7 ways to kiss fundraising goodbye
DESCRIPTION
Nonprofit fundraising doesn't work anymore. Here's how to take a more strategic financing approach to create a sustainable financial model for your nonprofit.TRANSCRIPT
Fundraising doesn’t work anymore…
Competition is Growing
More Organizations1.4 million nonprofits in US, up 19% since 1999More for-profit social change orgs
Less FundingPrivate donations level over last 30+ yearsGovernment spending cuts at every level
But Financing brings your nonprofit sustainable funding…
Financing is...A long-term strategy for bringing enough
money in the door to achieve your mission.
“How much should we raise to accomplish our goals?”
“How much can we accomplish with what we can raise?”
Board, Staff,
Donors
Money Strategy
Infrastructure
Sustainability
Funding Sources
Programs
Messaging
Fundraising Vs. Financing
Worn out Excited, engaged
Annual, only programsLong-term, all costsInadequate Fully funded
Weak
Few
Strong
GrowingFlat or declining
Diverse, Robust
Community changeNonprofit’s need
7 ways to move
from Fundraising
to Financing…
Nonprofit’s Financial Engine
Nonprofit’s Core CompetenciesNonprofit’s Mission
1. Connect Money & Mission
Nonprofits will be most successful
in this sweet spot
Create a financing plan that…Ties to your strategic plan
Encompasses 3-5 years
Includes revenue & capital goals
RevenueOngoingSupports day-to-day BUYS services
Vs. CapitalOne timeSupports infrastructure, development, systemsBUILDS the nonprofit organization
Raised $350K from 6 donorsNew database, websiteStaff & trainingMarket researchMarketing materials
ResultsDollars up $1.6 M (40%)Donors up 36% to 19K+
2. Raise Capacity Capital
A board member can raise money by…
Advocating for government $Hosting a friend-raiserRecruiting an in-kind service
3. Involve EVERY Board Member
A board member can raise money by…
Providing info on prospectsCreating an earned income business plan
3. Involve EVERY Board Member
A board member can raise money by…
Advocating for government $Thanking a donorNegotiating a lower vendor price
3. Involve EVERY Board Member
And much more…
Sources: Nonprofit Almanac and Giving USA
4. Diversify Funding
Sources of Nonprofit Sector Dollars
Don’t rely too much on a small piece of
the pie
5. Calculate the Cost of Fundraising
Net RevenueTotal $ Raised − ALL Expenses
Cost to Raise $1.00ALL Expenses ÷ Net Revenue
$20,000 EventNet Revenue
Income = $20,000Expenses = $15,000
Direct = $8,000 (venue, food, band)Indirect = $7,000 (staff & board time)
$20,000 − $15,000 = $5,000 Net Revenue
Cost to Raise $1$15,000 ÷ $5,000 = $3.00 CTR
It cost $3.00 to raise $1.00
A donor invests in a nonprofit with shared values
The nonprofit translates that support into change to a social problem
Community change occurs
Your nonprofit is just an
intermediary
6. Message Impact
The Message of Impact comes from a nonprofit’s
“Theory of Change”…
Inputs ($,
students, teachers,
staff, board)
Activities (read to students 2x per week)
Outputs (#
students, # hours, # of books given)
Outcomes (students
stay in school, do better in school,
graduate from school)
Impact (stronger schools,
safer streets, better
educated citizens)
Nonprofits usually
stop here
But this is where it
gets really compelling
7. Move From Push…
Pull: Create messages and hope people act(Direct mail, press release, gala,
advertising…)
…to PullPush: Create space for people to engage
(Social media, friend raisers, alliances…)
In order to move from Fundraising
to Financing…1. Connect Money & Mission2. Raise Capacity Capital3. Involve Every Board Member4. Diversify Funding5. Calculate the Cost of Fundraising6. Message Impact7. Move from Push to Pull
Learn More…
Build a Nonprofit Financing Plan Step-by-Step
Guide
Download Here
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