Building a Culture of Philanthropy in your organization

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Building a Culture of Philanthropy in your
organization
New York State Association for Rural Health
Wednesday, September 10, 2008
presented by Michael Stein
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Why Bother?
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Heres Why
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306.39 Billion Raised in United States in 2007
According to the 2007 Advisory Board Company
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Total giving, 19672007
in billions
Inflation-adjusted dollars
Current dollars
Recessions in light green 196970 197375
1980 198182 199091 2001
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Total giving by sourceFive-year spans, adjusted
for inflation
1,473.80
in billions
1,292.02
898.58
803.03
714.10
621.25
582.74
579.12
196872
200307
199802
199397
198892
198387
197882
197377
Individuals
Bequests
Foundations
Corporations
Giving USA uses the CPI to adjust for inflation.
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2007 charitable giving Total 306.39 billion
( in billions)
Corporations15.695.1
Foundations38.52 12.6
Individuals229.03 74.8
Bequests23.15 7.6
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Changes in giving by sourceCurrent
20062007
20052006
Percentage change from previous year
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Changes in giving by recipient organizationCurren
t
20062007
20052006
Percentage change from previous year
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The number of 501(c)(3) organizations, 19982007
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• At many not for profits charitable giving
  potential isnt realized because the fund raising
  function is under-resourced and poorly integrated

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How Philanthropy Can BenefitNot for Profits

• Philanthropy is the least expensive source of
  capital financing (sometimes, it is the only
  source!).
• Philanthropy provides the equity needed for large
  projects and may increase debt capacity of the
  organization by increasing the asset base.
• Philanthropy may enable the organization to
  embark on innovative new programs
• Philanthropy provides strengthened interaction
  between the community and the organization by
  encouraging the personal involvement and
  investment of donors and supporting organizations.

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Effective Fund Raising

• What Does That Entail?

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The Pyramid of Giving
Estate or Planned Giving Bequests Planned
Gifts Major Giving Endowment Campaigns Capital
and Special Campaigns Major Gifts from
Individuals Major Gifts from Corporations and
Foundations Annual Giving Support Group
Organizations Special Events and Benefit
Events Annual Giving Campaign/Direct Mail
Program Selected Publics All the Public -
Everyone in the Area
Investment
Involvement
Donor Commitment
Interest
Donor Growth
Information
Donor Contact
Identification
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Special Events

• Fund Raising Quicksand
• Friend-Raisers/Public Relations Value
• As a means to recognize and engage
  corporate/business supporters through
  sponsorships
• - Minimal ROI

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Direct Mail

• Broad-based appeals to natural constituencies
  local residents/businesses
• Generally geared to gifts less than 500
• Generates new donors
• An effective means to identify major and planned
  gift prospects for further research
• -Moderate ROI

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Corporate/Foundation Relations

• Philanthropic proposals to foundations,
  corporations local businesses
• Explore government funding opportunities
• Leverage support from vendors through sponsorship
  opportunities
• - Good ROI

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Major Gifts

• 500 Plus
• Face to Face solicitation by volunteers/staff
• Most effective and achievable means to make an
  immediate difference
• A team effort Staff/CEO/Board
• -Very high ROI

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Planned Giving

• Win-win Giving
• Variety of planned giving vehicles available
• Requires marketing effort to a broad audience
• Long-term results
• -Outstanding ROI

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Substantial Effort on the Least Effective Channels
Staff Time Spent on Each Activity
Staff time spent on each activity
Source AHP Report on Giving FY 2002 as presented
by The Advisory Board Company
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Fundraising ActivitiesNot Equally Productive
Cost to Raise one Dollar, by Activity
Source AHP Report on Giving FY 2002 as presented
by The Advisory Board Company
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National Trend

• 5 of donors contribute 95 of revenue

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Major Giving success is driven by

• Relationship
• Interest
• Ability

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The three-legged stool of Major Gift fund raising
CEO/Executive Team
Development Staff
Board/Volunteers
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Role of Development Staff

• Develops the case for support to stimulate
  interest
• Engages support from key constituencies
• Gathers information to assess interest and
  ability
• Builds relationships with donors and volunteers
• Train and support volunteers
• Makes the Trains Run on Time
• Staff driven/Volunteer dependant fund raising
  model

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Role of the CEO

• Champion for the Cause
• Advances donor relations/ solicits gifts
• Provides adequate resources
• Establishes a culture of philanthropy
• Integrates strategic planning with philanthropy

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Role of the Board

• Leverage linkages from social and professional
  networks
• Cultivate interest among those who demonstrate
  affinity
• Identify prospects, open doors and in some cases
  actively solicit gifts
• Validate giving ability/Donor interest
• Makes a personal gift

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Role of the Board (cont.)

• Makes development a significant portion of the
  Board agenda
• Ensures that there is an empowered group for whom
  development is a top priority

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Role of development counsel

• Advise on staffing model
• Assess current performance and future potential
• Conduct feasibility/planning study
• Identify resources for short-term fixes
• Design prospect identification/evaluation system
• Train staff volunteers in solicitation
  techniques
• Refine the case for support
• Participate in solicitations as needed

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9 Characteristics of Successful Major Gift
Programs

• Mission Clarity
• Case Statement
• Top-down Commitment
• Volunteers
• Public Relations
• Active leadership
• Professional Staff
• Recognition

Adapted from Association for Healthcare
Philanthropy Foundation
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Solicitation Tips