Basics in Developing Your Fundraising Plan

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    Free Micro e-MBA Module #9: Basics in Developing Your Fundraising Plan

    © Copyright Carter
    McNamara, MBA, PhD, Authenticity Consulting, LLC
    .

    Some of this program is based on materials adapted from the
    Nonprofit Capacity Building Toolkit(SM).
    This module is in the nonprofit organization development program.
    However, this module can also be used by anyone as a self-study
    exercise to learn more about nonprofit fundraising.

    Sections of This Module Include the Following

    Introduction
    Outcomes
    Materials for Review
    Suggested Topics for Reflection and Discussion
    Activities to Build Systems and Practices
    Assessments
    Tracking Open Action Items


    INTRODUCTION

    Raising funds to operate your organization and its programs
    is very likely one of the most important activities for your nonprofit.
    Many nonprofits obtain necessary monies from fees and sales (that
    is, from sources other than donations). However, if your nonprofit
    counts on donations, then this module will be very useful to you.

    This module will guide you through basic considerations and
    activities that address the questions:

    • What is fundraising?
    • Are you ready for fundraising?
    • What are the standard sources and how are they approached?
    • What’s the board’s role in fundraising?
    • How is a proposal written?
    • How can fundraising software help me?
    • Should you use a fundraiser and/or grantwriter?
    • How can the Internet and Web help you with your fundraising?
    • How is the overall health of your nonprofit’s fundraising
      activities?

    NOTE ABOUT PERSPECTIVES: As you’ll soon notice, there are many,
    major different aspects of nonprofit fundraising. There also are
    many specialists in most of the aspects. Thus, it’s not uncommon
    that there are very diverse, strong opinions about how fundraising
    should be done. This module aims to convey the basics and many
    of the “best practices” in fundraising. Many consultants
    might have different opinions about some of the perspectives in
    this module, but most would probably agree with most of the perspectives
    in this module.

    NOTE ABOUT BOARD COMMITTEES: Consider establishing a Board
    Fundraising Committee to review and guide implementation of key
    information in this learning module. Major activities and goals
    from this learning module could be incorporated in that Committee’s
    Committee
    Work Plan
    .


    OUTCOMES

    1. Learn Common Sources of Funding
    2. Understand the Board’s Role in Fundraising
    3. Assess if You’re Ready for Fundraising
    4. Learn Who Should Ask for Money, How Much
    5. Recognize Best Practices in Annual Appeals, Events, Major
      Gifts and Capital Campaigns
    6. Learn Key Components of Grant Proposals
    7. Draft Your Fundraising Plan
    8. Evaluate Your Fundraising Practices


    MATERIALS FOR REVIEW

    • The following materials will help you address each of
      the topics and learning activities in this module.

    All
    About Fundraising
    — particularly the sections: – – –
    Fundraising
    Basics (optional to read more than the 2 below)

    – – – Know
    Your Organization (read all)

    – – – Nonprofit
    Fundraising Demystified (read all)

    – – – Overview
    of Nonprofit Fundraising Sources and Approaches (read all)

    – – – Are You Ready for Fundraising? (read all)
    – – – Rating and Evaluating Prospects: Whom Do You Ask
    For How Much

    Fundraising
    and the Law (optional to read more than the 1 below)

    – – – New
    Form 990 Makes Fundraising Registration Unavoidable (read all)

    Fundraising
    Leadership (optional to read more than the 3 below)

    – – – Leadership:
    The Board’s “Mythunderstood” Role in Fundraising (read
    all)

    – – – How
    Do I Get My Board Involved in Fundraising and How Much Should
    a Board Member Give? (read all)

    – – – Role
    of the Nonprofit Board Fundraising Committee (read all)

    Development
    Staff: Defining, Hiring, Evaluating and Firing (optional to read
    more than 4 below)

    – – – Does
    Your Organization Need a Director of Development? (read all)

    – – – When
    The Development Officer Is Obliged To Raise Her Or His Own Salary
    (read all)

    – – – Asking
    For The Money Is The Job Of The Leadership And Friends … (read
    all)

    – – – Wearing
    Those Development and Marketing “Hats” at the Same Time
    (read all)

    Direct
    Appeals (optional to read more than 2 below)

    Grants:
    Foundation and Corporate (do read more than the following 3)

