[SP]Cindy says, “Uncertainty.” Wow very good answers.
Sonya says, “Change. Change is a big one.” “Technology.” “Mortality.” “Entropy.” “Definitely taxes.”
Larry: All right you’re getting the concept here. Is that there is something that we have to leave with, either we work with them or we work against them. There not going to change, we’re the ones that have to modify our approach. Can we go to the next slide please? So the primary obstacle in most fundraising programs if not all is that they start in the wrong place, and they don’t start with an understanding of the principles that are operating all the time.
Now I can tell you right now that the programs who do know these principles, and whether they call them the eight principles or not is irrelevant. The point is they are operating within this. If you look at their program you can identify every single one of them and say yes, this works. Those are the ones that raise money and more money, year-in-year-out and year-in-year-out.
And I want to say something else because I believe this and I have seen it because I have worked in very, very small organizations with one and two employees and I have worked in very large organizations with tens of thousands of employees, that it’s not a matter of how big you are, how much money you can throw at it or how professional your staff is that ultimately determines your fundraising success. It just does not, what really ultimately determines your fundraising success is your understanding of these principles and your attitude towards them. That is what determines it, and everything else flows from it.
Let’s go to the next slide. And I call these Eight Principles for Sustainable Fundraising. You can call them anything you want but these have come from my own experience. And as I have said before if you look at organizations that are high performing organizations they follow these very, very closely even if they are not really aware of them.
The one we are going to talk about today if you move to the next slide is principle five – work from the inside out. Now you see the photograph there, so what happens when you drop a pebble or a rock in to a lake? What happens? Anyone want to say?
Steve: Keith says, “Ripple.” Yes, “Ripple” Everyone’s saying ripple.
Larry: Yeah what kind of ripples?
Steve: Susan says, “Impact.” Dennis says, “The stone will sink.” “The waves get displaced.” “The water gets displaced.” “It’s a magnified effect.” Somebody saying, “Waves of energy.”
Larry: Those are all correct. Let me add one other thing, notice the shape of those that they are concentric waves that move from the center of impact, and that’s what I want you to focus on. All those other things contribute, that’s correct. The stone goes to the bottom, the energy is displaced, waves grow out but they do it in a very specific way every single time. They start from the center and they move outward.
So what I am going to suggest to you, principle five, then we can go to the next slide please, Steve. Is that what that says is you need to focus your fundraising first on those who buy relationship, and we can talk about that and/or affinity have the strongest reasons to give, and these people I call your fundraising elites.
Too often and I think we both can point to situations that we’ve been in, fundraising is an anyone, everyone, everywhere affair and that’s not what it is. Effective sustained fundraising is very deliberate and is focused by beginning on those who have the greatest relationship and the strongest affinity with your organization in terms of the reason to give. Let’s go to the next slide.
So let’s talk about fundraising elites for a minute. I would like people to tell me who are there fundraising elites, what kind of people are their fundraising elites? Can we get some responses there, and I am not looking for names of individuals, I don’t need your donor list. I am looking for the kind of people that we’re looking for.
Steve: I am seeing environmentalist, their volunteers, parents and students, board members, more volunteers, alumni, people who know the founder, people who believe in the mission. Lots and lots of answers coming in, customers, family members, lots of people are talking about types of people and other people are talking about people who care about the mission that they serve, it looks like.
Larry: I think all those answers are correct. And there again what shapes some of these answers will be your paradigm, if you have done your work on your paradigm.
Let’s go to the next slide. Now my definition of a fundraising elite is someone who shares your in-game goals, is someone who has dreams which are supported and encourage by your organization values. Let’s read that carefully, it’s their dreams which are supported by your values.
And then thirdly has it built an affinity for you through some sort of relationship and there’s lot of relationship mentioned in that list, whether it was an alumni, whether it was a board member, whether it was a staff member, whether it was a volunteer, volunteers are mentioned a lot and that’s rationally so but there is some affinity in to a relationship. Now who comes to mind? Are we getting any additional responses?
Steve: People are saying business in the area serve people who share their mission, community members, people who are passionate about the diverse world, the church people are saying people who have a connection to the mission, people who want to make a difference, people who are looking to cure different diseases. Those who see how an organization affect and impact a community. That’s a good one.
