

Figure 6

At this point all the other parties conclude contracts with the SPV. There are contracts between:- Service Providers and SPV:

payments - Government and SPV:

reimbursements if the project will success- Social Investors and SPV:

with additional financial return- Service support company and SPV:

mentioned above in exchange for payments

This structure has the following process described in steps: 1. Investments into a SPV 2. Payments to the Service Provider3. Service Provider execute the project, Service User4. Project has a positive social impact on the society which results in lower costs for government5. Government reimburse the SPV6. SPV forward the repayments to social investors7. Service support is executed through the whole process in form of

coordination and supervision After a successful implementation of the project the SPV stop to operate as a company and dissolved.

13 Source: own research based on Chatfield p. 4


6: Special Purpose Vehicle Delivery Structure13

At this point all the other parties conclude contracts with the SPV. There are contracts between:Service Providers and SPV: Service provider ensure successful projects in exchange for

SPV guarantee lower costs for the government in exchange for reimbursements if the project will success Social Investors and SPV: Social investors are funding the SPV in order to get rwith additional financial return Service support company and SPV: Service support organisation provide services mentioned above in exchange for payments

This structure has the following process described in steps:

s to the Service Provider Service Provider execute the project, Service Users participate Project has a positive social impact on the society which results in lower costs for governmentGovernment reimburse the SPV including additional financial return

repayments to social investors Service support is executed through the whole process in form of carrying forcoordination and supervision

After a successful implementation of the project the SPV stop to operate as a company and

Source: own research based on Chatfield p. 4


At this point all the other parties conclude contracts with the SPV. There are contracts between: ensure successful projects in exchange for

SPV guarantee lower costs for the government in exchange for

Social investors are funding the SPV in order to get repayments

Service support organisation provide services

Project has a positive social impact on the society which results in lower costs for government

carrying for organisation,

After a successful implementation of the project the SPV stop to operate as a company and is getting


The public sector SIB overlaps with the

Figure

A streamlined delivery structure is very simple and has only a limited amount of can see instead of contacting a SPV, service providers are directly connected to the investors. Such a delivery structure is more difficult to find due to higher risks for investors. After concluding the contracts between service provsocial investors and the government this structure has the following process: 1. Social Investors fund service providers2. Service provider execute projects3. Project has a positive social impact on society which res4. Government reimburse social investors including additional financial return Lead Delivery Agency delivery SIB models: The Lead Delivery Agency (LDA) is the respfunds and implementing them into projects. It can provide the funds either directly or subto other agencies. The reimbursement is based on the outcome of the projects. The difference between SPV and LDA is that an LDA is an independent company working on its own goals. This platform likely organisation provides an intermediate step between the social investor and the service provider and sometimes it acts as a coMoreover after conducting a project a LDA exists onward. Hence this LDA can be e.g. a foundation, a company (CSR), or the service provider itself or rather another NPO.

14 Cf. Mulgan, p. 10 15 Source: own research based on Chatfield p. 416 Cf. Mulgan, p. 11

The public sector SIB overlaps with the streamlined delivery structure14:

Figure 7: Streamlined Delivery Structure of a SIB15

A streamlined delivery structure is very simple and has only a limited amount of can see instead of contacting a SPV, service providers are directly connected to the investors. Such a delivery structure is more difficult to find due to higher risks for investors.

After concluding the contracts between service providers and social investors as well as between social investors and the government this structure has the following process:

Social Investors fund service providers Service provider execute projects Project has a positive social impact on society which results in lower costs for governmentGovernment reimburse social investors including additional financial return

ead Delivery Agency delivery structure16 overlaps with both philanthropic and commercial

The Lead Delivery Agency (LDA) is the responsible authority for collecting or even participating in funds and implementing them into projects. It can provide the funds either directly or subto other agencies. The reimbursement is based on the outcome of the projects.

tween SPV and LDA is that an LDA is an independent company working on its own goals. This platform likely organisation provides an intermediate step between the social investor and the service provider and sometimes it acts as a co-funder. As a return it eMoreover after conducting a project a LDA exists onward. Hence this LDA can be e.g. a foundation, a company (CSR), or the service provider itself or rather another NPO.

Source: own research based on Chatfield p. 4

7

A streamlined delivery structure is very simple and has only a limited amount of stakeholders. As one can see instead of contacting a SPV, service providers are directly connected to the investors. Such a

iders and social investors as well as between

ults in lower costs for government

overlaps with both philanthropic and commercial

for collecting or even participating in funds and implementing them into projects. It can provide the funds either directly or sub-contracted

tween SPV and LDA is that an LDA is an independent company working on its own goals. This platform likely organisation provides an intermediate step between the social investor and

funder. As a return it expects social values. Moreover after conducting a project a LDA exists onward. Hence this LDA can be e.g. a foundation,

8

Figure 8: Lead Delivery Agency Deliver

A LDA delivery structure has the following process:1. LDA raises money from investors and/or using own financial resources2. LDA forward resources to service provider3. Service provider execute project4. Project has a positive social impact 5. Government reimburse social investors including additional financial return There are some approaches one can use to approximately choose the right delivery model of a SIB. It depends on its complexity, duration and size of a project - The SPV model can be taken for - The streamlined model is adequate for - For all other types of projects SIB is mainly being developed in the Angloin this field in the European Unionas well as the SKOLL foundation are following up on this processphilanthropy sector is interested in SIBs. Next to this the independent research institute RAND Europe is carrying out a long-term research process shadowing the development of SIBs.

17 Source: own research based on Chatfield p. 418 Cf. Rana and Majmudar 19 Cf. Khan 20 Cf. Kippy 21 Cf. RAND corporation


: Lead Delivery Agency Delivery Structure of a SIB17

A LDA delivery structure has the following process: money from investors and/or using own financial resources

LDA forward resources to service provider Service provider execute project Project has a positive social impact on the society which results in lower costs for governmentGovernment reimburse social investors including additional financial return

There are some approaches one can use to approximately choose the right delivery model of a SIB. exity, duration and size of a project18.

can be taken for complex, large, and long-term projects. is adequate for simple, small, and short-term projects.projects which aren’t considered above, the LDA model

SIB is mainly being developed in the Anglo-Saxon region. The United Kingdom is currently pioneering European Union (EU)19. The European Venture Philanthropy Association (EVPA),

n are following up on this process20, which is a good indicator that the philanthropy sector is interested in SIBs. Next to this the independent research institute RAND

term research process shadowing the development of SIBs.

search based on Chatfield p. 4


on the society which results in lower costs for government

There are some approaches one can use to approximately choose the right delivery model of a SIB.

projects.

model fits the best.

Saxon region. The United Kingdom is currently pioneering . The European Venture Philanthropy Association (EVPA),

, which is a good indicator that the philanthropy sector is interested in SIBs. Next to this the independent research institute RAND

term research process shadowing the development of SIBs.21


The following process is explaining seven steps of developing a SIB:

Figure 9:Development Process of a Social Impact Bond

If one is getting through the whole process, a SIB is developed and can be used as funding resource.

2.1.3. Monetary Fine Acquisition Monetary fine acquisition (MFA) is described as a donation instrument where fines are forwarded from a local justice to non-profit organisations (NPO) for charitable functions. There is one regulation which says to favoursupporting victims. To use this practice as a fundraising instrument NPOs usually rely on “Oneanalysis of the judicial donors’ attitudes and promptness towards donatiindispensable. After, a customized marketing can be applied. Though, the regulations of MFA differ 22 Source: cf. Barclay and Symons, p. 5 23 For more detailed explanation of the steps read the following guide 24 Cf. Urselmann, p. 360 ff. 25 Definition “one-to-one marketing”: tailoring the marketing approaches to the needs of the customers using different statistical methods (individualization).

The following process is explaining seven steps of developing a SIB:

:Development Process of a Social Impact Bond22

If one is getting through the whole process, a SIB is developed and can be used as funding resource.

Monetary Fine Acquisition (MFA)24

Monetary fine acquisition (MFA) is described as a donation instrument where fines are forwarded profit organisations (NPO) for charitable functions. There is one

regulation which says to favour several areas and to invest the money first in projects such as

To use this practice as a fundraising instrument NPOs usually rely on “One-to-oneanalysis of the judicial donors’ attitudes and promptness towards donations in social projects is indispensable. After, a customized marketing can be applied. Though, the regulations of MFA differ

For more detailed explanation of the steps read the following guide cf. Barclay L., Symons T. p. 5

one marketing”: tailoring the marketing approaches to the needs of the customers using different

9

If one is getting through the whole process, a SIB is developed and can be used as funding resource.23

Monetary fine acquisition (MFA) is described as a donation instrument where fines are forwarded profit organisations (NPO) for charitable functions. There is one

several areas and to invest the money first in projects such as

one-marketing”25. An ons in social projects is

indispensable. After, a customized marketing can be applied. Though, the regulations of MFA differ

f. Barclay L., Symons T. p. 5-23

one marketing”: tailoring the marketing approaches to the needs of the customers using different


10

from country to country. That is why it is crucial to investigate them, find out if it exists in the own state, and to get an overview about the application process. To find some contacts to judges e.g. through members is advantageously. Currently this method is practiced in Germany.

2.2. Private Sector Fundraising

2.2.1. Venture Philanthropy (VP) Venture philanthropy (VP) is an upcoming trend in the world of philanthropy. It takes concepts and techniques from venture capital finance and business management and applies them to achieving philanthropic goals. As such it is closely related to the concept of social entrepreneurship, but then from the perspective of the financial backers of our social innovative projects. VP works to build stronger social purpose organisations (SPO) by providing them with both financial and non-financial support in order to increase their societal impact. European Venture Philanthropy Association (EVPA) purposely uses the word societal because the impact may be social, environmental, medical or cultural. The VP approach includes both the use of social investment and grants. As VP spreads globally, specific practices may be adapted to local conditions, yet it maintains a set of widely accepted key characteristics. This classification helps to whether find oneself inside or outside the VP circle. These classes26 are: - High engagement: Hands-on relationships between the social enterprise (SE) or non-profit

management and the venture philanthropists. - Organisational capacity-building: Building the operational capacity of the portfolio

organisations, by funding core operating costs rather than individual projects. - Multi-year support: Supporting a limited number of organisations for 3-5 years, then exiting

when organisations supported are financially or operationally sustainable - Non-financial support: Providing value-added services such as strategic planning to strengthen

management. - Involvement of networks: Providing access to networks enables various and often

complementing skill-sets and resources being made available to the investees. - Tailored financing: Using a range of financing mechanisms tailored to needs of organisation

supported. - Performance measurement: Placing emphasis on good business planning, measurable

outcomes, achievement of milestones and financial accountability and transparency. - For a better understanding for which countries VP comes into consideration it may be important to find oneself in the following graph of European Philanthropy models and adapt to it. Depending on the social sector share and its extent of independency we distinguish the following models.

26 Cf. direct citation Buckland, Hehenberger, Hay, p. 34


11

Figure 10: Models of European Philanthropy27

- Welfare partnership model: Venture Philanthropy movements are less developed and young.

Despite there are some outlines of strong demonstration projects by private individuals and corporations showing inclined interest in SE and VP. The barriers of stretching this field are the conservatism of foundations and the lack of human capital to put in and operate these initiatives. Resultant, investors are doubtful of placing their money in some projects. Besides government initiatives and the particularities of the philanthropic landscape are slowing down the nature and growth of VP.

- Liberal model: VP and social investment (SI) have matured very fast in the United Kingdom (UK) as an outcome of their strong philanthropic traditions. The area will expand on and on in the future, as the British government is ready to promote and experiment with less expensive ways such as pay-for-result models of social impact bonds (SIB) to provide social services.

- Developmental model: The development of philanthropy in these countries retained at a certain point. The eastern part of Europe suffered under decades of totalitarian rule, short-term thinking, and a general lack of risk-taking. These aspects affect both the business and the philanthropic fields. As the government is becoming dominant in the social sector also the risk of squeezing out private initiatives is growing.

- Social democrat model: Because of the stable conditions in those countries the philanthropic field was never taken centre stage in the civil society but rather struggled to make an impact. There are good prospects of changing due to the wealthiest parties slowly start to move SE and VP into the foreground28.

VP is one tool in the SI and philanthropy toolkit. It has emerged in Europe during the present decade as a high engagement approach to social investment and grant making across a range of SPOs, from charities and non-profit organisations through to socially driven businesses. Social investment refers to funding that may generate a financial return, but where the societal impact comes first; so-

27 Source: own research based on Buckland, Hehenberger, Hay, p. 35 ff. 28 Cf. Buckland, Hehenberger, Hay, p.36 ff.

12

called ‘Impact First strategies’. donations to the SPO supported; anfinancial return is maximized and the societal impact is secondary, are not included in EVPA’s definition of venture philanthropy. Therefore Venture Philanthropy is not to be mistaken for Corporate Social Responsibility (CSR). The relatively newer teboth ‘impact first’ and ‘finance first’ strategies. The following chart aims to clarify the differences and overlaps of this terminology.29

Figure 11: Positioning Venture Philanthropy in the Investm

29 Cf. direct citation Hehenberger, Harling, p. 1930 Cf. Hehenberger, Harling, p. 19


strategies’. Grant funding on the other hand is the provision of nonsupported; an ‘Impact Only’ strategy. ‘Finance first strategies’

financial return is maximized and the societal impact is secondary, are not included in EVPA’s definition of venture philanthropy. Therefore Venture Philanthropy is not to be mistaken for Corporate Social Responsibility (CSR). The relatively newer term “Impact Investmentboth ‘impact first’ and ‘finance first’ strategies. The following chart aims to clarify the differences and

: Positioning Venture Philanthropy in the Investment Landscape

Cf. direct citation Hehenberger, Harling, p. 19


on the other hand is the provision of non-repayable ‘Finance first strategies’, where the

financial return is maximized and the societal impact is secondary, are not included in EVPA’s definition of venture philanthropy. Therefore Venture Philanthropy is not to be mistaken for

Impact Investment” includes both ‘impact first’ and ‘finance first’ strategies. The following chart aims to clarify the differences and

ent Landscape30


The following table gives an overview of the different stakeholders and their roles in VP:

_____________________________________________________________

Figure 12: Stakeholders and their Role in Venture Philant

The European Venture Philanthropy Associationdevelopment of VP in Europe. Their website is an important resource for being updevelopment of the sector: http://evpa.eu.com

2.2.2. Cooperate Social Responsibilities (CSR) There are many models of Cooperate Social Responsibility (CSR), and therefore also different definitions. We first explore two definitions which are most relevant within the European conte 1. In November 2010, the International Organisation

the first international standard defining organisations’ social responsibility. ISO defines social responsibility as responsibility of an organisation for tsociety and the environment, through transparent and ethical behaviour that:- contributes to sustainable development- takes into account the expectations of- is in compliance with applicable law and consistent with international norms of- is integrated throughout the organisation and practiced in its relationship.

