Major Donors: Who Are They And Where Do You Find Them?
As a nonprofit fundraiser, you’ve probably heard some variation of the phrase, “treat every donor like a major donor.” While well-intentioned, this idea is very misleading. If you treat every donor like a major donor, you’d probably run out of team member time. Plus, not all of your supporters want to be wined and dined like a major donor.
As an essential and integral part of your fundraising strategy, your major donors should feel valued by your organization.
The majority of your funding likely comes from these major donors, so you should have specific strategies aimed at acquiring these key supporters. The process of identifying, stewarding, and soliciting major donors takes time and effort. Therefore, you also probably have specific major gift fundraisers on your staff to communicate with these supporters.
In this guide, we’ll cover some key information about how you can find your organization’s major donors and determine the right ways to engage them to solicit major gifts. We’ll cover the following ideas:
- Who are your major donors?
- 9 steps to identify your major donors
- Qualifying and ranking your major donors
- Building cultivation plans for your major donors
- Strategizing for rejections
- Tips for cultivating major donors
Ready to determine who your major donors are and raise more in major gifts? Let’s get started.
Who are your major donors?
Major donors are the supporters who make the largest donations to your organization and have a significant, direct impact on your mission. There is no specific amount that we can point to and say, “that’s a major gift” because it differs depending on the organization. Some nonprofits may define major donors as those who give over $10,000, while other organizations may consider any gift over $1,000 as a major gift.
If you don’t already have a major gift portfolio, you can start one by determining who your current major donors are using your donor database. Look at the largest donations made to your nonprofit— the individuals who contributed those gifts are considered your major donors.
You can expand your portfolio by conducting prospect research to determine who else in your donor database or broader community has a high propensity and capacity to donate to your cause.
Why are major donors important?
Major donors are important because they comprise the bulk of fundraising revenue for nonprofit organizations. On average, about 88% of nonprofit funding comes from the top 12% of donors.
Because they supply so much funding to your organization, your major donors are the ones who essentially provide the resources you need to keep your nonprofit afloat. They’re key players in your organization’s success and pursuit of your mission.
9 steps to identify your major donors
Soliciting new donors, much like growing your major gifts portfolios and upgrading mid-level donors to give more, should also start with those you already know. Prospects can be hiding in plain sight. After you’ve combed through your existing list, utilize proven strategies to find major donors elsewhere.
Here are some best practices to incorporate when identifying major donors:
1. Approach your current donors first
Cultivating prospective donors costs your organization time and money. Completing searches in-house with your current donor list reduces the opportunity costs associated with the cultivation process. You already share a relationship with your existing donors, focus on the people to whom you already have access.
Dig into your donor database and look for new major donors in the following segments of supporters:
- Former and current board members
- Current and lapsed donors
- Active volunteers
- Staff members
- Referrals from current supporters and board members
- Audience lists from similar organizations
Very few nonprofits have maximized contributions from their current donors, so don’t be too quick to assume you’ve done so. For example, you may assume your mid-level donors are maxed out for how much they can give. But they have already demonstrated (1) they’re philanthropic, (2) they’re interested in what you do, and (3) they’ve taken an active step to connect their expression of values to yours. You can use prospect research to determine their capacity and desire to make a larger gift.
Your current donor base gives you more to work with than if you tried to immediately go outside your database to find new major donors, so start here before looking elsewhere.
2. Tap into the benefits of shared beliefs
Those who share a belief in and passion for your cause are emotionally driven to provide greater impact for your organization. That’s why it’s important to review your donor database to find donors who have exhibited this passion through engagement with your organization.
Review your donor files to evaluate the giving histories of your donors and identify your most loyal, faithful donors. The recency of a gift is an important consideration here. Targeting donors who have given within the last 12 months is the best rule of thumb. This targeting allows you to focus efforts on donors who are interested now.
Cumulative giving is also a positive attribute to look for in these donors. Those who give frequently may be the most receptive to requests for larger contributions.
3. Explore the giving potential of your mid-level donors
The next step is to develop a strategy to understand your mid-level donors on a deeper level. A significant portion of major donors starts at the bottom of the pyramid. Volunteers, event attendees, annual fund donors, or people with whom you have engaged on some level through your emails and newsletters are often great candidates to move up the pyramid—they just need to receive some personal attention to motivate them.
