On this episode of Bloomerang TV, Amy Eisenstein, ACFRE joins us to discuss her new study on major gift fundraising.
Steven: Bloomerang TV, thanks for tuning in to this week’s episode. I’m Steven Shattuck here at Bloomerang as always. And if you’re following Bloomerang over the past few weeks and months, you may have seen that we helped co-fund a really cool new study on major gift fundraising. You may have seen us talking about that, or maybe you’ve actually downloaded that report.
If you haven’t, you definitely need to check it out, because it’s awesome, and we’ll link to that at the end of this chat. But before you download it, I want you to listen to one of the co-authors of the study. She’s Amy Eisenstein. I’ve got her on the line right now. Amy, how’s it going?
Amy: Hey, good. How are you Steven?
Steven: Good. Thanks for being here. I love the report. You know me, I’m kind of a nerdy data guy, so I love seeing all the awesome findings about major gift fundraising that you and your cohorts uncovered there. But before we get into it, I want to let you talk about yourself, and kind of what you’re all about. You have your ACFRE, you’re one of only like, what? Ten people in the universe that have that, which makes you super special.
Amy: One hundred and ten, but thank you.
Steven: So what all do you do? You’re a consultant, you’re a speaker, maybe give your short elevator pitch if you will.
Amy: Right. Well, thank you for having me. I’m Amy Eisenstein as you said. I’m a consultant, an author, a board retreat facilitator, a fundraising and board expert.
Steven: You are. You’re definitely speaking all over the place. If you see Amy on a schedule at a conference, definitely go to her session, because she’s super smart. But you just did this major gift study. Can you talk about how you and the two co-authors kind of got together and how this idea for looking into major gift fundraising the way you did sort of came about?
Amy: Yeah, well I have to say I’ve been thinking about major gifts, and actually how all nonprofits can be more successful at raising major gifts for many years. A few years ago, I was so frustrated that smaller nonprofits weren’t really actively engaged in the major gift process that I issued a challenge on my blog, and I called it the Major Gift Challenge.
And I said, “Okay, all you small nonprofits, if you just spend a few hours a week dedicated to raising major gifts, you too will succeed at raising major gifts.” And we did this for a whole year on the blog, and hundreds of nonprofits took the challenge. So I thought, “Okay, we’re really onto something.”
And then I actually was doing a session at an AFP international conference on the book that came out of the blog posts, and your boss, Jay Love was in the session, and he said, “Hey Amy, wouldn’t it be cool to have some research to back up your project here?” And I said, “Oh, yes Jay. I’ve been thinking about that for awhile. How can we do that?” And he said, “Well, I have the perfect research partner for you.” He introduced me to Adrian Sargeant, and the rest is history.
So we could talk about the project, but I’m so thankful to Jay and Bloomerang, because without that introduction, this project probably wouldn’t have happened.
Steven: Yeah. It’s really cool to see you and Adrian come together. It’s like a meeting of the top minds to put all this research together, because he’s always our go-to. So how did you actually conduct the surveys, the interviews? I know there’s a literature review. What was kind of the process for like, gathering the information, gathering that data about major gift fundraising?
Amy: Right. So let me back up one step before I get to that. And that is, basically I went to Adrian with Jay’s help, and I said, “I have this question, and the question is, can small and mid-size nonprofits really raise major gifts? And if they can, how? And is that a question that you’d be interested in helping me answer?” And fortunately, Adrian was really excited and said, “Yes, I’d love to help answer that question.”
And so, I just wanted to throw that out there. That’s sort of the premise of the research. And so yes, we did a literature review to find out what’s already existing out there, if anything on the topic, and what we found was that all prior research, as you can imagine had focused on large organizations and million dollar plus gifts.
Amy: And that’s really not what we were looking at. We were looking at organizations with budgets of 10 million or less, and major gifts significantly less than a million dollars. And complete literature review of all the existing work out there, we didn’t, to our knowledge, this is the first time a formal research project has been done around smaller nonprofits, small and midsize nonprofits.
After we did the literature review, we interviewed over 10 hours of experts in the field, both development directors and consultants to talk about what are the issues around major gifts that come up, and concern smaller nonprofits. And so, we took the results of the literature review, what we learned, and the interviews, and we created a survey. And we sent it out, Adrian calls it snowball style.
We sent it out to thousands of nonprofits, and we got over 600 nonprofits to fill out, what I consider a fairly complicated survey. And to me, that speaks volumes that 600 people bothered to fill it out, because it took a considerable amount of time. And that just tells me that they really are interested in the topic. And it’s more than twice as many responses we needed for a statistically valid study, so we were really excited by the response.
Steven: Hey, I love starting off with the premise of can small shops really raise major gifts, because it opens the door to so many things. Like you said, there’s lots of nonprofits in that 10 million and under. I think the majority of nonprofits are actually in that bracket.
Amy: Yeah. I think it’s close to 95% of nonprofits are under $10 million.
Steven: And which is weird, because, and like you said most of the research is above that, and all those org’s get kind of locked out.
Steven: And did you find that, or maybe did you feel that smaller nonprofits, they kind of feel like they can’t raise major gifts or they’re unable to, they don’t have the resources to? Was that kind of a part of answering that question?
Amy: Yeah. I think that there is a sense of frustration among these small and mid-size nonprofits, that they don’t have the resources. They don’t have the donors who are interested enough in them, and they don’t have the skill-set and the knowledge base to effectively raise major gifts. So we wanted to find out, is that true?
