Tag Archives: fundraising

Small Nonprofits Must Make Big Gains in 2012

Giving USA: The Annual Report on Philanthropy, issued recently by the Giving USA Foundation and its research partner, the Center on Philanthropy at Indiana University, is considered the most reliable and prominent resource for information about trends in charitable giving and announced that giving increased modestly last year.

Charitable giving in the United States increased in real dollars in 2011 by 4.0%, reflecting the second consecutive year of collective higher charitable support from individuals, corporations, foundations, and bequests, according to the annual landmark report that has tracked philanthropy for more than 50 years.

With the issue of the Report came some important highlights that reflect significant pressures facing the 1.1 million nonprofits and another 222,000 religious organizations across the U.S., including changes in behaviors by American donors of all types, especially individuals who collectively represent 88% of all giving.

The 2011 estimate of $298.42 billion represents growth from a re-stated figure of $286.91 billion given in 2010.

Giving USA: The Annual Report on Philanthropy has detailed annual estimated charitable contributions by Americans – and how they are used – since 1956, making it the longest-running study of its kind.

The Report does not show changes by any one organization or regions across the country; rather, it reflects total giving by 117 million households, approximately 12.4 million corporations, an estimated 99,000 estates, and approximately 76,000 foundations.

Among the highlights of the GUSA Report for 2011 are several critical observations that have likely relevance to small-to-medium-sized nonprofts. Most notably we observed the following trends and implications:

Giving to Religion

Giving to “houses of worship” in the U.S. remains the largest single category attracting donor support, but for the second consecutive year, this sector reflected a decline in both total dollars given and as a percentage of overall giving.

Giving to religion, making up 32% of all giving, declined by 1.7% in real dollars and 4.7% in inflation-adjusted dollars. This decline is attributed to a steady decline in religious affiliation across the country in all denominations.

Giving to International Issues

Giving by all sources to international organizations grew a remarkable 240% in current dollars, or 167.1% in inflation-adjusted dollars between 2001 and 2011, and 7.6% alone in 2011.

While there were no major international incidents in 2011 that garnered major support (excluding the Japanese tsunami), we suspect that very large donors, including the Gates Foundation, are still supporting international projects in substantial ways.

Giving to Education

Education, specifically support for colleges and universities, saw a 4.0% increase in giving, and it remains the second largest sector that donors support. Very large capital campaigns returned to college campus fundraising efforts in 2010 and 2011, and impacted this aspect of the nonprofit world.

Giving to Public-Society Benefit

Charitable support for traditional “umbrella organizations” increased by 4.0% in 2011. However, this category’s figures are clouded because once again GUSA included dollars attributed to donor advised funds as well as to United Ways and the Combined Federal Campaign into the overall calculation. Incoming funds to donor-advised fund administrators grew collectively 77% between 2010 and 2011.

Several other highlights from the GUSA 2011 Report include the following:

  1. Support for nonprofits via bequests increased 12.2% to an estimated $24.41 billion.
  2. Giving by foundations did increase 1.8%, however when adjusted for inflation giving by foundationsdeclined 1.3% in 2011.
  3. Giving by U.S. corporations and their foundations held steady at $14.55 billion.
  4. Giving to human services nonprofits rose an estimated 2.5% last year and is the third-highest amount ever recorded (behind 2008 and 2010)
  5. America’s charities face many challenges including increasing competition from more than 1.1 million nonprofits and an economy that is recovering far slower than we have witnessed following previous downturns.
  6. The “best” year for giving ever was 2007, when GUSA reported $309.76 billion in charitable support. The 2011 results are the closest that total giving has been to $300 billion since 2007.

The complete GUSA report as well as an executive summary is available now.

Adapted from an article featured on eJewishPhilanthropy.com on June 19, 2012. 

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2012 Update: Social Media and Nonprofits

You’re going to want to tweet this: in response to May’s “Question of the Month,” 24% of respondents claimed that social media was the best marketing tool for nonprofits. “Word of mouth” and the organization’s own website tied for first place, each netting 29% of respondents’ votes.

http://onlinebusiness.volusion.com/articles/word-of-mouth-marketing-introduction/Not surprisingly, some nonprofits are turning to social media as a means to disseminate their missions, visions, and values. The Fourth Annual Nonprofit Social Network Benchmark Report reported that in 2012, 93% of U.S. nonprofit organizations have a presence on one or more social networking websites.