Ask these candidates what they are interested in about your cause. What drives them to attend your event or make a gift? Ask these candidates what impact they would like their contributions to make. Take this knowledge and match their passions with your organization’s projects and programs. For example, if a supporter has expressed interest in your food bank, you may send them emails when campaigns supporting this program are coming up.
Then, you can determine who has the potential to give more, give again, or give to a new project.
4. Narrow down top-tier donors to a small, select group
Specify your focus to the top 2-3% of donors from the tip of the donor pyramid. Always leave resources available to invest time in these relationships. It’s worth it to put some extra effort into those with the deepest pockets. But, be sure to prioritize the most likely “yes” candidates in your major donor cultivation plan. This means you’ll put the majority of your time and effort into the opportunities that are most likely to result in major gifts.
5. Consider your donors’ financial capacity
Whether you’re considering existing donors or new prospects, if their beliefs align with your cause, then the next step is to assess the wealth factor. Determine whether the donors are able to give more.
In the first few steps, we discussed how you can find prospects who share a passion for and belief in your cause. When you start with this passion first, you have a better chance of reaching the ideal gift potential amount.
Then, you can review supporters’ wealth indicators such as their real estate ownership and stock holdings. This type of wealth screening can show if they have the financial capacity to provide the gift amounts you’re looking for.
Remember, capacity does not necessarily mean generosity. Keep in mind that someone who has not expressed any interest, despite excess financial capacity, may not be worth your valuable time.
6. Look for new prospects outside of your existing donor database
Again, the focus should initially be on cultivating, stewarding, and managing your current major donor portfolio, before “chasing” new prospects. However, some resources should still be expanded to target new prospects. The following strategies outline how to connect with donor prospects from outside your current donor pool.
7. Find donors who support related causes
Seek out nonprofits with a mission similar to that of your organization. This strategy is a good way to find donors who may believe in your cause. Conduct prospect research to find annual reports from these similar nonprofits. These reports can provide information about other major donors, such as names and their general giving level. Many prospects focus their gifts on particular causes and may be willing to expand their giving to your cause.
8. Leverage your donors’ relationships with other potential donors
Capitalize on your informal networks to find others who might be interested in your organization. Many of your major donors are actively involved in the community and serve on various foundation and corporation boards. They likely have connections to people who have both the capacity and willingness to give.
Serving as a board member for a major corporation is usually a good indication of wealth, too. A board member of a foundation may not necessarily be wealthy, but even these people make good prospects as they often have an affinity for nonprofits and have obvious other connections. They also understand the importance of charitable giving.
Overall, word-of-mouth promotion is an effective strategy for finding new prospects. Existing contacts will often open the door to their wealthier friends. They will tell you all about them and how to make the connection.
9. Seek out opportunities for interacting with potential donors
Hosting and attending events can be an excellent opportunity to make contacts and develop relationships with new prospects. For example, some organizations may host open houses, auctions, galas, or other special events.
Pay attention to these options, whether it is a one-time event or an opportunity for ongoing interaction. Prepare ahead of time by tracking who will be in attendance. Note new members of a particular nonprofit (especially one with a similar mission to yours). These individuals could be potential candidates for your future fundraising campaigns.
Qualifying and ranking your major donors
We mentioned in the last section that you should start with your donor database to identify the major donors you want to cultivate. But when you’re making this determination, do you simply look at everyone who gave more than $1,000 (or whatever your major gift amount is) and dump them all into your portfolio for the year?
This approach runs the risk of too many results and an inflated donor portfolio that uses too much of your major gift officer’s time. Qualification and ranking will help narrow down your most prominent prospects.
Qualifying your donors
Qualification is a bit like cultivation-lite. You make a few preliminary ‘moves’ to see if the donor bites. If they do, you know they’ll likely respond to continued cultivation. This makes them worth including in your portfolio.
One approach your organization may use is something known in marketing as the “Rule of Seven.” In most cases, it will take seven tries to get a conversation with a potential donor over around a three-month period. If you make a good faith effort and your prospect doesn’t ‘bite,’ move on. This prospect doesn’t belong in your major donor portfolio for cultivation. Here’s what to do to get the answers you need:
- Send a letter or email introducing yourself, thanking them, and telling them they’re important. Let them know you’d like to meet them and learn more about what drew them to your cause.
