How to Land a $500 Million Donation: 5 Lessons From the Silicon Valley Community FoundationDecember 4, 2013 by Taylor Short
While many nonprofits value small donations from givers, the data shows that up to 75 percent of an organization’s revenue comes from major donors, or individuals who give $1 million or more. But acquiring these types of donations can be challenging. It takes considerable time and effort, and many nonprofits still find it difficult to execute correctly.
To get expert insight on this topic, we interviewed Andrew Cope, vice president of development for the Silicon Valley Community Foundation (SVCF). In addition to his 21 years of fundraising experience, his organization received a $500 million donation from Facebook’s Mark Zuckerberg last year. Based on Cope’s advice, here are five top strategies fundraisers can use to land major donations and keep their nonprofit afloat.
Conduct Thorough Research to Uncover Donor Interests
To successfully capture the attention (and funds) of a major donor, nonprofits must first put in the effort to research the prospect’s giving history and involvement and interests in charitable causes. “Research in general is critically important, and unfortunately, it’s not done as well as it should be in many cases,” Cope says.
Without this foundation of information in place to help you align your organization’s goals with those of the donor you’re targeting, the entire process could end with a rejection. Fortunately, many free resources exist to help nonprofits learn more about potential donors. There are a few pieces of information Cope recommends specifically looking for.
These include IRS Form 990s, which are forms that federally tax-exempt organizations must submit to the IRS each year. These forms contain information about where nonprofits get their funding from, and, if you know a prospect has given to a cause before, can be used to gauge their typical level of giving.
GuideStar offers free and paid subscriptions to access financial reports on nonprofits. Senior Business Director Bunkie Righter says fundraisers should use IRS 990s to look for information such as donor name, job position, annual salary and years of experience.
Other important factors include the names of any boards the individual serves on and what professional connections he or she has. This information can give fundraisers an idea of what the prospect’s lifestyle is like and what causes typically motivate them to donate. Nonprofits should also conduct basic Internet searches to learn more about a donor.
Searching for a person’s full name, for example, can bring up details about any major donations they’ve made in the past. It can also tell you about their family’s giving history (e.g. if any foundations have been established in their name), which can help you further identify charitable giving interests.
Alone, each piece of information may not be fully reflective of a donor’s giving habits, as some donations are made privately. But together, this information can help you evaluate if a person’s interests and giving history indicate they might be receptive to making a donation to your organization.
As Cope explains, “[When I research a donor], I’m looking for a general scope of philanthropy that’s available in the public domain. It helps build a picture of the number and type of organizations a donor might be interested in supporting.”
Get Potential Donors Involved With Your Organization
Securing a large gift from an individual can be a long process—sometimes years—which means that once a prospect is considered to have giving potential, you must begin to build a relationship with them. To demonstrate the impact of your organization’s accomplishments, you should try to engage potential donors by getting them involved with your cause.
Asking them to volunteer or join your nonprofit’s board is a great way to do this. However, Cope cautions, many philanthropists that are known for their charitable contributions are frequently asked to join boards and committees, so organizations should be very conscious of how they approach them.
“[Nonprofits] may think, ‘Oh, here’s a high-net worth individual. Surely he’ll give if we can get in front of him,’ but the reality is that donor involvement is the single largest factor in giving,” he explains.
Whatever the opportunity to get a prospect involved, Cope recommends starting off with a small commitment to illustrate your nonprofit’s impact, such as an invitation to join a short-term committee or participate in a single volunteer event. This helps get the person interested in what your organization is doing and how they can help without overwhelming them.
It’s also important to choose the most appropriate person from your organization to make the initial outreach. “Sometimes it’s the CEO, whom the donor respects,” Cope says. “Sometimes it’s a board member or somebody else who is already volunteering in a similar capacity.”
Board positions should be offered to those who are knowledgeable about your nonprofit’s cause, but also those who could be potential donors. Neglecting the giving potential of board members is a missed opportunity, Cope says.
Ask for an Appropriate Amount
Knowing how much to ask a potential donor for is one of the most important parts of the solicitation process. Not only is asking for an appropriate amount more likely to lead to a donation, but asking for too little or too much can either result in an inadequate donation or a ruined relationship.
Nonprofits have to be realistic, Cope says, and make sure the research they’ve done on a potential donor is accurate so they make the right ask. “Even though asking a donor for a seven-figure gift may seem reasonable, if you haven’t done your homework, you could learn that not a single organization has ever landed anything more than $5,000 from that donor,” he explains.
Use the research and past giving history you’ve uncovered to estimate how much the prospect is comfortable giving. You also need to be prepared to explain exactly what the project is, what the donation will go towards and the impact it will have, in as much detail as possible.
Invite the potential donor to lunch and have an honest exchange with them, explaining that you’d like to sit down to further discuss your projects and possibly enlist their support.
Make the Ask on the Donor’s Terms
Deciding when and how to ask for a large donation depends heavily on the preferences of the donor. Don’t be too aggressive—judge the situation based on your prior research and interactions with the donor. A few questions you can ask to gauge a potential donor’s interest include:
- Do they ask insightful questions about the cause?
- Are they interested in the results of your nonprofit’s projects?
- Do they express a desire to meet the people who work on these projects?
If the answers are positive, it may be time to ask. “Really use your gut and gauge the donor’s comfort level,” Cope advises. “Some donors like the typical lunch and a formal presentation, but some find it pushy.”
If the prospect is comfortable with it, Cope recommends setting up an appointment in person, and bringing along whomever would be most appropriate to help explain the purpose of the donation—the CEO, executive director, project manager, etc.
After reviewing the donation size, the project scope and the expected impact, Cope recommends feeling out the prospect to see if they’re interested by saying something like, “If this sounds attractive at all to you, would you entertain a proposal from me?”
If that receives an affirmative response, Cope typically uses something similar to the following to make the ask: “I’m hoping you would consider a gift of $100,000 to help us achieve this goal that I explained to you.” This is followed by something such as, “I don’t want to put you on the spot. If you need time to consider, I just want you to know exactly what we’re envisioning here.”
This approach places control into the hands of the potential donor, which allows them to be comfortable with either committing to make a donation on the spot or taking more time to mull over the decision.
Show Confidence in Your Cause
Finally, conveying confidence during an ask can make the difference between landing a large donation or losing a potential donor’s attention forever. Therefore, performing the legwork early on to get a clear picture of a prospect’s giving tendencies and being able to show passion for the cause are integral to successful fundraising.
GuideStar’s Righter recently got the chance to hear Emmett Carson, CEO and president of the SVCF, speak at an event. She says his presentation demonstrated t qualities: confidence in themselves and their research, and a strong belief in the value of their organization’s impact. The mixture of research and relationship building characterizes the intangible nature of working up to ask for a major donation.
Righter says this is where many nonprofits falter in landing large deals. “It’s artform and a science, and you have to treat it that way,” she says.