Wealthy donors are giving generously, even as the number of everyday Americans who give to a charity is dwindling. Rich individuals donated an average of nearly $35,000 in 2022, one survey found. It should be no surprise, then, that many nonprofits are increasingly looking to big donors to hit their revenue goals.
Yet the smartest fundraising focuses on nurturing all kinds of donors, not just those with the deepest pockets, says Tiffany Legington Graham, chief marketing and development officer at the National Civil Rights Museum, which has tripled or quadrupled the number of new gifts from individuals at all levels since she arrived in the spring of 2022. “It’s almost like a multilayered cake, right?” Legington Graham says. “You want to build a foundation of giving that is happening regardless of one-to-one outreach, sort of like passive fundraising … Because once you have it, then you know that’s just rolling in the background while you are cultivating the higher-end midlevel and major gifts.”
This approach is even more important for small nonprofits, she says, and includes setting a good cadence for direct-mail and email appeals so you are consistently asking for gifts. “You’ve got to work smarter, not harder,” she explains. “Because as we know, it takes an average of 12 to 18 months to secure major gifts, so if you’re only focused on major gifts, what’s happening in the interim?”
As you expand your pool of donors, use prospect-research tools such as wealth screenings to identify those who have the potential to give midlevel or big gifts and develop targeted outreach to cultivate them, Legington Graham suggests.
You should think of your trustees as your front line for helping you meet new potential donors.
The Chronicle spoke with three seasoned fundraisers who shared their top tips and tactics, plus real examples from their work, to help you adapt your fundraising to the current climate and attract more big gifts. Here’s what they say.
Focus on midlevel donors.
This is a smart way to help sustain fundraising revenue in volatile economic times while also building a pipeline for major giving, Legington Graham says. The National Civil Rights Museum has been emphasizing this group in the last year, and as a result, has upgraded some supporters from annual giving to four- or five-figure gifts and identified strong leads for potential major donors. “To me, that’s one of those, I won’t say recession-proof ideas, but it certainly helps when you focus on that middle group because oftentimes, $2,500, $5,000, $10,000 is more accessible than higher-end major gifts, and people are more inclined to maintain their giving to an institution in that regard,” she says.
Identify gaps in your donor pool.
Assess your database and consider whether there are groups that are missing, Legington Graham suggests, such as communities that might have a natural connection to your cause but aren’t yet giving. Then, create personalized “journeys” to engage them. For example, the National Civil Rights Museum is using donor personas, such as “history aficionados,” “activists,” and “idealists” to reach out to groups of potential supporters with communications tailored to their interests and values.
Diversify your board.
Arena Stage, a nonprofit theater in Washington, D.C., has successfully replaced some key donors it lost over the past few years by seeking new board members from outside its network, says Chief Development Officer Ryan Merkel. Here are a few creative ways Merkel accomplished this that can be adapted to other organizations and missions:
- Ask corporate partners to recommend company leaders who care about your organization’s mission and might be interested in serving on the board. This both strengthens Arena Stage’s relationship with its partners and opens the door to a new network of potential major donors, Merkel says.
- Consider donors who demonstrate passion for your work. Arena Stage looks for potential board members among “group leaders” — individuals who secure a big block of tickets. An example might be the social chair of a local AARP chapter buying 50 tickets for its members.
- Create a “young patrons’ board.” Arena Stage started such a board a few years ago for people roughly 40 or younger, with a gift requirement that is considerably lower than that of its governing board. While the main purpose of the young board isn’t to develop governing board members — all of whom are major donors — it sometimes works that way, Merkel says, and even when it doesn’t, this tactic can help expand your base of engaged donors.
Tap into big donors’ networks.
A peer endorsement from an existing supporter who loves your organization is always valuable when seeking big gifts, Legington Graham says, but even more so in times of economic instability. Ask key donors if there are people in their network whom they think you should meet and if they would consider connecting you, she suggests.
For Legington Graham, that has led to an email introduction, a lunch meeting with the donor and his or her contact, or even a peer gathering at the donor’s home to talk about the organization’s work. “Typically, because they love the mission, they’re always happy to share it with folks in their network,” she says.
Maximize your board.
You should think of your trustees as your front line for helping you meet new potential donors, says Jeffrey Shaw, vice president of institutional advancement at Harris-Stowe State University. Shaw built a board for the university foundation when he arrived about two years ago and has prioritized getting them actively involved in university life and fundraising. He treats board members almost as if they were donor prospects, he says, moving them from the acquisition stage to ongoing stewardship, including meeting with them one-on-one, inviting them to participate in campus activities and events, and trying to engage their companies, too.
I think you have to walk a line — you don’t want to be existential, but it’s OK to be honest and open with donors about your nonprofit’s need.
