Creating Sustainable Growth in Your Fundraising - Part 2

by Larry Johnson on February 27, 2017
In Part 1, I unabashedly stated that most of what passes for “sustainable fundraising” isn’t.   Most organizations are living an illusion simply because money keeps coming in the door each year.
 
What’s missed is these organizations are leaving upwards of 50% of the philanthropy that’s available to them.  Moreover, what’s being raised is very sensitive to external conditions beyond their control.
 
Achieving true sustainability and permanent growth in your fundraising begins with a recognition that there are unchanging truths which govern all philanthropy, then internalizing those axioms in the culture and daily life of your organization.
 
Once you’re at that point—and very few nonprofits ever make it that far—creating a fundraising paradigm that works for your organization and is within The Eight Principles of Sustainable Fundraising® is the next step.
 
Let’s look at the Y.  In fundraising parlance, the YMCA is what’s called a “semi-open” organization.
 
So, what does that mean?
 
The Flavors of Nonprofits
 
There are three types of constituencies for nonprofits:  closed, semi-open and open.  Those with closed constituencies have clearly defined groups who will support them.  Churches and fraternal organizations, for instance, have “closed” constituencies.  When these organizations go out to fundraise, their base of support is limited to their members.
 
Universities, and membership organizations such as arts groups and youth groups have both a membership and a non-membership component to their donor constituency.  The Y fits into this category.  This is called a semi-open organization.
 
The Y can expect support from its members but it can also gain support from individuals who are not members who share the Y’s values and community goals.
 
Most social service organizations are what is known as “open constituency” nonprofits.  There is no clearly defined support group.  These groups’ support is based totally on a values/goal alignment.  Identifying who fits into your constituency if you’re an “open” organization takes more work and consistent effort.  Identifying who will support you may be your biggest challenge in fundraising.
 
Now that you know that a local YMCA is “semi-open”, that puts into motion a set of fundraising priorities that begins with an appreciation and application of Principle 1 of The Eight Principles™, Donors are the Drivers®, continues with Principle 3, Leadership Leads™, Principle 5, Work From the Inside Out™, and is capped off with the application of Principle 6, Divide & Grow™.
 
This sequence then becomes the basis for a YMCA fundraising paradigm, or ontology—there’s that word again!
 
There’s still work to be done including accounting for geography, demography, age of the local organization and other variables.  But, now you have the basic outline.
 
Notice something that I haven’t mentioned.
 
The implicit questions are: “But, can I do this?”  “Do I have enough money and staff?”  “Am I ‘big’ enough”?
 
Instituting a program of fundraising that creates sustainable and scalable philanthropic revenue is not organization size or budget dependent.
 
The big guys who are flush with cash DO NOT have an inherent advantage over the small guys.  They simply don’t.
 
Remember it’s about how you’re thinking more than what you’re doing.  It’s about looking at the problem through a new lens and being able to interpret what you’re seeing.
 
Selecting the Right Tools
 
Once you’ve done the heavy lifting and created an accurate fundraising paradigm of your organization, you can take a breath.  The good news is that this paradigm changes very little over time.
 
Now you’re ready to choose the tools you’ll need to get the job done.
 
These days that undertaking is a cross between visiting an adult candy store and the auto parts warehouse.
 
How’s that?
 
It’s like going to a candy store because there are more glitzy, sexy, fundraising toys that absolutely boggle the imagination than ever before. 
 
It’s like visiting an auto parts warehouse in that when you arrive you have only a vague idea what you’re looking for.  You’re “sold” by a sales person who might know 10% more than you do.  When you get back into your car in the parking lot, you wonder, “Just what did I buy?”
 
As an example, I’ll use my favorite hobby-horse, the nonprofit CRM industry.  I’m old enough to have used the earliest versions of these tools before there was even Windows®.
 
“You’re THAT old?” you say.
 
Yes, I am.
 
The power, complexity and sophistication of the nonprofit tech tools now approaches the level of the software systems used for advanced aeronautical research and nuclear physics.
 
The products being sold to nonprofits are very powerful, sophisticated tools.  The difficulty is the clear majority of nonprofit fundraising programs are nowhere near mature enough to benefit from many of these tools.
 
It’s like buying a Ferrari when you need a lawnmower.
 
The message?
 
As you select your fundraising tools, always err on the side of simplicity—and less.  If it ain’t simple or clear, chances are it’s not for you.
 
Once you’ve chosen the tools that work for YOU, you’re on your way.  Now the sky is, literally, the limit!
 
One last thing.  Principle 8 of The Eight Principles™ is Invest, Integrate & Evaluate™.  Don’t forget the “evaluate.”  Continual evaluation, modifying as you go, is critical to maintaining your forward momentum.
 
Remember, complacency is death.
 
Go out and get it done!  To your fundraising success!

Larry C. Johnson will be leading the session “The Aha Moment in Fundraising” at the upcoming NAYDO conference.

Founder of The Eight Principles™, Larry is the author of the best-selling, award winning book, The Eight Principles of Sustainable Fundraising.  Ranked among the top-15 fundraising coaches in the United States by the Wall Street Business Network, Larry believes in the power of relationships to build a better place.
 
Larry has coached the volunteers and executives of hundreds of nonprofits.   Larry was awarded the Outstanding Development Executive Award by the Association of Fundraising Professionals (AFP) in 2010.  In early 2016 he launched the ground breaking fundraising training program, The Oracle League™.  It’s sequential, building-block knowledge approach and all-digital platform is generating rave reviews.   Larry holds the CFRE and is a graduate of Yale University.
 
Larry and his wife Connie are active members of the Treasure Valley YMCA, and are leadership donors to the annual Healthy Kids Campaign.  They live near Boise, Idaho.

 
The Eight Principles of Sustainable of Fundraising® and Donors are the Drivers® are registered trademarks of M E Grace & Associates.  All rights reserved.

 
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