However, there are still many organizations that have no social media strategy to speak of. The answers to this month’s question reflect a number of trends we’ve noticed developing over the last few years:

  1. All nonprofits do not yet understand the power of social media.
  2. The priority placed on social media as a “connection tool” is sporadic and seems to  be used primarily by very large and very small nonprofits.
  3. Creativity relating to marketing remains very traditional. Even though everyone has a website and therefore the capability to connect with users via an interactive interface, many don’t.
  4. Impersonal marketing still dominates the landscape, and nonprofits suffer for it.

Over the last five years, many nonprofits have transitioned to using Facebook and Twitter as ways to build a donor base and market themselves to supporters. However, there is still a great deal to be learned about just how effective a tool Facebook and Twitter can be.

An astounding 98% of respondents to the Report indicated they have a presence on Facebook, offering many potential opportunities for fundraising. However, 53% of respondents said that they were NOT using Facebook for fundraising at all. 

Some organizations are opting for a modified social media fundraising approach. According to Robert Strickler, the Donor Pages Product Manager at DonorPerfect Software, an increasing amount of nonprofits are turning to what he calls a “donor driven” approach.

His firm has developed Donor Pages, an online “friend to friend portal” where an organization recruits its supporters to set up a website where they can reach out to family, friends, and colleagues and personally ask them to donate.

“Using a page like this gives ownership to the online social fundraising experience,” says Strickler. “We find that this tends to be effective because it operates on a more personal level.”

Just like fundraising through direct mail, meetings or phone calls, the same rules of stewardship are just as critical to online fundraising. Connection – genuine, heartfelt, and personal – is the key to fundraising success.

Adapted from “Social Media and Jewish Nonprofits: Missing in Action?” originally published on February 15, 2012 via eJewishPhilanthropy

Putting Transparency & Accountability Into Practice

Many members of the American Jewish community have felt a strong connection to Israel. For years, they obligingly gave to Israel-based organizations consistently and heartily…but times are changing.

Time has demonstrated that trends in America’s nonprofit sector arrive in Israel only a few years later. Therefore, it is only a matter of time before Israeli donors see the logic and match their American counterparts’ demands.

Hundreds of Israel-focused nonprofit organizations represented in the U.S. seek charitable support from American donors every year. Why do some receive it…and others don’t?

Nonprofit experts Shuey Fogel and EHL Consulting’s Avrum D. Lapin will join together to discuss the “new normal” in the American fundraising arena for Israel-based organizations, highlighting generational shifts that have critical implications for nonprofit leaders as they try to raise funds in Israel and abroad.

Topics will include:

  • Transparency: How new donor expectations are changing the ways Israel-based nonprofits operate.
  • Accountability: What outcomes nonprofits must demonstrate to their supporters, and why today’s donors are more demanding than ever before.
  • Differentiation: Why nonprofits must communicate with clarity, and how best to make the mission stand out in a cluttered marketplace.

Adjusting to the “New Normal”
Putting Transparency and Accountability into Practice
Thursday, June 14th
9:15 – 11:30am
Talpiot, Jerusalem

This seminar is being offered free-of-charge.

For more information or to RSVP: jfogel@u-bank.net

What Do Donors REALLY Want? Information!

Reposted from eJewishPhilanthropy – May 21, 2012

Nonprofit leaders face tremendous pressures today: living, operating and succeeding in a competitive marketplace of ideas, programs and services presents innumerable challenges. Donors who are guided by a passion for certain aspects of an agency’s mission and vision might be unaware, or unconcerned, about the everyday deliverables the agency must produce to achieve certain goals. Keeping both supporters and constituents happy is often a delicate dance.

Nonprofit leaders must continuously upgrade and strengthen their abilities to translate their mission into a “selling proposition” for a variety of interest groups. This selling proposition involves creating a case for support that clearly communicates what the agency does, their goals, and the methodologies used to achieve these goals.

All of these complexities must then be translated into “everyday language” and communicated in the fundraising context to donors of all shapes and sizes, from national foundations to individual givers.