2. In 2011, the European Commission (EC) puts forward a new definition of CSR as “

responsibility of enterprises for their impacts on societyshould have in place a process consumer concerns into theirtheir stakeholders. The aim of this is:- maximizing the creation of

stakeholders and society at large;

31 Source: http://evpa.eu.com/knowledge32 Cf. N.U. (2): direct citation: https://www.iso.org/obp/ui/#iso:std:iso:26000:ed


_____________________________________________________________

: Stakeholders and their Role in Venture Philanthropy31

The European Venture Philanthropy Association (EVPA) is an important platform supporting the development of VP in Europe. Their website is an important resource for being up

http://evpa.eu.com.

Cooperate Social Responsibilities (CSR)

There are many models of Cooperate Social Responsibility (CSR), and therefore also different definitions. We first explore two definitions which are most relevant within the European conte

In November 2010, the International Organisation for Standardisation (ISO) launched ISO 26000, the first international standard defining organisations’ social responsibility. ISO defines social responsibility as responsibility of an organisation for the impacts of its decisions and activities on society and the environment, through transparent and ethical behaviour that:

sustainable development, including health and the welfare of society;takes into account the expectations of stakeholders; is in compliance with applicable law and consistent with international norms of

throughout the organisation and practiced in its relationship.

In 2011, the European Commission (EC) puts forward a new definition of CSR as “responsibility of enterprises for their impacts on society”. To fully meet their CSR, enterprises

process to integrate social, environmental, ethical, human rights and consumer concerns into their business operations and core strategy in close collaboration with

. The aim of this is: maximizing the creation of shared value for their owners/shareholders and for their other stakeholders and society at large;

Source: http://evpa.eu.com/knowledge-centre/what-is-vp/, 05/06/2014

): direct citation: https://www.iso.org/obp/ui/#iso:std:iso:26000:ed-1:v1:en, 05/06/2014

13


_____________________________________________________________

31

is an important platform supporting the development of VP in Europe. Their website is an important resource for being up-to date about the

There are many models of Cooperate Social Responsibility (CSR), and therefore also different definitions. We first explore two definitions which are most relevant within the European context:

ation (ISO) launched ISO 26000, the first international standard defining organisations’ social responsibility. ISO defines social

he impacts of its decisions and activities on society and the environment, through transparent and ethical behaviour that:

, including health and the welfare of society;

is in compliance with applicable law and consistent with international norms of behaviour; throughout the organisation and practiced in its relationship.32

In 2011, the European Commission (EC) puts forward a new definition of CSR as “the ”. To fully meet their CSR, enterprises

to integrate social, environmental, ethical, human rights and in close collaboration with

for their owners/shareholders and for their other

1:v1:en, 05/06/2014

14

- identifying, preventing and mitigating their A company which operates in CSR can be useful not only in order to get access to capital, but also it may provide customer relationships, human resources, and capacity building. CSR has eight focus areas. Therefore when developing a CSR strmatch-make companies which work within a focus area parallel to our organisation’s values and actions. The focus areas are34: 1. Environment 2. Fair operating practices 3. Consumer & customer issues4. Community involvement and develop5. Human rights 6. Labour practices 7. CSR governance 8. Communication

When approaching companies it is important to have established clear minimum standards, to ensure that you do not compromise the mission and vision of your organisationthe ‘Triple bottom line’ (TBL). In traditional business accounting, the ‘bottom line’ refers to the sum of revenue minus expenses, which is either ‘loss’ if negative, or ‘profit’ if positive.adds two more ‘bottom lines’; social paraphrased as ‘Profit, People, and Planet’which makes it a global model for CSR.

Figure 13: Triple Bottom Line of Co

The CSR sector is in constant evolution: traditionally CSR was embedded in a small department of the company, running mostly grantorganisations (NPO). There was not necessarily a strong focus on (the measurement of) the social impact, nor on a long-term strategy. This type of CSR is very much in line with grant giving strategies of other sectors like public institutions and foundations. The financial crisimpetus for changing this model. CSR is currently being developed into different areas, including the

33 Cf. European Commission: direct citation, p. 634 Cf. Martinuzzi, Krumay, Pisano, p. 17 35 Source: http://en.wikipedia.org/wiki/Triple_bottom_line#mediaviewer/File:Tri


identifying, preventing and mitigating their possible adverse impacts.33

A company which operates in CSR can be useful not only in order to get access to capital, but also it may provide customer relationships, human resources, and capacity building.

Therefore when developing a CSR strategy it is important to map and make companies which work within a focus area parallel to our organisation’s values and

Consumer & customer issues Community involvement and development

When approaching companies it is important to have established clear minimum standards, to ensure that you do not compromise the mission and vision of your organisation. A useful tool to do t

In traditional business accounting, the ‘bottom line’ refers to the sum of revenue minus expenses, which is either ‘loss’ if negative, or ‘profit’ if positive.adds two more ‘bottom lines’; social and environmental concerns. The three together are often paraphrased as ‘Profit, People, and Planet’. TBL has been standardized by the United Nation (UN), which makes it a global model for CSR.

: Triple Bottom Line of Corporate Social Responsibilities

The CSR sector is in constant evolution: traditionally CSR was embedded in a small department of the company, running mostly grant-giving short-term projects for individuals, charities or non

ere was not necessarily a strong focus on (the measurement of) the social term strategy. This type of CSR is very much in line with grant giving strategies

of other sectors like public institutions and foundations. The financial crisis has given a strong impetus for changing this model. CSR is currently being developed into different areas, including the

Cf. European Commission: direct citation, p. 6

Source: http://en.wikipedia.org/wiki/Triple_bottom_line#mediaviewer/File:Triple_Bottom_Line_graphic.jpg


A company which operates in CSR can be useful not only in order to get access to capital, but also it

ategy it is important to map and make companies which work within a focus area parallel to our organisation’s values and

When approaching companies it is important to have established clear minimum standards, to ensure A useful tool to do this is

In traditional business accounting, the ‘bottom line’ refers to the sum of revenue minus expenses, which is either ‘loss’ if negative, or ‘profit’ if positive. The concept of TBL

and environmental concerns. The three together are often . TBL has been standardized by the United Nation (UN),

rporate Social Responsibilities35

The CSR sector is in constant evolution: traditionally CSR was embedded in a small department of term projects for individuals, charities or non-profit

ere was not necessarily a strong focus on (the measurement of) the social term strategy. This type of CSR is very much in line with grant giving strategies

is has given a strong impetus for changing this model. CSR is currently being developed into different areas, including the

ple_Bottom_Line_graphic.jpg


15

creating of management tools for innovation and growth, employee motivation and customers’ attraction and retention, risk management and operational management. Next to this CSR is in a tension with the new trend of venture philanthropy: sometimes they overlap, sometimes they are clearly demarcated. Important is that the CSR department still is the main point of access to most companies for support. The support coming from these companies can be divided in different categories36. - Corporate Giving - Sponsoring - Corporate Foundations - Cause Related Marketing - Corporate Volunteering - etc.

Some ways of using the support from a CSR are shortly described in the following chapters.

2.2.2.1. Sponsoring Sponsoring means to get a return in form of services from non-profit organisations (NPO) as a consideration for funding their projects. Usually companies which fund NPOs are not asking for any consideration, but some of them at least expect it. In other terms sponsoring means:

“to analyse, to plan, to execute, and to control all activities, associated with provision of financial and material resources as well as services and know-how, to foster individuals and organisations in areas such as sports, culture, environment, or media. It includes conditions about sponsors’ commitments and sponsored companies’ contribution. Besides it enables the attainability of organisational marketing and communication goals.”37

There are three aspects which distinguish between donations and sponsoring. First, there is an exchange of activities. Second, the NPO is included into the marketing of an organisation. And third, there is a sponsoring contract between the sponsor and the NPO. According to the view of a sponsor there are several criteria considered:

Characters Form Example

Types of sponsoring

Altruistic sponsoring

Companies do not force the organisation to advertise them; most important for sponsor is to foster cultural, social, and other non-commercial institutions

Aid-oriented sponsoring

Companies desire to see their labels advertised by the sponsored organisation; companies prefer to sponsor social and environmental areas

Classic sponsoring

Necessary that sponsored organisations advertise the company, while the sponsorship itself is moving into background; characterized by a special planning and controlling of the entire process

36 Cf. Urselmann, p. 302 37 Cf. Bruhn, direct translation, p. 6 f.


16

Instruments of sponsoring

Performance sponsoring Responsible for athletes by providing sport equipment

Company sponsoring Companies foster projects e.g. Siemens, Opel etc.

Foundation sponsoring Companies’ foundations finance projects e.g. Robert Bosch, Volkswagen etc.

Number of sponsors Exclusive sponsorship Only one company is sponsoring projects

Co-sponsorship Two or more companies are sponsoring projects

Type of sponsors’ service Financial Contribution into projects Materials Provision of flights, computer, vehicles etc. Services Supplying know-how

Diversification of sponsoring

Concentrated sponsoring Sponsorship only in one area e.g. sports

Differentiated sponsoring Sponsoring in multiple fields e.g. sports, environment etc.

Type of utilization Isolated sponsoring

Sponsoring is used separately from other instruments

Integrated sponsoring Sponsoring is related to other methods Table 2: Characterisation of Sponsoring38

Before getting in touch with sponsors it is important to check the legal situation in your country due to in some there are regulations, which for example forbid financial sponsoring. Independent to the type of sponsoring there is a systematic process which facilitates the decision making and the communication between the parties. A plain description is given below. 1. Analyse current situation (determination of material requirements) 2. Define the strategy (concept, positioning, creation and actions) 3. Operate (implement the strategy) 4. Controlling (measure efficiency and impact)39

As compensation the sponsored organisations can advertise the sponsor either through (in)direct channels or provide its service to him. The NPO could have the alternative to: - Promote during an event (direct advertisement) - Use the companies title/name and/or logo in publications or newsletters - Integrate company into their communication process (indirect advertisement)40 - Conclusion is that sponsoring is a good instrument for both, advertising the sponsors and NPOs as well as fundraise resources (financial, intangible, material etc.) for a project. Nevertheless it is not the easiest way to fund a project.

2.2.2.2. Corporate Giving41 Corporate giving is nothing else than a donation forwarded from a company to a non-profit organization (NPO) for social purposes. If one wants to corporate with this company, it may be useful to establish a relationship with the corresponding of the company on a trustful basis.

38 Source: own research based on Bruhn, p. 20-24 39 Cf. Bruhn, p. 46 40 Cf. Bruhn, p. 28 f. 41 Cf. Urselmann, p. 301


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2.2.2.3. Corporate Volunteering42 Sometimes companies are not funding the non-profit organisations (NPO) with money, but with time or services. That means that employees of the corporative company are attending as volunteers. A lot of companies are using this kind of donation. Around 80 % have already volunteered in social engagements. But there are only few NPOs which realize this opportunity and are actively using it. Corporate volunteering is difficult to use, as usually the employees are helping out for short-term period sand sometimes for a limited amount of times. Every process has to be explained again and again, which results in time consumption and finally in costs. Another term for corporate volunteering is “secondment” due to an employee’s temporary changing of responsibilities and tasks.

2.2.3. Microfinancing in Europe “Microfinance is a source of financial services for entrepreneurs and small businesses lacking access to banking and related services. The two main mechanisms for the delivery of financial services to such clients are: relationship-based banking for individual entrepreneurs and small businesses; and group-based models, where several entrepreneurs come together to apply for loans and other services as a group.”43 “Microfinance consists mainly of micro-loans (less than EUR 25.000) tailored to micro-enterprises (91% of all European businesses) and people who would like to become self-employed but are facing difficulties in accessing the traditional banking services. Throughout the European Union, 99% of all start-ups are micro or small enterprises and one third of those were launched by unemployed people.”44 “Compared to the microfinance markets in South Asia, South America or Africa, the European microfinance market is a young, highly heterogeneous but growing market segment, notably in new Member States and some western countries, usually when the regulatory framework is conducive to this activity, with micro-credit institutions aiming at self sustainability, increased micro-lending capacity and, in some cases, transformation into banks.”45 “Being a crucial tool to overcome the effects of the financial crisis, we have been involved in the European microfinance sector since 2000, providing funding (equity and loans), guarantees and technical assistance to a broad range of financial intermediaries, from small non-bank financial institutions to well established microfinance banks to make microfinance a fully-fledged segment of the European financial sector. In this way, we pursue core European Union's objectives: entrepreneurship, growth and job creation.”46 Microfinancing can be used for pre-financing or as bridging financing until receiving the public subventions or other financial resources. The use of microfinancing is risky for the non-profit sector as the rates, the fees, as well as the debts have to be paid back and a NPO does not have permanent cash inflows. The EU does not directly provide to individuals or businesses, but provides guarantees, loans and equity to intermediaries who can then lend to small businesses or make available equity finance.

42 Cf. Urselmann, p. 307 43 Cf. direct citation Kannan, Panneerselvam p. 78 44 Cf. direct citation Kraemer-Eis, Lang, Gvetadze, p. 55 45 Cf. direct citation Kelly, Kraemer-Eis, p. 28 46 Cf. direct citation N.U. (4)


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Few programmes can be found in Annex 1 (Table 9: Annex I: Programmes of Microfinancing in Europe).

2.2.4. Charity Affinity Credit Card (CACC) A charity affinity credit card (CACC) is a special form of co-branded credit cards. Issuers of those are working with non-banking institutions such as non-profit organisations (NPO) and provide them a credit card with a logo of the participant NPOs.47 These cards are tailored to the needs of its customers and hence some specific services are included.48 The CACCs are available from following issuers: - Banks - Associations - Travelling Enterprises - Retailer

CACCs foster the awareness level of an NPO as both the NPOs and the issuer authorities advertise them. It is also possible to arrange special regulations with the giving authority such as provision of financial support for projects or provision of services. The banks are paying two different commissions: either a percentage for the distribution of a card or a commission for the transaction volume (0.2% – 0.3%)49. The fundraising through CACC is therefore a method which brings in only small amounts of financial resources. But after a while and with an increasing number of credit cards the collected amount can add up to large donations. There are four conditions50 one should prove in advance: - Evaluate the reward programme: here one should examine the benefits of the cards

whether for the organisation itself or for the end-customer. �� For what do we get the provision? (new account, monthly charge volume, balance

transfer, etc.) �� Are there benefits for the end-customer? (points, miles, or cash back)

- Know the terms: �� What are the rates and fees? �� Does the lender charge cardholders extra for personalization? �� Are there hidden charges that lessen the value for your organisation and/or its

supporter? - Think about the marketing support:

�� Does the issuer provide tools to support marketing efforts beyond direct mailing? �� Do you have to wait for marketing approval or marketing messages or can you insert

preapproved copy in newsletters or share it on social media? �� Are you flexible about sending messages on your own timeline?

- Check references and reputation: �� Talk to other non-profits to evaluate the image. �� Check an issuer’s asset quality, capital adequacy, profitability, and loan growth (to find in

the balance sheet).

