Just Say NO to (Certain) Funding – Why Turning Away Some Funding Opportunities Is a Good Idea

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Nonprofits are always seeking funds. Entire departments are established for fundraising. Yet some funding opportunities aren’t a good idea. Learning which ones to turn down and which ones to accept can save your organization a lot of time and debate later on.

Why Say No to Funding Opportunities?

Why turn away money? After all, aren’t all opportunities for funding good opportunities?

Alas, no. Here are some reasons why you may wish to turn down a funding opportunity:

  1. It’s a significant amount – but unlikely to be continued another year: Although a large amount of money may be useful to fund a major project, the lack of it the following year may cause a great deal of stress for your organization. It may be better to scale slowly than to use a windfall for a major advance, just to have it stall for a while.
  2. It is government-funded, but it is an election year: While that may not necessarily indicate change, if the incumbent loses the election and the funds are part of a controversial project, the funds may evaporate. The sudden loss of funding may negatively impact your nonprofit.
  3. Funds are restricted: Restricted funds have their place in any nonprofit, but if all sources are restricted funds, this can hamper the organization’s ability to achieve its mission. Without funding for overhead, marketing, and similar needs, programs do not have adequate support. All the funding in the world for a program won’t make a big difference if you can’t support it long-term.
  4. The funding source goes against your mission: You may not have pursued the opportunity, but it arrived on your doorstep. Alas, it contradicts vital aspects of your organizational culture or mission. That’s a good reason to say “no” to an opportunity, tempting though it may be. You must remain true to your mission for long-term stability and growth or risk alienating donors who also believe in your mission.

Saying no can be difficult. It’s hard to turn down opportunities, especially if you’ve been working hard to find new ones. Rather than worrying about turning down opportunities, focus instead on the better step ahead: preparing guidelines for funding sources so that your staff knows where to look, what to look for, and how to develop the right sources of funding.

Now Say Yes – Prepare Funding Guidelines

To prepare funding guidelines, you’ll need to work out which opportunities align with your mission. Then, examine how the opportunity impacts the bottom line, both short and long term.

  • Speak with your accounting team and finance professionals to discuss what, if any, impact specific types of funding make on the long-term finances of the organization.
  • Decide what portion of restricted funds should be pursued, and for which types of programs. Include this in the guidelines.
  • Examine how government-funded opportunities may or may not align with your organization’s mission. Then, develop written guidelines about the types of opportunities that are acceptable and those that are not.
  • Develop a plan for “gray area” funding opportunities. How should these be evaluated and by whom? Do you want to pursue them and then decide later on what to do if they should come through; or discuss as a team which ones to approach and which to decline?
  • Share guidelines throughout your organization. Review annually to ensure they continue to align with the values your organization holds dear and with the current plans, financial forecasts, and information at hand.

Passing up an opportunity may feel frightening, especially if your organization is desperately in need of funds, and whose isn’t? By focusing on the “yes, let’s do this” and preparing funding guidelines, you can decrease the times you must decline funds and instead, spend energy wisely on pursuing valuable funding opportunities.

Welter Consulting

Welter Consulting bridges people and technology together for effective solutions for nonprofit organizations. We offer software and services that can help you with your accounting needs. Please contact Welter Consulting at 206-605-3113 for more information.

What Are the Most Common Fundraising Pitfalls? Here are Three You Should Know

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Fundraising ranks high on the list of a nonprofit’s priorities. Everyone wants to get better at fundraising; after all, the better you are at this critical task, the more funds you have to support your work!

Creative fundraising campaigns tend to get the publicity with writes up in your favorite nonprofit journals or marketing magazines. However, there are times when too much of a good thing can be confusing, underwhelming, or just plain wrong for your nonprofit.

As you consider your next fundraising campaign, keep in mind these three lessons from the world of fundraising. Keep them in a file of “what not to do,” so you don’t repeat the mistakes of others. Learn, grow, explore, and yes, test new concepts, but beware of these three fundraising pitfalls.

The Big 3 “What Not to Do” in Fundraising Marketing

Pitfall #1: Being so clever you miss the point and confuse donors.

It’s easy to get lost in a clever campaign. Perhaps you’re tired of the same-old fundraising campaign your organization has used successfully for the past several years, or you feel the need to try something different. That’s fine, but make sure the cleverness doesn’t outweigh the point of the campaign.