Amy: What are the real issues? And how can they be successful? And luckily we got amazing results.
Steven: So what were the most surprising results to you? What kind of stood out? Was there anything that you thought, that’s definitely how I thought it was going to turn out, or did they surprise you, or not surprise you? What were kind of the cool tidbits there?
Amy: Right. So I’ll give you a few of the result highlights. But I want to say, a lot of the results weren’t truly surprising, which to me is really good, because that means the best practices in the field are accurate.
Amy: But we did get some amazing results that really solidified and verified some of the things that we’ve been doing, and it’s just more proof, but there were some surprising results too. But let me give you, I’ve sort of pulled a few of the real highlights.
Amy: Although there’s too many to cover today. So let’s talk about first, training and education. I’m so excited by this result. We found that for every additional form of training that a development staff member or professional engaged in, and that ranged from webinars to full day conferences, to intensive forms of study, like a masters degree program or CFRE. For every additional form of training, someone engaged in, they raised an additional $37,000.00 in major gifts for their organization.
Amy: And that’s cumulative. Now obviously, the more intensive the form of training or education, the closer the correlation, and the more they raised. So CFRE is not the same as a webinar, I don’t want to make that association. But there was a direct correlation with more major gifts raised even as a result of a webinar, and significantly more for more intensive forms of study. And the disappointing thing that we all know to be true in this sector is that the more expensive the form of training or education, like a masters degree or CFRE program, or even a multi-day conference, the less likely people are in the field to take advantage of them.
Amy: So only 10% or 15% of the sector is taking advantage of those more intensive forms of study. But the results are very clear that they’re raising significantly more money. So that was really exciting and hopefully affirming for people who need to get more money in their training and education budgets.
Steven: Yeah, you got to invest money to make money sometimes, right?
Amy: Yeah. So that was one. Another one was the really important aspect of your pipeline, and who’s in your major gifts pipeline. And whether they’re new donors, or existing donors, and the importance of your database where that comes into play, and really how, who goes into your pipeline impacts what comes out of it. And I don’t think small shops pay nearly enough attention to the research to utilizing their database as well, to figure out who’s in them. It was really amazing.
We found that people with too many new prospective major gift donors in their pipelines actually lost money in the short run. And we know this for a long time from direct response fundraising. So acquisition of new donors cost money, it’s an investment. But the good news is that we found that with retention donors, repeat donors, subsequent gifts, they went up significantly. So it’s great. But I think smaller nonprofits aren’t paying as close of attention as they need to be to who’s in their pipeline, and that was a clear result.
Steven: Interesting. I really liked . . . one thing that stopped me was you defined or had the survey respondents define what is a major gift to them. Which I thought was a really important thing to do, because you hear the word major gift, and you think, “Oh, that’s a million dollar gift, and our organization, we’re never going to get a million dollar gift.” But it’s really more of what it is to the donor, or what it is to the organization, I really like that. And I’m wondering if you could talk more about why you thought that was important in terms of really defining what a major gift is, and how that can actually help the organization actually go after those gifts.
Amy: Yeah, I think that’s such an important point, because a lot of board members and probably development staff, and executive directors feel like major gifts are out of reach of them.
Amy: They really don’t know what they’re talking about. And so defining it is important. So we found that the average major gift at these organizations was about 25,000, but the most common major gift size was between 1,000 and 5,000.
Amy: And we broke down the results. We separated out the smaller organizations in the survey, under a million dollars, and then we looked at the million to $5 million budget organizations, and then we looked at the $5 million to $10 million budget organizations. So I’m giving you the summary of all of those, but when people do look at the research results, they’ll be able to see those results broken out even by organization size. So yes, we’re talking about major gifts, 1,000 – 5,000, and up to $25,000.00 is a major gift for most of these organizations.
Steven: I really love that, because I just think it empowers those small orgs to feel like, “Oh we can get that and we can go after that amount of money” rather than, “Oh we, can’t get a million dollars, so we’re not even going to try.”
Amy: Right, that’s right. but once you get 1,000 or 5,000, then you think, okay 10,000 is not out of reach, and 25,000 is not out of reach, and it just goes up from there.
Steven: It’s awesome. I love it. So I want everyone to check it, there’s a great executive summary, and then you can get the full on report. Where can people find that stuff, because I want people to read this and get the data.
Amy: Yeah. So the executive summary and the full report can be found at www.masteringmajorgifts.com/report.
Steven: We’ll link to that. You’ll see us there, you’ll see Amy, the two other co-authors, and we should give a shout-out to Donor Search and Support Center. They were sort of our partners in crime in funding us, so they’re obviously really awesome partners too.
Amy: Yeah, thank you. All right.
Steven: Well Amy, this is cool. Where can people find out more about you? They should follow you on Twitter and all that good stuff too.
Amy: Oh yes, so thank you. I’m at Amy Eisenstein.com as well.
Steven: Right on. We’ll link to all that good stuff. Amy, thanks for all the work you do, and for joining us for 10 minutes or so, this is awesome to have you.
Amy: Thank you Steven. I really appreciate everything Bloomerang’s done for this report, and the whole sector. So thank you.
Steven: It was fun. It was a fun process. Well, thank you all for watching. We’ll catch you next week with another great interview chat, and we’ll talk to you then. So have a great rest of your day, and I will see you soon. Bye now.