47 Cf. Sistare 48 Cf. Kröselberg, p. 321 49 Cf. Kröselberg, p. 321 50 Cf. partly direct citation Schmelzel


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2.2.5. Payroll Giving The idea behind payroll giving it is that employees abdicate the cents from their monthly income to donate it for social purposes. For example of a monthly income of 1754, 65 Euro, the employees donate 65 cents.51 The operating company keeps the donations automatically and later forwards the collected amounts to a non-profit organisation (NPO). Synonyms of payroll giving are “workplace giving” or “give as you earn”. This system was invented in the UK and is not common in other European countries yet. It may be difficult to find companies which are exercise payroll giving. Though, it is possible to contact some companies and to suggest them to corporate with us in form of payroll giving.

2.2.6. Cooperatives The International Cooperative Alliance (ICA; founded in 1895) is the main global representative body of the cooperative movement. It defines the cooperative task ‘an autonomous association of persons united voluntarily to meet their common economic, social, and cultural needs and aspirations through a jointly-owned and democratically-controlled enterprise’.52 The cooperative as organisational mode has been developed throughout the 19th century as a reaction to the first industrialisation and its impact on both rural areas and cities. Often the “Rochdale pioneers” and “Friedrich Wilhelm Raiffeisen” are referred to as two of the most influential initiators of the Cooperative movement. As such its development process is very alike the development of the preventive system (cf. Mutual aid societies). Cooperatives are based on the values of self-help, self-responsibility, democracy, equality, equity and solidarity. In the tradition of their founders, cooperative members believe in the ethical values of honesty, openness, social responsibility and caring for others. The cooperative principles of ICA are a set of global guidelines by which cooperatives put their values into practice53: - Voluntary and Open Membership: Cooperatives are voluntary organisations, open to all

persons able to use their services and willing to accept the responsibilities of membership, without gender, social, racial, political or religious discrimination.

- Democratic Member Control: Cooperatives are democratic organisations controlled by their members, who actively participate in setting their policies and making decisions. Men and women serving as elected representatives are accountable to the membership. In primary cooperatives members have equal voting rights (one member, one vote) and cooperatives at other levels are also organised in a democratic manner.

- Member Economic Participation: Members contribute equitably, and democratically control, to the capital of their cooperative. At least part of that capital is usually the common property of the cooperative. Members usually receive limited compensation, if any, on capital subscribed as a condition of membership. Members allocate surpluses for any or all of the following purposes: developing their cooperative, possibly by setting up reserves, part of which at least would be indivisible; benefiting members in proportion to their transactions with the cooperative; and supporting other activities approved by the membership.

- Autonomy and Independence: Cooperatives are autonomous, self-help organisations controlled by their members. If they enter into agreements with other organisations, including governments, or raise capital from external sources, they do so on terms that ensure democratic control by their members and maintain their cooperative autonomy.

51 Cf. Goffart, p. 302 52 Cf. direct citation Kaswan, p. 9 53 Cf. direct citation N.U. (5)


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- Education, Training and Information: Cooperatives provide education and training for their members, elected representatives, managers, and employees so they can contribute effectively to the development of their cooperatives. They inform the general public - particularly young people and opinion leaders - about the nature and benefits of cooperation.

- Cooperation among Cooperatives: Cooperatives serve their members most effectively and strengthen the cooperative movement by working together through local, national, regional and international structures.

- Concern for Community: Cooperatives work for the sustainable development of their communities through policies approved by their members.

Compared with other organisational and business models a cooperative has a more juridical freedom, which allows developing statutes and decision-making procedures in a practice it fits the aim of the cooperative in the best way. As it is aimed at realising this social aim rather than a pure financial profit, a cooperative can also lay down its social goal in the statutes, making it a value- and community-based business model. This means that it can strive for similar goals in society as a non-profit organisation (NPO), but do this through a business approach. It can develop its own commercial activities, strive for (in)direct profit for its members and develop capital for the benefit of its members. Members can be individual people as well as legal bodies (organisations), or even a combination of both. As a cooperative is strongly community-based, it means is mainly functions well on local, regional or national level. Next to this it is aimed at generating commercial actions to reach a social impact. For DBYN this means that it is mainly an opportunity to promote towards our member organisations, as an organisational model to support actions like for example fighting youth unemployment, or by developing a product or service which can be commercialised to generate income for a local organisation. It is much more difficult to use this on network level as well.

2.3. Fundraising within society sector

2.3.1. Crowdfunding Crowdfunding is a concept where many small investors or stakeholders are willing to invest small amounts of their money in projects to which they feel related. It is based on “Praenumeration”, an early form of “subscription business model”. This business model is related to other cooperative models and the model of mutual aid societies. It has resurfaced with the development of the web 2.0, which allowed social networking to develop online. Synonyms for crowdfunding are ‘community funding’ and ‘tribefunding’. Nowadays crowdfunding is winning in importance worldwide. One of the main markets amongst others is Europe (cf. Figure 32: Annex II: Crowdfunding Platforms Acting Worldwide)54. However it focuses more on Western Europe. The following chart shows how the crowdfunding market share is distributed among the European countries.

54 Cf. Massolution research, p. 16 / 18


Figure

Partly our member countries are represented with the higher m Crowdfunding includes four different categories of return on investments - Donations & Rewards: Investors donate an amount without a reward or with a small in

reward in return. The return on investment is mainly a soc- Loans: Investors receive a periodical return for their contribution and will have to get their full

investment reimbursed. Interest rates can be determined, starting from 0%.- Revenue sharing: Investors receive remuneration depending on the fina

project. - Equity crowdfunding: Investors take a share in the capital of the enterprise/project. They are

remunerated through the possible payout of dividends.

The following chart aims at orienting the choice of business model based on tcrowdfunding action (social, financial, or material):

Figure 15: Business Models Based on Purpose of Crowdfunding

55 Source: own research based on: https://www.mymicroinvest.com/en/blog/posts/crowdfundingvolume-of-money 15/04/2014 56 Cf. Buysere, Gajda, Kleverlaan, Marom, p. 10 f.

15%

Crowdfunding Market Share in

Europe in Terms of Volume of

Figure 14: Crowdfunding Market Share in Europe55

Partly our member countries are represented with the higher market share within Europe.

Crowdfunding includes four different categories of return on investments (ROI):

Investors donate an amount without a reward or with a small inreward in return. The return on investment is mainly a social return.

Investors receive a periodical return for their contribution and will have to get their full investment reimbursed. Interest rates can be determined, starting from 0%.

Investors receive remuneration depending on the fina

Investors take a share in the capital of the enterprise/project. They are remunerated through the possible payout of dividends. 56

The following chart aims at orienting the choice of business model based on tcrowdfunding action (social, financial, or material):

: Business Models Based on Purpose of Crowdfunding57

Source: own research based on: https://www.mymicroinvest.com/en/blog/posts/crowdfunding-market

Cf. Buysere, Gajda, Kleverlaan, Marom, p. 10 f.

63%15%

22%

Crowdfunding Market Share in

Europe in Terms of Volume of

Money

United Kingdom

Germany

Poland, France, Italy,

Spain

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arket share within Europe.

Investors donate an amount without a reward or with a small in-kind

Investors receive a periodical return for their contribution and will have to get their full

Investors receive remuneration depending on the final turnover of the

Investors take a share in the capital of the enterprise/project. They are

The following chart aims at orienting the choice of business model based on the purpose of the

57

market-share-in-terms-of-

Poland, France, Italy,


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There are three phases in a crowdfunding action: 1. Preparation: The preparation process requires a high time investment (between one month

and one year). Before starting it is important to develop a business plan for the project. This means that you need to go further than a normal project plan, and also include stakeholder analysis and marketing.

2. Fundraising campaign: A typical crowdfunding action takes two to three months. There needs to be a clear set deadline including a set aimed amount. In order to be successful the campaign progresses in 3 steps.

� The first step is normally given by family & friends (1st network = spark), � the next are friends of family and friends (2nd network = flame), � and finally there is the general public (3rd network = fire).

3. Implementation: Once you start developing the project it is important to maintain a clear communication strategy with your investors.

In order to be successful in crowdfunding, it is essential to have a strong focus on process required to attaining goals. In the preparation you develop the project, but the fundraising campaign can be seen as active market research: if you bring in enough money this means that people are interested and committed to your project. The use of social media is crucial throughout the process: - Crowdfunding is organized through dedicated websites on which you can promote your action.

Almost all these platforms cost money. There are different models for this, including a percentage of money raised or in a fixed amount for each action.

- Next to this you need to create buzz on the project using other social media like facebook, google+, linkdin, twitter, youtube, vimeo, flickr, tumblr, instagram, soundcloud, etc. A special mention needs to be given to interest which lets users easily click to your dedicated crowdfunding platform.

The following table gives an outline, the time and resources required for different sizes of crowdfunding actions: Funds to be raised € 2.500 – 10.000 € 10.000 - € 100.000 > € 100.000 Investors 50 – 200 > 200 > 2.000 Duration campaign 30 – 45 days 30 – 60 days 60 – 90 days Time per day 15 min – 2 hours 1 – 2 hours 2 – 4 hours Tools campaign Email

Social media Social conversation Community

Email Social media Social conversation Larger community blog

Email Social media Social conversation Larger community blog Offline marketing Press support

Network Support and trust from 1st and 2nd network

Support and trust from 1st and 2nd network and partly 3rd network

Support and trust from the full network

Table 3: Required Resources and Time of Crowdfunding Actions

Crowdfunding can be used to raise the full capital required to start-up, or as co-financing for public institutions or co-financing for business credits. Legislation on crowdfunding is always based on the laws of the country in which the action takes place. The EU is working on changing legislation to make available throughout euro zone.

57 Cf. Buysere, Gajda, Kleverlaan, Marom, p. 12


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There are some aspects which can be conductive to profitability of crowdfunding but also build up barriers. Advantages: - To get money through crowdfunding platforms (CFP) means as well to share the information

about our organisation and the projects we are performing due to the most platforms are also connected to social media. As already mentioned we need to create buzz and to attract donors. That means that the platform is used for both as a server and as a marketing tool.

- A forum on each CFP provides us the opportunity of getting feedback for our projects. This important information can be partial used for measuring the social impacts.

- Some of these platforms are not raising any costs for joining them to raise58 funds. It is possible to book extra options which are liable to pay costs. But in our case we see crowdfunding as a relatively inexpensive way for raising financial resources.

Disadvantages: - The amount of money that should be raised for the project might be limited. Nevertheless this

can build a basis or can be combined with another source to reach the needed crowd. - Different CFPs are using different funding models. If one of them is using the so called ‘All or

Nothing’ model we might get nothing if we won’t raise the planned amount of resources. That means that if we cannot raise the whole amount we have planned, we will get nothing.

2.3.2. Legate With a legate a non-profit organisation (NPO) can fundraise money through the last will of someone who wants to support the impacts even after his life. In this case a person, who writes the testament to bequeath NPOs with property or assets (as a whole or in part), must have an enormous reliance towards an organisation. When writing the testament they can decide whether to allocate the money within an organisation or to build up a foundation59 for them. But both would support a NPO. The allocation of money at NPOs is usually tax free, but it is the function of every country itself to prove the legal status referring legates concerning a gift tax. There are different ways to initiate the society to think about heritage fundraising. The most common ways to inform the target group are informative letters, phone calls (inbound / outbound calls60), personal conversations, information online (through a homepage), and magazines. A distribution channel of the information about legates should be chosen by each organisation depending on their resources (human, capital). E.g. if an organisation has enough human resources it is advisable to inform though personal conversations due to it is easier to build up faith. If an organisation has predominant financial resources it can even use more ways at the same time.

58Cf. Social Media Fundraising (SMF) p. 33: Donation/Volunteer platform. 59 Saving Scheme: For us it would be possible to participate within this foundation and to apply some interest paying accounts. That means that the money which was forwarded to the foundation is forwarded to an account with an advantaged interest rate, which generates surpluses and those can be used for financing new projects. Usually a saving scheme is supported with borrowed capital and is then paid back to their owner after a specific period. But if the money is forwarded through a legate it can be used for more than only one period. 60 inbound calls = incoming calls from interested donors; outbound calls = outgoing calls to the target group to inform them

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61This method of fundraising requires a lot of responsibility, time and stability. Usually the contributor considers more than one organisation. That is why we have to point out to donors that there are also other NPOs in order to act in an ethical way. If then they choose to inherit to our association we need to provide a contact person who will be the responsible for giving informationinterview. Sometimes it is necessary to involve a lawyer as the non-profit sector has not enough expertise to instruct about the legal part of legates. Plenty of chambers provide volunteer or cheaper assistance of lawyers for NPOs. The typical audience consists of childless couples and women starting from the age of 70. To address the right target group, NPOs can use their existing database of donors and inform about or rather bring nearer the concept of legates. To communicate internevery description) has the advantage that a faith in our mission and vision was already built up. Consequently that is the easier way of gaining legates. A disadvantage could be if there are no or limited personal information about thgroup. The aim is to upgrade the occasional donors to a major donor (heirship) within the donation pyramid. If NPOs does not have donors so far, there is nothing left for them than to commthe external way. External communication means to inform the potential donors from time to time even if they are not responding. Using the external communication channels is as important as using the internal. It is proved that around the hnever before contributed donations. Some will build up relationships to the organisation without any signs.

2.3.3. Social Media Fundraising As the internet consumption is increasing enormously over thfundraising is a new approach full of advantageseveryone due to they do not require a lot of resources and can be implemented easily. To facilitate the understanding of SMF, it

Direct sourcing / Internal:The internal fundraising or recruitment of volunteers includes methods such as ‘Donation/Volunteer button’, ‘Online Auctions’, and ‘Direct Mailing’. It is internal as the methods need to be implemented by the organisation itself. That means that own resources (human and capital) are used to carry out those tasks. The fundraised resources are flowing in directly without passing by a third party.

Table 4: Division of Social Media Fundraising Methods

61 Source: http://cdn2.hubspot.net/hub/53/filetext.png?t=1369081646000

62 Source: own research


This method of fundraising requires a lot of responsibility, time and stability. Usually the contributor considers more

anisation. That is why we have to point out to donors that there are also other NPOs in order to act in an ethical way. If then they choose to inherit to our association we need to provide a contact person who will be the responsible for giving information through a personal interview. Sometimes it is necessary to involve a lawyer as

enough expertise to instruct about the legal part of legates. Plenty of chambers provide volunteer or cheaper assistance of lawyers for NPOs.

he typical audience consists of childless couples and women starting from the age of 70. To address the right target group, NPOs can use their existing database of donors and inform about or rather bring nearer the concept of legates. To communicate internally (with members of every description) has the advantage that a faith in our mission and vision was already built up. Consequently that is the easier way of gaining legates. A disadvantage could be if there are no or limited personal information about the donors and therefore it is difficult to get closer to the target group. The aim is to upgrade the occasional donors to a major donor (heirship) within the donation

If NPOs does not have donors so far, there is nothing left for them than to commthe external way. External communication means to inform the potential donors from time to time even if they are not responding. Using the external communication channels is as important as using the internal. It is proved that around the half of last will donations are coming from people who never before contributed donations. Some will build up relationships to the organisation without any

Social Media Fundraising (SMF)

As the internet consumption is increasing enormously over the last years, using social media for a new approach full of advantages. It offers diversity of methods which can be used by

everyone due to they do not require a lot of resources and can be implemented easily.

ng of SMF, it is divided into two main categories:

Direct sourcing / Internal: Indirect sourcing / External:The internal fundraising or recruitment of volunteers includes methods such as ‘Donation/Volunteer button’, ‘Online Auctions’,

g’. It is internal as the methods need to be implemented by the organisation itself. That means that own resources (human and capital) are used to carry out those tasks. The fundraised resources are flowing in directly

The external fundraising contains ‘Donation/Volunteer platform’, ‘Activist Fundraising’, ‘Affiliate Shopping’, and ‘Google AdSense’. These methods are also implemented by the workers but the income of resources is flowing in through a third party and may be deposit an amount of fee e.g. other websites or online shops.