In today’s economy, customers drive the marketplace, and in the philanthropic world, donors drive the discussion around sustainable funding. The essential question then becomes, “What do donors want?”

What are their motivations to give, and what do they expect from the agencies they support and the staff who run them?

How are decisions made in the current giving climate, and what are the “deal breakers” today?

We thought that it would be most helpful to address these issues through questions that are often raised during our interactions with donors across North America. Let us predicate this conversation with two basic assumptions about why people give:

  • They care about the person making the “ask.” Despite advances in technology and the way people give to agencies (text to give, online fundraising websites, etc.) the dictum “people give to people” is still as true as ever.
  • They care about the impact of their gift. The vision of the organization and the resulting impact of the contribution are critical to encouraging a donor to make a gift. The difference that the gift will make in the lives of people, the life of the community and in the life of the donor remains essential parts of the “selling proposition.”

Now, let’s move onto the top three questions we receive as fundraising consultants.

DONOR QUESTION #1: Do you have a Business Plan?

We first heard this question more than ten years ago during a meeting with a prospective major donor to a prominent Jewish arts group in New York City. Nowadays the question seems intuitive enough, yet the organization’s Artistic Director who was leading the meeting was taken aback.

“Well, we have a budget,” she responded.

“I’m not looking for a budget,” the prospect responded. “I want to know that my investment will not be swallowed up because the organization – as much as I love what you do – won’t exist five years from now. Show me that you believe and can demonstrate that you will be around and in good health and I will make the gift that you are asking for.”

SOLUTION #1: Be prepared with current facts and long-term vision.

Be ready with the facts: your nonprofit is a business with a “selling proposition” that provides demonstrable benefits within your community. Know what those benefits are and how they will change over time. Luckily for our example organization, the Director had considered the long-term viability of the mission and vision and was able to communicate it to the donor, who then made a significant gift.

It is essential for nonprofit leaders to consider the long-term vision for your nonprofit: where it is today, where it will in five years, and in ten years. This long-term vision (which will often include grand plans such as new programs, services, and resources) will inspire and motivate your donors.

DONOR QUESTION #2: Why does it take so long to understand what you do?

“It is like I have ADD sometimes: I cannot listen to long explanations,” complained a leading benefactor to a growing Israel-based organization. This individual, a successful entrepreneur and philanthropist, made a good point.

In today’s fast-paced and hyper-competitive world driven by smart-phones, tablets, and the demand for instantaneous responses and results, donors want the information now. In addition, loyalty is an almost-dying commodity; unlike in decades past when someone picked one cause and stayed with it for a lifetime, today’s donors spread themselves around.

SOLUTION #2: Make your point quickly and use varied communication channels.

Modern nonprofits needs to be deft and nimble, framing their”selling proposition” in small, understandable bites through a variety of communication channels. Create an “elevator speech,” no longer than 30 seconds, that explains your organization’s mission, vision, and deliverables, and distribute it to your executive staff, Board of Directors, and leading donors. Utilize online tools, such as Facebook and Twitter, as well as traditional media like newsletters, press releases, and direct mail.

You must always be ready to make your case quickly, because donors who notice that you are slow to respond to their interests might move on to the person or organization that best fills that philanthropic vacuum with easily digestible information.

DONOR QUESTION #3: I cannot ask my friends for money; can’t you just do it for me?

This is the question we most often receive from leading donors and Board members. For example, a committed Board member of a Jewish day school was recently approached to set up meetings with his contacts for the head of the school, who would then present the school’s “selling proposition” and hopefully engage these prospects as donors. The Board member was devoted and generous with his contacts but would not attend a prospect meeting with a contact he knew personally.

“Just tell him I said he should give,” the Board member offered. “If he hears that, and knows that I am also supportive, then he will give.”

“Come with us,” we implored him, knowing the power of personal connection. “We will help you prepare and role play for the meeting. Tell him yourself how much you support this cause, and he will be moved and surely respond.”

“I cannot ask my friends for money,” he lamented. “What if they say no?”

“He agreed to a meeting and knew why we requested the meeting. If he was going to say no, he would have done so already,” we advised.

We went to the meeting without the Board member and made our presentation.