Plus, as Shaw recruited new trustees, he set clear expectations for their annual giving and involvement in fundraising from the get-go, including asking them to sign a board member commitment form where they could indicate their interest in helping with specific types of donor outreach, such as visits, hosting a gathering, or sponsoring an event. That enabled Shaw’s team to follow up and hold the trustees to their commitments throughout the year.
The form was part of a larger toolkit Shaw created that also included resources to teach the board members about fundraising and help them succeed, including scripts for donor thank-you calls and sample steps for moves management.
Streamline your donor communications.
Automate as many processes as you can to help ensure that all donors get attention throughout the year, while freeing up fundraisers to focus on building relationships with big donors and bringing in new supporters, Shaw suggests. For example, Harris-Stowe uses “workflows” in Raiser’s Edge to automate some stewardship actions, such as sending a customized e-card to donors on their birthday from Shaw’s email address, so it feels personal.
Harris-Stowe also has an automated email series that goes to new donors at certain intervals and milestones during the year after their first gift, such as their donation anniversary.
Supporters who give larger sums also get some automated outreach, but with a higher touch, Shaw says, including handwritten thank-you cards created and mailed by a company called Handwrytten, which uses a robot to pen the letters on Harris-Stowe stationary.
The university also uses a platform called ThankView to create and send customized digital thank-you videos to certain donors, whom Raiser’s Edge flags as needing a video when a qualifying gift comes in.
Be vulnerable.
During the pandemic, when Arena Stage lost most of its earned revenue from ticket sales, Merkel explained to several board members that fundraising revenue needed to make up the difference and asked if they could increase their gift or make one in the first place. “There’s a vulnerability there,” he says. “I think you have to walk a line — you don’t want to be existential,” but it’s OK to be honest and open with donors about your nonprofit’s need.
At the top of the year is when your DAFs are hopefully a little bit fuller, and that is the time to reach out to DAF holders.
Being a little personally vulnerable works well, too, Merkel says. For example, he has noticed that communication with donors has become more casual since Covid. He now texts or calls many supporters on their cell phone, and this year several of them texted him to wish him a merry Christmas or happy New Year.
Highlight gifts to inspire more giving.
Harris-Stowe has seen a big jump in endowments during the two years since Shaw arrived, he says, because gifts are getting more visibility and people are seeing how much the university appreciates and does what it says it’s going to do with the money.
Whenever a big gift comes in, Harris-Stowe highlights the donor’s generosity on a variety of communication channels, from sharing photos of the donors’ family on social media to a story in the annual magazine.
Endowment donors also get a plaque and personalized report by mail. Sometimes supporters share this information with their friends, relatives, companies, and other contacts, Shaw says, some of whom are then inspired to become donors themselves.
Use matching gifts to boost results.
Harris-Stowe uses part of the Title III funding it receives as a historically Black university to offer matching gifts for endowments, Shaw says, which is very attractive to a lot of potential donors. If other HBCUs are not already using some of that government aid to match endowments, he adds, they should start.
Arena Stage is also seeing great results from matching gifts, which it uses in a couple different ways. As part of its year-end fundraising, the group asks trustees to match year-end gifts from specific groups of donors, including new members, renewing donors, and local supporters. Taking this segmented approach enables the theater to engage several major donors instead of just one, Merkel says, and lets those donors feel responsible for the results, such as the number of new members acquired. “That’s direct impact,” Merkel says. “And it makes their day. They feel great.”
Arena Stage is using matching gifts to promote planned giving, too. The theater got two big donors to agree to match documented planned gifts, which allowed Merkel’s team to tell potential donors that if they signed a commitment, 10 percent of their pledge would go to the theater right away. That was an extremely powerful way to attract large gifts, Merkel says, because the deadline set for the match created a sense of urgency around planned giving, which can be tricky to achieve. “I will crow about that tactic for the rest of my career because it worked so well,” he says.
The theater closed planned gifts that had been in the works but also found new planned-giving prospects by advertising the match in mass emails. A small share of the recipients made a commitment, Merkel says, but those leads were very valuable: The campaign brought in roughly $5 million in planned-gift commitments over three years, he says.
Prioritize donors who have DAFs or family foundations.
These supporters are key, Legington Graham says, because they have shown that they are philanthropic by creating these giving vehicles, and they have already set aside money to support charities, regardless of possible economic troubles. To find and cultivate them, the National Civil Rights Museum started by mining its donor database to identify individuals who have given in one of these ways, she says. Then, the organization separated them into groups, or segments, and developed specialized communications for each.
Don’t wait until November or December to talk with DAF donors, Legington Graham says, because that is when many are focused on adding money to their DAF, rather than distributing it. “And so, at the top of the year is when your DAFs are hopefully a little bit fuller, and that is the time to reach out to DAF holders,” she says. “Once they have already kind of topped off the DAFs at the end of the year, and now they’re ready to think about the next year’s giving again.”