: Division of Social Media Fundraising Methods62

Source: http://cdn2.hubspot.net/hub/53/file-44811017-png/Blog-Related_Images/fundraising-pyram

Figure 16: Donation Pyramide (small)


ally (with members of every description) has the advantage that a faith in our mission and vision was already built up. Consequently that is the easier way of gaining legates. A disadvantage could be if there are no or

e donors and therefore it is difficult to get closer to the target group. The aim is to upgrade the occasional donors to a major donor (heirship) within the donation

If NPOs does not have donors so far, there is nothing left for them than to communicate through the external way. External communication means to inform the potential donors from time to time even if they are not responding. Using the external communication channels is as important as using

alf of last will donations are coming from people who never before contributed donations. Some will build up relationships to the organisation without any

e last years, using social media for . It offers diversity of methods which can be used by

everyone due to they do not require a lot of resources and can be implemented easily.

Indirect sourcing / External: external fundraising contains

‘Donation/Volunteer platform’, ‘Activist Fundraising’, ‘Affiliate Shopping’, and ‘Google AdSense’. These methods are also implemented by the workers but the income of resources is flowing in through a third party and may be eposit an amount of fee e.g. other websites or

pyramid-with-

: Donation Pyramide (small)


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Direct sourcing methods:

- The Homepage �� Donation / Volunteer button: The meaning of a Donation/Volunteer button is to dispense both either money or volunteer work. A website of a non-profit organisation (NPO) is a perfect basis for starting a successful fundraising and recruitment via social media. It will attend promotion and information about our aims, target groups, movements, and also provide the opportunity to fundraise money as well as engage volunteers. To win these resources through the own homepage it is necessary to arrange the donation process as simple as possible. A successful donation button requires time, money, and development work. In other words: before using this method one should investigate two aspects to decide if this method coming into consideration: - Estimate the costs, both in time and money of online fundraising and volunteer recruitment - Analyse the donors base to prove the matching to online interaction (e.g. facebook likes, number

of homepage visitors etc.) Other important factors to think about are screen design, language, navigation, and searching tools etc. Just to insert a button on the homepage does not assure a proper fundraising. Behind this process it is crucial to have a strategy how to support the button and give it attractiveness. For an efficient donation process it is essential to show the users the benefit of the donation: to activate, to involve, and finally to encourage them to push the button. There are several possibilities to motivate a donor. The most important is to promote the website through social media e.g. facebook, google+, linkdin, twitter, youtube, vimeo, flickr, tumblr, instagram, soundcloud, etc., All these methods of encouraging new or already existing donors are free for every user and also an effective way for expanding our information, aims and needs.

- Online Auction

Online auctions are one of the most effective fundraising instruments which can be used to raise the amounts of needed resources internally in a very short time. This type of fundraising method is appropriate for NPOs that want to earn budget on their own and have the wherewithal. In addition, online auction is a way to transfer donated items into cash resources. Nevertheless online auctions are time consuming and sometimes difficult to manage. But there are possibilities to combine some SMF methods e.g. find volunteers to help out with auctions. If one has experience with programming websites it is also possible to start an auction on the own homepage. But usually other auction platforms are willing to support NPOs as it has a positive effect on them. Furthermore there are already existing charity-auction websites. To accomplish the biggest amount of financial sources it is important to think about special occasions which are beneficial e.g. Christmastime, Eastern, etc.


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- Direct Emailing As almost 86 % of the worldwide internet users have an own E-Mail, ‘Direct Emailing’ may be a suitable way for: - obligating existing donors - generating donations or keep donors up-to-date - winning the attention of new donors - giving information about the organisation itself as well as its undertaking.

That is easier said than done. But if adhere to the following advices, direct emailing can emerge as a simple and effectual method. Choose the right subject: The first question a receiver may have is: “What is my advantage?” The addressee decides within few seconds whether to open the Email or not. By mentioning the organisation’s name in the subject line it may win the first attention, especially if the NPO is well known. (E.g. Don Bosco) Use a meaningful Email address: Not only the subject is important, but also the address should contain the name of one’s organisation for a better identification of the mail. In other terms we as the asking organisation for money have to answer all the questions within one email that occur when the audience receive and start to read it. Basic and personal questions: Questions concerning the Email: � Who is writing and why? � Should I read it or delete it? � How do they greet me and is it up-to-date? � Who signed the mail? � Why are they writing to me? � What is the catch?

� Do I already know the organisation? � What will be the result of my donation? � Who will prove the process and can I trust

them? � Will I get something for as a reward

(present, newsletter, etc.)? � Why should I donor to exactly this

company? � How can I pay and is it secured?

Table 5: Questions to Answer within Direct Emailing

Creating an E-mail which answers the questions from ‘Table 5: Questions to Answer within Direct Emailing’ at once it is recommended to rely on the ‘KISS’ method. ‘Keep it simple and stupid.’ The best way to apply it is to avoid technical terms, long sentences, and structure everything in advance. If once the Emails are designed well and can clarify accrued questions, there is a huge possibility to corporate with a big amount of donors. Still it is significant to keep on listing and recording donors due to it is more difficult to find new applicators than motivate current one to invest once more into a project.

- Donation Platform / Volunteer Platform

A donation platform differs in the attitude of donations from a crowdfunding platform (CFP). A donation platform is established only for non-profit organisations (NPO), what means that there is no possibility for other projects such as start-up companies. The money which is donated is project-oriented; consequently it means that this project has to have social impact on the society.


The following chart is showing how it works to present projects and to fundraise financial resources through a donation platform.

Figure

The rankings of the organisations and the order of projects given on this platform depend on the common aims as well as a suggestions or evaluations. Some organirecommendations of people and others get evaluated by the platform itself. That means if a company wants to have a better positioning it is supposed tengagement.

- Activist Fundraising

Activist fundraising works alike a donation platform with the exception of one more step. The following chart is showing the procedure:

Figure

63 Source: own research

The following chart is showing how it works to present projects and to fundraise financial resources

Figure 17: Functionality of Donation Platforms63

The rankings of the organisations and the order of projects given on this platform depend on the common aims as well as a suggestions or evaluations. Some organisations get evaluated through recommendations of people and others get evaluated by the platform itself. That means if a company wants to have a better positioning it is supposed to promote its intentions, image

Activist fundraising works alike a donation platform with the exception of one more step. The following chart is showing the procedure:

Figure 18: Functionality of Activist Fundraising64

27

The following chart is showing how it works to present projects and to fundraise financial resources

The rankings of the organisations and the order of projects given on this platform depend on the sations get evaluated through

recommendations of people and others get evaluated by the platform itself. That means if a company o promote its intentions, image and social

Activist fundraising works alike a donation platform with the exception of one more step. The

28

During the activist fundraising a nonforeground there are the activists which collect the money themselves with their own fundraising instruments. Afterwards they can choose the organisations and projects they want to donate in. Fothe NPO itself it is important to register on such a platform and be represented among the society.

- Affiliate shopping

Affiliate shopping means to buy products or services whether on a platform working as an affiliate platform, at the online shop itseand thereby approve a donation to NPOs. The customers will pay the same price as they would pay usually. So those are actually the online shops funding the NPOs. The role of the customer hermeaningful as they have to choose the organisation they trust in and want to support before ordering the products. To find enough interested people we have to spread the reputation of Don Bosco organisations. We have to impress the people and to iadvertising starting with familiar groups of employees and volunteers at our The picture below is shortly describing the cycle of this method.

Figure

The provision we will get depends on the conditions of the online shops. Sometimes they keep a small part as a fee. The process is quite simple and easy to implement. Usually it is enough to be signed in at these shops.

- Google AdSense (GAS):

Google AdSense (GAS) (not to be confused with Google AdWordsallows earning money by providing space for advertisement on our own content sites. These advertisements are generating revenues p

64 Source: own research 65 Source: own research 66 Google AdWords is a model for publishers, not for advertiser, which want to advertise their products and services, moreover it is liable to pay costs.


During the activist fundraising a non-profit organisation (NPO) is moving to the second place. In the foreground there are the activists which collect the money themselves with their own fundraising instruments. Afterwards they can choose the organisations and projects they want to donate in. Fothe NPO itself it is important to register on such a platform and be represented among the society.

Affiliate shopping means to buy products or services whether on a platform working as an affiliate platform, at the online shop itself, or through the own website of a non-profit organisation (NPO) and thereby approve a donation to NPOs. The customers will pay the same price as they would pay usually. So those are actually the online shops funding the NPOs. The role of the customer hermeaningful as they have to choose the organisation they trust in and want to support before ordering

To find enough interested people we have to spread the reputation of Don Bosco organisations. We have to impress the people and to inspire them with trust. A good beginning would be to do more advertising starting with familiar groups of employees and volunteers at our own

The picture below is shortly describing the cycle of this method.

Figure 19: Functionality of Affiliate Shopping65

The provision we will get depends on the conditions of the online shops. Sometimes they keep a small part as a fee. The process is quite simple and easy to implement. Usually it is enough to be

Google AdSense (GAS):

Google AdSense (GAS) (not to be confused with Google AdWords66) is a concept of google which allows earning money by providing space for advertisement on our own content sites. These advertisements are generating revenues per click or per impression.

Google AdWords is a model for publishers, not for advertiser, which want to advertise their products and services,


ofit organisation (NPO) is moving to the second place. In the foreground there are the activists which collect the money themselves with their own fundraising instruments. Afterwards they can choose the organisations and projects they want to donate in. For the NPO itself it is important to register on such a platform and be represented among the society.

Affiliate shopping means to buy products or services whether on a platform working as an affiliate profit organisation (NPO)

and thereby approve a donation to NPOs. The customers will pay the same price as they would pay usually. So those are actually the online shops funding the NPOs. The role of the customer hereby is meaningful as they have to choose the organisation they trust in and want to support before ordering

To find enough interested people we have to spread the reputation of Don Bosco organisations. We nspire them with trust. A good beginning would be to do more

organisations.

The provision we will get depends on the conditions of the online shops. Sometimes they keep a small part as a fee. The process is quite simple and easy to implement. Usually it is enough to be

) is a concept of google which allows earning money by providing space for advertisement on our own content sites. These

Google AdWords is a model for publishers, not for advertiser, which want to advertise their products and services,


29

The use of GAS is generally not difficult and does not require much input. An organisation needs to have a google account, a website or something alike where an advertisement can be inserted, and an address with an appending bank account to receive the earned money. Three parties are participating in a GAS process: - User: neutral person surfing in the web - Publisher: company or person who wants to spread its advertisements among the web - Advertiser (non-profit organisations): provider of the websites or other tools for placing

and spreading advertisements - Publishers are paying google via “Google AdWords” for offering their advertisements to advertiser. Every advertiser has the possibility to use GAS through its existing google account. Within this process the advertiser has to describe the content of the website, forward personal information, and finally submit the application. After google will investigate the information and try to find the most suitable contents for our medium depending on our field of work. Each time the page is visited the server displays it and count the visits. The payments can be accounted in two ways: - Pay per click: it counts only if the user is clicking on the ad and get to the website - Pay per impression: it counts each time an advertisement is displayed

The payout is based on the cost per mille (CPM) theory what means that every time the server counts till a special amount of clicks or impressions, which was arranged before e.g. 1.000, google is paying out a contribution agreed upon. For us it has the advantage that we are able to decide which type of advertisement we want to show (e.g. video, text, pictures etc.), google delivers reports about the visits, it is for free, and easy to handle.

2.3.4. Awards, Competitions and Prises67 Many public institutions and private companies, foundations and NGOs hand out a huge diversity in awards or write out competitions with prizes. Eurodesk alone reports of 81 prizes in the European Union which can be attributed to youth projects or youth organisations. Some prizes are connected to competition; some are connected to rewarding achievements. Often there is a monetary reward, however there is much value given to the additional visibility of our organisation. Next to this, being awarded a prize can also increase the credibility of your organisation. It is impossible to include fundraising through awards, competitions or prizes in the organisation’s financial strategy. However, it could be interesting to follow-up on competitions as part of the communication strategy of the organisation.

2.3.5. Merchandising Merchandising means to sell products with logos or motives of the organisation. Especially in the world of youngsters these products are popular. Using merchandising as a fundraising method is as well an opportunity to strengthen the identification of the non-profit organisation (NPO).

67 Cf. www.eurodesk.eu


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The problem of using this tool for fundraising is that the money an organisation is earning, counts as self generated income. Not every NPO is able to earn and keep profits according to their organisational form and hence regulations of their countries. There are two ways of distribution: - On one’s own: Therefore it is important to define the way an organisation wants to sell it.

Whether sell it online (build up an own online shop or through the own homepage), sell it inside the organisation (local shops) or sell it after projects to participants, through member organisations, friends or family members.

- Find a vendor: A vendor provides the area of selling the products through a channel the company can choose itself. A vendor owns much more experience and know-how in supplying products to the community. However it is important to go through some facts a vendor should possess: quality, small minimum order size, competitive pricing, and excellent service and efficient cost-effective delivery options.

The latter is much easier to fulfil and can save a lot of costs consider that for selling on one’s own you need not only financial resources but also new employees and time.

2.3.6. Fundraising Activities The term “Fundraising Activities” includes all possible projects which provide a non-profit organisation (NPO) with resources of every description. The aims of those activities are not only to raise money but also to inform the society about our organisations, the goals we want to achieve, the reasons for collecting money as well as for winning volunteers and other resources which can be useful. As the young generation is really innovative and intent it will be easy for them to establish such activities as competitions/contests, events, sales, collections, etc. For each category there are over 100 different activities. Following the table is giving just a short overview of the most famous performances:

Umbrella Term Activity

Sports & Tournaments Minigolf Board games

At your service Car Wash

Just for Fun Bingo Quiz night

Food Bake sale Lemonade stand

Sell, Sell, Sell Garage Sale At the office Good Karma Jar

Talent Spotlight Talent Show Karaoke Evening

Start the bidding Hired hand Special Occasion Birthday Events

Table 6: Fundraising Activities68

68 Source: own research based on http://www.wellspring.ca/Niagara/Get-Involved/Host-an-Event/101-Fundraising-Ideas.aspx#At_Your_Service, 20/05/2014


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Every member in its country has the possibility to start such a project and to raise big amounts to help each other or even use it for own purposes. The most financial resources can be raised by asking for participations fees or by selling something. In order to be profitable the costs for such an activity should be lower than the generated funds. Therefore it is helpful to develop a reliable budget plan for the first estimation before running activities. It is also possible to combine this instrument with others such as sponsoring, cooperatives etc. In that case partners from private or public sector would maybe even cover the costs partly.