“I really like what I am hearing and am interested in supporting the school,” the prospective donor replied, “but I really need to speak with my friend who set this up to know why he’s giving and how much before I’ll give you a final answer.”

SOLUTION #3: Conquer your fear of the “ask.”

So many leading donors do not want to ask their contacts to support their favorite charity. What drives this phenomenon? Fear! Leading donors are afraid that if they ask friends for money, these friends might then turn around and ask them for money. That sometimes happens, but is typically for a good cause, and should not be considered reason enough to NOT ask.

Secondly, leading donors fear of losing a friend when they ask for money. In our 21 years of consulting, this has never happened. Strong prospect research eliminates candidates who do not want to give, so that by the time a leading donor asks his/her friend to help support a cause, the answer is always yes. The amount varies, and sometimes it takes more than one ask, but at EHL Consulting we have never seen a friendship dissolve because of this situation.

Remember, the mission and not the market drives the donor, so know WHY your agency is in business and be clear and concise in how you communicate your “selling proposition” to your stakeholders. Use ALL of the tools that you have at your disposal … from online marketing to far-reaching contacts of your Board members and agency leadership. They all have their role in helping communicate long-term vision.

Also, don’t be afraid to ask others to support your passions. The real reason a donor supports a worthwhile cause is because he/she receives a formal request. Finally, if you want to close a major gift, take a deep breath and meet face to face.

Don’t rely on technology to do what humans do best.

21 Years…and Still Going Strong!

As The EHL Consulting Group enters our third decade as a firm, it’s encouraging to see not only how much we’ve grown, but also how much the nonprofit sector has matured and evolved as well. Both domestic and international nonprofit organizations have changed markedly since the early 1990’s . . . in terms of the numbers of agencies, the levels of sophistication, the work required to attract significant philanthropic support, and the amount of transparency that donors demand.

Helping so many different nonprofits in so many different ways has been – and continues to be – meaningful beyond expectations, and has made our work at EHL Consulting an effort that has been rewarding personally and professionally. 

As a longstanding member firm of the Giving Institute, EHL Consulting abides by a strong code of ethics that ensures our clients are treated with respect, and that their campaigns are always honest, heartfelt, and powerful. Working closely with enthusiastic and devoted men and women from all walks of life and from all parts of North America and elsewhere motivates us to keep improving our services and hopefully make a positive difference in the world at large.

We have seen the philanthropic marketplace grow and strengthen remarkably over the past 21 years. From a “slap on the back” network of unseen agreements and elite charitable circles, it has matured into a sophisticated, more scientific, accountable and increasingly transparent (though not enough) environment. Giving is now a $300+ billion dollar industry, accelerated by committed professionals with a drive to achieve substantial, measureable results.

The fact remains, however, that with all of the tools and the science, the real work is still built around relationships and connections with people. Giving is an act of passion, not a business transaction, and the connections between people are, and will always remain, the driving force.

Successful organizations know that connections are key, and always work hard to cultivate those personal bonds. Those who rely on technology and “arm’s length” communication will be forever doomed to struggle with difficulty. And besides, connecting with people is far more fun!

Our team at EHL Consulting is very optimistic about the future of philanthropy and we look forward to ever greater growth and productivity in the months and years to come. Thank you to all of our past and present clients for their hard work, enthusiasm, and dedication. For all of you who we have not worked with yet…we hope to meet you soon!

With gratitude,

Robert I. Evans, Founder & Managing Director

Avrum D. Lapin, Director & Principal

Non-Cash Giving Can Be an Important Donor Option

Reposted from eJewish Philanthropy – May 3, 2012

While the most common way to satisfy charitable commitments is with cash and appreciated securities, an often uncommon means available to donors is to utilize “stuff:” items of value that are often very attractive to collectors and which can become practical ways to satisfy philanthropic obligations.

Donors at all levels, but most notably high net worth contributors, periodically utilize non-cash giving. Art museums have received benefactions of pieces of art for decades and other types of nonprofits have welcomed real estate, especially when property was highly valued and represented an easy way for a donor to avoid costly capital gains taxes while satisfying a pledge.

