One of my predicted “5 Nonprofit Trends to Watch in 2017” is that we will see “More Analysis of What Nonprofit Financial Sustainability Requires.” In other words, I think (hope) in this new year that nonprofit leaders and their funders will work to figure out how to make nonprofits more financial sustainable.
Financial sustainability means that both the way money comes in the door (revenue) and the way money goes out the door (expenses) happen in a smart, strategic way. When they do, you have a robust financial model.
In my mind, one of the first steps toward that sustainability is for nonprofit leaders to look inward. While there are many reasons for the financial instability that plagues the nonprofit sector — from the Overhead Myth, to restricted funding, to lack of financial training — nonprofit leaders sometimes perpetuate the dysfunction themselves with an unhealthy attitude toward money.
Nonprofit leaders must embrace money as a tool — rather than a scourge — that can help them better achieve their mission.
So in this new year, in order to get closer to financial sustainability in your own nonprofit, I challenge you to ask yourself these questions about money:
- Do I embrace money as a tool to achieve our mission?
As the ultimate cheerleader of your nonprofit’s board and staff, you must ask whether you yourself fully embrace money. Money has long been viewed as a necessary evil in the nonprofit sector. We don’t want too much of it (for fear of scaring off donors); we don’t want to ask people for it (for fear of rejection); we don’t want to make our board go out and get it (for fear they will bolt). But it is your role as leader of your nonprofit to eschew those outdated notions and instead recognize that a smart, well-executed money strategy can be instrumental to achieving your mission.
- Do we know our actual costs?
Not just the full costs to run each of your programs (which is important), but the overall costs of executing on your strategic plan. I can’t tell you how many nonprofit leaders I meet who a) don’t have a strategic plan in place or b) if they do, they haven’t tied it to money. You simply will not accomplish anything if you don’t analyze and plan for what it will truly cost to accomplish your goals as an organization. So start by using this Bridgespan tool to figure out the full costs of your programs and then add to that the other organizational and infrastructure costs necessary to achieve your overall strategic goals.
- Do we have a financial model?
So that’s how money flows out of the organization, but to fully flesh out your financial model you need to plan for how money will flow into the organization. The funny thing about money is that if you are smarter and more strategic about it, you will attract more of it. So instead of hoping and praying that enough money will show up at your doorstep, create an overall financial strategy that includes your tactics for how you will attract each applicable revenue line (individuals, foundations, corporations, government, and/or earned income) that flows into your financial model.
- Does our board understand and contribute to our financial model?
Once you’ve figured out your financial model, you must get your board fully involved in it. A nonprofit will never be financially sustainable if money is left solely to the staff to figure out. That means the board needs to understand revenue and expenses, over the long-term, and how they apply to the overall strategy of the organization. And it is not enough for them just to understand it, they must contribute (in many and various ways) to the successful implementation of that financial model.
- Do we ask funders to support the effective execution of our financial model?
You can’t just have a great financial strategy on paper, you also need to invest in the structure and systems necessary to execute on that strategy. That means you have to hire talented money-raising staff, acquire functional technology, develop capable donor systems, create compelling marketing and communications. Those elements make up your money-raising function, and in order to make it effective you have to invest in those elements. So figure out what that will cost and convince some funders to pay for it.
It’s time to get over your money issues. You will not achieve financial sustainability unless you fully embrace money as a critical conduit to the social change you seek.
Photo Credit: Daniel Borman
I recently received a note from a blog reader who disagreed with my argument that a nonprofit’s board of directors should be charged with raising 10% of their nonprofit’s budget. Not only did this reader disagree with the idea of setting a 10% board fundraising goal, but he disagreed with linking board governance and fundraising at all.
As he wrote:
“I recently resigned from a board of a nonprofit, after a 5-year stint. I was honored to be asked to join the board, until at my first meeting pledge cards were passed around, and I realized it was my money, not my leadership skills, that qualified me for board membership. I have given on numerous occasions, but I refused to pay a “bill” I received for my share of employee Christmas bonuses last year. There have been many instances where the board was expected to give money. Only a tiny fraction of the budget would be raised through these measures, so it seemed like it was a membership test. Governance should be totally separate from fundraising.”
While I appreciate this reader’s frustration as a board member, I would argue that his unfortunate experience had more to do with poor management of a board, and less to do with fundraising being part of a board member’s charge.
I don’t believe board members should ever be “billed” for a contribution. Rather, the board chair and the executive director should sit down with each board member individually on an annual basis and have an open conversation about that board member’s role on the board. This should be a much larger conversation than just what she wants her annual financial commitment to be, but that still must be part of the conversation. So while you absolutely should discuss why the board member has chosen to serve on your board and what she would like her role to be, you also can (and should) discuss how she wants to contribute to the financial model of the organization.
And if you define a board member’s “contribution” much more broadly than just a check she writes, the sum total of all of the contributions each board member makes can be much more significant than “a tiny fraction of the budget.” Every single board member, if truly right for the post, has many ways to contribute to the financial model of a nonprofit (here is just a beginning list of ways). If you ask board members to think strategically about how they can contribute, and if they are well versed in the financial model of the organization they serve, it should be fairly easy to get them involved in a significant way.
