In fundraising, as in all else, proper planning prevents poor performance. In this article, Bill Tedesco, CEO and Managing Partner of DonorSearch, identifies vital facts that researchers can provide to their fundraisers to help them prepare for meetings and solicitations, without getting mired in extraneous detail.
Five Things to Learn About Your Major Gifts Prospects
Everybody has probably taken a test they didn’t study for or given a presentation off the cuff. Sure, if you can pull it off and ace the test, or leave your audience standing in applause, it is the best feeling in the world. But what about the nine times out of ten that you fail the test or stutter through ten minutes of filler before excusing yourself? Being unprepared is a rightful anxiety inducer. Preparation is a chief component of success in all aspects of life, fundraising is no exception.
A fundraiser soliciting a donation from an annual fund-level contributor on whom she has no background information has a tough job. Now, raise the stakes and make that contributor a major gift prospect. Yikes! That’s the equivalent of not studying for a test you think is going to be multiple choice, only to find out when you get to the classroom that it's free response.
Total charitable giving is expected to increase by 4.8% in 2015 in the United States. That’s good news for nonprofits across the country. Even better news for fundraisers seeking major gifts is the study that found that 86% of wealthy adults say giving is important. That percentage is clearly in fundraisers’ favor.
The trick to preparing for soliciting a major gift prospect is not only studying up, but studying smart. It is important to get all the pertinent information without getting bogged down in the superfluous details.
There are five essential specifics to know about your major gift prospects: previous donations to nonprofits, nonprofit involvement, real estate ownership, business affiliations, and political giving. Let’s walk through those five categories in more detail now.
#1 Previous Donations to Nonprofits
This category can actually be broken down into two separate subcategories, prior donations to your nonprofit and prior donations to other nonprofits.
To Your Nonprofit
Past donations to your nonprofit are the main indicator of future contributions.
Investigating your loyal annual fund donors could reveal plenty of major gift prospects. You’ll need to have a clean and up to date donor database in order to do this efficiently, but sometimes high quality donors are right under your nose.
Prospect research, whether by a prospect screening company or an in house team, can take your list of repeat donors and determine who on the list has the financial capacity to make a major gift. With that knowledge, your development department will be well equipped to start making the push to transition annual fund supporters to high-level donors.
One thing to keep in mind is that even if a donor is only contributing small gifts to your organization, he might be giving major gifts to others. Prospect screening can reveal that information and show your team who has the ability to up their giving.
To Other Nonprofits
Speaking of giving to other nonprofits, charitable contributions elsewhere are markers of major gift prospects for your organization.
There’s a certain level of cross-over amongst nonprofits. It is rather unavoidable given the fact that there are 1,507,231 nonprofit organizations in the United States alone.
Even though we’d all like to believe our organization is a beautifully unique snowflake, each nonprofit has another out there with some common traits, be it mission, location, or size.
Use those similarities to your benefit. For every related nonprofit, there’s a donor list with major gift prospects waiting to be acquired by your development staff.
#2 Nonprofit Involvement
Major gift prospects are typically people who have a demonstrated vested interest in charitable work. There’s no better evidence of that than documented involvement in yours or other nonprofits.
The prospect could serve on a board for a social service nonprofit or chair an annual gala for a local museum. They say actions speak louder than words, and sometimes actions speak louder than wealth markers too. A donor with a lot of money is not going to be as likely to give as a donor with less money but an intimate connection to the service world.
#3 Real Estate Ownership
Although philanthropic dedication should be a driving consideration when scouting for major gift prospects, those who don’t have the funds to contribute a major gift obviously can’t donate one. Wealth markers may not be the most important indicators, but they are significant. Real estate ownership is a clear indicator of wealth. Interestingly though, there’s a notable correlation between property ownership and philanthropy as well. People who own $2+ million in real estate are 17 times more likely to give, and even those who own $1-2 million in real estate are 4 times more likely to give. With knowledge of real estate ownership, a fundraiser gets the best of both worlds, learning about a wealth marker and a philanthropic indicator.
#4 Business Affiliations
Checking business affiliations is all about taking the donors you know and learning about whom they know. Current donors can give your staff much-needed introductions to various movers and shakers in the fundraising community. Beyond your donors' connections in the business world, the company they work for is a crucial detail to know. Many companies have matching gift programs. In those cases, companies will match whatever an employee donates to a charity, doubling the donation. That’s too good a deal to miss out on!
#5 Political Giving
This final point isn’t as obvious as some of the others at first glance, but it makes a lot of sense when you really think about it.
People donate to political campaigns because they are truly passionate about that candidate or party, or about the issues they represent. They saw something they wanted to give to, made the decision, and donated. Political givers are donors of action. Throw in donations of a significant amount, and you’ve got a great major gift prospect.
There are a few more major gift indicators than these five, but this list should give you plenty to work from when researching. Study hard, sharpen those number two pencils, and go get those major gifts.
© 2018 New England Development Research Association