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Do You Have a Donor Pyramid or a Donor Sombrero?

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The donor pyramid is a familiar concept for most fundraising professionals. It is the simple framework that represents successful donor cultivation, and our ultimate goal of upgrading and retaining donors into higher levels of giving. Top donors give major gifts.

General funds contribute annual support. But what about those people in the middle of your donor pyramid who have the potential to become future major donors, but aren’t currently giving at a high level? I prefer to refer to this group as mid-level donors. Mid-level donors vary from organization to organization but usually contribute between $500 and $2,500 annually… and learning how to engage and upgrade them is the key to building a healthy donor pyramid.

Why nonprofits struggle to build a healthy donor pyramid and how to overcome it

The reality is that too many organizations focus only on the top and bottom of the donor pyramid, lacking an intentional focus on developing the middle. When this happens, the pyramid loses shape—and thus, its purpose—and becomes what we call the “donor sombrero.”

A few years ago, I had the opportunity to hear Former President Bill Clinton speak at an AFP conference in Chicago where he shared some of the fundraising challenges for the Clinton Library. He noted that the vast majority of contributions were donations from the bottom of the pyramid, or large gifts of $500,000 or more from those at the top. But there weren’t many donations in between. Unfortunately, this isn’t unheard of in fundraising.

However, why is it that so many organizations rely on major donations or small general fund donations from the masses? Do you really think that it’s because donors only want to give significant gifts or small amounts?

Of course not. The main reason nonprofits struggle to build a healthy donor pyramid is because they lack an intentional strategy for engaging and upgrading those donors in the “middle” of their pyramid.

Engaging and maximizing the potential of mid-level donors is key not only to reaching our fundraising goals today, but to reaching the major donors of tomorrow. Don’t overlook them. Instead, develop an intentional plan that will enable your organization to effectively upgrade them towards becoming major donors while building a solid donor pyramid today.

If you want to learn more about how to build a healthy donor pyramid, I’d definitely encourage you to download our free resource, “Mid-level Donors: 7 Things You Need to Know.”

What is the status of your donor pyramid? Are you missing mid-level donors?

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