Many words are used interchangeably in the world of fund development. But actually, the terms have distinct meanings and purposes. For instance, when you hear Fund Development, it probably invokes a series of thoughts, a broad spectrum of ideas that make up what it is and what it means. No matter if you’re a seasoned fundraiser, new to organizational fundraising, or an experienced organizational leader, it’s essential to understand the lingo so that you can lead authentically and with authority.
Fund Development often seems to be the catch-all phrase used to talk about raising money. In actuality Fund Development is the process of creating opportunities and plans to raise dollars. Another way to think of Fund Development is in terms of relationship-building–building and strengthening relationships while educating and inspiring people with your mission and giving them opportunities to invest in current programs and initiatives, as well as your organization’s future. A big part of Fund Development is having a development plan, a description of your process, and the tactics and activities involved in the process.
Philanthropy is another phrase used concerning raising funds. Philanthropy is the word we use when we talk about giving that supporter a desire to make a meaningful impact in a particular charitable arena, to improve an area of interest in society that is vitally important to the donor. Philanthropy may involve the creation of a family foundation built to help, not necessarily with immediacy, but to have a long term effect on the cause. Philanthropy is the why and what rather than how. Philanthropy is the purpose of creating a Fund Development program.
Fundraising is one of the most used catch-phrases when it comes to raising monies. The most basic definition of fundraising is the actual act of raising funds for immediate use and impact. Included within fundraising is the creation of a donor base that will continue to support the mission, albeit with modest donations. One of the critical aspects of fundraising is hosting fundraising events that both naturally bring attention to your organization and help generate engagement or buy-in. Events can be any size and can attract different donor bases depending on the nature of the event, for instance, your gala may not attract the same donor base as your 5k race or charity volleyball tournament! Events are not one size fits all, and you can create an event for the audience of your choice. If you’re looking to draw a younger donor base, you may want to consider hosting a highly active event. On the other hand, if you are looking to engage an older, more sophisticated donor base, you may want to consider hosting a more formal event.
An old fundraising stand-by that merits some attention, yet is often met with mixed reviews, is the direct mail campaign. When soliciting current donors with direct mail, you can have very positive results; people ingest the information on their own time and can make a thoughtful decision about if they feel connected to your mission. Whereas a “cold call” solicitation targeting new or non-donors produces minimal results. It can be intensely uncomfortable for both parties, assuming your target answers their phone! As a result, it’s essential to be sure your direct mail campaign includes some key things.
First and foremost, you want to be sure you tell your story – who you are, what you are raising money for, and how you have used previous donations. This latter part sounds so simple, but paying close attention to this step can reassure donors that you are committed to using their dollars as they request, that they can trust in your organization’s integrity. Additionally, a small but essential detail is ensuring that you include a blurb in the solicitation letter stating that their donation is tax-exempt, again, seems so simple, right? Yet it’s a vitally important detail. Perhaps surprising is the positive response you’ll receive if you include a pre-addressed envelope for their donation. You might consider a stamped envelope, but first, carefully consider whether your charity’s operating budget can support an expenditure for postage, which can be costly. Your donor will understand the need to provide postage!
Thanks to all the advances in technology, there are even more opportunities for digital fundraising events that have almost no cost associated with them and have a minimal impact on staff time. The advantages of these types of events are that you can easily reach a broad audience, and that audience can help share your event. One donor who gives only $10 to your cause but passes your information on to others in their social network can help you generate exponentially more donations. Options for digital fundraising can include anything from silent auctions to Go Fund Me campaigns. Many times, donors are willing to support these types of events as long as it’s easy to help.
A frequently forgotten part of the fundraising process is Friendraising. The purpose of friendraising is just that – add bodies in support of your mission. A friendraiser is usually hosted by a current donor in a smallish setting, allowing you and others in your organization to interact and educate potential supporters. Having key leaders attend these events is a wise approach as it gives potential donors direct access to engage and ask questions, and it makes them feel important. But remember, during an event like this, don’t ask for donations of any kind. Instead, focus on acquiring contact information and keep your new friends informed. Once you settle into a pattern of reminding them of your existence and importance, then you can ask for their financial support. In many ways, fundraising is like a continuum—you must consider how to move individuals along a continuum of support without jumping too quickly to an ask they won’t be ready to support.
As you expand your base of supporters, it is vital to be aware of any potential philanthropists to whom you’ve been introduced. In general, a philanthropist is a more generous giver and one that may be interested in longterm support either through bequest or annuities. This type of giving is called planned giving, and you want to be sure you have all material ready to be able to answer questions related to your program.
Finally, keep in mind that, no matter the level of giving, it is crucial to have a donor stewardship program firmly in place. Donor stewardship activities can be as simple as thank you letters and personal notes, or as grandiose as donor plaques or naming opportunities (this is where annual reports come in!) Think of stewardship as an affirmation of your donor’s support. By recognizing the importance of donor stewardship, you are well on your way to both retaining donors and increasing their level of support. This process is not just a one-and-done; it is a process you continue on an ongoing basis with every donor you have. If you haven’t already, consider planning your donor stewardship program using a calendar with tactics—and stick to it. Donor stewardship is often the easiest program to drop when stress is high, and capacity is low, but it’s critical to the success of every fund development program.
There are a lot of keywords that fall under Fund Development, which is your primary plan to raise monies; they include philanthropy, fundraising, friendraising, philanthropist, planned giving, donor stewardship, and many more. The critical thing to keep in mind as you craft your Fund Development plan is that, once you settle on how you’ll use the words, ensure that the definitions you use are generally understood and that you’re consistent in their use.
Atrómitos’ team has decades of fund development and fundraising experience, from capital campaigns and donor stewardship plans to digital fundraising program development and execution. We’d love to talk to you about how we can help your organization maximize its fundraising goals and revenue. Contact us today!