    – – – Grants:
    Free Money — Not Quite! (Part 1) (read all)

    – – – Grants:
    Free Money — Not Quite! (Part 2) (read all)

    Special
    Events (optional to read more than 3 below)

    – – –What
    is a Special Event? (read all)

    – – –Special
    Events — So Misunderstood (read all)

    – – –Events
    to Remember — Events to Forget (read all)

    Annual
    Funds or Annual Campaigns (optional to read more than the 2 below)

    – – –Annual
    Campaigns: Once A Year Every Year (read all)

    – – –The
    Annual Fund is Obsolete (read all)

    Major
    Gifts and Planned Giving (optional to read more than 4 below)

    – – –What
    is a Major Gift? (read all)

    – – –Asking
    For The Major Gift — Part 1 of 3 (read all)

    – – –Asking
    For The Major Gift — Part 2 of 3 (read all)

    – – –Asking
    For The Major Gift — Part 3 of 3 (read all)

    Capital
    Campaign and Endowment Fundraising (optional to read more than
    2 below)

    – – – Phases
    of a Capital Campaign (read all)

    – – – Capital
    Campaigns – Part #1: What They Are (read all)

    – – – Capital
    Campaigns — Part #3: Are You Ready for a Capital Campaign? (read
    all)

    Fundraising
    Online (optional to read more than 2 below)

    – – –Elementary
    E-Philanthropy (read all)

    – – –Online
    Fundraising: A Startup Guide (read all)

    Donor
    Recognition (optional to read more than 1 below)

    – – –The
    Art of Recognizing and Thanking Donors (read all)

    Fundraising
    Planning (Tying It All Together) (optional to read more than the
    1 below)

    – – – 6
    Steps to a Fundraising Plan for a New Nonprofit (read all)

    Hiring
    Fundraisers and Paid Solicitors (optional to read more than the
    2 below)

    – – –Do’s
    and Don’t’s of Hiring a Grantwriter (read all)


    SUGGESTED TOPICS FOR REFLECTION
    AND DISCUSSION

    • Learners are strongly encouraged to discuss the following
      questions with peers, board members, management and staff, as
      appropriate.

    Fundraising Basics

    1. What are at least 5 of the 9 aspects of an organization
    that should be known before doing fundraising, as asserted by
    the author in Know Your Organization?

    2. What are at least 5 of the 9 truths that the author asserts
    in Nonprofit
    Fundraising Demystified
    ?

    3. What are at least 5 of the major 9 sources of funding described
    in Overview of Nonprofit Fundraising Sources and
    Approaches
    ?

    4. What are some of the advantages and disadvantages of getting
    funds from individuals? Foundations? Corporations? Government?
    (See Overview of Nonprofit Fundraising Sources and
    Approaches
    .)

    5. If a fundraising campaign is to be successful with an individual,
    what are the 3 things we must do with the donor? (See Rating and Evaluating Prospects:
    Whom Do You Ask For How Much
    .)

    Fundraising and the Law

    1. The Form 990 asserts that nonprofits must register in each
    state they are to do fundraising, especially if their budgets
    are over how much? (See New Form 990 Makes Fundraising Registration Unavoidable.)

    Fundraising Leadership

    1. What are 3 of the 4 strategies to get the Board involved
    in fundraising? (See Four Steps to Take Board Members from Fear of Fundraising to Enthusiasm.)

    2. What are the 3 myths asserted by the author in Leadership: The Board’s “Mythunderstood”
    Role in Fundraising
    ?

    3. What is the role of the Board’s Fundraising Committee? (See
    Role of the Nonprofit Board Fundraising Committee.)

    Development Staff

    1. Who should ask for the money — the hired fundraiser or
    the Board and staff of the nonprofit? (See Asking For The Money Is The Job Of The Leadership
    And Friends…
    )

    2. What are at least 2 of the reasons that the activities and
    responsibilities of fundraising and marketing should not be combined?
    (See Wearing
    Those Development and Marketing “Hats” at the Same Time
    .)

    3. Should your nonprofit have a position of Director of Development?
    If so, should it be part-time or full-time? (See Does Your Organization Need a Director of Development?)

