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case for investment

How Convincing is Your Nonprofit’s Fundraising Ask?

beggingTired of the endless fundraising circuit, nonprofit leaders sometimes get frustrated when prospective donors won’t invest in their nonprofits, like this executive director:

“Here’s my problem…It’s obvious these people have money, they just don’t want to share it with us.”

What this executive director fails to realize is that the burden to connect the dots for donors lies squarely on her shoulders. It is up to nonprofit leaders to articulate – in a compelling, inspiring way – how their nonprofit is creating a solution to an important social problem, and why donors should care about and invest in that solution.

A Case for Investment can help you do just that.

Now more than ever, nonprofits are struggling for funding amid growing competition and diminishing available dollars. At the same time, burgeoning interest in performance management and impact investing have focused more donors on the outcomes their investment in a nonprofit will bring.

Donors, especially major donors, are less likely to give to a nonprofit because the organization “does good work” and more likely to give because a nonprofit demonstrates how it creates a solution to a social problem the donor cares about.

Those nonprofits that want to continue to attract and grow philanthropic investment must create a compelling, thoughtful argument for why a donor should give to their organization. This argument is called a “Case for Investment.” Driven by a thoughtful combination of data and emotion, a good Case for Investment can help a nonprofit communicate and connect with their target donors much more effectively.

The Case for Investment Step-by-Step Guide can help you create your nonprofit’s case.

case for investment guideAs one nonprofit executive director who used the Guide put it:

“I am using it as a catalyst to create a branding campaign with my Marketing Committee. Of course, this will be used for fundraising and grant writing as well. We really needed the framework to build value for our donors, volunteers, and clients.”

A good case for investment is the fundamental building block from which all donor communications, marketing materials, grant proposals, website language, and more is born.

The Case for Investment Step-by-Step Guide is broken down into ten sections:

  1. Why Create a Case for Investment?
  2. How to Use This Guide
  3. The Need
  4. Solution
  5. Impact
  6. Financial Model
  7. Strategic Direction
  8. Resources Required
  9. Social Return on Investment
  10. Next Steps

In each section there is a series of questions, which you will answer. Your answers to these questions become the basis for your final Case for Investment. Examples of other nonprofit’s cases for investment are highlighted in each section, allowing you to see how others have made their arguments.

The Case for Investment Guide is one of six guides in the Social Velocity Step-by-Step Guide Series. You can learn more and download this and other guides here.

Photo Credit: JHall159

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The Gentle Art of Nonprofit Board Herding

Nonprofit board fundraisingThere is such a hunger in the nonprofit sector for help wrangling the board of directors. Because the board is a disparate group of volunteers, it can often seem impossible to get their attention, let alone get them all pointing in the same, effective direction. This is even more true in fundraising. But if you can get your board members all on the same page, it can transform your nonprofit.

So as we approach the end of the year and the height of nonprofit fundraising I wanted to offer some ways you can get your board more involved, not just for the next couple of weeks, but for years to come.

Here are some strategies to get your board fundraising for your nonprofit:

Start a Game-Changing Board Discussion
One way to plant the seed of change is to engage the board in a thought-provoking discussion. If you’re interested in kicking one off at your next board meeting, ask your board a question like:

And if you are uncomfortable starting the discussion yourself, let me do it. Share my video Why Every Board Member Should Fundraise at the meeting and see how board members respond. Be prepared for some disagreement, perhaps even anger and frustration. But I believe it’s far better to get the demons on the table so you can examine them rather than pretending they just don’t exist.

Give the Board Options
If you have board members that are scared of fundraising, or that hate to ask people for money, there are plenty of other things they can do to help. I believe there is an endless list of ways board members can contribute to the financial engine of the organization, from writing a business plan, to negotiating with a vendor, to hosting a friend raiser, and the list goes on. If you want to help your board think outside the fundraising box, these lists (here and here) of ways board members can raise money (without fundraising) can help.

Educate the Board on Fundraising
Often a board’s inertia comes from a lack of knowledge. Very few people know how to fundraise effectively. So remove that barrier by educating your board about how money flows in the nonprofit sector, how other boards raise money, how to ask for money, etc. The Getting Your Board to Raise Money webinar, the Finding Individual Donors webinar, and the 10 Traits of a Groundbreaking Board e-book can all be useful tools to help your board understand how things work and how they can be more helpful to the financial sustainability of the nonprofit they serve.