2.4. Fundraising through Foundations

2.4.1. Foundations and Philanthropy Unlike commonly assumed, the European Philanthropy sector doubles the size of the United States’ (US) philanthropy sector: there are between 90.000 to 110.000 foundations in Europe with annual expenditure between 83 and 150 billion euro. There is a large diversity in themes to which foundations can donate: education and children/young people are in general two of the most common ones. Compared with the US there is a high flexibility in how foundations and philanthropy is run in Europe. This is due to the fact that there are no EU regulations on foundations. Each country has its own regulations, based in its cultural tradition. As result there are a lot organisations call themselves foundations which actually are not. Much philanthropy is managed through the use of foundations, but not all foundations are philanthropists. European foundations can be categorized in four main areas: - Grant-making foundations: A grant-making foundation is an empowered entity which

primarily engages in grant-making for specified purposes. This type is the most common in the US. These foundations are based on the distinction between charity and philanthropy.

- Operating foundations: Operating foundations do not mainly fund other institution. They prefer to pursue their mission through own activities and projects. Operating foundations can be distinguished depending on their nature of assets (income-producing assets and non-monetary assets). These foundations usually include private museums, hospitals, nursing homes, private universities and research institutes.

- Other types of foundations:

�� Corporate foundations: These are company-sponsored foundations established by their for-profit mother companies. They act as vehicles for promoting corporate citizenship and corporate philanthropy. Usually they do not posses own assets and rely on the pay-in and pay-out system69 that makes corporate philanthropy more stable.

�� Community foundations: Foundations of this class are independent organisations acting in a geographic area, which, over time, builds up an endowment contributed from a multitude of donors. There are two main differences to other foundations: the focus of grant-making is on local community or geographic area and their structure contents cluster of funds.

�� Fundraising foundations: These foundations have the legal form of a foundation without any substantial assets. However they have a strong relationship to the general public because

69Pay-in / pay-out system: if profits of the mother company are higher it donates to the foundations (pay-in) more than the foundations are giving to the community (pay-out) and vice versa.


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of raising resources on a continuous basis. In other terms they transfer ideas, social capital, individual reputation, or medial access into money.

- Mixed foundations: Those are foundations which e.g. engage in grant-making, initiate own projects and operate their own institution simultaneously, but with a major on one of the mentioned function.

In Europe the major share is composed of operating foundations. However in some particular countries there are more grant-making foundations as the chart below is showing.

Figure 20: Relative Share of Grant-making Foundations within each Country70

Consequently for the members of these countries it is easier to get in touch with grant-making foundations and apply for payments of the projects as the foundations are not operating themselves. It is important to understand the cultural context of each foundation before approaching them, as each type of philanthropy through foundations is contextual. In Europe there are six civil society models which have an impact on philanthropy: four regional models (Anglo-Saxon model, Rhine model, Mediterranean model and Scandinavian model) and two transversal models (Catholic model and protestant model)71. Each model has an impact on the governance, the themes, the grant types and the application procedures of a foundation. Because there is no standardisation in foundations in Europe, there are also very few opportunities for European organisations and/or projects to be funded. Working with foundations mainly works on local, regional or national level. Foundations generate their capital through the financial markets: grants are mostly the interests of investments. This makes foundations dependent of the cycle of the market. In other terms, when the markets go down also the foundations have lesser money available, which goes against the needs of civil society. When addressing foundations for financial support, ensuring the sustainable impact of the projects offered is of prime importance. One can do by installing measures of quality assurance in following areas:

70 Cf. Adelman, p.59 71 Cf. MacDonald, Borms, p. 8 f.

0%

10%

20%

30%

40%

50%

60%

Relative Share of Grant-making

Foundations within the Countryies

Relative share within each

country


- Governance: the board needs to have maturity, the staff needs to be managed professionally in

order to ensure a correct administration of the grants, and one needs to be open to accept input or control of the foundation.

- Finance: the book-keeping needs to be do in a professional way, certified by external audits. Next to this having clear financial reports help to increase transparency.

- Communication: it is important using the jargon of the foundations when addprojects. At the same time it is important to showcase the uniqueness of your projects in a sincere way. If you have ambassadors (public figures) of the organisation, you need to use them.

- Impact: Each foundation wants to achieve a social impaimportant to develop and apply evidenceorganisational culture.

It is a long-term process to startsuccessfully an organisation needs to allocate adequate financial and timely resources to it and it won’t guarantee a successful fundraising. But still it will help to build up relationships with foundations. ccording to the survey ‘Foundations in the European (EFC)’ European foundations and our network have similar aims. As the chart below shows they spend the most in health and social services. Also areas such as education and initial training, employment, philanthropy, and voluntarism are important for us and them.

Figure 21: Distribution of Foundations' Support by Fields of Interest in 13 EU Member States

Interesting to observe is that in some areas the actual expenditures are higher thainterested foundations. That meansinterest. One can assume different reasons: foundations spend bigger amounts for the projects or the projects of those areas are much mo

72 Cf. Clarke, p. 9

the board needs to have maturity, the staff needs to be managed professionally in order to ensure a correct administration of the grants, and one needs to be open to accept input

foundation. keeping needs to be do in a professional way, certified by external audits.

Next to this having clear financial reports help to increase transparency. it is important using the jargon of the foundations when add

projects. At the same time it is important to showcase the uniqueness of your projects in a sincere way. If you have ambassadors (public figures) of the organisation, you need to use them.

Each foundation wants to achieve a social impact with its support. Therefore it is important to develop and apply evidence-based impact evaluations, which are coherent to your

term process to start-up working with philanthropy foundations. In order to do so sfully an organisation needs to allocate adequate financial and timely resources to it and it

won’t guarantee a successful fundraising. But still it will help to build up relationships with

ccording to the survey ‘Foundations in the European Union’ of the ‘European Foundation Centre (EFC)’ European foundations and our network have similar aims. As the chart below shows they spend the most in health and social services. Also areas such as education and initial training,

, and voluntarism are important for us and them.

: Distribution of Foundations' Support by Fields of Interest in 13 EU Member States

Interesting to observe is that in some areas the actual expenditures are higher thaThat means that funds are not distributed equally and referred to the fields of

interest. One can assume different reasons: foundations spend bigger amounts for the projects or the projects of those areas are much more cost intensive.

33

the board needs to have maturity, the staff needs to be managed professionally in order to ensure a correct administration of the grants, and one needs to be open to accept input

keeping needs to be do in a professional way, certified by external audits.

it is important using the jargon of the foundations when addressing your projects. At the same time it is important to showcase the uniqueness of your projects in a sincere way. If you have ambassadors (public figures) of the organisation, you need to use them.

ct with its support. Therefore it is based impact evaluations, which are coherent to your

up working with philanthropy foundations. In order to do so sfully an organisation needs to allocate adequate financial and timely resources to it and it

won’t guarantee a successful fundraising. But still it will help to build up relationships with

Union’ of the ‘European Foundation Centre (EFC)’ European foundations and our network have similar aims. As the chart below shows they spend the most in health and social services. Also areas such as education and initial training,

: Distribution of Foundations' Support by Fields of Interest in 13 EU Member States72

Interesting to observe is that in some areas the actual expenditures are higher than the number of that funds are not distributed equally and referred to the fields of

interest. One can assume different reasons: foundations spend bigger amounts for the projects or the


34

As well non-profit organisations (NPO) are attractive partners for foundations due to they are “easily approachable, relatively flexible, and usually less bureaucratic than the public partners.” Before approaching it is necessary to identify possible foundations which could support you. This includes the context analysis, civil society model, and the analysis of their strategic plans. Parallel to this process one needs to develop clear project proposals to approach the individual foundations. Next one needs to start-up contact-making with possible foundations. For this it is important to have face-to-face meetings. Best is to first approach foundations through meetings organized by the foundation sector’s intermediary platforms. Here one needs to approach individual foundations, with a short introduction aimed at setting-up a follow-up meeting. The follow-up meeting will determine if there are possibilities of cooperation. Once relationships have been established, they need to be maintained. Adequate time needs to be given to maintaining contacts and sending updates of the improvement of our organisation within the preference of the foundation or philanthrope. Two main types of relationships can exist between the foundations and NPOs: - Grant-Making / Collaboration: The so called “grantor-grantee” relationship is based on

receiving grants from foundations to finance specific and limited in time projects. Here we can distinguish between public authorities’ support which is common in west European countries (over 60% in Ireland, Belgium, and Germany) and philanthropy in New Member States (26% in Romania, 23 % in Slovakia, and 18 % in Hungary)73

- Contracting: this kind of relationship is interesting for collaboration with operating foundations as they primarily do not grant external parties. Contracting is generally worked out at a national level and means that NPOs and foundations are partners in designing and delivering a project together. Usually foundations are then involved in NPOs working alliances.74

A list of European foundation networks can be found in Annex I Table 11: Annex I: Networks of European Foundations.

2.4.2. Transnational Giving in Europe (TGE) Based on the regulations of Europe, which restrict the earnings, the profits, and donations within NPOs, we have to seek for alternatives of allocating self earned resources or donations from other European countries. As it is possible to fundraise money through foundations, and Don Bosco already have own foundations to corporate with, transnational giving could be the solution for allocating surplus resources. Transnational Giving in Europe (TGE) was established in 1999 by major European foundations and associations in order to facilitate donations within Europe. That means TGE is a partnership of leading European foundations which facilitates the exchange of financial resources and result in tax efficiency. In other terms it enables donors, both corporations and individuals, resident in one of the participating countries, to financially support non-profit organisations (NPO) in other member countries, while benefiting directly from the tax advantages provided for in the legislation of their country of residence. Currently TGE is supporting 15 countries (Germany, Belgium, Bulgaria, France, Hungary, Ireland, Italy, the Netherlands, Poland, Romania, the United Kingdom, Slovakia, Slovenia, Luxembourg and Switzerland). 73 EFC has produces a policy paper for grant-seekers on how to approach foundations and corporate funders for support. About 90 % of funding requests are declined immediately because they do not fit the interest areas. http://www.efc.be/programmes_services/resources/Pages/Advice-for-grantseekers.aspx 74 Cf. Clarke, p. 20 f.


TGE in particular is interesting for charitable organisations as fundraisers. As soon asfundraising opportunities abroad and their foreign donors are interested in tax effective giving, they should make use of TGE. Currently, the TGE network deals exclusively with monetary donations. Donations in kind, including movable or immovable assets, are not accepted. In most countries, there is no minimum amount per donation. But if an organization needs to purpose a minimum donation it is possible to clarify this question with the responsible authority in each country. The first step is to contact the competent office in the own countone responsible authority depending on their field of work and interest. The second step is to fill in a TGE Grant Eligibility Application Form (GEAF) and apply for a membersevery NPO must fulfil some restrictions. The country profiles including the associated restrictions can be found on the homepage of TGEEurope. In exchange the donor wil We as a NPO can act as receiver or as donor and whether receive or provide gifts from or to our members. That is how we distinguish two situations. Whether:- A donor or a NPO can donate to a

country than our or - a European organisation can receive donations from donors or NPOs within Europe.

How can NPOs or donors donate to an organisation which is based in another European country: this process describes how someone from one country can donate money to a NPO which is based in another country within the European Union (EU).

Figure 22: Transnational Giving Process 1: Donor Donates to European Organisation

Explanation: 1. Donor has to contact the recipient non

TGE network. 2. If the recipient organisation is not yet affiliated to the TGE, it has to apply for being a member of

TGE by filling in the GEAF 3. The donor, contacts his national TGE partner, which can be found on the homepage of TGE

order to collect the necessary information to complete his donation by bank transfer. The donor has to make sure that the order of transfer mentions:

� the donor's name, � the donor's residence address (to receive the donation certificate required to benefit

from the tax deduction), � the recipient organisation’s name.

4. The receipt of the donation and according to agreements between the different parties, the TGE partner carries out the transfer to the beneficiary, minus the operating costs.

75 County profiles: http://www.transnationalgiving.eu/tge/details.aspx?id=219942&LangType=1033 76 TGE partners amongst Europe: http://www.transnationalgiving.eu/tge/details.aspx?id=219

Step 1:

Contact the organization

Step 2:

Accession of the organization to the

TGE network

TGE in particular is interesting for charitable organisations as fundraisers. As soon asfundraising opportunities abroad and their foreign donors are interested in tax effective giving, they

Currently, the TGE network deals exclusively with monetary donations. Donations in kind, including ble assets, are not accepted. In most countries, there is no minimum amount per

donation. But if an organization needs to purpose a minimum donation it is possible to clarify this question with the responsible authority in each country.

to contact the competent office in the own country. Some countone responsible authority depending on their field of work and interest. The second step is to fill in a TGE Grant Eligibility Application Form (GEAF) and apply for a membership status. According to TGE every NPO must fulfil some restrictions. The country profiles including the associated restrictions can be found on the homepage of TGE75. Once an NPO is approved it can receive donations within Europe. In exchange the donor will get a fiscal receipt deductible for their national tax purpose.

We as a NPO can act as receiver or as donor and whether receive or provide gifts from or to our members. That is how we distinguish two situations. Whether:

A donor or a NPO can donate to another organisation which is based in a different European

a European organisation can receive donations from donors or NPOs within Europe.

How can NPOs or donors donate to an organisation which is based in another European his process describes how someone from one country can donate money to a NPO

which is based in another country within the European Union (EU).

: Transnational Giving Process 1: Donor Donates to European Organisation

Donor has to contact the recipient non-profit organisation to make sure it is affiliated to the

If the recipient organisation is not yet affiliated to the TGE, it has to apply for being a member of

r, contacts his national TGE partner, which can be found on the homepage of TGEorder to collect the necessary information to complete his donation by bank transfer. The donor has to make sure that the order of transfer mentions:

donor's residence address (to receive the donation certificate required to benefit from the tax deduction), the recipient organisation’s name.

The receipt of the donation and according to agreements between the different parties, the TGE out the transfer to the beneficiary, minus the operating costs.

County profiles: http://www.transnationalgiving.eu/tge/details.aspx?id=219942&LangType=1033 TGE partners amongst Europe: http://www.transnationalgiving.eu/tge/details.aspx?id=219958&LangType=1033

Step 2:

Accession of the organization to the

TGE network

Step 3:

Donation by bank transfer

Step 4:

Donation transfer

35

TGE in particular is interesting for charitable organisations as fundraisers. As soon as they have fundraising opportunities abroad and their foreign donors are interested in tax effective giving, they

Currently, the TGE network deals exclusively with monetary donations. Donations in kind, including ble assets, are not accepted. In most countries, there is no minimum amount per

donation. But if an organization needs to purpose a minimum donation it is possible to clarify this

y. Some countries have more than one responsible authority depending on their field of work and interest. The second step is to fill in a

hip status. According to TGE every NPO must fulfil some restrictions. The country profiles including the associated restrictions

. Once an NPO is approved it can receive donations within l get a fiscal receipt deductible for their national tax purpose.