A recent synagogue client received a valuable sculpture, valued at $300,000, when a member inherited the piece from a deceased relative. The donor did not want the piece and made the gift with two important stipulations: the congregation had to hold the piece for at least three years and that it is displayed prominently (requirements made for tax considerations subject to the related-use and tax exempt purpose rules of the 501(c)3 ).

Another congregation was nearly the recipient of a time-share at a Poconos resort, carrying with it a value of about $10,000. Fortunately formal Gift Acceptance policies prohibited the institution from accepting a gift of this type and the donor ultimately made cash payment for a campaign pledge instead.

Laura Linder, executive director of the Jewish Foundation of Memphis, is talking passionately these days about two gifts the Foundation has received within recent months from older Jewish philanthropists originally unaware of the power of gifting valuable collections.

The Foundation received the first gift in late 2011 when a member of the Jewish community, Susan Adler Thorp, began breaking up the estate of her late parents, Herta and Dr. Justin Hans Adler, and considered ways to deal with a Tiffany glass collection her mother had amassed. Determining that no living relatives wanted the collection, she contacted the Foundation and made arrangements through Mrs. Linder to transfer a significant portion of the collection that took more than 50 years to create.

After cataloging the objects and working in concert with one of the nation’s top auction houses, the Foundation received very significant proceeds earmarked for and added to the Herta and Justin H. Adler Philanthropic Fund, the family’s donor advised fund (DAF). Proceeds from the auction of that collection will be used in part to help fund the purchase of life-saving prescription medications for senior citizens, the Temple Israel Museum, and other charitable organizations designed to help make life better for others.

While the Adlers were avid collectors of art, they also were dedicated philanthropists, often saying that “charity is the gift you give for having a good life,” noted Mrs. Thorp. “My parents shared an eye for beauty and a love for art,” she said. “My mother’s passion was collecting Tiffany glass. Nearly everything in the collection was found as my mother searched for Tiffany glass.” All of the items in the collection were sold in a special Heritage Signature Auction of Lalique and Art Glass in New York City on November 19th. The much- anticipated live auction generated far more than the book value of the collection.

A second non-cash gift came to the Memphis Foundation earlier this year as a result of an anonymous Jewish couple preparing to downsize. The donor had passionately developed an enormous coin collection, including U.S. coins, shekels, and other pieces of varying value. The Foundation has contracted with an auction house to catalogue the coins and it is expected to go to auction in several venues later in 2012. Proceeds could exceed $500,000 and will also be used to create a DAF for an as-yet-to-be-determined set of purposes.

“During the ten years I have been at the Foundation, we have received several real estate gifts,” Laura Linder told us. “But until recently I had never even considered the power of encouraging donors to make non-cash gifts of this type or of this magnitude. This is an eye-opener for all of us at the Foundation.”

Tax implications for donors using collected items are a motivator, for sure, especially if offspring have little or no appreciation for or interest in “the stuff,” a commonly used term voiced by Bob Koo, a Palm Beach-based art and philanthropy consultant to the high net worth philanthropically-focused. “While our work is focused especially on successful individuals and families, there are certainly implications for donors of all levels,” he says.

Koo conducts educational seminars across the U.S. and has written extensively about the approaches that nonprofits might consider to attract part or all of collected possessions. Very often, he says, “things” that people have collected probably have no significant value … other than to the collector. “But in other instances, fine art of all types, books and manuscripts, coins and medals, clocks and watches, entertainment and space memorabilia, furniture, jewelry, vintage motor cars or wines and whiskeys can have large price tags. And when estate planning requires significant taxes, nonprofits can benefit significantly when they openly encourage donors to make gifts of this type … prior to their passing.”

Both Koo and Linder have told us about other circumstances where donors have talked about people who have considered charitable gifts to either satisfy current priorities or pave the way for other charitable opportunities. Both share a common recommendation to nonprofits: market the concepts actively and showcase the values of gifting collectables.

One other important consideration for nonprofits accepting non-cash gifts: carefully review your Gift Acceptance policies and update the written, formal documents so that you minimize jeopardy and are prepared with responses when potential donors inquire about gifting collectibles. Nonprofits should review such policies annually but giving beyond “conventional” methods requires careful strategies and policies.