A too-clever campaign may rely heavily on puns, graphic gimmicks, or similar ideas to deliver its purpose. What ends up happening is that donors glance at the advertisement, experience momentary confusion, and set it aside. Instead of motivating them to donate, the ads gets tossed in the bin or ignored.

Avoid the too-clever trap: To avoid this pitfall, you can test the “clever” campaign against the tried-and-true response piece. See if the smart piece outperforms the stalwart marketing piece. Mail or send the same number of pieces to a split of your audience. This is called an A/B test and pits A, the clever campaign, against B, the tried and true one. Since you already know the average results of your tried and true campaign, you can see easily if the new piece outperforms it.

Another and simpler method is to show the piece to five random people, perhaps friends, family, or those unaffiliated with your nonprofit. Ask them questions: would they donate? Do they understand the point?

These two steps can save you from wasting time, money, and resources on something that won’t get you the results you desire.

Pitfall #2: Going overboard with design or enclosures.

Yes, it’s a time-tested nonprofit marketing tactic to include a small gift item to entice people to send money back. Stickers, stamps, a notepad, a pen, these are all fine…to a point.

But if your charity is asking for money, consider the impression these gifts make. Are they useful items? Are they expensive items? If so, they might be perceived as frivolous expenses instead of a simple gift.

Another way in which nonprofits sometimes go overboard is by using paper or design that appears expensive. “What!” you may argue. “That paper was much less expensive than the other kind we used to use, and it looks so elegant!”

That may be true, but potential donors only see the surface. They understand what appears to be a very expensive mailer and may perceive that you are ‘wasting’ money on marketing. Err on the side of caution and ensure that your designs reflect the spirit of your nonprofit.

Pitfall #3: Amateurish design.

Design is more than adding photographs or using fonts to punctuate a mailer for effect. Too many colors, competing fonts, a smattering of graphics, and you could end up with a marketing piece that confuses rather than motivates people to act.

A professional graphic designer understands the impact that color, visuals, and type make on the page. Designers know where to put the call to action (the request for donations) and how to set up a mailing panel appropriately. Hiring a professional nonprofit marketing agency or graphic design skilled in designing for nonprofit fundraising is a worthwhile investment.

Nonprofit Fundraising the Right Way

Don’t let the mistakes of the past weigh you down. If, as you’re reading this, you see errors that your nonprofit has made in the past, note them and move on.

At Welter Consulting, we act as the bridge between your nonprofit and the software that you need to succeed. This includes fundraising software to track, manage, and measure the impact of donor contacts. We are here to help you with software selection, implementation, training, and audit preparation. Contact us at 206-605-3113 for a consultation today.

Using eBay for Fundraising Auctions

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eBay, the ubiquitous auction website, offers more than a platform to sell off old clothes or knickknacks you no longer want. It has become a powerful forum for nonprofits to raise funds.

The Nonprofit Times reports that eBay for Charity helped nonprofits generate a record $102 million in 2018. Many charities use eBay as a fundraising auction platform. Warren Buffet, the famous financial expert, helped raise $3.3 million for a human services charity auction via eBay. The charity auctioned the opportunity to enjoy a meal with the financial whiz (and the chance to ask him for tips!). Other charities have raised more modest funds, but many are using eBay as a reliable fundraising outlet.

eBay for Charity:  Four Opportunities

eBay for Charity offers nonprofits four ways to raise funds via the site:

  1. List your nonprofit on the website: Individuals can find and ‘favorite’ the nonprofit of their choice. When they shop on eBay, a portion of the proceeds is sent to their selected nonprofit.
  2. Donate directly: eBay sellers can check a box off during the listing setup process to indicate that a portion of their fees and/or sale goes towards a charity.
  3. Charity auctions: Nonprofits can set up a charity auction on their own, or a series of charity auctions, using the platform.
  4. Direct sales: You can also set up shops and stores on the popular site to sell goods with the proceeds going to the organization.

Does It Work?

Many people express skepticism about the site’s ability to help charities fundraise. After all, isn’t eBay a place for good bargains, discounts, and used goods?

Yes, and no. Over the past several years, the site has evolved as a viable shopping platform, a place where entrepreneurs can set up their online stores at a fraction of the cost of self-hosted sites and stores. Many run their entire businesses via eBay, either selling new goods, reselling goods, or using a combination of sales and auctions.