    4. Should a Director of Development do fundraising to raise
    his/her salary? What? (See When The Development Officer Is Obliged To Raise
    Her Or His Own Salary.
    )

    Grants: Foundation and Corporate

    1. What are at least 4 of the 5 things that the author asserts
    you must describe in a grant proposal, in Grants: Free Money — Not Quite! (Part 1)?

    2. What is the importance of reporting back to the funder?
    (See Grants: Free Money — Not Quite! (Part 2).)

    3. What are at least 5 of the major components of a proposal?
    (See Proposal Writing Short Course.)

    Special Events

    1. What is a special event? What are at least 4 of the 6 criteria
    that the author asserts are needed in a special event, in What is a Special Event?

    2. What was the major misunderstanding about special events
    as portrayed in Special Events — So Misunderstood?

    3. When is a traditional gala, fancy auction event or cocktail
    party not the right choice, as asserted by the author in Events to Remember — Events to Forget?

    Annual Funds (or Annual Campaign)

    1. What is an annual fund or annual campaign? (See Annual Campaigns: Once A Year Every Year.)

    2. What are at least 3 of the 4 goals of the campaign, as asserted
    by the author in Annual Campaigns: Once A Year Every Year?

    3. What is the wrong message that the author asserts is too
    often made in annual funds, in The Annual Fund is Obsolete?

    Major Gifts and Planned Giving

    1. What are at least 3 of the 4 criteria that needs to be met
    to qualify as a “major gift,” as asserted by the author
    in What is a Major Gift?

    2. When does the author say is the best time to ask for the
    money, in Asking For The Major Gift — Part 1 of 3?

    3. What phrasing should never be used, as asserted by the author
    in Asking For The Major Gift — Part 2 of 3?

    4. What is the right amount to ask for, as asserted by the
    author in Asking For The Major Gift — Part 3 of 3?

    Capital Campaigns

    1. What is a capital campaign? Capital Campaigns – Part #1: What They Are.)

    2. What are the phases of a capital campaign? (See Phases of a Capital Campaign.)

    3. What are at least 6 of the 12 issues that must be considered
    to assess if you’re ready for a capital campaign, as mentioned
    by the author in Capital Campaigns — Part #3: Are You Ready for
    a Capital Campaign?

    Fundraising Online

    1. What are 3 kinds of companies that help nonprofits do fundraising
    online? (See Elementary E-Philanthropy.)

    2. What are at least 6 of the 10 things that nonprofits should
    think about if they’re going to do online fundraising? (See Online Fundraising: A Startup Guide.)

    Donor Recognition

    1. What is the best way to thank a donor? (See The Art of Recognizing and Thanking Donors.)

    2. What are at least 3 things that donors want to hear about
    how their money was spent? (See The Art of Recognizing and Thanking Donors.)

    Fundraising Planning (Tying It All Together)

    1. What are 5 of the 6 steps to a Fundraising Plan? (See 6 Steps to a Fundraising Plan for a New Nonprofit.)

    Hiring Fundraisers and Paid Solicitors

    1. What are 2 reasons why a grantwriter should not be hired
    based on a contingency fee, that is, based on how much money he
    or she will raise? (See Do’s and Don’t’s of Hiring a Grantwriter.)

    2. What should you look for when hiring a fundraiser or grantwriter
    — what are at least 3 of the 5 reasons to hire a fundraising
    consultant? (See Hiring a Consultant: 12 Essential Tips.)

    3. What are at least 5 benefits of hiring a fundraising consultant?
    (See Benefit of Hiring a Fundraising Consultant.)


    ACTIVITIES TO BUILD SYSTEMS AND
    PRACTICES

    • Learners are strongly encouraged to complete the following
      activities, and share and discuss results with peers, board members,
      management and staff, as appropriate.
    • As you proceed through the following activities, be sure
      to note any incomplete actions in the Action Item Planning List.
    • Write down your answers to the following questions —
      those answers can be compiled into your Fundraising Plan.

    1. Fundraising Preparation

    1. Is your organization really ready for fundraising? How do
    you know?

    2. How will the Board be involved? Remember that Board members
    should be very involved — it’s not just the CEO’s job to raise
    funds.

    3. What will be the role of the Fundraising Committee?

    4. Who else will be involved and how?

    2. What Are Your Fundraising Goals? How Much Should You Ask
    For? By When?

    1. How much money will your organization ask for? Is it for
    operating costs or a capital campaign? How did you determine this
    amount?