We as a NPO can act as receiver or as donor and whether receive or provide gifts from or to our

nother organisation which is based in a different European

a European organisation can receive donations from donors or NPOs within Europe.

How can NPOs or donors donate to an organisation which is based in another European his process describes how someone from one country can donate money to a NPO

: Transnational Giving Process 1: Donor Donates to European Organisation

profit organisation to make sure it is affiliated to the


r, contacts his national TGE partner, which can be found on the homepage of TGE76 in order to collect the necessary information to complete his donation by bank transfer. The donor

donor's residence address (to receive the donation certificate required to benefit

The receipt of the donation and according to agreements between the different parties, the TGE out the transfer to the beneficiary, minus the operating costs.

County profiles: http://www.transnationalgiving.eu/tge/details.aspx?id=219942&LangType=1033 958&LangType=1033

Step 5:

Donation Certificate

36

5. In February of the following year of the donation (or sooner if the donor requests it), the donor receives a donation certificate which he can include in his tax filing in order to benefit frotax deduction allowed under the laws of his canton of domicile.

How can NPOs receive gifts from donors positioned in other European countries:process describes the way a European NPO receives its tax deductible donations from donors who are based in another European country than the NPO.

Figure 23: TGE Process 2: European Organisation Addressing Donors

Explanation: 1. If the recipient organisation is not yet affiliated to the TGE, it has to apply for being a member of

TGE. 2. If the recipient organisation is accepted, contacts will be made with the relevant TGE members

to inform them donations will/could come for the organisation. Relevant bank details will be given to the organisation for each country to allow them to stardonors.

3. Each TGE partner will transfer within agreed periods received donations minus the operating costs to the organisation together with a list of donors.

4. The TGE partner foundation issues a donation certificate and sends it taccordance with the laws of its country.

On the website of TGE one can find all the contacts of the EU The benefits of TGE are: - Europe-wide opportunities to mobilis

NPOs and donors. They provide communication to expatriates, multinational corporations, and foreign individual donors and enable to raise more fundraising opportunities. As well they handle the tax efficiency, what for us means that we receive tax

- National fiscal incentives to charitable giving:NPOs will yield the same taxes as they are used to in their national countries. The national government will treat the NPOs as domestic charities referring to the regulation

- Expertise in national law tax:like. TGE provides specialists in tax laws and non

- Administration taken care of the NPO:is carrying out all administration work related to European donations, such as fill in tax forms and deliver etc.

For gifts and donations until 5.000 The maximum the network can ask for is a fee of 6

77 Contracts of the European Union: http://www.transnationalgiving.eu/tge/default.aspx?id=219948&langtype=1033

Step1:

Accession of the organisation to the TGE network


In February of the following year of the donation (or sooner if the donor requests it), the donor receives a donation certificate which he can include in his tax filing in order to benefit frotax deduction allowed under the laws of his canton of domicile.

How can NPOs receive gifts from donors positioned in other European countries:process describes the way a European NPO receives its tax deductible donations from donors who

sed in another European country than the NPO.

: TGE Process 2: European Organisation Addressing Donors


If the recipient organisation is accepted, contacts will be made with the relevant TGE members to inform them donations will/could come for the organisation. Relevant bank details will be given to the organisation for each country to allow them to start communication with their

Each TGE partner will transfer within agreed periods received donations minus the operating costs to the organisation together with a list of donors. The TGE partner foundation issues a donation certificate and sends it taccordance with the laws of its country.

On the website of TGE one can find all the contacts of the EU77.

wide opportunities to mobilise resources: TGE is acting like a bridge between the hey provide communication to expatriates, multinational corporations, and

foreign individual donors and enable to raise more fundraising opportunities. As well they handle the tax efficiency, what for us means that we receive tax-free contributions.

nal fiscal incentives to charitable giving: Once in the network of TGE, donors and NPOs will yield the same taxes as they are used to in their national countries. The national government will treat the NPOs as domestic charities referring to the regulationExpertise in national law tax: The NPOs are released from lifelong tax calculation and the like. TGE provides specialists in tax laws and non-profit sector for each European country. Administration taken care of the NPO: Additionally to the expertise the TGE management is carrying out all administration work related to European donations, such as fill in tax forms and

000 € TGE raises 5 % of fees and everything above is invoiced to 1 %. mum the network can ask for is a fee of 6.500 €.

Contracts of the European Union: http://www.transnationalgiving.eu/tge/default.aspx?id=219948&langtype=1033

Step 2:

Alerting the relevant other TGE members

Step 3:

Donation Transfer


In February of the following year of the donation (or sooner if the donor requests it), the donor receives a donation certificate which he can include in his tax filing in order to benefit from the

How can NPOs receive gifts from donors positioned in other European countries: this process describes the way a European NPO receives its tax deductible donations from donors who

: TGE Process 2: European Organisation Addressing Donors


If the recipient organisation is accepted, contacts will be made with the relevant TGE members to inform them donations will/could come for the organisation. Relevant bank details will be

t communication with their

Each TGE partner will transfer within agreed periods received donations minus the operating

The TGE partner foundation issues a donation certificate and sends it to the donors in

TGE is acting like a bridge between the hey provide communication to expatriates, multinational corporations, and

foreign individual donors and enable to raise more fundraising opportunities. As well they handle

Once in the network of TGE, donors and NPOs will yield the same taxes as they are used to in their national countries. The national government will treat the NPOs as domestic charities referring to the regulations of donations.

The NPOs are released from lifelong tax calculation and the profit sector for each European country.

e expertise the TGE management is carrying out all administration work related to European donations, such as fill in tax forms and

€ TGE raises 5 % of fees and everything above is invoiced to 1 %.

Contracts of the European Union: http://www.transnationalgiving.eu/tge/default.aspx?id=219948&langtype=1033

Step 4:

Donation Certificate


37

For spreading the fundraising opportunities among Europe, working with TGE is an alternative which should be taken into consideration.

Fundraising Management

3. Fundraising Management Fundraising Management is a very important preach the aims of fundraising, what means to diversify the income sources, first an organization has to invest in them. A successful allocation of investments can be reached by establishing and implementing the planning process. However, in advance a decision about the right approach towards an input-output-relation must be made. The first one the so called minimum principle concentrates on the given output which should be reached with a minimum of input. Onthe maximum principle which impliesare useful, but the most suitable one depends on the individual initial situation of a nonorganisation (NPO). For fulfillinmanagement system will be required. The following chapters describe the process of fundraising management shortly, in order to give an overview as well as a basis for NPOs to implement fundraising instruments or to improve their current methods.

3.1. The Planning Process and its Components Planning is a management responsibility which is extremely important in order to make decisions about the prospective aims and the way of achieving distinguish three planning phases with different time intervals and sets of goals:

Figure

The planning process bases on those phases and must be done for important steps which guarantee the accomplishment of fundraising.

78 Source: own research based on Urselmann, p. 370

Normative

Planning

Strategic Planning

Operational Planning


Fundraising Management is a very important process to execute the above mentioned methods. To reach the aims of fundraising, what means to diversify the income sources, first an organization has to invest in them. A successful allocation of investments can be reached by establishing and

the planning process. However, in advance a decision about the right approach towards relation must be made. The first one the so called minimum principle concentrates

on the given output which should be reached with a minimum of input. On the other hand there is maximum principle which implies to achieve a maximal output with a limited input. Both theories

are useful, but the most suitable one depends on the individual initial situation of a nonorganisation (NPO). For fulfilling one of these principles, a strategic line of actions and certainly a management system will be required. The following chapters describe the process of fundraising management shortly, in order to give an overview as well as a basis for NPOs to implement fundraising instruments or to improve their current methods.

The Planning Process and its Components

Planning is a management responsibility which is extremely important in order to make decisions about the prospective aims and the way of achieving them successfully. Within planning we distinguish three planning phases with different time intervals and sets of goals:

Figure 24: Planning Levels and Intervals78

The planning process bases on those phases and must be done for all of them as they contain important steps which guarantee the accomplishment of fundraising.

Source: own research based on Urselmann, p. 370

• > 5 years• long-term goals• e.g. mission

Normative

Planning

• 2 - 5 years• intermediate-term goals• based on long-term goals

Strategic Planning

• < 1 year• short-term goals• detailed action, time and budget plans

Operational Planning

1

rocess to execute the above mentioned methods. To reach the aims of fundraising, what means to diversify the income sources, first an organization has to invest in them. A successful allocation of investments can be reached by establishing and

the planning process. However, in advance a decision about the right approach towards relation must be made. The first one the so called minimum principle concentrates

the other hand there is to achieve a maximal output with a limited input. Both theories

are useful, but the most suitable one depends on the individual initial situation of a non-profit g one of these principles, a strategic line of actions and certainly a

management system will be required. The following chapters describe the process of fundraising management shortly, in order to give an overview as well as a basis for NPOs to implement new

Planning is a management responsibility which is extremely important in order to make decisions them successfully. Within planning we

all of them as they contain

term goalsterm goals

< 1 yearterm goals

detailed action, time and budget


2

- Normative planning: The most important aim within this stage is the mission statement of a NPO. Additionally it is recommended to plan the needed resources as precise as possible and to analyse the structure of the current fundraising market79 and the own company.

- Strategic planning: Within this planning phase we define the methods and strategies which will be used to achieve the goals for the next 5 years, the so called strategic goals. DBYN is already planning at the strategic level (cf. Master Plan 2012 – 2014 = 3 years). It is recommended to set up aims by following the SMART method, which is explained in the chapter Error! Reference source not found. Error! Reference source not found.. Planning over an intermediate period is required insofar as big investments maybe accrue and the chosen methods will be profitable only after few years.

- Operational planning: As there are many projects, needs of resources of every description, - Operational planning: As there are many projects, needs of resources of every description, and other short-term activities, it is necessary to plan all this for each year. Every aim should be documented separately and go deeply into details. A budget plan is indispensable.

3.1.1. Setting Goals to Identify a Plan To ‘maximize money’ is not a strategic goal but anyhow it is one of the most common purposes of non-profit organizations (NPO). It is not widely known that strategies (long- and short-term) are deflected from organizations goals. The strategies help to intense and detail the future plans in order to succeed through reasonable actions. To concentrate on long-term aims and to build up orientation one should start to define goals for a period longer than one year. Short-term goals will provide a central theme for the NPO in order to reach the goals including their own mission statement, which is the most important objectie within an organization. The establishment of effective and realistic goals have to agree with those of the stakeholders (SH) of a NPO, as they have a big influence. Those are divided into internal and external SH.

- Internal SH: NPO itself, the administrative board, members, employees, and volunteers - External SH: providers of resources, consumer, potential members and volunteers

Goals have to be SMART (Specific, Measurable, Assignable, Realistic, and Time-related).

Example: S Increasing financial resources M by an amount of 10.000 € A through crowdfunding R for execution of new projects T within the next two years.

As NPOs are ethical and bound in honour to act in the right way it is highest priority to make a decision referring the ethical principles of the various fundraising methods, either use the method or not.

79Analysing the fundraising market: The analysis of a market requires specific instruments which define the needed factors. First a company needs to investigate the industrial sector. This is possible by considering the five forces of Porter which are: threat of new entrants, threat of substitute products or services, bargaining power of customers, bargaining power of suppliers, and intensity of competitive rivalry. This examination will help to identify the attractiveness of the fundraising market to point out the best approachable method.


3

The following illustration shows the international statement of ethical principles for fundraising.

Figure 25: International Statement of Ethical Principles in Fundraising80

3.1.2. Strategic Planning As important as setting goals over the different planning stages, are factors such as provider, outsourcing, distribution and communication channels, etc. Those are parts of the so called marketing-mix, which in this case can be seen as the fundraising mix. It offers the possibility to determine different portfolios, which are used to make decision concerning our future fundraising sources. Hereinafter the factors concerning NPOs are explained shortly. All of them are a part of the strategic planning layer, what means that while choosing them a NPO needs to contemplate about using them for at least an intermediate period of time. - Provider of resources: To get in contact with a new fundraiser is a strategic decision an organisation needs to make as long as there is no barrier on the part of the mission. One cannot immediately decide whether to ask a company or foundation. Before making use of new sources, it requires investments into know-how such as literature, seminars, responsible employees / experts, etc. - Outsourcing: Inside fundraising a NPO is able to decide to outsource its fundraising to experienced companies which provide help or complete solution programmes. It is useful for NPOs with less know-how. Fundraising methods which require high inputs such as costs and are cheaper to outsource should be done by extern providers. Other methods which are cheaper in development and do not demand great skills for implementation should be executed internally. There are different types of service provider: those which are specialised on the sources e.g. society, foundations, or public authorities; and those who are specialised on fundraising methods e.g. sponsoring, donations, monetary fine, etc. - Selecting distribution and communication channels: As the channels of getting resources and communicate the aims are changing over the last years, e.g. from collecting money on the street to social media donations, we can consider the life cycle of the different instruments. The four phases are: introduction, growth, maturity, and decline. And every

80 Source: http://www.afpnet.org/Ethics/IntlArticleDetail.cfm?ItemNumber=3681


4

method of fundraising can be found in one of these stages. Hereby an investigation about the current status of the channel will show if it is effective to use it during the next few years or not.

Figure 26: Product Life Cycle81

If a method is among the first two phases, it may be interesting to invest in it. Investments into methods which are located within the last two stages are not worthwhile. Summing up it is recommended to prove NPO’s fundraising-mix (providers, products, distribution and communication) to not mismatch the future fundraising markets and needs. A continuous planning process helps to better allocate the investments and to prevent risks within the planning process.

3.1.3. Operational Planning: Within the operational planning it is crucial to set up goals for a period of one year and to report them. Subsequent a procedure for every aim must be designed in order to reach it within this period. Typically for the operational planning is that every process is planned down to the finest detail in each area e.g. the method, distribution and communication channel, provider, etc. Not to forget are associated time and budget schedules. The whole steady but lengthy process enables us to keep control and limit the possibility of suddenly appearing risks. A significant advantage of operation planning is that ratios can be calculated which provide the information about the process of fundraising. Those are: - Response ratio - Average donation - Return on Investment - Lifetime value and cost - Production costs

All of them are explained in chapter Error! Reference source not found. Error! Reference source not found.

3.2. Controlling within the Fundraising Process

81 Source: http://blog.deonbotha.com/wp-content/uploads/sites/4/2011/09/dffc0-productlifecycle.gif


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3.2. Controlling within the Fundraising Process

3.2.1. Strategic Controlling To reach the desired position within the fundraising strategies, first one needs to analyse the current status, then define the aims and finally find instruments to reach them. The controlling is hence responsible for recording all the environmental changes and to adapt the strategies towards them. The analysis is based on few instruments which are well known and thus can be used internationally. The SWOT Analysis (Strengths, Weaknesses, Opportunities, and Threats) is identifying the current position and status of a NPO and its chances and risks from the environment. This method is divided into internal and external factors. Strengths and weaknesses are internal factors which refer to the organization itself82. External factors include opportunities and threats, which define the developing environment of the NPO83. The goal of this analysis is to show an organisation how it can: - implement its strengths into the opportunities (SO strategies) - reduce the weak factors by executing opportunities (WO strategies) - avoid threats through experienced strengths (TS strategies) - show the relationship between threats and weaknesses and try to avoid both (WT strategies). - Environmental

factors Organizational

factors Strengths Weaknesses

Opportunities SO WO Threats ST WT

Table 7: Framework of the SWOT Analysis84

The grey fields are strategies an organization has to work out.