Larry: There’s one thing that is decidedly absent in that list. Can anyone pinpoint what is decidedly absent? One thing.
Steve: People are saying staff, people are saying themselves, people who have the money, people who are already supporting you perhaps.
Larry: Here’s what we did not mention, we’ve not talked about money because guess what? It’s not about money and that was mentioned indirectly in one of the comments. It’s not about money.
So when we think of the word elite we all can think of someone who has money or power or both and you know we’ve all heard it you know go ask Sally, go ask Jim, they’ve got money. Well guess what? That’s only half the equation, it’s funny there has to be an understanding, there has to be a relationship, there has to be reason other than the fact that they have the ability to make the gift.
So that’s not what we’re talking about here. That’s not to say that you don’t have people, that your program want to abide by the [Prado] rule because it will. That’s just one of those other sort of mathematical things that happens without you even trying, but the point is that’s not a person who is necessarily an elite, you’re looking for someone who fits these other criteria.
Now why would that be so important? Anyone want to venture? Why am I saying you need to focus on the elites first in specific terms?
Steve: Jane says, “That they will stick around.” Couple of people say, “They’re low-hanging fruit.” Lee says, “They’re probably your donor base.” “They’re the center of the impact. Best ROI.” David says. “They’re dedicated.” “They’re your ambassadors.” “They’re your champions.” Lots of different synonyms there.
Nick says, “They have the ability and means to give.” Catherine says, “They feel more connected and they want to do more.” Miriam says, “They build momentum the fastest.” That’s pretty interesting.
Larry: These are all very good answers. Keep going, Steve. Let’s hear some more.
Steve: “They are driven by the goals of the organization.” “They have allegiance.” “They have the luxury to dream.” That’s well put Eileen, Thanks for that. “They have the skin in the game.” Doug says.
Larry: We’ve got a poker player there among us.
Steve: Johnson says, “They go to bed thinking about your issue.” Linda says, “They’ll probably ask their friends.”
Larry: These are all very good reasons. Go ahead.
Steve: Yeah, I was just saying, Laura says,…
Larry: What is Laura saying?
Steve: … “They are your primary fuel.”
Larry: Okay. These are all really good answers and it says you’re thinking correctly here and let’s go to the next slide. You know I am going to isolate three general reasons and a lot of the responses we’ve been given fit in to one of these three.
The first one being you do your elites first because it focuses upon those who have the strongest reasons to give and give and give. So what does that do to your program? It creates revenue stability and growth. You get sustained revenue and growth. You know I have all the data. I don’t generally like to put a lot data in front of people because that’s not what convinces people. It’s real life experiences that convince people.
But if you just took a look at what I had given in the last session which was a pretty severe one and you isolate giving from individuals who were connected in an investing kind of way, who are giving based on a values connection and between the years 2007 and 2009 that kind of giving only declined overall by 1%. So you see that kind of giving was very, very stable.
Now if you were hooked on independent foundation grants or transactional event revenue then you could have seen a pretty severe drop in your bottom line, if that was a big part of what your revenue looked like. But in that case you have that stability.
Next thing we heard several things related to networks, networks are the king. People give to people. Even if you have the most wonderful mission on the face of the earth and it’s the most compelling thing ever you know we are on the inside looking out and so it’s really easy for us to kind of convince ourselves with self-talk that we’re worth more than we are, that’s just human nature.
But if people are connected to other people that’s where it grows, so that will actually grow your base and then it grows it organically. I mean you know doing data search and that kind of thing can net people and there’s nothing wrong with that and I think it should be done, but if you’re looking at the top retainers and the top growth that’s stable. It’s this organic growth that will get you where you need to go. So you have higher retention rates with this kind of growth.
And then last, donors bring uneven commitment and differing resources, and I really sort of like to point to three things there. To me there are three classes of supporters, let’s call them that for a minute. There’s the responder, there’s the donor, and there’s the investor.
Now responders are those that show up at your gala or your auction and buy a gift basket or discounted trip to Hawaii. They were there for something other than philanthropy for the most part.