Involve the Board in Making the Case
You can’t expect the board to raise money if they can’t make a compelling argument for why people should give. And you can’t just hand board members a brochure and expect them to effectively articulate the message. If you really want to get your board excited about raising money for your cause, involve them in making a case for investment. Bring them together as a group to ask and answer a series of questions about why people should give to your nonprofit, what your organization is working towards, why it matters, and so on. The Draft a Case for Investment Step-by-Step Guide will give you the framework to use. At the end of the exercise you will have not only a compelling case to make to prospective donors, but, more importantly, an army of board members excited about making that case.

It is an unfortunate reality that almost every nonprofit leader faces. Boards of directors, as a rule, are not effective fundraisers. But you can move beyond that by getting your board to talk, think and act differently about bringing money in the door.

And if you’d like some one-on-one help to get your board raising more money, check out the board engagement consulting and nonprofit leader coaching services I provide.

Photo Credit: Wikimedia Commons

 

 

 

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Investing in a Sustainable Nonprofit Future

Investing in a Sustainable Nonprofit FutureI wrote last month about the crippling nonprofit fear of investment. Related to that, nonprofits need to understand and embrace the concept of Return on Investment. Nonprofit leaders often exist in such a world of scarcity that they don’t recognize that an investment today can have a huge payoff down the road. And not recognizing the value of a return on investment, particularly when it comes to a nonprofit’s fundraising function, can keep nonprofits in starvation mode.

One of the ways I consult with nonprofits is coaching a development director or executive director to increase money flowing to the organization. We work on getting board members to bring money in the door, identifying new donors, crafting a compelling message, launching new revenue streams, developing an overall financing plan.

This work could have a huge future payout:

  • Board members no longer sit on their hands but actively recruit new donors to the organization.
  • New donors are acquired through a thoughtful, strategic major donor campaign.
  • A compelling case for investment convinces foundations and major donors to invest at higher levels and for longer periods.
  • A new earned income stream brings in unrestricted revenue.
  • An effective financing plan puts scarce resources to their highest and best use.

If you think of this in terms of return on investment it’s a no-brainer. You have two options:

  1. Continue to struggle day-to-day for the foreseeable future, or
  2. Make an investment today in order to dramatically increase funding and sustainability tomorrow

Let’s do the math. If a nonprofit with a budget of $1 million were to spend, say $5,000 on hands-on coaching to develop a financing plan, create a compelling case for investment, get their board engaged in fundraising, and launch a major donor campaign those elements could translate into well over $100,000 of new money annually for the nonprofit.

Here’s how:

  • A financing plan clarifies and marshals resources so staff and board know exactly where the money flows and who will do what to make it happen. The very act of creating and monitoring a financing plan could increase funding by 5%, or $50,000.
  • A case for investment, when done well, becomes the backbone of any and all money-raising efforts. It can be integrated into your website, your social media efforts, your donor letters, your presentations. Telling a concise, compelling story makes donors sit up and take notice and adds perhaps another 2% increase, or $20,000.
  • If your entire board starts (in their own unique ways) bringing money in the door that could increase your bottomline as well. If each member of a 15-person board starts to increase their own giving and/or the giving of those in their network by $1,000 each, that’s another $15,000.
  • A major donor campaign charts a logical, strategic way for you to identify and acquire new donors. Getting strategic about how you find and recruit those donors will ensure much greater success, perhaps a 5% increase, or $50,000.

So with very conservative estimates the original $5,000 investment in coaching translates to $135,000 in new money every year thereafter.

My favorite example of this is when I helped KLRU, Austin’s PBS station use $350,000 in capacity capital to do many of the above things. After 3 years of implementing a new financing plan, using a new case for investment, and more, they were raising $1.6 million in NEW REVENUE each year. That’s a huge return on investment.

If you make a smart investment in improving the money engine of your nonprofit, that investment will pay off many times over, creating a more secure financial future for your organization.

If you’d like to learn more about how I coach nonprofit staff to bring more money in the door, check out my Coaching services, or send me an email to schedule a time to talk further.

Photo Credit: MeckiMac

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