82E.g. strengths: what are we good at; weaknesses: disadvantages in relation to other charities 83 E.g. opportunities: which external factors increase the possibility for our new fundraising sources; threats: which factors cause fundraising difficulties 84 Source: own research


6

To identify the internal factors should not be a problem for the NPO. As assistance for the environmental analysis (external factors) it is recommended to use another method, the so called PEST analysis.

P Political analyses the government attitudes such as legislation changes, gift aid, data protection

E Economical determines donors’ behaviour in the future e.g. employment levels, individual and corporative wealth, interest rates, dispensable income, tax rates

S Social how people are feeling and behaving in society and their attitudes towards charity

T Technological changes and development in technology such as cash machine donations, text messages donations, providers

Table 8: Framework of the PEST Analysis

Strategic controlling also includes the investigation of current fundraising methods by using a portfolio. There are several possibilities of portfolios. The most common is the BCG-matrix, which was established by the ‘Boston Consulting Group’. In case of fundraising it shows the relation between the current success of channel and proposition and the growth potential within channels.

Figure 27: Boston Consulting Group Matrix (BCG-Matrix)85

By ordering the financial sources among the portfolio, we can easily decide about the methods we should keep, the one we should invest in, and the instruments we have to dispose.

85 Source: own research based on Clifton


7

The BCG-Matrix is linked to the product life cycle (PLC) as follows: The sources which can be found in the section of question marks stand in the introduction stage of their life cycle. According to it, these sources promise high potential of growth, but they have not turned out as a successful channel of fundraising yet. Now it is up to the organization to choose either to invest into those instruments, due to the expectation of high growth or to pullback without investing and thus avoiding risks. The products inside the quadrant of rising stars provide a high success rate and still have potential to expand in its size. Those methods are part of the growth phase of the PLC, what means that they generate profitable income, which can be used either for projects or also for investments of some question marks. The cash cows that can be found at the left bottom corner of the BCG-Matrix are the matured sources which provide the biggest percentage of an NPO’s funding. The fundraising sources which are allocated within the decline field at the PLC neither have a potential to grow nor are they successful income channels. As result they are placed in the poor dogs area. As long as they still provide capital without high costs a NPO can use them. But to avoid negative consequences organization should regard the divestment strategy.

3.2.2. Operational Controlling Operational controlling refers to the shortest but the most detailed planning phase of fundraising management. The main reason for developing short-term plans is that they support an organization in every question that appears and besides give them stability in each area to avoid negative effects. Operational controlling primarily focuses on ratios which can be compared over one year to see whether an organisation has been profitable within its fundraising methods. NPOs with an accurate accountancy system have an advantage as all required factors and numbers for calculating the ratios have been collected over the years. Following the most important ratios and numbers which should be compared are introduced. Response rate: It provides the percentage of the number of authorities, companies, and people, which responded to our demand with a donation. The number depends on the way a NPO appealed to its target group. If we only ask new donors a rate between 0,1 % and 1,5 % is acceptable.

�� =#��

#��

Formula 1: Response Rate

Revenues: A detailed investigation of our income provides us the positioning of the best sources. Average donation rate: The average donation rate helps to see how much one donor invested into our projects and organisation.

�� =Σ��ℎ��

#��ℎ��

Formula 2: Avarage Donation Rate


8

Lifetime value (LTV): Within this ratio it is possible to identify the amount of donations a donor provided during his period of support starts from his first donation and lasts until his last one. This helps to see if we are gaining professionalization inside our fundraising methods. The aim is to raise the LTV ratio over the years. There are three different ways to calculate it; - Average LTV: e.g. DBYN has 2 different donors. The first one donated 100 € over eight years

(800 € over his lifetime). The second one donated once an amount of 200 €. The average LTV would be 500 € ((800 € + 200 €)/2). This alternative can only be used for natural persons. Also it has some disadvantages which complicate the calculation and interpretation of this number.

�� =Σ�� ∗ #��

#��

Formula 3: Average Lifetime Value

- Average LTV of a specific period: To facilitate the average LTV calculation an organisation could

align it towards a specific period e.g. 10 years. It means: Income of all donations of the last 10 years divided by all persons which at least donated once in the last 10 years. The drawback is that detailed aspects cannot be pointed out.

- Prospective LTV per donor: This is the sum of all expected future net proceeds (donation less its costs) discounted to the current period of one donor. This method is difficult to establish due to the interest rates and future donations have to be estimated, but it provides the best insights and forecasts. To facilitate the implementation an organisation may preset fixed values such as a period of 5 years or a discount rate of 10 %.

�� =Σ(�� − ��)

(1 − �) !"!#$"

Formula 4: Prospective Lifetime Value

Production costs: Those include all the costs and other resources needed to either gain new donors or implement new methods and/or the costs for care and services.

��% �� =Σ�� &%�� %�'��

#��(��

Formula 5: Production Costs per Donor

The following example shows the concept of calculating production costs:

Assumption is based on the direct emailing method: Out of 10.000 contacted persons 100 responded with a donation (response rate: 1 %). The whole process lasted for 22 days. For those 100 people we had following costs adjusted to the needed time:

costs for internet provision: 36 € (50 € p.m./30*22) employee costs: 3.000 € (22 days of a yearly income of 30.000 € based on the net working days, that means holidays are deducted: 30.000*22/220)

total costs: 3.036 € by distributing the total costs over the new funders it would mean that we have production costs of 30,36 € per one donor.

Lifetime costs (LTC): The expenses over the lifetime describe the costs needed for motivating and carrying the donors over their lifetime. It is important to calculate them as they should be lower than the production costs. For the different alternatives of calculation one can apply the methods of


9

LTV. As soon as LTC is higher than the production costs, the method of fundraising might be unprofitable. Once the ratios are established and calculated they can be interlinked with each other and therefore other ratios can be assumed. Return on investment (ROI): The ROI shows the distribution of costs referred to the income.

)*+ =(�%�% − ��%)

��%

Formula 6: Return on Investment (ROI)

To calculate the return we have to divide the earned amounts through the incurred costs. A ROI equal one means that the costs have been as high as the income and we have not generated any profit. A ROI higher than one represents a profit due to lower costs and higher income. A ROI below one is a sign for loss.


10

3.2.3. SWOT Analysis and Portfolio of current Income Sources As in the last years DBYN did not executed new fundraising methods it is almost impossible to calculate all mentioned ratios. A SWOT analysis and a BCG matrix will still show the current situation and positioning of DBYN as well as compare their income sources. The results should illustrate once more the importance of diversification. Strengths Weaknesses � Significant know-how of the application

process and strong skills referring planning and execution

� Strong focus on youth work on long-term experience and adherence towards the style of working

� Don Bosco is well-known worldwide � Strong network with 13 members �

opportunity for contacts to VIPs � strong relationships within the network �

DBYN was founded by the members

� High dependency on few sources (ca. 50 % is from the EU � public sector)

� Member ship fee is an unsecure financial resource, as it is decreasing over the last years

� Little experience with other fundraising methods of different sectors

� Low number of employees � only one person for everything

Opportunities Threats � Increasing demands for services and

projects.86 � Diversification of sources is possible �

decreasing risks for the organisation � CSR is a trend � new possibilities for

collaboration � High potential of growth in every fundraising

sector � Social Media trend increase rapidly

� The big parties and organization have a high market share and are very stable � difficult competitive situation

� New demand for skills for different fundraising methods

� Declining amount and changes in distribution of financial resources at the European level87

� Project-oriented support means that we have to ensure, that all the projects we’re doing have an impact on the society

Strategies derived from the SWOT analysis: Strengths and opportunities (SO strategies): - The strong skills of planning and executing tasks as well as applying for grants can be perfectly

implemented for several fundraising planning operations. - With a long-term focus on youth work, we can concentrate on the needs of youngsters, who will

have an increasing demand for our services. As a well-known and represented organisation worldwide, different needs can be considered in every country.

- As an organisation with 13 members within Europe, DBYN has the opportunity to get in contact with important people in order to collaborate or to address potential partners.

- Due to the fact that we provide strong support to our members, everyone of them as well as we can realise the high potential of fundraising sources and exchange information about organizational and operating issues within the application of those methods.

Weaknesses and opportunities (WO strategies):

86 Around 5.5 million young people are unemployed in the EU. The unemployment rate among young people is over 20% –

double the rate for all age groups combined and nearly 3 times the rate for the over-25s. 7.5 million people aged 15 to 24

are currently neither in a job nor in education or training.

87 Money is only given to impact-oriented projects. Public budgets are under pressure due to growing unemployment and poverty and social exclusion levels. This factors can lead to an economic crisis.


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- To increase our independency of current funding sources, we have to apply other fundraising methods, which also will help to avoid risks of getting nothing and the disability of providing services to the persons with needs. Also members which will be active in diversifying their fundraising portfolios might increase their fees and thereby strengthen one of our income sources.

- Our lack of experience with applying other fundraising methods as well as the low number of employees at DBYN may build up a barrier which will be difficult to overcome. To use the opportunity and implement new instruments of financing as well as follow the continuous development of this sector, DBYN might need support due to every method needs a closer investigation and a great deal of time and costs.

Strengths and threats (ST strategies): - The worldwide familiarity of Don Bosco and his style of working, as well as the powerful

experience within the youth sector will strengthen our position amongst the high competition of the social sector. In order to overcome the competitive situation we have to show the positive results of our projects and pointing those outwards.

- To fundraise money or other resources it is necessary to keep on working within the network and its members, due to fundraising will demand new skills and a lot of patience. A proper communication and information flow among the members is a must.

- Fundraising does not mean to get rid of old income sources and only make use of new ones. The situation of subventions is already changing towards impact-oriented projects, what means that we have to contact experts and establish methods to show the results of our services. Therefore we can benefit from the contacts of our members and support each other.

Weaknesses and threats (WT strategies): - As we are high dependent on only few sources we have to take more care of our future

incomes. Currently we obtain our major finances from the public sector. Because the amount of financial resources given by the European Union is declining and the distribution of funds among the organization is changing towards impact-oriented projects we have to establish possible solutions for worst case situations.

- Accordingly the risk of getting fewer funds is increasing. Our problem is that we do not have any substitutes. Even the membership fees are decreasing over the last few years, which show us that it is not a secure source of financing. We have to stop the growth of both risks and change the strategy by using the opportunities.

After the SWOT analysis it may be interesting to have a look at the current income sources of DBYN.


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Figure 28: BCG Matrix: Portfolio of Current Funders of DBYN 201388

The axes determine the extent to which a method can grow within the sector (vertical) and the current success of the channel (horizontal). About 74 % of the raised money is provided by the European and the local as well as national government. The other 26 % come from our members through the incoming membership fees and other sources, such as gifts.89. The major share is coming from the public sector (highlighted yellow and bright yellow), in which a potential grow is expected even though the budget of the EU is under pressure because of the economic crisis. But due to different methods of this section we can expect that the extent of possibilities within public fundraising will increase in future. The membership fees are seen as the cash cows and are in the lower bottom corner. They provide us with financial resources without any investments from our side. The potential of growing is relatively low as the sector can only expand by gaining new members. The rising stars (subventions) provide us with the biggest share of our needed resources. They support around 50 % of our projects. As their main purpose is to give support to youth, they will keep on developing programmes which explains the high rate of expected growth. For example the YiA programme was valid until 2013. From 2014 on the European Commission established the Erasmus+ programme, which again is focused on youth work and their education. Regarding the portfolios in the next chapter, it is shown that raising financial resources through the public sector is would be an advantage as the risk is low and the reward as well as the return on investment (ROI) are located in the upper area. However the funded amount through the EYF is much lower than the one of the European Union. Consequently the extent of the success of YiA is currently higher than the one from EYF. Both, the SWOT analysis as well as the portfolio show that it is highest importance to build up new fundraising methods. It will take some time to go through all the planning and evaluation processes

88 Source: own research based on the financial report 2013 89 The data is based on the financial report 2013 of DBYN.


13

and in the end to find and implement the most suitable method, that means we can expect the first visible success at the earliest in three to five years.

3.2.3.1. Analysis of Potential Sources with Subjective Portfolios To sum up the in chapter 2 explained methods and show which of them are sustainable and suitable, some assumptions have been investigated. The portfolios shown below are based on several factors. As the decisions about placing the methods are subjective, adaptations, if needed, can be made depending on the factors of each country. For a better understanding one can find the tables explaining the combination of different aspects which conclude the positioning of the methods in Annex II: Facts and Figures.

Figure 29: Fundraising Methods: Risk vs. Potential Reward

The portfolio above is showing the relation between the risk and the potential reward of a fundraising method. The identification of risk is associated to the extent of success. That means: ‘How high is the risk to get nothing?’ It was divided into low, middle, and high risk. The same breakdown is used for the potential reward. The reward (not to be confused with the ROI) expresses the amount of resources we can at least get out of the specific source. The difference between ROI and the potential reward is that the reward does not include any information about the resources we have to input. The ROI however is a result of the input and the associated output. Now non-profit organisations (NPO) can see which methods are the most suitable for them but also chose the most profitable ones. The second quadrant includes the most efficient instruments as the risk is low and the potential reward tends to the higher part of the scale (social impact bonds, subvention, microfinance). If for example an organisation does not care about the risk then it should consider the first and the second quadrant due to those methods have the higher potential reward.


14

The fourth one in the right lower corner indicates the methods with the highest risk and the lowest rewards. Logically those methods can be used for gaining know-how, experience, but also could be useful if the NPO has own special resources or contacts which will decrease the risk and/or increase the rewards. In general the portfolio projects that for organisations with low risk acceptance it is advised to use methods of the public or private sector. NPOs with high risk acceptance could also make use of foundations and some methods of the societal category.

Figure 30: Fundraising Methods: Time and Return on Investment

Figure 30: Fundraising Methods: Time and Return on Investment compare the methods towards the time until we get any resources and the return on investment (ROI). The corresponding tables can be found in the annexes. The factor time determine the period in between the application process and the actual day of receiving resources of every description. In this case we compared the inputs and the outputs. If the input was higher than the output the result cannot be satisfying. If a NPO is looking for a high amount of resources then public funding and the private sector are appropriate. If there have the need for resources in short-term the society as well as the public sector can help out very fast. The methods of the quadrants one and two can and should be used in any case, but for the other two sections a NPO needs time, resources and smooth planning process for a proper execution.