Secondly there are the donors. Now those people who make a gift to you but the reasons for making a gift may not be directly related to your mission. It’s not that they don’t believe in your mission but it may be something else indirectly.
And I will give you a personal example. My neighbor across the street is also my dentist, so I need to be in good terms with him. But beyond that he is a real big supporter of the Boy Scouts. I was a Boy Scout, I like the Boy Scouts. Are they my top cause? No they’re not. But when my neighbor comes over to ask me for a gift I make that gift because he asks me.
So in that sense I am a donor to the Boy Scouts. Well will they ever be in my top three? No. Will I be giving them commissary gifts to my ability? No. But I am a donor.
And then thirdly there’s what I call your investors and this is the group that I am talking about. These are your elites. Now investors can invest at a low level, they can invest at a high level but the point is they have made an emotional commitment to the success of your organization and an investor is just as valuable if they’re giving you seven figure gifts once or twice as the grandma whose giving you $50 a month for 30 years because they represent that connection, that drive.
And so they do bring an even commitment and resources so you’re looking to grow that group of investors and that’s why you focus on elites first. You work from the inside out. Okay now we’re going to do a few exercises. Can we go to the next slide, Steve?
Larry: All right and you don’t have to share this. I would like each of you on a piece of paper right now. Write the names of five donors that you feel qualify as a fundraising elite. Let’s take a couple of minutes and do that.
Steve: Just you know, Larry, I am playing along home too. I got a little non-profit I can do this for.
Larry: Good. Hey, terrific.
Okay, let’s hope you’ve been able to come up with five donor names. Can we get some responses? How many out there were actually able to put names to five people that you consider are fundraising elite for your organization? How many people were able to do that? Can we get some yes out there?
Steve: A lot of yes. People saying it’s easy. Some saying they have ten. Some saying they have six. Many more than five. That’s great. Good job, thanks everyone for doing that. Excuse me, Larry, people are still writing, many more.
Larry: Great. Okay, so now you have a list of people that you have in mind every day, every day these people, because they are the people who are responsible for the ultimate success of your organization because they are going to supply the resources that do it.
And it’s not just the money; remember this isn’t really about money. This is about something much larger than money. It’s about spreading the word. It’s about growing advocacy. It’s about also contributing resources which will consist of both time and money, everything grows together.
Let’s get people suggesting ways in which we can engage our elites. Can people suggest a few ways that we can actually reach out and engage people?
Steve: Monica says, “Volunteerism.” Vance, “Spotlight them.” That’s a good idea. “Newsletter.” “Communicate.” “Direct ask.” “Personal visit.” We love personal visit in Bloomerang for sure. “Open houses events.” “Invited dinner.” “Personal meeting.” “Social media.” Couple of times people have said. “Handwritten note.”
Christina says, “Transparency.” Great idea. “Networking.” “More newsletters.” “Say thanks.” It’s always a good idea to say thanks.
Larry: You know and we know how dismal that rate is.
Larry: While you are submitting your ways, I will tell you a story, I have a client that recently told me a story that he was given…it’s an organization that gives scholarship for individuals in the grip of some sort of addiction. And these scholarships are to go for therapy and they’ve had some pretty good success with this.
And there was this one family who had a son who was in drug addiction and he went through rehab using one of these scholarships and they were pretty successful and the family is a fairly well-heeled family and they made a pretty significant gift to this organization, and the Executive Director reached out and called them off and thanked them and sent them a personal thank you note.
You may think well there’s nothing unusual about that. Well, the family said that in their history of philanthropy this was the first time that it happened. They were stunned, that someone called them back and said thank you. So that tells you how uncommon that is. It comes of the tongue pretty quickly but in real life it doesn’t happen very often.
Let me suggest one other thing you can do that I didn’t hear come back. When you get the opportunity and you can do this personally, you can do this through social media, you can do this through some sort of formalized survey although it’s a bit stilted, but you don’t have to physically put yourself in front of some person although it’s certainly the best way, and that is to ask one simple question. Why do you support us? And then wait for the answer. I guarantee you if you do that with very many of your elites you going to get some very surprising answers.
