Lecture #6 The Development Process

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Lecture #6The Development Process

“…People Give to People…”

Myth: People Give to causes that need money

Truth: People give to people who ask them to give to causes

Individuals give from three sources:• Discretionary or disposable income• Their assets• Estates

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Lecture #6 The Development Process

Annual Fund

Endowment, Capital

Buildings, Equipment, Endowment

Special Programs & Projects

Ongoing Programs

& Services

Estate Planning

AssetsIncome, Assets

Current Income

Benefit:

Source:

Donor

Major Gifts Program

Capital Campaign

Planned Giving

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Objectives of the Annual Fund:– To solicit and secure a new gift, repeat, and upgrade– To build and develop a base of donors– To establish habits and patterns of giving by regular solicitation– To seek to expand the donor base through new prospects– To raise annual unrestricted and restricted money– To inform, involve, and bond the constituency to the org.– To use the donor base as a vital source of information to

identify potential large donors– To promote giving habits that encourage the contributor to

make capital and planned gifts– To remain fully accountable to the constituency through annual

reports (discussed more in a future lecture)

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No organization is similar; therefore needs different strategies and tactics to build and sustain a successful development program.

The Development Officer’s Job…• to “Right Size” it for your organization’s needs

Answer the following questions for direction:• What are the needs of your organization?• What are the resources available to you?• What champions to you have?

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Stages of Development - moving up the Donor Pyramid

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1. Identify potential prospects– Compile and develop lists of predisposed individuals– Similar organization’s annual reports, book of lists,

professional organizations, natural constituencies, etc.

7http://www.nps.gov/partnerships/fundraising.htm

8http://labspace.open.ac.uk/mod/resource/view.php?id=448021

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2. Convert potential prospects into qualified prospects

– Test the list effectiveness by identifying linkages– Engage volunteers, staff (e.g. rating session)– May be combined with step 1

Who do you know?

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3. Convert qualified prospects into initial donors

– Build on linkages, test interest by asking for gift– Solicit by personal contact (telephone, direct mail,

special event)– Acknowledge gift (opportunity to validate the linkage;

negate buyers remorse)


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4. Convert initial giver into donor of record– Build on interests and linkages– Report to the donor how the organization used their

gift– Invite to renew, Acknowledge

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5. Increase the gift– Research, building on linkages and interests– Inform (report on use), involve in organization– Invite to renew at a higher level (use gift club

concept)– Acknowledge

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6. Secure Special Gift (e.g. $1,000)– Continue research through linkages, involve, build

on interests– Align interests with a special need of organization – Personally solicit (face-to-face) , invite to gift club

membership– Acknowledge


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7. Secure Major Gift (e.g. $10,000+)– Validate donor as a major gift prospect via linkages

and donor research (i.e. capacity)– Involve the donor in the institution via planning, case

evaluation (“testing the case statement”)– As a loyal donor, ask him/her to participate in

cultivation events or help in identifying new prospects; join board committee

– Share needs of the organization; align solicitation to donor’s desires, face-to-face solicitation by CEO/Board Chair, acknowledge

– Reward/Recognize

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7. Secure Major Gift (e.g. $10,000+)– Validate donor as a major gift prospect via linkages

and donor research (i.e. capacity)– Involve the donor in the institution via planning, case

evaluation (“testing the case statement”)– As a loyal donor, ask him/her to participate in

cultivation events or help in identifying new prospects; join board committee

– Share needs of the organization; align solicitation to donor’s desires, face-to-face solicitation by CEO/Board Chair, acknowledge

– Reward/Recognize


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Lecture #6The Development Process

8. Secure Big Gift– Continue to involve and engage through linkages

and interests– Employ donor as an important advocate; invite to

serve as volunteer leader (board member); – Foster a desire to give and ask by involving in

cultivation events and engaging his/her personal contacts

– Ask, Acknowledge, Reward/Recognize


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9. Secure Planned Gift– Continue involvement with the purpose to strengthen

bond between the donor and the organization– Create feelings of belonging to and identifying with

the organization– Foster mutuality of interests– Giving in perpetuity (endowment) or legacy

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HOWEVER:

• Evolves over a very long time horizon (e.g. 10 - 20 years)– Through many Development Professionals

• Very time consuming– As donor progresses up the pyramid, the tactics become more

personal (hence dedicated MGO)

– Greater access; involving the time/energy of organizational leadership outside of the Development Office

• 80/20 rule: 20% of your donors will provide 80% of the funding – Most of your donors will only progress so far in up the donor pyramid

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http://www.youtube.com/watch?v=sd5H_2r-QW8&list=UUdnth3tXfhMjHgIchCw-CTQ&feature=share&index=2

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Lecture #6 The Development Process