One traditional approach is what I call sausage making; if you follow these steps exactly, using these tools and methods, you will get these results. It’s a numbers game. The danger here is getting trapped in rigid procedures and routines. A certain amount of entrepreneurial spirit is required, in any activity. A big factor in HBS Capital Campaign success was our team’s ability to come up with intelligent answer for all obstacles, and constantly change methods to address prospects’ different wants and needs. (I confess that one of my favorite questions was: “Why do it that way?”) You’ll end up leaving a lot of money on the table with a “grind it out” plus it reduces staff to crank-turners.

The gift pyramid is part of this approach. It reflects wealth distribution, and assumes giving at all levels, with 80 to 90 percent of all funds received coming from the top of the pyramid.  It is the outcome of what could be described as a funnel strategy; pour a lot in, and a few good ones will come out. I have no issue with gift pyramids per se, just with their single-minded use. If you do use a pyramid, its shape should reflect your fundraising strategy (and not the other way around!); it’s an outcome, not a method. For example, some causes don’t have a broad appeal, so there’s little point to looking at the bottom of the pyramid. (I call that the elephant strategy.) Sometimes you want everyone – especially board members – to give at least something. (That would be a participative strategy.) Or you may combine the two; maximize ongoing participation, and go elephant hunting for large projects.

There’s another traditional fundraising approach that I call the lamprey eel method; “I’ll attach myself to you until you give.” Who can argue with the importance of building and maintaining relationships with people supportive of your cause?  But, taken in isolation or to extremes, the strategy is flawed. One risk is “friend raising” instead of fundraising. Yes, I have made some good friends through my philanthropic work, but that is a pleasant by-product of partnering for a cause.

Another risk is that the donor becomes attached to a specific individual at an institution. What happens if that person leaves the organization? That is one reason why HBS’ development office makes a point of introducing donors to several staff members, and stressing that they are all there to serve. A similar problem sometimes arises with charismatic leaders of organizations, especially founders. People become more committed to the person than the cause or the overall organization, which can pose problems down the road.

All that said, I do think there’s a “secret formula” that underlies all fundraising, both good and bad. It’s just plain algebra, really. Assume a blank slate. Simply stated, if you multiply number of donors by closing percentage and average gift size, you arrive at a total-dollars-raised estimate. And each of the variables in the formula is actually a point of leverage.  Part of the power and value of this approach lies in its implications for both fundraising effectiveness and efficiency. For example, if you increase your average gift and/or improve your closing rate, you can reduce the number of donors needed, and still hit your fundraising goal. Because you are dealing with fewer donors, you will need fewer staff for all the behind-the-scenes work, and you can lighten the load on your volunteers.

By improving on any of these measures, you can positively affect your total dollars raised.  And you can get better, as you go. You can use the formula to test actionable options, based on the best available information at any point in time—i.e., making educated guesses to start, and introducing refinements as you go along.

What is your organization’s approach to fundraising?

I developed what I call the priority giving strategy after a capital campaign experience with the late Frank Batten, an HBS Class of 1952 alum and media pioneer. As the publisher of a newspaper in Virginia in the 1950s, he had championed desegregation; the paper earned a Pulitzer Prize for that work.  He also was a noted philanthropist, making large gifts to his undergraduate alma mater and many other institutions and causes.

As I waited outside his office, I considered what to say to Frank. If I went about the conversation the normal way, explaining how important HBS and the campaign were, I suspected we’d just get into an argument. (Frank wasn’t one for tooting one’s own horn, so I figured I shouldn’t toot HBS’s horn.) I decided to try a different tack, and begin by telling Frank how proud the School was of his success, and philanthropic generosity. This was easy, because it was true. I closed by saying that I hoped HBS could be number four or five on his list of giving priorities. 

Not long afterward, HBS received a $32 million donation from Frank to support the renovation of the School’s residential campus. Actually, that put HBS fifth on Frank’s list—but that turned out to be a very good place to be!

The experience of Groton, an independent boarding school in Massachusetts, provides another example. During Groton’s capital campaign, which was approximately one-tenth the size of HBS’s, the headmaster of that school enjoyed great success by asking people to make Groton the number-four priority on their giving lists (except for the board chair!).  Conversely, I recently attended a meeting of a group to which I was a reasonably generous donor—in fact, one of their biggest—and was offended to hear a staff member proclaim that this organization had to be the number-one priority of everyone at the table!  Why? And who was he to make that decision for me?!

Would it be wonderful, even magical, to become a prospect’s number-one priority? Absolutely! Would it be wonderful, even magical, if that prospect’s engagement with your organization grew and grew, and your work emerged as his or her core issue? Yes—all the better!

Meanwhile, don’t count on wonders and magic.  Be bold, ambitious, and realistic.  Earn the bird in your hand, and keep an eye on the two birds in the bush.