Warren Buffet’s charity raised over $3.3 million, as we mentioned above. Are other nonprofits raising money using the site’s features for charities? A press release issued by the company makes it clear that yes, they are:

  • The Prince’s Trust, a U.K.-based nonprofit headed by Prince Charles, raised about $138,000 in just 24-hours. The campaign promises to help budding entrepreneurs ages 18-24.
  • Homes for Our Troops, a USA-based nonprofit that helps veterans, raised $160,000 to build specially designed handicapped accessible homes for severely injured veterans. The nonprofit used a 10-day auction format to raise funds.
  • Seattle Goodwill: Goodwill stores offer clothing, furniture, and other items at retail shops around the nation. However, the Seattle store recognized the power of reaching a wider audience and listed their items in an online store powered by eBay. The store quickly realized that they were making much more money online than in their stores, with goods selling far above the asking price.

These are just a handful of stories shared by the company to demonstrate how different nonprofits use the site to raise funds. But doesn’t it give you some great ideas? For example, you can:

  • Run a celebrity auction: Like Warren Buffet’s donated dinner date, how about seeking a local celebrity for a charity meal auction?
  • List donated items: List donated items in an online store or auction site and promote the event to your email list. Make sure you have a suitable donor contact list and donor management software to run your campaign.
  • Ask your followers and fans to select your charity as their desired nonprofit on the site. This way, whenever they purchase on eBay, a portion goes automatically to your nonprofit.
  • Encourage people to list items for charitable sale and donate the profits to your organization. It’s fast, easy, and straightforward.

Are you ready to try eBay for Charities? Sign up on the site, and let the fundraising begin!

Welter Consulting

Welter Consulting bridges people and technology together for effective solutions for nonprofit organizations. We offer software and services that can help you with your accounting needs. Please contact Welter Consulting at 206-605-3113 for more information.

Storytelling for Fundraising – But What Do I Say?

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In our last article, we talked briefly about the importance of getting your board “on board” with fundraising efforts. Boards should lead the way in the fundraising department and set the tone for the entire organization to encourage support and donations.

One way in which you can encourage your board members to participate in fundraising activities is to change the mindset around fundraising from a chore to a pleasure. How can asking for money be a pleasure? When it’s framed as a story with a message at the end, it becomes much more fun to talk to people about your nonprofit and yes, ask for a donation.

If you’re not a natural storyteller, never fear. We have several tips to help you think on your feet.

What Stories Should I Tell?

Stories for fundraising take several forms. These include:

  1. Stories about the organization: Talk to people about how your organization became involved in its work. Who was the founder? What did he or she do? Where did you start? Most board members know their organization’s story by heart. It’s a great place to start. The ending can be, “We need your help to keep the story going…” and then the call for a donation.
  2. Stories about individuals: Individual stories stick in people’s minds the best. Who are the people you have helped? Tell their individual stories and include details (without compromising anyone’s privacy, of course). For example, a nonprofit that donates mosquito netting to villagers in Central and South American can share how it helped one woman give birth to a healthy baby by preventing zika virus infection. It’s stories like this that connect people emotionally to the charity to which their funds are donated.
  3. Ask the other person their story: This is an interesting twist on storytelling for donations. Instead of telling your story, or the organization’s account, ask the other person their story in reference to your organization’s mission. Someone seeking donations for an education nonprofit may ask, “Where did you go to college?” and the answer may lead to a story about how the potential donor chose their college. This can segue into a discussion about how they paid for college, the opportunities a college education opened for them, and so on. From there, you can weave the story of how your nonprofit helps people go to college and why their donation is essential. You use their story as a springboard for the donation request.

Connecting the Dots, Story-Style

Stories connect the dots between the work an organization does and the impact it makes upon those it serves. Data about the organization is important; after all, people do want to look up nonprofits on sites such as GuideStar and Charity Navigator to ensure that their donation is going to an organization that manages its work responsibly.

But it is the stories that people remember, not the facts. An animal shelter helps place dozens of dogs and cats annually, but it’s the story about the shelter dog who woke his family up by barking and saved them from a fire that will keep donors interested. It’s asking the donor if they’ve ever rescued a dog from a shelter and seeing their eyes light up when they tell you about Duke and what a great dog he was, and then reminding them that the Dukes of this world also needs a home. Stories, and the emotion they convey, connect the dots between heart and mind, donor and organization.

Welter Consulting

Welter Consulting bridges people and technology together for effective solutions for nonprofit organizations. We offer software and services that can help you with your accounting needs. Please contact Welter Consulting at 206-605-3113 for more information.