And I’ll give you a personal story that I think will illustrate this. I was running a major gift program at a university back east and I was visiting this gentleman who is a tech entrepreneur. He co-founded a company that everyone on this webinar would know immediately if I mentioned the name. And the person was older and I had being working with him for about a year, year and a half, and I was representing his alma mater.
And he knew why I was there, he knew who I was, I don’t make any excuses about that and he knew that we were working on some sort of major investment for his alma mater. And at one point, we’d being working on this for several months and we were getting closer to something very formalized, this man…we’re sitting at a restaurant in Northern California in Silicon Valley and he looks at me and says, “Larry I have a very serious concern about making a significant gift to you or to the university in this case.
And of course, you know, as a professional fundraiser, I naturally began to run through my mind all the possible concealable problems that we could have. Oh, he didn’t like the students on campus, it’s the president, he was snubbed at an event, who knows what. I mean it just comes from everywhere.
And then he said something that absolutely stupefied me, I was not expecting it and he said, “I am afraid that if I make you a really significant gift you will never come back to visit me again.” Think about that. This man wasn’t concerned about the money, he was concerned about the relationship, and I have seen that in lesser obvious ways be repeated over and over and over again.
And, so I encourage all of you to get serious about really discovering what motivates your donors. And in my view the best way to find out that is just to ask them. Let’s go to the next slide.
I am going to suggest to you that you achieve ongoing growth by doing three things. When you understand and apply all eight of the principles, and understand and apply is one thing to give mental effect and it’s another thing to work within them. Two when you create a paradigm that’s specific to your organization, that is within those principles not one that’s without it and that when you do this consistently.
And let me give you a metaphor, I don’t know how many of you were sailors, I’ve been sailing a couple of times but there some things that you have to know when you sailing. First of all you have to be able to understand the weather where you are that doesn’t change. You have no control over that, you have to know the ocean you’re in, you have to know your charts, you have no control over that, you have to build the right boat for that situation. That’s your paradigm.
And then and only then do you use the right techniques, the right sailing techniques that are suitable for that boat in that ocean and you do it consistently, you don’t get half way towards your destination and decide oh I think I’ll to this different. Let’s go to the next slide.
I would like you to take the-and you can share this if you like, but it’s not required. I would like you to list three actions that you can take based on what you’ve discussed today. What we’ve talked about today, what are three actions you can take right away? They may be very simple, they may be very incremental but what three actions could you take today based on what we’ve talked about?
Steve: Lots of people are saying, personal visits, meetings, ask donor what motivates them. I think you made an impact Larry.
Larry: Okay, now we list in the reverse. List two things that you going to stop doing as a result of today’s discussion.
Steve: Dolce says, “Stop worrying about money.” “Making connections not about money.” People are going to stop doing that. Broad Mallen is not going to do that anymore. That’s a good one, Charlene. Elizabeth says, “Stop procrastinating.”
Larry: You know I go to the gym. I try to keep myself relatively fit and the month of January is month I absolutely loved because it’s when everyone makes there resolutions and it’s about 30-45 maybe 60 days and then we back to normal again. So if you going to resolve to stop you better resolve to stop and then do it.
Steve: Yeah great.
Larry: Anything else interesting?
Steve: Christina says, “Focus on connections and not money. Focus on specific donors to build a relationship.” Chris says, “He’s not going to worry about technology.” That’s good. Katie says, “I am going to stop avoiding telephone calls. Phone calls are fun. You might actually find you like it, Katie.
Larry: Well, I think the operative word in a number of these reasons is stop worrying about these things, this anxiety piece. I mean technology we leaving with it. I am living with it this morning.
And by the way, FYI, everything is back to normal on my system after we are through with this thing. Isn’t that the way it always works? But that doesn’t mean that we’re going to be obsessed or worried about it. We worked around it today. You know you were not able to see my face, I actually shaved and I put on a nice sweater on you know, everything, but it didn’t work.
So okay, we’ll go with that. Are there any unanswered questions that we can address before I move on? I mean is there something that’s really burning that people would like to ask now.
Steve: Ivana is wondering how do you convince CEOs, board members and staff members of these principles and all the things that you’ve talked about. How do you get buy in I guess is the question.
