Tips for Effective Fundraising

Looking at the Big Picture: The 5 Key Ingredients of Effective Fundraising

To fundraise effectively, an organization needs an effective fundraising plan. A concise plan will help an organization reach new donors. Objectives for increasing donors must be clearly outlined and planning needs to incorporate strong volunteer leadership, timelines, communications, and more.

The 5 key ingredients to effective fundraising are:

1. Knowing what motivates individuals/groups to donate;
   
   
2. Knowing your project;
   
   
3. Being aware of potential sources of funding;
   
   
4. Developing a strategy;
   
   
5. Being familiar with your organization and its resources.

Knowing what motivates individuals/groups to donate

“People give to people!”, is a well used phrase in fundraising. Statistics indicate that 75 cents of every Canadian dollar donated in a year was given by individuals. Some examples of what motivates individuals/groups to donate include:

• people like to help others;
• they may have a personal involvement or commitment to the group and cause;
• they seek recognition;
• they enjoy the event;
• ego gratification;
• the need to belong to an organization by either donating their time or money;
• community pride;
• religious point of view;
• compassion;
• community pressure;
• guilt;
• or they may give just because they were asked to give!

Knowing your project

People will want to know what it is they are being asked to support. Some things to be aware of include:

• the costs involved;
• the benefits to community and organization;
• exactly how much money you need - not how much money you think you could raise;
• when are the dollars needed, and
• the cash flow required to see the project through.

Potential Sources of Funding

There are several different ways your group can choose from to raise money. They include:

• Special Event/Activity Fundraising;
• Individual Donations;
• Private Sector Foundations and Companies;
• Foundations and other grant making agencies; and
• Federal and Provincial Government.

• Usually fun, entertaining
• Easy to ask for dollars in a relaxed atmosphere
• Dollars available on the spot
• Community involvement helps to build cohesiveness
• Good potential for positive public relations

• Risk of not making a lot of money and perhaps even losing dollars
• Usually requires a lot of time and effort to organize
• People want full value for their dollars (they forget donation aspect and look at what they get vs. donating)
• It's difficult to be unique with this type of approach (everybody’s doing it!) and it takes creativity to have your event noticed
• Because everyone is usually giving the same amount, people may actually give less than they might have if they were asked to donate directly

Individual Donations

Involves soliciting donations through individual contacts (e.g. door-to-door, canvassing, phone, letters).

There are 2 approaches to soliciting individuals:

1. Target an individual
2. Mass mailing or canvassing

• Low cost involved
• Fewer people required
• Encourages two-way communication of project and organization
• Public relations – gives you the chance to tell your story
• Can be tax deductible if your organization is a registered charity

• Requires more volunteers for the door-to-door or targeted approach
• Not everyone likes to solicit and some people don’t like to be asked in this manner
• Requires time in relation to potential donations
• If no one is home – they may not have a second chance to donate
• Door-to-door can be expensive and time consuming in rural areas

Private Sector Foundations and Companies

This method is similar to soliciting donations except it is targeted to businesses. Many businesses budget each year for donations and sponsorship towards fundraising projects for their own public relations and marketing. Donations from businesses may be in dollars or product. Be prepared with your request!

Some of the PROS of fundraising from Private Sector Foundations and Companies include:

• Potential for larger donations
• Good public relations for the business and for the organization
• Tax deductible for business
• Potential for repeat donations (secure source of funds)

• Willingness to contribute depends on business cycle
• Sometimes difficult to identify person who approves donations
• Large businesses may require a professional presentation by the organization
• There may be lag in time between commitment and donation
• The budget for donations/sponsorship may only be established at a particular time in year

Foundations and other grant-making agencies

In Canada there are hundreds of charitable foundations that administer funds for a variety of products.

A PRO of fundraising through foundations is that if you find the right match, your organization may be eligible for a large amount of funding.

LIMITATIONS of fundraising through foundations include:

• There may be a long response period
• Foundations usually require detailed project proposals and organization information
• Grants could be one-time only

Public Sector Grants

Many municipal, provincial, and federal government departments have funding programs to which charitable and non-profit organizations may make application.

Some of the PROS of public-sector fundraising include:

• Can often be a major source of income
• Eligibility standards are well documented and established and it is usually easy to determine if your proposal will qualify for funding.

• Proposals are usually time-consuming to prepare and requires extensive support documentation
• Identifying the right program to suit your needs can be challenging
• There is usually a lengthy approval process
• Organizations must usually be incorporated as a non-profit or be a registered charity to qualify to funding

Developing your fundraising strategy

Deciding which source to target is a difficult one. You may decide to utilize more than one approach. Consider these factors as you develop your strategy.

1. Timing. Urgency for requirement of funds should be considered. If cash not needed immediately, you may ask for a pledge.
   
2. Amount of funding required. The size of expected donation should be relative to size of project. Ask for a specific dollar amount and be realistic.
   
3. Available resources. Number of volunteers, costs involved and time available to conduct a fundraising campaign.
   
4. Profile of project. Person or business contributing to project in many cases must be offered tangible and intangible returns (e.g. public relations or direct individual benefits) – identifying profile of project will help to determine geographic boundaries of campaign.
   
5. Environment. Availability of funding from some sources may be conditional on economy.
6. Sequence. If more than one source is being considered, (e.g. event fundraising used in conjunction with another source), individual contributions may be affected by prior “donations” through special events fundraising.
7. Values. The organization must be supportive of the method being used to raise funds. Some types of fundraising activities may not meet with approval of organization or community (e.g. lotteries, sponsorship by certain companies).

Know your organization

Preparation Points

• Be aware of your organization’s image in the community (how it’s perceived will affect financial support by community)
• Evaluate past fundraising efforts to determine successful strategies (learn from mistakes)
• Ensure that the membership is fully in support of the project – internal apathy may be harmful to fundraising results.
• Investigate eligibility of organization for charitable status through Revenue Canada. This would allow donations to be tax deductible.

• The make up of committee should be reflective of needs
• Working members and honorary members of committee should have profile, credibility, and personal support for the project
• Chairperson (and/or directors) of campaign coordinates the project to avoid duplication of effort and contacts
• Chairperson acts as official spokesperson for the campaign
• Goals and targets are set by committee
• Roles of each person are determined and clearly defined to each individual
• Training is provided to volunteers everyone must know his/her job
• Provide regular update session with volunteers who will be doing the work
• Encourage feedback sessions and evaluation of progress
• Design a fundraising kit to fully explain their role and campaign
• Consider all potential questions and have answers designed and readily available

• Make it easy for the donor (i.e., pick it up, postage paid, bank deposit)
• Know who it is in the organization that decides on donations
• Know when budgets are established
• Make appointments for your interviews
• If they don’t give – don’t be discouraged, leave with their moral support and accept rejection gracefully
• Keep records of all contacts, comments, history of donations, this helps to prevent duplicate contacts (i.e., recipe card file or notebook may be useful)
• Offer receipts on the spot
• Ensure follow-up and thank you from the organization
• Ensure progress of project is made available to all supporters
• If you don’t know the answer to a question, ensure an answer is forwarded promptly
• Inform media of your project and ensure maximum recognition of all major contributors

Source

Fundraising For Your Organization by Peter Fleming and Nancy Larmer, Ontario Ministry of Agriculture and Food.

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