In this week’s edition of Ask an Expert, we answer questions about running capital campaigns during this time of great economic uncertainty.
Angela Joens, assistant vice chancellor of development outreach at the University of California at Davis; Brenda Asare, president and chief executive of the fundraising consultancy Alford Group; and fundraising consultant Brian Bonde, provide the answers.
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Should we keep moving forward with the pre-silent phase of our capital campaign and put out a request for proposals to assist with phasing, financing, and implementation? Or should we just stop altogether for now and focus on operations and current needs?
— A development director at an independent school
Charities need a firm idea of who will be their major capital-campaign donors before they can gauge whether they have the support to power a major fundraising drive, says Asare. As in any other year, she says, nonprofits should launch a feasibility study or philanthropic assessment to illuminate this data.
Fundraisers should survey donors on how much they plan to give to the charity over the coming years and how they’ll balance those gifts with donations to other groups, she says.
Undergoing this process now not only helps charities identify their greatest financial needs and the capacity of their supporters but it also buys them time — about two to four months, Asare says.
“By the time this behind-the-scenes work is completed, donors may be ready to engage in conversation about how the organization navigates Covid-19 and what they are seeing as their future,” she says.
Joens agrees that a lot depends on how much legwork the charity has already completed. When the pandemic hit, her team at UC Davis was in the final stages of its silent phase, which it began in 2016. She went back to previously identified stakeholders to take their temperature on the campaign now that the economic outlook had dimmed.
“We just do not know what the next few months or years will look like, so gathering data and taking the pulse of your leadership is a good next step,” she says.
Joens and her team talked with the university administration, board, and campaign steering committee to gauge buy-in for a continued campaign. They also reached out to donors to ask whether they would still be able to give to the campaign or if they would have to change when the university would receive their pledges in full.
These discussions gave Joens the confidence to continue the campaign’s silent phase. It helped that she and her team had prepared to launch the campaign in a weaker economy than when they began the pre-silent phase, she says.
“If everyone is on the same page, then I would proceed with your planning,” Joens says. At Davis, fundraisers are planning for a virtual campaign launch in October.
We’re in year two of five of a Capital Campaign — our building is just being completed. I’m repeatedly being asked by my board what we can expect in terms of people and companies not paying their pledges. I don’t know how to respond as this is unprecedented. What are your suggestions on how to reach out to donors who have made pledges or how to respond to board members? It seems like an awkward question to ask these donors.
— Executive director at an agricultural education nonprofit
“If the building is almost complete and you don’t have your pledges in hand, you may be in trouble,” says Bonde. It helps to have an archive of signed donor agreements outlining how a donor will pace a gift, he adds.
“With these documents in hand, you should be able to build a timeline of expected cash flow from the pledge payments which you can share with the board,” he says.
However, even the most committed donors may have to make changes to their pledges now that the Covid-19 crisis has upended the economy. The best way to make sure your donors can still make good on their pledges, Bonde says, is to ask.
“Donors are our organizational family, and we need to support each other as a family right now,” Bonde says. “You should be talking to them more in this time of crisis, not less!”
A personal, empathetic touch will help ease these difficult conversations, he says. It helps to remember that donors and fundraisers are likely facing similar uncertainties right now, he adds.
“Celebrate their past support. Ask, ‘How are you doing?’ and then truly listen. Then ask them, in an open, compassionate, and transparent way, about their giving at this time,” says Bonde.
And while some donors may need to make changes to their pledges, Bonde says fundraisers shouldn’t be too worried. “Most donors who would make a major gift to a capital campaign are likely to have much of their wealth intact, even in this particular time,” he says.
Asare agrees that donors will probably keep their word. “What we are more likely to see during this moment is donors extending time for payout pledges, adjusting timing of their first pledge payment, or adjusting payout schedules,” she says.
For example, donors may rework their pledge so that they can give more money a few years from now, when the economic outlook may be brighter, and less money during the uncertain near term. Offering donors the chance to make these changes goes a long way, Asare says.
Catch up on recent editions of the column.