Larry: Well, let me suggest that convincing is not going to be very successful. It’s an experiential persuasion. My experience has been that you put them in a situation where there is a team-building exercise or some other event which tends to bring people together. Help them work through each of these on their own.
They have to experience it. Talking at them or telling them go with the book and come back will maybe affect one out of a thousand, all right. There has to be that experiential piece, that’s what I do in my business is that I coach people to do that, is to bring it together, but it has to be that common bond, that common experience and what some people call shared experience.
And there will be some people who never get and that’s okay, but that’s the people you invite to maybe do something else rather than be on your board or do something else. Or as I heard from one development officer at a university out here, well, you know what we do when board members who don’t perform, we plaque and whack them. You give them a plaque and you whack them off the board, so I’ve always liked that when I heard that and those of us who are in fundraising have been in situations where we would all like to do that. What else, another question.
Steve: Another one from Susan. Susan is saying the competition in her area is very big. There’s a lot of competing non-profits. What would you say to Susan who wants to do all these things, but is finding that very competitive, especially in her small geographic area?
Larry: I have a clarifying question. What sort of competition are they. Is this competition from similar organizations or all non-profits?
Steve: We’ll give Susan a moment to respond. So Susan says there’s a lot of donor burn-out and that she has three of the same type of organizations in their county alone.
Larry: Okay, well there a couple of things going on here. Typically when people say competition they are referring to the plethora of non-profit organizations and many of these organizations they’re approaching anyone and everyone. And as we know there certain donors in every community that are on everyone’s list because they have money, because they’re generous, regardless of whether they have any real connection or affinity for what you do or how you do it, they still approach and this is one of the big contributing factors to burn-out, that and asking people to often which always is the number one negative which is comes back every year.
So that’s a more typical kind of competition and to that answer my response is you’re not in competition with them at all if you’re focusing on people who believe in what you do because their will be people who like you more than they like something else. And if you’re focused on those which is what we’re talking about today, fundraising elites that’s going to be far less of a factor.
Now the other kind of competition where there is or there are two or three organizations that do very similar things, there really only two paths that are open to you, and that is you either decide to collaborate and cooperate in some way towards a common good or you just decide you’re going to have the best possible outcome as any of these organizations and you appeal to people on this basis.
Because what we seeing in the Millennial generation is there all about impact, they are all about effectiveness. When I first got in to this business I never ever got an outcome or effectiveness question from the donor unless we were talking about a gift of at least six figures. With Millennials and that’s adults between the ages of 25 and 35 you get those questions for a gift of $50. So that is going to do a lot of sorting out among some of these organizations on its own.
So those are really your two options in that regard. So does that answer your question, Susan?
Steve: She says yes.
Larry: Okay good, thank you. What else? We have a couple of minutes left here.
Steve: Yeah we got some time left and questions coming in. I am just going to pick a few ones out that look interesting. Wanda here says, “How do you expand your elite base?” How do you transition a donor to an elite? So I think people know they have some elites, but they want more obviously.
Larry: Well, let’s go back to networks are king. Who do these elites know? You know if a person is really an elite they think you are the best thing since sliced bread and they are more than willing to invite their friends and other people or share the fact that they really think that you’re terrific. And people like to be asked to do this for the most part.
Not put upon and there’s a very real difference. You know Sally you know I see that you’re a friend of Jim, you belong to the same country club you know we really are trying to get him to make a gift, why don’t you that. That’s far different from saying to Sally, “Sally you know we so appreciate your support and your commitment to this organization, we would like you to serve and help us identifying new people that we think would have the same values and the same concern as you and we can add as a support for our organization.
Far different you see, then she’s not pressed upon to triangulate with another person and then it becomes more organic, more natural. And you can do it through a data analysis and you get some sort of fall0through screens and that kind of thing, but the retention rate is slow. I am not suggesting that you don’t do it because these tools have become very inexpensive as compared to what they used to be, but still the organic way is the best. You simply ask someone but don’t put them on the spot by asking them to triangulate to another donor. Does that answer your question?
Steve: She hasn’t responded yet. I hope she does though. Yes. One that says yes. Thank you.
Larry: Good thanks, Wanda. What else, Steven? Anything else, we’ll take one more.