Are you undershooting your potential? Do you need to aim higher? Or do you have the opposite problem: unrealistic expectations?

Unfortunately, too many fundraising organizations are competitive, political cauldrons. One development officer had an outstanding reputation for developing strategies for his prospects. Unfortunately, he never seemed to get around to executing them. “Ready, aim…ready, aim…ready, aim…” was how one person described it. Eventually, I asked him: “Can I reassign this donor? You haven’t called on him.” The reaction: screams of “That’s my prospect, he’s on my list!” That sort of competitive attitude can be reinforced by performance metrics, evaluation and compensation systems, and culture. But, it can be corrected similarly.

Organizational structure also can contribute to competition. I am often amazed at how siloed fundraising organizations tend to be. Within individual giving, there may be major gifts, annual giving, planned giving, a capital campaign, and more. Each group may be fighting for “donor rights.” Donors, however, may not care how their gift is categorized. What may annoy them, however, is making a donation, and then being “nickel and dimed” for special events or contributions to other groups. Fortunately, there are ways to address structural issues too, with cross functional teams or donor-centered liaisons, for example.

The “fundraising organization,” however, is not just the folks in the development office. I view it as a partnership among staff, volunteers, and donors. One development officer went even further, sponsoring regular meetings where employees were kept abreast of fundraising needs and activities. Her goal was to create create an environment where everyone, not just the formal fundraisers, felt responsible for success. One example of just that: 100% of Mount Auburn Hospital doctors and 60% of nurses showed their commitment to the organization’s mission by making personal donations to a major campaign.

The notion of competition extends beyond the organization as well. Yes, there are many nonprofits out there vying for dollars. But, I routinely say something that donors are genuinely surprised and pleased to hear: “Thank you for all the other good work you’re doing in the world.” (A few specifics can go a long way, here.) And I mean it.  In fact, some of those efforts may well serve your cause. For SummerSearch, a leadership program for low-income youth, a contribution to the Posse Foundation – which offers four-year, full-tuition scholarships to public high school students – may well benefit its kids. Why wouldn’t it celebrate the good works of the Posse Foundation and its donors?

A competitive mindset can lead to misguided strategies, too. One common one is to try to “own” all your resources. Successful nonprofits get good at using other people’s resources—not just in the tenuous early days of the venture, but also as they gain traction. They learn which resources they should own and employ, and which can be bartered, partnered, or rented. They pursue strategic alliances with other organizations. They recruit volunteers. They share mailing lists. They partner on projects.

Think about the organizations in which you are involved. Is competition the watchword… or collaboration and teamwork?

The “Huh?” reaction is often from fundraisers who are so passionate about their mission that they can’t understand why anyone might be – well – less than excited. They may see “donors” as one great undifferentiated blob. The fact is that donors come in all shapes and sizes, with different interests and their own set of giving priorities.

Not recognizing that fact can lead to this scenario. The following conversation was with a friend on the Boston Museum of Science’s board.

She explained: “One of our donors gives a little something every year, but we want to raise his sights. He’s told us that he doesn’t particularly like museums, and wants to give his money to underprivileged children. What should we do?”

I replied: “Nothing.”

Why that rather discouraging response? Because there was no hope. The museum wasn’t a priority for the donor, and that’s what it takes to garner a significant gift.

People may give several or even many checkbook gifts. It may be to support an organization that is important to a friend or family member. How many times have you been asked to buy Girl Scout cookies? Or support a friend’s cause? It may be in response to a crisis, such as Hurricane Katrina. The cause will be perceived as worthy, but not worthy enough to invest a sizeable chunk of your philanthropic dollars. People will only make two of three of that magnitude, and it will be for causes that that they are passionate about, and to organizations that they trust to make good use of their money. 

Here’s another story, illustrative of another common mistake. I was leading a session on fundraising with a group of nonprofit leaders. When I asked for best and worst fundraising experiences, a man’s hand shot up. He explained that some of his prospects responded to his pitch enthusiastically, others were lukewarm at best. And yet—he continued, displaying a mixture of puzzlement and indignation—he was making exactly the same pitch each time! Why were the responses all over the map?

Around the room, many heads were nodding in sympathy. Why, indeed?

From the way I’ve related this story, and from your own experience, you probably already know the answer. A “one size fits all” approach to fundraising can’t work consistently. Your job as a fundraiser is to arrive at a deep understanding of what motivates each donor, and consider what you are proposing from his or her perspective.

You can’t assume that everyone is as excited about your work as you are; it’s not all about you. Your job is not to try to change people’s mind, but to find like-minded people and convince them that – together – you can accomplish something that you could not do alone.

