Major Donor fundraising is an art. It is all about relationships and looking after your donors. It is about building relationships with high net worth individuals to the point where they naturally want to make a difference by the level of their donation
Organisations will have different views about what constitutes a major donor. For some it may be an individual donation of £1,000+. For others it might mean a gift of £100,000+. There is no right or wrong level but it is about the donor’s ability to give and ideally at a level that challenges them.
Is your organisation ready for a major donor?
Major Donors should be a valuable and ongoing source of income. The time spent cultivating a potential major donor is crucial and also cost effective as one donor can bring about serious change for your organisation’s income. It is also easier to build a long term, meaningful relationship with a substantial donor than using direct mail however personal that may look. However it is important to check if your organisation is ready to launch a major donor campaign and that the right culture exists to embrace this approach. Serious donors need to feel ownership of the organisation’s mission and will expect an inside track to your future plans, goals, achievements and challenges. They may expect to have regular contact with your CEO and Chair and at times they can be challenging and demanding but this can often be because they are passionate about the cause.
Why do donors give?
Major Donors have a wide variety of reasons for identifying with and giving to a cause. They are not mutually exclusive and one reason is not necessarily better than another:
- Philanthropy – they believe in giving, they may have a religious motivation, they might be purely altruistic, they have a social conscience.
- Affinity – they are personally associated with the cause (they might be motivated to give to a cancer charity if they or a close relative or friend has suffered with cancer).
- Social recognition – they may enjoy seeing their name on your headed paper or on a building, they might enjoy a glitzy dinner with celebrities or royalty.
- Mutual benefit – it might be good for business or it might enhance their social circle, they might be giving for reasons that are not obvious to you.
It is useful to work out their motivations and then to match these with what your organisation can offer. At all times they have to feel good about giving and that they are making a difference to those your organisation is supporting . Make sure they know how their gift is changing the lives of homeless people, or for cancer sufferers or those struggling with poverty.
Influence is crucial in all that a fundraiser undertakes – the 5 P’s are a good model to look at this:
Passion – emotional engagement – donors need you to be passionate about the cause you are representing, take them on a journey to the heart of how you help change lives.
Proposal – define problem/issue and suggest solution (this is your case for support).
Preparation – What do you want outcomes to be ? Consider a range of outcomes in order of priority. Eliminate negatives.
Persuasion - Rapport (tone) Language Perception/donor point of view.
Persistence – Intelligent flexibility. Change/adapt – go for your goal.
The Seven Steps
Traditionally there is a seven step approach to engaging with major donors. This is a useful tool but as with all relationships should not be rigidly adhered to, take the donor on a journey, at their time and pace.
1 - Identify potential donors
Who are your potential donors? Always good to start with your existing customers. Are there any hidden gems in your database? Donors who may be giving small sums but have the potential to give a significant gift given the right approach.
2 - Research potential donors
Research the people you’ve identified – are they good prospects? What can you find out about them? There is increasing amounts of public information available, search engines, rich lists, Who’s Who etc but it is often soft information that is most valuable so find out who may know your prospects – ask your trustees, existing donors who are close to you even your friends and relatives!
3 - Plan for potential donors
A plan should be tailored to their motivations, it can take three years to successfully engage a key prospect.
You generally need four prospects at ‘ask’ to get one donation. For example the NSPCC average was just over three ‘asks’ to every gift.
4 - Involve the donor
Engage the donor and build a relationship with them. Are there briefings they can attend or small dinners, breakfast meetings where they can ask questions?
Some people will give a donation at the first meeting. Other people will take years to get to the point where they donate.
5 - Ask the donor
- If you can get away with it, never mention money at the ‘ask’, instead ask them to get involved and pledge their support.
- Tell them about what their gift could achieve
- Know when to shut up!! You’ll be far more nervous than they are and you will be tempted to start babbling and never stop!
- They will probably ask you at lot of questions, so make sure you’re in a position to answer them.
- It will be a big decision for them and they may well want to go away and talk to their family and accountant.
- You don’t have the close the deal – the challenge is not to get a “no”.
- Rehearse your pitch!
6 - Close
You might need a final meeting for them to talk with a Trustee/Finance Director/Chief Executive. This might need to be done in stages so that they are comfortable that their donation will be spent well.
7 - Thank the donor
- Do it quickly - as soon as you receive the donation.
- If you don’t have an internal system that alerts you the day a donation comes in then you need to create that system – thanking without delay is crucial if you want the donor to donate again in the future.
- The ‘close’ might have taken a while and it can be a tedious process. The ‘thank you’ needs to bring them back to the reason why they gave.
- Should they be thanked by the Chief Executive , Chair of Trustees, or by one of the people on the frontline (a scientist, an street worker etc) – think about the reason why they donated and tailor your response accordingly.
An eighth and crucial step – stewardship
This is used extensively in the States and adapted by the NSPCC.
- How can you keep them warm?
- These are your best prospects for future donations and you need to treat them accordingly.
- What creative approaches can you use to ensure they feel valued and part of your future plans?
Other ways for major donors to give
Allia is a charitable investment service supporting causes that give people a better future. Its charitable bonds provide a way for supporters to make a secure, fixed-return social investment and release an up-front, tax-free gift for their chosen cause.
- Listen to the major donors Charity Talk, where Simon Morris, chief executive of Jewish Care, discusses the role of major donors in his organisation.
- In this interview with Dame Steve Shirley, she shares her top tips for managing relationships with major donors.
- Raising funds from the rich: interviews with major donors.
- The Influential Fundraiser (Jossey Bass 2008) by Bernard Ross and Clare Segal
- Best practice for major donors fundraising (Institute of Fundraising)
- Major donors share their giving motives.
- Why rich people give, by Theresa Lloyd.
- Carnegie's gospel of wealth
- The Big Give website helps charities promote projects they are seeking funding for. From small to significant amounts, the site is well used by donors.
Have your say
What is your experience of major donor fundraising? Have you had to deal with difficult issues or found it hard to get off the ground? What advice would you give to others?
Share your experience or ask your questions on the Fundraising forum.