    2. How much will go to programs, that is, to directly serving
    clients? How much will go to indirect costs, that is, to administrative
    overhead?

    3. How much will the fundraising activities cost, for example,
    office supplies, if you hire a fundraising consultant, etc.?

    4. By when will you need the money?

    3. What Sources Will You Approach? How? When? Who Will Approach
    Them?

    1. What specific funders will you approach and how? Among individuals?
    Foundations? Corporations? Government?

    2. Who will approach each source? It should not just be the
    CEO who always takes the lead. Perhaps the Board members need
    to be trained about fundraising — who will do that training?

    3. How will you approach each source? Remember that each might
    prefer to be approached differently — see their guidelines for
    solicitation. Also remember that startup nonprofits rarely receive
    grants — they usually get funding from individuals.

    4. When will each source be approached?

    4. Should You Hire a Fundraiser — and If So

    1. Should you hire a fundraiser? If so, then why? If not, they
    why not?

    2. If you decide to approach a fundraiser, what might he/she
    want to know about your organization?

    3. If you hire a fundraiser, how should they be paid? How do
    you know?

    5. How Will You Monitor That Donor Requirements Are Being
    Met?

    1. Major funders, such as foundations and corporations and
    the government, will want reports about the status of meeting
    their requirements. How will you ensure those requirements are
    being met?

    2. Who will provide regular reports to the donors?

    3. Who will provide donor recognition letters or other forms
    of communication?

    6. Fundraising Software

    1. What software might you need to better manage your fundraising
    efforts? What must you consider when getting this software?

    7. Draft Your Fundraising Plan

    1. By now, you have already developed the basic components
    of a broad fundraising plan. You can compile your plan by collecting
    your answers to the above questions.

    2. Obtain board approval of your fundraising plan. (If you
    have been working with a board committee to answer the questions
    and conduct the activities suggested in this module, then board
    approval should be fairly straightforward at this point.)


    ASSESSMENTS

    1. Answer the questions about “Fundraising Indicators”
    in the Checklist of Nonprofit Organizational Indicators.
    List an action plan to complete items suggested by the audit,
    but not done by your organization.

    2. Also see Campaign Assessment and Review:
    What Was Accomplished and What Was Learned
    .

    3. Also see Evaluating Your Fundraising Knowledge and Practices


    REMINDERS FOR THOSE IN THE ON-LINE DEVELOPMENT PROGRAM

    1. Are you exchanging feedback with others about what you’re
    learning in this program?

    2. Are you sticking to your study schedule for this program?

    3. Are you practicing your basic skills in management and leadership,
    including in problem solving and decision making, planning and
    meeting management?

    4. Are you communicating throughout your organization by using
    your skills in internal communications?

    5. Are you managing yourself? How many hours a week are you
    working? Are you noticing any signs of stress? If so, what are
    you doing about it?

    6. One of the ways you might be able to tell if you’re stressed
    out and/or losing perspective might be whether you’re tracking
    details or not. Are you using the action item list referenced
    above?

    7. Are you reflecting on learnings from past modules and how they build on the learning
    in this module? For example, are you seeing your organization from a systems view,
    as explained in the module “Starting and Understanding Your Nonprofit?”


    TRACKING OPEN ACTION ITEMS

    1. One of the first indicators that an organization or a person
    is struggling is that open action items are not tracked and reviewed.
    (Open action items are required actions that have not yet been
    completed.) Instead, people only see and react to the latest “fires”
    in their workplaces or their lives. Whether open action items
    are critical to address now or not, they should not entirely be
    forgotten. Therefore, update and regularly review a list of open
    action items (identified while proceeding through this program)
    that includes listing each open action item, who is responsible
    to complete it, when it should be completed and any associated
    comments. When updating the list, consider action items as identified
    during discussions, learning activities and assessments in this
    module. Share and regularly review this action item list with
    the appropriate peers, board, management and employees in your
    organization. You can use the following Action Item Planning List. (At that Web address,
    a box might open, asking you which software application to open
    the document.)

    2. If you have questions, consider posing them in the national,
    free, online discussion group hr.com, which is attended
    by many human resource and organization development experts.


    (Learners in the nonprofit organization development program
    can return to the nonprofit organization development program.)


    For the Category of Fundraising (Nonprofit):

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