Developing a Fundraising Strategy
This article was originally published on the Funding Centre site please check the original sources (Developing a Fundraising Strategy and The fundraising action plan: seven steps to success) for updates.
THE TAKEAWAY: You can fundraise in an ad-hoc, haphazard kind of way and you might get there in the end. Mind you, you might not. Plus you risk burning out all your volunteers along the way. It’s far better to have a plan.
Asking for money is never easy, but it is nonetheless a necessity for most not-for-profit organisations. Although it’s undoubtedly hard, fundraising can – and should – be a fun and energising experience. It is also an experience that should be shared. One of the challenges is ensuring that everyone in the organisation has some involvement in raising money.
Step 1: Designate a fundraising coordinator
As a first step, it is important for an organisation to assign the overall responsibility for fundraising activities to one person.
Even if you have a fundraising committee or outside consultants, one person in your organisation still needs to be in ultimate control of your fundraising strategy.
Step 2: Set your parameters
Schedule some time for senior staff/volunteers and your board/committee and others interested in fundraising to get together to throw around some ideas and establish your strategy.
- Outline your goals. What do you hope to achieve?
- Research past fundraising activities – what has worked? And just as importantly, what hasn’t?
- Work out who your friends and potential friends are, and who is willing to support your organisation – businesses, government departments, individuals, families, philanthropic trusts and foundations.
Step 3: Identify your fundraising methods
Identify which of the seven pillars of fundraising your organisation will try to draw funds from in the upcoming year, and how. If possible, you should aim to draw from all seven:
- Sales/Earned Income
- Community-Business Partnerships (Sponsorships)
Conduct market research with members, friends, etc., collecting their good ideas and examples of what has worked to raise money.
Detail a case to support each prospective fundraising activity, and set an estimated target for each.
Remember that the imperatives for each method of fundraising are different:
- Grantmakers will each have a specific goal that they want to achieve through their grants and will want you to demonstrate how you can help them achieve those goals.
- Donors generally want to contribute to specific projects or activities, rather than the organisation as a whole.
- Crowdfunding supporters will want to be coached in how to reach out to their own network to support your organisation.
- Members want something in return for their fees – information, special access, etc.
- People attending a special event do not always have charitable motives – if they’re paying for entertainment and they expect to be entertained.
- Businesses generally enter partnerships with not-for-profits to do the right thing, but they also may want to be seen to be doing the right thing. There may be other drivers (e.g. access to markets) at play as well.
Set a timeline and a year planner, noting good times (and bad times) for the organisation to raise funds.
Step 4: Get your systems in order
Before you can accept any payments, you need to make sure you have the right administrative systems in place. You’ll need to be able to record and receipt all of your income, and ensure you can keep track of how, when and by whom it is being spent. In most cases, you’re going to have to report on that later.
When making an appeal for public funds there are certain laws you must abide by. There are different rules for each state and territory applying to different methods of fundraising and different types and sizes of organisations. These rules are separate from the tax and incorporation laws that you are also obliged to observe. There may be other laws as well.
Step 5: Get under way
Don’t spend too long planning and pondering – get stuck in.
If you’re a first-time fundraiser, start small with something that won’t take much effort and won’t throw your budget into deficit if it tanks (a film night is always a good option).
Creating quick wins is a great way to get the team enthused and chanting “What’s next?”
Step 6: Monitor
The development of a fundraising strategy needs to be an annual exercise and should be evaluated and tweaked throughout the year as well. You need the flexibility to react to new opportunities or to curtail activities that are either not practical or not profitable.
After every fundraising activity, and at least once a quarter, step back and check how you’re going. If you’re not hitting your targets, what could you do to put the situation to rights?
Don’t forget to monitor your volunteer workforce as well – if they’re already burnt out only a few months into the year you’re in trouble.
OUR TIP: For every fundraising activity you undertake, try to ensure that you have the ability to walk away if something is not working. It’s better to walk away and lose a small amount than go ahead with an event and ensure you lose a far larger amount. If you have planned well and have a strong risk management plan the alarm bells will start ringing long before it gets to that stage.
Step 7: Say thanks
One of the main lessons of fundraising is to ensure that you appropriately acknowledge those that have assisted you, either as volunteers, donors or sponsors. Acknowledgement can be expressed during an event, in your newsletters, on your tickets, in advertising, or in a personal letter from the CEO or Chair.
If the donation/sponsorship/voluntary contribution is significant, consider providing a plaque, framed certificate or some form of permanent acknowledgement (signage, dedication).
Step 8: Review
At the end of each year, have a look at what you said you’d do and then compare it to what you’ve actually done. Hold an evaluation session to give everyone the opportunity to contribute to the discussions around what worked and what didn’t.
Then have a break. And a party. Celebrate what’s been achieved and all those who have allowed you to achieve it.
Then it’s time to start again.
The fundraising action plan: seven steps to success
Below is an excerpt from The Complete Community Fundraising Handbook.
Once you have your strategic plan, your business plan and your marketing plan in place, you can start working on your fundraising action plan.
Your action plan should have seven specific components, and all of them need careful attention:
Setting the Target
“Raising money” isn’t enough. “Raising $20,000” isn’t enough (though you need financial goals as well). You need to estimate costs and returns at each stage of the process. Don’t just write in how much you need to raise; what counts is what you’re able to raise. Never lie to your budget.
Making the Plan
What actions will you undertake to go about raising that sum? Quantitative goals are easier to focus on and much easier to monitor. For example, instead of “Visit donors” write down “Visit five donors”. Instead of “approach possible sponsors” plan to visit “five warm possible sponsors”.
Identifying the players
Wherever you have an action to be performed, settle on who’s going to do it – and don’t take the easy way out by giving all the tough jobs to whoever didn’t turn up at the meeting (and don’t punish someone for coming up with an idea by giving them all the work). Check that the people who are down to do things have the time and the skills and the authority to do them. Make sure they know they are down to do them, and that they’ll be held accountable if they’re not done.
Clocking the timing
Wherever you’ve got an activity down, settle on how long it ought to take – five days? Five weeks? What’s the margin for error? Even a rough estimate helps the people involved to gain perspective and allows you to see what tasks are dependent on others being completed first.
Setting deadlines and checking for progress
Draw up a timetable with major deadlines featured in red. Allow a little cushion for delays (but don’t let people just include these in the basic task times). If you can see that some components must be completed before others, break these out as separate tasks and give them personal attention at every stage. Pencil in the spots where you’ll have to monitor the work to make sure that all target dates are being met.
Weighing your resources
Check every action to see whether it will need any extra resources (money, people, expertise). Will you have to spend money to get the job done? Have you got it? When will you need it? Will you need support staff or cooperation from other people? Specify the requirements in advance so there are no surprises.
Adding it all up
Make sure you’ve included not only step-by step monitoring of progress but also allowance for a through after-the-fact evaluation. Did you reach your targets in time, cost, and outcomes? What lessons have been learned? Qualitative goals are important, too. How will you decide if the job was well done? Set the guidelines or criteria before you start, and be sufficiently flexible to notice what else happened that needs to be counted in the pluses or the minuses of the campaign.
Finally, make allowance for a thorough after-the-fact evaluation.
Video – Patrick Moriarty’s Ten Golden Rules of Fundraising
- Fundraising Legislation and regulations
- Ethical Fundraising Policy
- Board Fundraising Policy template
- The Seven Pillars of Fundraising
- Fundraising Checklist – How to win grants funding
- How to organise a special fundraising event
- How to get started with Crowdfunding