- Follow up with a phone call. See if you can set up a meeting. If not now, ask for permission to spend a few minutes on the phone within the same week. Learn more about their passions and find out their preferred method of communication. If you miss them, leave contact information and follow up with an email.
- Wait a week to hear back; try again.
- Try again a week later.
- Send a survey. Send your survey via direct mail or email, depending on the donor’s communication preferences. Make it brief, asking just a few questions about their key areas of interest and how they prefer to receive communications. Make responding to your inquiries easy with one-click survey responses or pre-addressed envelopes for return mail.
- Send a handwritten card if you’ve still received no response. Mention you’re sorry you’ve been unable to connect. Ask their preferred method of communication and give them lots of ways to contact you (mail, email, phone, text, social media, etc.).
- Send an invitation to an upcoming free event, tour or volunteer activity. Follow up with a call or email to let them know the invitation has been sent. Ask them to RSVP to you directly.
- Try a final bonus phone call, email or text to top prospects you’re still not willing to give up on.
If a donor seems receptive, add them to your portfolio. If they fail to respond at all, you’ll know adding them to your portfolio will bear no fruit. Keep them where they are, assuring they continue to receive a regular flow of information from your organization.
Ranking your donors
Ranking your major donors involves tiering them by their capacity and likelihood of giving a major gift. By determining who the top-tier supporters are, you can split out your time to focus the majority of your attention on those top supporters while still providing the necessary resources and time for lower tiers.
This concept is illustrated below as a tier of cupcakes. The cupcake at the top is the yummiest. You want to spend 50% of your time here, then 30% with the next tier. You want to take the time to really enjoy these cupcakes.
You’ll also be able to get some enjoyment from the lower tiers – but not as much. Renewing mid-level and major gifts at the same level they’ve always given is the easiest thing to do, but you don’t want to get stuck there because you’ll never grow. In fact, if you try to over-indulge on the bottom tiers you’ll just get sick. It’s too much. The bottom level tier belongs in your regular annual giving track.
Tier folks into A, B, and C groupings based both on (1) capacity to give and, just as important (if not more important), (2) how close they are to being ready to make a major gift.
You’ll use wealth indicators to determine the capacity of supporters. Generally, this can be done through research, but also through tools built into your donor database showing supporters’ generosity. You’ll be able to figure out how close they are to making a major gift based on their pattern of giving (how recently they’ve given; the pattern of increases; how frequently they’ve given, and other types of active affiliation and engagement with your cause).
Here is how to proceed:
- Level A strategies will be the most individually tailored, up close, and personal. That’s because these will be passion-based gifts. It just makes good economic sense to put your limited resources where the most promise lies. These prospects will have the highest revenue goals and should make up roughly 10-15% of donors in your portfolio. The economic value of these donors will approach 50% of your goal.
- Level B strategies will strive for retention and significant upgrades. These donors will make up roughly 40% of your portfolio. Endeavor to move some of them to A level over time, or see if they’ll consider multiple major gifts for different programs.
- Level C strategies will strive for retention and smaller upgrades. These donors will make up roughly 50% of your caseload, yet only 20% of your revenue goal. They are loyal, steadfast, and true, but perhaps not capable of making much larger gifts right now.
Build cultivation plans for your major donors.
Cultivating your major donors is never a one-size-fits-all process. If all of your outreach and touches are the same among all supporters, your organization doesn’t have a major donor program; it has a donor renewal program. As a result, most donors would give precisely what they gave the previous year. High levels of retention aren’t bad, of course, but this strategy leaves money on the table.
Don’t just throw a bunch of ‘touches’ and ‘moves’ at your prospects. Work with them. Once a donor is qualified for your portfolio, the next task is building a relationship. No cold calls. No cookie-cutter plans.
Spend time thinking about what moves you’ll measure, trying to reduce your pipeline to the smallest number of moves possible. Measure only activities that get you closer to a gift. Sending a holiday greeting card won’t help much. Setting up an in-person meeting with the director will.
Recalibrate as you go along
The tier you’ve chosen for your donors (A, B, or C) is never set in stone. As you continue with moves, you may discover the donor still doesn’t say yes or says yes at a level that doesn’t merit keeping them in their current tier. Recalibrate when things start to feel like they’re not working so you can move folks to another tier.
Here are some options for moving your supporters between various tiers:
- Move some donors off the plate entirely into the annual giving manager’s domain where they’ll get mostly mailings but not as much face time.