Connecting Practices and Learning from Each Other

Reposted from eJewish Philanthropy – April 4, 2012

Three different but important conferences took place late last month and have served to connect and engage Jewish development professionals as well as donors and other committed individuals in interesting ways. One gathering reached out to Reform synagogue development professionals only, another involved Jewish foundation representatives and leaders, and the third served to engage primarily nonprofit professionals working to organize their efforts across the State of Israel. Each conference resulted in positive outcomes but took different approaches and each received different levels of visibility in the media.

Consider each of the meetings:

  • At the Jewish Funders Network (JFN) in Tel Aviv, 400 Jewish funders from across the globe gathered to address common concerns and to discuss common practices facing Jewish philanthropists.
  • At Amuta21C, 250 men and women came together to discuss challenges facing “third sector organizations in Israel,” the terminology being used to refer to nonprofit organizations.
  • At the Reform Synagogue Development Professionals (RSDP) annual meeting in Philadelphia, fundraising professionals from 19 midsized and large Reform U.S. congregations focused on best practices, innovative technology considerations, and the challenges related to attracting more philanthropic dollars from the members of Reform synagogues.

In reflecting on the purposes and importance of each gathering, we see important connections that more than justify the value of commitments of time and other precious resources. While attendees at each meeting undoubtedly used the opportunities to connect with longtime friends, colleagues, and like-minded people doing similar work, the value of sharing ideas and considering new methodologies became uppermost and is a uniform theme.

Jonny Cline, the co-organizer of Amuta21C, told us this conference “looked to address the issues of the culture of philanthropy in Israel, or lack thereof, shared responsibilities with the changing paradigm of the relationships between business and the third sector.” The program and other information can be found atAmuta21C.com, and pictures and discussions are at Facebook.com/Amuta21c.

On the heels of Amuta21C, the Jewish Funders Network (JFN) continued its focus on networking between and among some of the most connected Jewish donors. According to one prominent attendee, Jennifer Laszlo Mizrahi, “JFN is the place for people who care about smart giving in the Jewish community. Participants are outstanding human beings and the work they are doing is making the world a better place.”

She told us that one highlight at this gathering “was that there were many Israeli givers … a new trend in global giving” in the Jewish giving arena. Cline cited a panel discussion at the Amuta21 conference that featured “meet the investors” where Dame Stephanie Shirley and private philanthropist and owner of the multi-family office Philippe J. Weil, joined Sandy Cardin of the Schusterman Foundation, and Vered Raz, director of corporate responsibility for the Fishman Group. The “catch phrase” that came from the conference was a call for more and better cooperation between philanthropists and nonprofits/third sector agencies.

At the gathering of Reform synagogue development professionals, networking, too, was a major focus, with several discussions sparking dynamic discussions about planned giving, technology, and best practices. Maxine Lowy, of Temple Oheb Shalom of Baltimore and who chairs the group, termed the annual meeting as “invaluable” and looks forward to the next get-together in San Francisco in March 2013.

“Our focus was a set of discussions about what Jewish houses of worship can learn from other religious institutions … how to better be a ‘connector of people’ rather than facilitators,” she mused.

Reports about these three different conferences have been covered, partially on eJewishPhilanthropy, as well as in other blogs and media sources. Most importantly, they reflect important efforts to connect people with intersecting agendas and priorities, each with different approaches. Strengthening Jewish philanthropy has historically receded in times of economy contraction or recession, which often result in downturns in giving. We note that several other major conferences are scheduled for later in 2012 but the three we have highlighted cover Jewish perspectives that focus on Jewish priorities and nonprofits that serve the Jewish community in the US and in Israel.

Jewish communal leaders have often expressed frustration that Jewish donors were not devoting sufficient attention and resources to Jewish priorities. Perhaps the long term results will reflect more Jewish dollars directed for Jewish needs and a better understanding how to marry Jewish philanthropic desires with the work of Jewish nonprofits … in the US, Israel, and around the globe.

If you are the planner or an attendee of a forthcoming conference on Jewish philanthropy, please advise us. As Cline told us, the point of these meetings “is to facilitate the development of a professional community … that will encourage and enable professional and organizational development and that will create and facilitate a channel of communication between the professional community and the (Jewish) philanthropic world.”