Hugh Bennett, Associate Director of Prospect Identification at MIT, gives an overview of prospect ID, and makes the case for a dedicated staff in research offices to oversee this important function.
What is new Prospect Identification?
by Hugh Bennett
There's an old story about how an elephant is described by blindfolded people who touch different parts of the elephant. One feels the trunk and thinks it is a fire hose. One feels an ear and thinks it is a frond of a palm tree. Another touches a leg and thinks it is a porch pillar. When dealing blindly with things, it is possible to have different reactions. Prospect Identification for major gifts is like this. Depending on whom one asks, prospect identification for major gifts is defined differently.
- A senior non-profit VP or president might think it is a donor who has made a first time $1M gift.
- A non-profit fundraiser might think it is that major gift prospect that he/she had contact with for the first time or that prospect someone else told them about.
- A non-profit prospect management analyst might think it is that person they found in the database that no one is calling even though there may be copious amounts of data on the prospect and a capacity rating history in the database system.
- A non-profit researcher might think it is that person they wrote up details on for the first time, or maybe it is like the prospect management analyst - finding someone unsolicited in the database even though there may be copious data and capacity information existing.
- A predictive modeler or data mining analyst might think it is the prospects they find in the database who could be aligned with certain fund raising causes that currently interest the non-profit, or maybe those prospects they churn back as wealthy (even though they are already identified as such in the database).
All of these definitions are actively being used. The one thing these definitions all lack is the actual point of origin.
Prospects for major gifts can be identified for the very first time in different ways by different organizations. References are big in some shops; new patients in hospitals are another common source. But few organizations have systematic ways to find unknown wealth among an existing and fairly static pool of connected prospects, like alumni.
In my higher education research department, we have what appears to be one of the only dedicated proactive research groups in higher education.
We identify new major gift prospects that were not previously recognized as such. These people are almost all already affiliated with our schools (typically as graduates), but they were not known to be wealthy.
In our case, this research results in 800 to 1,000 totally new major gift prospects with confirmed wealth every year. That’s approximately 7,000 in the past 8 years. And, it’s over 90% of our newly rated major gift prospects over the past 8 years. (The rest are mainly unconnected "wish list" type prospects rated by others.) Our efforts have also doubled our overall pool of now known wealthy prospects. All these people had new data entered and were written up when recognized as major gift prospects by proactive research.
Our fundraisers don’t need to qualify these prospects for wealth, only inclination. And they aren’t wasting their valuable time on prospecting people without major gift level wealth.
Our dedicated proactive research professionals have developed systematic approaches to source totally new major gift prospects, mostly from data external to our in-house database. Proactive prospect identification is a science of methodical, valuable work that empowers an organization to hire more fundraisers and raise greater amounts for its cause.
Some non-profit consultants like Dan Pallotta have argued that organization should invest in their advancement services and do more to grow their non-profits. Having a dedicated proactive research staff is arguably one of the best ways to do this.
Reactive researchers are not trained to do proactive research and are busy doing their jobs. Having them do proactive research as part of their job is a waste of time in my opinion. It’s distracting from their main activity and they haven’t got the training, tools, time, or “radar” to be effective or efficient. They are good at detailed research on assigned pre-identified prospects, not at repetitively and systematically finding new golden needles in a haystack.
Proactive research is steps before other fund raising work and often not recognized for its value. Solicitations and other steps along the way can truly add value. But, it is possible that the most valuable work was the origin. All that follow-up work would not have been done without highlighted prospects to focus on.
Strangely some call this proactive work glamorous, even alluring. Hardly. It's methodical and sometimes quite tedious. And we rarely are recognized for what we do.
Yet, my group has discovered several thousand connected individuals as new major gift prospects. They all have proven levels of high wealth, many with recent liquidity events that make them likely and timely tax-driven candidates for major gifts. Even though many are still yet to be solicited, some have already made subsequent multi-million dollar gifts.
Others can emulate this process and improve the health and wealth of their fund raising organization. They can improve and redefine their prospect identification.
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