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[ASK AN EXPERT] Is A Gift Chart Appropriate If Not In A Capital Campaign?
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Our Ask An Expert series features real questions answered by Claire Axelrad, J.D., CFRE, our very own Fundraising Coach, also known as Charity Clairity. Today’s question comes from a nonprofit employee who wants advice on whether a gift chart is appropriate to raise funds if not in a capital campaign:
Dear Charity Clairity,
We have an ambitious individual fundraising goal of $500,000 this year – almost 1.5 times what we raised last year! Since it’s in support of a plan to expand services, my boss thinks the case for support will sell itself. I’m anxious. I think we’re going to need to seriously ramp up major giving. But I’m not sure where to begin. We’re not in a capital campaign, but I’m wondering if I need a gift chart or something else as a blueprint to assure we generate enough contributions.
— Nervous Nellie
Dear Nervous Nellie,
You can ask for major gifts all year long; not just during a formal capital campaign. So, while you don’t necessarily need a formal gift chart (a capital campaign construct), you do need to know at the outset how many prospects and donors you’ll need, and at what levels, to reach your goal.
Organization: Goal + prospects and donors to meet that goal
If you have a $500K annual giving goal, chances are good you’re not going to get there with 50,000 $10 donors. You’ve probably heard of the Pareto Principle (aka the Rule of 80/20) as it applies to fundraising. It states that 80% of your fundraising will come from 20% of your donors. These days, I find it to be closer to 90/10. In some cases, I’ve seen it be as much as 97/3. So, you’re on the right track. Most organizations simply do not have a large enough donor base (or mailing list) to be sustainable without major gifts.
I love gift charts as an organizing tool. You can use a gift chart calculator as a starting place. Here’s what a $500,000 goal might look like.
You’ll want to tweak it, however, based on what you know about the donors in your database. For example, if you know you have zero prospects at the $125,000 level, you’ll want to add more prospects at some of the levels below this.
It’s not a bad idea to share your gift chart with your major donor prospects regardless of whether you’re in a capital campaign. Major annual campaign donors also like to know where they stand.
Role of the board
Speaking of knowing where they stand, this is especially true for board members. They’re your leaders. If they aren’t leading, how can you expect others to give passionately? If you need board members to give $5,000 gifts, and they’re giving $500 gifts (mostly out of habit and expectation; not based on capacity), you’re dead in the water. Nothing demonstrates this quite as simply and clearly as a gift chart.
So, be sure to review this chart with the board – and get their buy in – before you go public. If they won’t approve it, you’ll need to revise your fundraising goal downward. Period. You may be a rare exception, but I’ve never seen an organization significantly ramp up their fundraising from individuals without board leadership.
Be honest about what success will look like
Going into each ask, you must be crystal clear what a successful outcome will look like. Sometimes you may have 25 prospects and need only 10 gifts at a particular level. So, if one prospect gives less than what you’d hoped for, you may be okay. Other times, especially at the top of the gift chart, you may not be able to be so sanguine.
Here’s an analogy: If your kid comes home from school with a grade of “F,” I’m guessing you won’t be telling them how proud you are. Yet, too often, we’ll walk out of a donor solicitation meeting and pat ourselves on the back for having elicited a $25K pledge when we asked for $50K. That’s 50%. That’s an “F.”
If you don’t raise enough you’re not going to reach your goal. The one phrase I hear solicitors utter that makes me wince is: “Any amount you can give will be helpful.” That’s just plain not true. You need a gift that is enough to meet the need. We’re trained to be grateful, no matter what. But, gratitude alone won’t pay the bills. You’ll help less people than need help. You may even have to close down programs or shut your doors. “Any amount…” is a wing and a prayer strategy. That’s not what you want.
Let me tell you a true story:
I worked with a small nonprofit in precisely your situation. They hoped to dramatically grow their annual campaign so they could expand services. The board had approved an ambitious growth plan; yet had not been giving passionately. We had a retreat and talked about the importance of board leadership in this regard. The staff made a gift chart and came up with suggested ask amounts for each of the board members. The executive director (ED) kicked it off by asking the board chair to commit. The board chair doubled his previous gift, and the ED came back ecstatic. I looked at her and said, “How much did he commit?” She said, $2,000, which is twice what he gave last year!” I said, “How much were you supposed to ask for?” She said, “$4,000, but when I walked in he told me right away that he and his wife had decided to double their giving and he was so proud; how could I ask for more?” I patiently explained that if the board chair gave only that amount he could not reasonably ask his peers to give more (this happened to be a board comprised primarily of members in the same profession, so their circumstances were relatively similar; they were true peers). I also noted that while $4,000 might be a stretch for this individual, it most certainly was something he could afford without affecting his lifestyle in any way. He was in the habit of giving well below his means. The organization needed to break this habit if it wanted to grow. The ED saw immediately what needed to happen next. She went back to the board president and asked again. Only this time, she was clear what would constitute success. She showed him a table of where gifts needed to range. The board president did not head for the hills. Instead, he talked to his wife again and came back with a $4,000 commitment. Not only that, he told this story when he asked other board members so they would understand what was expected of them as well. The board rocked the campaign and reached their goal. Now this organization is growing by leaps and bounds.
I guarantee having this gift chart in place will reduce your nervousness, for the same reason you having any type of plan will stand you in good stead. Because, to paraphrase Lewis Carroll, if you don’t know where you’re going, any road will get you there.
Now you know where to go!
— Charity Clairity (Please use a pseudonym if you prefer to be anonymous when you submit your own question, like “Nervous Nellie” did.)
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