Now, let’s look at the “Of course not!” reaction to “it’s all about you.” That usually is accompanied by “It’s all about the donor!” Well, not really. At the risk of raising a few eyebrows, I’ll posit that mission comes first, then donors. Yes, donors provide the lifeblood of many nonprofits, and acquiring and retaining donors is the core work of fundraising. But there are compelling reasons why your focus must remain first and foremost on your mission.

Focusing intensively on mission can help you avoid two common mistakes. The first is accepting funding for projects that aren’t consistent with your mission, which can cause you to veer off course, and end up with a jumble of unrelated initiatives driven by donors’ wishes rather than what you set out to accomplish.

The second mistake is making the institution, rather than the cause it serves, your priority. Focusing on the institution tends to lead to the creation of a laundry list of things that the institution thinks it needs to function effectively. Such a list—or at least some of the items on it—may be of interest to some donors. But it will almost certainly turn off potential significant supporters who could have been inspired by your broader purpose.

Being mission-driven also keeps you from ignoring potential supporters who should not necessarily be dismissed out of hand. One of my favorite philanthropy-related articles is titled, “An Episcopalian, an Atheist, and a Jew Walk into a Catholic School…”[1] The article describes a number of non-Catholic “patron saints” who stepped up in big way to support inner-city Catholic schools, because they cared about the kids in those schools, and saw the parochial-school system as performing better and at lower cost than its public counterpart.

Does any of this sound familiar?

Many nonprofit volunteers and directors say they hate asking people –  especially their peers – for money. They feel like they’re in unfamiliar, even hostile territory. And for some people, asking for money feels like begging, and no one wants to be a beggar.

My response is that I’m proud of the fundraising work I do. I’m not asking for myself. I’m asking for a cause I believe in. And I’m helping donors accomplish their philanthropic and personal goals. I wouldn’t do it otherwise. So, there are two questions that I encourage you to ask yourself: “Am I personally committed to this cause? Do I believe I am helping donors achieve their goals by contributing to it?”

The begging psychology often comes from the expectation that you’ll be turned down by many, some say two-thirds, of the people you approach. That doesn’t have to be the case. In fact, it signals poor fundraising.  Much preparation is required before you get to the ask. Do you understand what motivates the prospect? What stage is she at, in her life? What can you offer, to solve a problem that is important to her?  With that kind of deep understanding, you should be getting to a “yes” about 80% of the time.

I will often begin with “I’m asking you to share in something I believe is important.” But it isn’t, of course, that simple. In addition to talking about the right things, at the right time, your pitch needs to be buttressed by facts, and expressed in terms meaningful to the prospect. With Nature Conservancy people, I talk about vernal pools.  With business people, I talk numbers. And, regardless of the audience, it sometimes involves more than talk. It may require show-and-tell, to really excite a prospect.

Being comfortable with fundraising is partly a matter of knowing your personal style. I can’t understand how one of my friends can spend hours participating in a phonathon. Personally, I like face-to-face interactions, where I can read people and their reactions.  During Harvard Business School’s Capital Campaign, I had over 1,000 face-to-face meetings with prospects. That said, I have a hard time doing cold calls, with no background information about the person. I was fortunate to have the support of an excellent development staff at HBS, who kept me informed and on track.

There are times when fundraising volunteers or nonprofit executive simply can’t get comfortable “making the ask.” Faced with this problem, one development officer said to the organization’s president: “You set it up. I’ll say the words.” The teaming, which required trust on both sides, worked beautifully. Roles also can vary depending on the prospect, and over time. It’s important to be clear on who has what role, when. That may include having no role.

At least two mega-million dollar donors that I cultivated on behalf of Harvard University had no interest in meeting the school’s President, a source of great consternation to many. The donors weren’t interested in hierarchy; they were dying to meet the academic leaders they were being asked to sponsor. My role diminished slightly during the solicitation process as well. I might become more of a facilitator, as the project and proposal took shape. I didn’t mind, so long as the check arrived with the right number of zeros.

Have I persuaded you that fundraising is not begging, and that you can be a valuable contributor to your cause, through fundraising? I  hope so!

We decided that a session on fundraising myths could be informative and interesting. In a pre-seminar survey of participants, we asked them about myths and truths that they had been taught and/or experienced. Interesting result: many things appeared on both lists! One example: “Fundraising is fun.” Another example: “Fundraising is easy.”

We brainstormed our own list of myths and truths. We too discovered some ambiguity. Much depended on the situation.  What was most important for fundraising leaders was to know what questions to ask themselves about each dimension of their efforts: getting started, first encounter with a prospect, courtship, the ask, and stewardship. The conclusion: Yup, not as clear cut as one might think, just as our seminar participants had signaled.

The result is presented below as a handy table. It offers assessment of myths and truths and – most importantly – the questions to ask yourself at each step of the fundraising process.

Some of these myths have been and will be elaborated on in other blogs. No surprise that you will to see an “on the other hand” or two there.

What is your experience with “myths” and “truths?”