Steve: Okay. We got one here. Let’s see. One from Mary Lee and I know that she quite speaks for a few other people attending. Mary Lee says, “We’re a start-up, were all founder funded so far. She’s wondering how do they leap beyond and find others who will care beyond the initial founders.”
Larry: Well I will use the B-word. Your leadership board is really the place where a lot of this starts. There are only three reasons why a person should be on a non-profit board. Their duties are to advocate, well first of all, to define the policies of the organizations so the staff can operate in a healthy and productive way. To advocate to the organization, to everyone that they know, and thirdly to make sure that the resources are there. And if you have a group that’s functioning in that way then you will able to start building your network at that point.
Now the good news is this, you’re a start-up organization that’s actually not a bad thing and I only have to give you the experience that I had when I tried to learn golf several years ago. I will admit that I went through three set of lessons and you wouldn’t know it if you looked at me today and one of my pros said to me. “Larry there is actually good news. You don’t have any bad habits to unlearn.”
Well the same thing applies here, you don’t have any bad habits yet. So you really in a very great position to begin to build this, but it’s organic, it’s not 5 today and 500 next week. It’s five. It’s ten. It’s 50. It’s 75. It’s a 150 it’s that kind of thing. So there has to a reasonable expectation. Does that answer your question, Mary Lee?
Steve: She says yes.
Larry: Well, if you go to the next slide, you know I am going to offer you some more things you can look at. I think as I said before it’s important to know you have to understand all the principles and put them all together. And when you do that that’s what gives you the synergy.
And if you just go to my website which is theeightprinciples.com and you click on the link on the front, on the splash page which says, discover the unique fundraising idea. There are four short videos and they have accompanying PDFs that are sent to your mail box free of charge and you can view those as many times as you like.
I am also offering five complimentary one-on-one 50-minute consults if you just go to callwithlarry.net, there is a schedule there and there is a place where you can schedule a time with me.
And then lastly Amazon sells the book for $21 and Barns and Noble shows it for $29, we sell it on the website for $29.Those of you who participated today we’ll send it to you $15 postpaid, use the email address communicate, someone will get back to you and then take your information over the phone, and we will get it out to you.
I want to thank you again and I want to thank you, Steve, and go out and raise some money, build some friendships.
Steve: This was a lot of fun and I really appreciate everyone who took part and participated and answered questions and asked questions. It was a lot of fun. I am usually a bystander, so this is kind of fun for me me to be so involved so thanks Larry, this was really cool, one of our more unique interactive sessions so thanks for doing it. Would you answer more questions than we would be able to get to?
Larry: My pleasure. Sure I mean if you’ve got some time, I’ve got some time.
Steve: Okay, I meant offline if people can reach out to you and ask more questions?
Larry: Well, yeah right now for a few minutes or as I said you can on go to the under the callwithlarry.net and schedule specific time and we can talk about your specific needs.
Steve: Cool, we’ll send the link to all that. I will be sending out the recording a little later on this afternoon as well as the slides. So look for that for me a little later on this afternoon and with that, we’ll let folks go and let some folks maybe haven’t had lunch. But thanks for hanging out with us for an hour. Thanks for taking time out of your day and Larry thanks again to you for hanging out with us. It was a lot of fun.
Larry: It was my pleasure and let me just say to all participants, if any of this technology does not work just send an email to info@theeightprinciples and someone will get back to you.
Steve: Okay, cool and just so everyone knows we do this webinars every Thursday. We are actually taking next Thursday off because on Wednesday we’re having a special four-hour long webinar. It’s our first online conference called BloomCon.
We are running out of space. There’s only about 100 seats left, we opened up to a thousand people. You can check that out just go to Bloomerang.co/bloomcon. Again it’s free. You can hear from Adrian Sargent [SP], Tom Ahern, and Kitty Larue Miller [SP] and they are going to do a panel at the end of the presentation. But check that out, if you have some time free on Wednesday.
If not look at our webinar page, we’ve got a lot of webinar scheduled throughout February and March, so you may see a topic there that interests you. We would love to see you again on one of our webinars. So with that will call it a day. I will look for an email from me later on. If we don’t talk again, have a great weekend and we’ll see you soon.