15

3.2.3.2. Segmentation of Income Sources towards Geographical Areas As the members of DBYN are located amongst Europe, it is useful to categorise the fundraising methods towards different geographical levels. We decided to differ in local, regional, national and international area. Local: refers to municipal government such as cities, towns, and villages; the lowest and most closely related to the local citizens and organisations. Regional: region that is categorised by its function such as city-region, metropolitan area, etc. National: the level of the entire country. International: the level of the entire continent/world. The categorisation of the above described methods according to geographical areas is based on some subjective factors. - Effort and expenses: The cost factor is the main aspect shaping the areas of fundraising. It includes organisational costs, communication costs, transaction costs, taxes etc. Costs at the local or regional level are usually lower as everything is in geographic reach. Sometimes it is to consider using methods at the lower cost level, especially if returns are lower than the total costs. E.g. the methods of corporate social responsibilities such as corporate volunteering would cause too high travel costs on international level and besides there are many opportunities to corporate with companies from the same region, due to the high extent of internationalisation nowadays. - Integration of the funding party: The extent of the integration is changing a lot. Depending on it, fundraising methods can be executed on different geographical levels. It means that if e.g. companies or foundations want to participate physically in a project, it is recommended to work with them maximum on the national level. Everything further than that would cause to high effort and expenses and would not guarantee a stable relationship. Figure 31: Categorisation of Fundraising Methods according to Geographical Areas shows all instruments which are divided into four categories. Some instruments can be applied within all areas. Each method is highlighted in the colour of the specific fundraising sector (public: yellow, private: orange, society: violet, foundations: green). The length of the bar shows how far a method can be expanded in general. But depending on the criteria above there are parts emphasised with stronger colour than the rest. Consequently it would be better to concentrate on this territory. As the decision bases on a subjective opinion, every organization is free to change the emphasis according to its preferences and the factors and regulations of their countries. According to the graph around 40 % of all here mentioned instruments can be applied on the national as well as international level.


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Figure 31: Categorisation of Fundraising Methods according to Geographical Areas

In general public fundraising can be expanded to the international level, or at least the European level, while organisations using methods within the society sector are more tied to local and regional levels. The lower methods in the graph extend to the international level, due to their extent of integration. Those methods can be implemented worldwide easily.

Local Regional National International

Categorization of Fundraising Methods towards

Location

Conclusion

xvii

4. Conclusion For reasons like dependency, sufficient liquidity or unequal distribution of financial resources, it is the right time for DBYN and also for its members, to start thinking about their future incomes. This decision will provide the network with more stability, knowledge and autonomy. As the market for fundraising is growing and there is no end in sight, we as an organisation should join the social branch in order to be able to fulfil our goals and especially our mission statement. By considering the financial sources in different sectors like public private or social, mentioned in chapter two, we have plenty of possibilities for an appropriate diversification programme. The more we will implement the fundraising process into our organisation the more it can grow and develop in future and the higher our impact on the society could be. The third chapter also give us already an overview on which we can start to build up our fundraising strategies. Based on motives like risk reduction and independency fundraising has to be a high extent goal in our target system and should be implemented into all three layers of planning. The threats within the market should not discourage the network, as we have enough strength to overcome internal and external weaknesses. As a strong network which was established by members it also have a strong cohesion and thus will intense the support within the organisation itself. It is recommended to establish a well functioning fundraising division for all members including DBYN, which could provide support to all who adjust their income sources, as the process itself is very time consuming and requires a lot of refinements and attention. A separate division could organise meetings to inform all about new opportunities and to help out with the planning and controlling processes. The specialisation on those tasks would raise the chances for a successful fundraising. After all “fundraising is the gentle art of teaching the joy of giving”90. And this is what we should point outwards to our donors and sponsors in order to follow the ethical standards and fundraise resources in a new and cleanly way.

90 Cf. Hank Rosso: http://fundraisingcoach.com/quotes/

Annex 1

xix

Annex I: Potential Contacts of Fundraising Methods Microfinancing in Europe: Competitiveness and Innovation Framework Programme (CIP): http://www.eif.org/what_we_do/guarantees/cip_portfolio_guarantees/index.htm European Parliament Preparatory Action (EPPA): http://www.eif.org/what_we_do/microfinance/EPPA.htm European Progress Microfinance Facility: http://www.eif.org/what_we_do/microfinance/progress/index.htm JASMINE: http://www.eif.org/what_we_do/microfinance/JASMINE/index.htm JEREMIE: http://www.eif.org/what_we_do/jeremie/index.htm Most European countries have their own local, regional and/or national microcredit providers, which often work together with the European programmes indicated about: http://ec.europa.eu/social/main.jsp?catId=983&langId=en

Table 9: Annex I: Programmes of Microfinancing in Europe

Crowdfundingplatforms: Indiegogo Web: www.indiegogo.com

“244 countries & territories. 5 currencies. 4 languages. People everywhere are joining forces on Indiegogo to fuel innovation and fund what matters to them.”

Kickstarter Web: www.kickstarter.com

“Every project on Kickstarter must fit into one of our categories. Our categories are Art, Comics, Dance, Design, Fashion, Film, Food, Games, Music, Photography, Publishing, Technology, and Theatre.”

Kiva Web: www.kiva.org

“A non-profit organisation with a mission to connect people through lending to alleviate poverty. Leveraging the internet and a worldwide network of microfinance institutions, Kiva lets individuals lend as little as $25 to help create opportunity around the world.”

Peerbackers Web: www.peerbackers.com.

“Peerbackers is a new way to fund entrepreneurs.”

We Fund Web: www.wefund.com

“Focusing on creativity in all forms.”

World of Crowdfunding Web: www.worldofcrowdfunding.com

Table 10: Annex I: List of Crowdfunding Platforms


xx

European Foundation Networks: Bellagio Forum for Sustainable Development Web: http://bfsd.server.enovum.com/en/

“BFSD is an international network of grant-providing institutions striving to attain environmental balance, economic stability and social progress. The Forum brings together individuals from foundations and businesses to build trust, dialogue and effective partnerships.”

Donors and Foundation Networks in Europe Web: http://www.dafne-online.eu/

“DAFNE is a network with its own governance structure bringing together 24 donors and foundation networks from across Europe. With a collective membership of over 6.000 foundations, DAFNE underpins the individual activities of its members by strengthening collaboration between the national associations.”

European Foundation Centre Web: http://www.efc.be/

“EFC is an international membership association of foundation and corporate funders.”

European Programme for Integration and Migration Web: http://www.epim.info/

“EPIM is an initiative of 12 European foundations, with the goal of strengthening the role played by civil society in advocating for constructive approaches to migrants in Europe. This is done through grant-making, capacity building and networking.”

European Venture Philanthropy Association Web: http://evpa.eu.com/#&panel1-1

“EVPA is a membership association made up for organisations interested in participating venture philanthropy and social investment across Europe.”

Mercator Fund Web: http://www.mercatorfund.net/home

“The work of The Network of European Foundations’ Mercator Fund is underpinned by principles that the global philanthropic community has a vital role to play in promoting in implementing the work necessary to bring about social and political change. The Mercator Fund aims to generate innovative ideas to respond to key global challenges through the development of projects that address core global social issues.”

Network of European Foundations Web: http://www.nef-europe.org/

“NEF is an operational platform that seeks to develop joint initiatives between foundations and other actors. They support projects in several fields – socio-economic, educational and in international development – in Europe and in the world.”

Philanthropy House Web: http://www.philanthropyhouse.eu/

“Philanthropy House is a European initiative first of its kind, conceived and supported by six foundations located across Europe. Each foundation provided mission-related funds to develop the House as a model for the future, a novel way of helping foundations become stronger together while offering a window to discover the important work they do to European decision-makers and the general public.”

Table 11: Annex I: Networks of European Foundations

Annex 1

xxi

Online Auctions: Bidding For Good Web: www.biddingforgood.com/auction/biddingforgood.action

“They provide a unique online platform, where nonprofits, schools, consumer and businesses converge to create dynamic and existing fundraising events and ultimately, to raise more money for the causes we care so much about. With the help of over 8.000 customers and the 400.000+ shoppers in their bidder community, they have created a new category of shopping.”

Bidding Owl Web: www.biddingowl.com

Ebay www.ebay.com

“With 145 million active buyers globally, eBay is one of the world’s largest online marketplaces, where practically anyone can buy and sell practically anything. “

Finn Web: www.finn.no/torget

Lebon Coin Web: www.leboncoin.fr

Table 12: Annex I: Online Auction Platforms

Donation Platforms: Better Now Web: www.betternow.org

Better Place Web: www.betterplace.org

Causes Web: www.causes.org

Changing the Present Web: www.changingthepresent.org

Global Giving Web: www.globalgiving.org

Just Giving Web: www.justgiving.com

Razoo Web: www.razoo.com

Table 13: Annex I: List of Donation Platforms


xxii

List of European and international networks of cooperatives in different sectors: Network Description Association of Mutual Insurers and Insurance Cooperatives in Europe Web: http://www.amice-eu.org/

“Its prime purpose is to ensure that the voice of the insurance sector in Europe is heard and that interests of its members (6.000 companies in Europe) are taken into account in securing a level playing field for all insurers in Europe regardless on their legal form.”

CECODHAS Housing Europe Web: http://www.housingeurope.eu/

“It is a network of 41 national and regional federations which together gather about 41.400 public, social and cooperative housing providers in 19 countries. All together they manage over 25 million homes.”

Cooperatives Europe Web: http://www.coopseurope.coop/

“The voice of cooperative enterprises in Europe. On behalf of its 92 member organisations from 36 European countries across all business sectors it promotes the cooperative business model in Europe.”

European Association of Cooperative Banks Web: http://www.eacb.coop/en/home.html

“Represents, promotes and defends the common interest of its 28 member institutions and of cooperative banks, with regard to banking as well as cooperative legislation.”

European Commission Cooperatives Web: http://ec.europa.eu/enterprise/policies/sme/promoting-entrepreneurship/social-economy/cooperatives/

European Community of Consumer Cooperatives Web: http://www.eurocoop.org/en/

“Euro coops is primarily active in food retail. Its members are the national organisations of consumer cooperatives in 19 European countries and one Non-European member.”

European Confederation of Cooperatives Web: http://www.cecop.coop/

European Social Cooperative Web: http://www.escoop.eu/

“Euscoop has the purpose to pursue the general interest of the community, towards human advancement and the social integration of citizens.”

International Cooperative Alliance Web: http://ica.coop/en

“An NGO which unites, represent and serve cooperatives worldwide. It provides a global voice and forum for knowledge, expertise and co-ordinated action for and about cooperatives.”

International Raiffeisen Union Web: http://www.iru.de/

“A worldwide voluntary association of national cooperative organisations.

Mondragon Web:http://www.mondragon-corporation.com/ENG.aspx

“Business group, integrated by autonomous and independent cooperatives with production subsidiaries and corporate offices in 41 countries and sales in more than 150.”

Renewable Energy Cooperatives Web: http://www.rescoop.eu/rescoop-team/cooperatives-europe

“A group of citizens that cooperate in the field of renewable energy, developing new production, selling renewable energy or providing service to new initiatives.

Table 14: Annex I: European and International Networks of Cooperatives

Annex 1I

xxiii

Annex II: Facts and Figures

Figure 32: Annex II: Crowdfunding Platforms Acting Worldwide


xxiv

Return that we have to give for funded resources What kind of resources do we need? Financial and social

return Only social return Financial, Volunteers,

Services etc. Only financial

SIB Subventions Monetary Fine

SIB Subvention MFA

Microfinance

VP CSR CACC Payroll Giving Cooperatives

VP CSR CACC Cooperatives

Microfinance Payroll giving

Merchandising Crowdfunding Fundraising Activities

Legate Awards SMF

Legate SMF Fundraising Merchandising Awards

Crowdfunding

Foundations Foundations

Table 15: Annex II: Valuation of Fundraising Methods: Return we give and Resources we need Financial return is: The extent of the output is

Secure Less secure Low High SIB Subventions

Monetary Fine MFA SIB Subvention

Microfinance VP Payroll Giving

CSR CACC Cooperatives

Payroll giving CACC Cooperatives

Microfinance VP CSR

Legate Awards SMF Merchandising Crowdfunding Fundraising Activities

SMF Fundraising Activities Merchandising Awards

Crowdfunding Legate

Foundations Foundations

Table 16: Annex II: Valuation of Fundraising Methods: Security of Financial Resources and Output Risk Potential Reward

Low Middle High Low Middle High

SIB Subventions

Monetary Fine MFA SIB Subventions

CSR Payroll giving Cooperatives

VP CACC

Microfinance CSR CACC VP

Cooperatives Payroll giving Microfinance

Merchandise SMF Fundraising Activities

Legate Awards Crowdfunding

SMF Merchandising

Fundraising Activities Awards

Crowdfunding Legate

Foundations Foundations Public sector fundraising

Private sector fundraising Fundraising within the social sector

Fundraising through foundations

Table 17: Annex II: Valuation of Fundraising Methods: Risk and Potential Reward

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International network represented in

13 European countries

We, the partners of Don Bosco Youththem together through various international activities. We hereby look to broaden the opportunities for these young

people who are, through various reasons, excluded. By concrete activities of co

Through our own Salesian identity, we aim to keep the heritage of Don Bosco alive and look to offer a ‘youthful voice’ in the Europe of today. By doing this, we want to make a real difference in the lives of all young people,

Austria

Austria

Belgium

Czech Republic

Germany

Ireland

Malta

Poland

Slovakia

Slo

Spain

The Netherlands

United Kingdom

onal network represented in

13 European countries www.donboscoyouth.net

Mission statement DBYN

We, the partners of Don Bosco Youth-Net, wish to contribute to the total development of all young people by them together through various international activities. We hereby look to broaden the opportunities for these young

people who are, through various reasons, excluded. By concrete activities of co-operation, we wish to be a living example of tolerance and mutual understanding.

Through our own Salesian identity, we aim to keep the heritage of Don Bosco alive and look to offer a ‘youthful voice’ in the Europe of today. By doing this, we want to make a real difference in the lives of all young people,

most in need.

Austria www.jugendeinewelt.at

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Belgium

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Czech Republic

mladez.sdb.cz/sadba/

Germany

www.aktionszentrum.de

Italy

www.federazionescs.org

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www.salesians.ie

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www.spysmalta.org

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www.donbosco.pl

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www.domka.sk

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Spain

www.confedonbosco.org

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www.donbosco.nl

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www.salesianyouthministry.com

www.donboscoyouth.net

Net, wish to contribute to the total development of all young people by bringing them together through various international activities. We hereby look to broaden the opportunities for these young

operation, we wish to be a living example

Through our own Salesian identity, we aim to keep the heritage of Don Bosco alive and look to offer a ‘youthful voice’ in the Europe of today. By doing this, we want to make a real difference in the lives of all young people, especially for those

www.jugendeinewelt.at

www.donbosco.at

dienstdonbosco.be

mladez.sdb.cz/sadba/

www.aktionszentrum.de

www.federazionescs.org

www.salesians.ie

www.spysmalta.org

www.donbosco.pl

-ceh.si

www.confedonbosco.org

www.donbosco.nl

www.salesianyouthministry.com