- Move others up and begin to focus more cultivation and solicitation resources on them.
- Move others into your legacy (aka ‘planned’ or ‘deferred’) giving track. You likely have folks who give $1,000 to $5,000 annually who cannot afford to make larger lifetime gifts. However, they very well may be able to leave a bequest of $50,000 — or even their entire estate – through their will. This is like getting not just a cupcake, but an entire cake!
Strategize for rejections
As a fundraiser, you’re likely going to be faced with objections from donors. Very few donors will immediately say yes without a little bit of pushback. This is especially true when the donor is a bit unclear of your organization’s mission and general concept. This is not a crisis; rather, it’s an opportunity.
Take time to consider your donor prospect’s perspective:
- If someone is encountering you for the first time, they may simply need to learn more about you.
- If someone is being asked for a major increase, they may want to get clarity on what their dollars will specifically fund.
- If the gift is a bit of a stretch, they may want to consider it within the context of other financial obligations.
When you receive pushback like this, remember that you can make a big difference by simply listening and responding to their questions and concerns. These can even be opportunities to get to know your major donor better! In response to hesitations, be sure to:
- Show them you’re listening to them.
- Demonstrate to them that their best interest is also your best interest.
- Express to them, by how you listen and what you say, that they can trust you.
Don’t be a fundraising arm twister. Rather, gently take folks by the hand and walk them down a pathway towards enacting their passions.
Sometimes folks’ passions won’t mesh with yours and that’s perfectly okay. For these folks, “no” means “not a good fit” and you should move on. However, many of your prospects can still be worked with.
Often people just need some help reframing their decision-making process. They may just be thinking out loud and looking for a way to be convinced this would be a good decision. This means you must put yourself in their shoes, listen carefully, empathize, and show them ways they might feel comfortable proceeding with a gift.
Instead of walking in afraid they’ll say “no” or “but,” consider whatever they say to be the opening up of a conversation. One in which they’re waiting for you to persuade them you’re offering them a worthwhile investment.
Tips for cultivating major donors
Consistent communication with your major donors is important to keep them engaged and giving at higher and higher levels. Therefore, be sure your major donor cultivation plan offers several opportunities to reach out to your supporters and to do so with a personal touch.
Here are our top four suggestions for the most personal and effective contacts:
1. Call your major donors
Have your CEO or a board member call your major donors, whether it is to thank them, invite them to a cultivation event, ask for their input or feedback on an idea, or share a new issue or challenge your organization is facing.
While it can be tempting to pitch your organization on these calls, this type of communication will fall flat, especially if your donor is primarily interested in just one of your programs. To build a genuine relationship, use this opportunity to get to know your donors by asking them questions about how and why they became engaged in your cause.
2. Have your CEO send monthly emails to major donors
When you send these regular communications, be sure they sound familiar. The message should have the same personal feel of a holiday letter you’d send to your friends and family members, updating them on your life. Instead of sharing information about your latest family vacation, you’ll share the latest information and impact data about your organization and mission.
This helps your major donors feel like a part of the community, among other like-minded people who share their values. By communicating openly and updating supporters regularly, you can make these important supporters feel like a part of something larger than themselves.
3. Learn about your programs and projects major donors care most about
Once a year, make sure you call or meet with them to inform them personally about how that particular program has benefited from their support. Give them specific numbers of additional people served, lives saved, families fed, etc.
4. Schedule an in-person or virtual meeting
Meet with your donors face-to-face once a year and ask for their feedback. Spend 80% of the time listening and only 20% talking. Ask what advice they have for you. Find out how you could be doing a better job of telling your story in the community. Share some of the challenges your organization is facing.
While all of your supporters are important, don’t fall into the trap of “treating everyone like a major donor.” It takes time and dedicated relationship-building strategies to cultivate your major donors, so give them the attention they deserve.
If you’re interested in learning more about major donors and your major gift strategy, check out these additional resources:
- Major Gifts: The Ultimate Guide To Kickstart Your Program. Learn more about how to develop your major gift program in order to have the most productive conversations with your major donors.
- The Ultimate Donor Engagement Guide + Top Strategies. Major donors are those who are highly engaged with your organization. Use this guide to develop a strategy that provides plenty of engagement opportunities.
- Donor Stewardship: Expert Tips To Build Strong Relationships. Stewardship strategies help your team develop relationships with your major donors. Review these top tips to steward your supporters.