And getting each board member engaged and involved in the organization should be the aim. While I agree that the idea of a “membership test” is certainly unappealing, there should be a bar to being a member of the board of a nonprofit organization. If some members are allowed to be members in name only, but not required to have any skin in the game, then what compels any member to invest their time and resources in a significant way? If there is no bar that a board member must clear to be a board member, then what separates a board member from just an interested member of the public?
A board of directors must be a nonprofit’s staunchest supporters, most vocal advocates, and most committed allies. If a nonprofit cannot depend on its board to work tirelessly, not only to ensure achievement of the mission, but also to ensure financial sustainability, how can a nonprofit possibly expect those outside the organization to care? So, yes, being a member of a board must come with some level of commitment, both of time and of resources.
Because at the end of the day, there is no mission without money. By allowing any individual board member, let alone your entire board, to make programmatic and organizational decisions without fully understanding and contributing to the financial model of the organization you are creating an enormous disconnect between mission and money. A person cannot hope to understand something unless they have actually worked within it. So each board member must somehow contribute to the financial model of the nonprofit on which they serve.
Just because nonprofit leaders sometimes do a poor job of engaging their board in the financial model does not mean that we should separate the governance of a nonprofit from its financial model. All board members must understand, embrace, and actively work toward the financial sustainability of the nonprofit they govern.
Photo Credit: Susana Fernandez
The Evelyn and Walter Haas, Jr. Fund, a foundation on the forefront of investing in nonprofit capacity and one of the few foundations funding nonprofit leadership development, released a new report this week Beyond Fundraising: What Does It Mean to Build a Culture of Philanthropy?.
While I applaud the Haas Fund for taking a pioneering interest in, as they put it, “understanding how to break out of the nonprofit sector’s chronic fundraising challenges,” unfortunately I don’t think that this report will move the needle on the sector’s money woes.
Their landmark 2013 report published with CompassPoint, UnderDeveloped: A National Study of Challenges Facing Nonprofit Fundraising (of which the Beyond Fundraising report is a follow up) uncovered a real crisis in fundraising staffing in the nonprofit sector. And last year Haas announced a multi-year effort to “to identify gaps that may need to be filled when it comes to helping nonprofits break out of chronic fundraising challenges.”
A sector-wide conversation about money is so incredibly needed that I really appreciate the Haas Fund’s efforts to start it, especially when philanthropists are loathe to talk about the sector’s money challenges, let alone invest in solving them.
But in the hope that debate spurs greater change, and because of Haas’ expressed desire to open a conversation so that they can “learn out loud,” I offer my concerns about the Beyond Fundraising report.
As Linda Wood, Senior Director of Leadership Initiatives at the Haas Fund (and past interviewee on this blog), describes in the beginning of the Beyond Fundraising report, there must be a fundamental change in how nonprofits approach fundraising. As she writes: “Without a deeper shift in how organizations hold the work of fund development, simply adopting new tools and techniques may not be enough.”
The Beyond Fundraising report, authored by philanthropy consultant Cynthia Gibson (also a past interviewee on this blog), starts from where the 2013 UnderDeveloped report left off: that the lack of a culture of philanthropy is the most important issue holding nonprofits back from fundraising success:
By framing the issue as a talent pool problem alone, we neglect to focus more critically upon entrenched organizational factors that contribute to the inability to establish development as a shared function and nurture an organizational culture to sustain it. The right development director hire alone will never break the cycle, but the right person inside an organization that has a culture of philanthropy, can.
The Beyond Fundraising report is an attempt to understand what a culture of philanthropy is and how to encourage its growth. The report defines a “culture of philanthropy” as a situation in a nonprofit where:
Most people in the organization (across positions) act as ambassadors and engage in relationship-building. Everyone
promotes philanthropy and can articulate a case for giving. Fund development is viewed and valued as a missionaligned program of the organization. Organizational systems are established to support donors. The executive director is committed and personally involved in fundraising.
The report delineates four necessary components to a culture of philanthropy:
- Shared responsibility for development
- Integration and alignment with mission
- A focus on fundraising as engagement
- Strong donor relationships
It then provides a list of indicators for nonprofit leaders to use to assess whether or not they possess a culture of philanthropy, a list of “guiding questions” nonprofit leadership can ask in order to build a culture of philanthropy, and a list of roles that development staff and funders can play in bringing a culture of philanthropy to fruition.
While I don’t disagree with any of the indicators, questions, or roles the report describes, I don’t think that any of them, or even their sum total, will solve the lack of financial sustainability at a particular nonprofit, let alone in the nonprofit sector overall.
And this is because I think that only looking at fundraising — the pursuit of philanthropic dollars, which only make up 13% of all the money flowing to the nonprofit sector — is a fundamentally flawed approach to understanding money in the sector. My bias has always been to move the sector from a broken fundraising approach to a more strategic and holistic financing approach.
And while I agree that individual nonprofit leaders are part of the problem, they are just one part. Often their troubled approach to money is simply a reaction to a dysfunctional system. Certainly we need to move away from some ineffective money practices that nonprofit leaders embrace (being reactive rather than strategic about money, not calculating the return on investment of fundraising activities, not aligning money and mission, allowing a board to dismiss their money-raising responsibilities…).
But I worry that by scapegoating the problem to the shortcomings of individual nonprofits we are ignoring the larger financial dysfunctions of the sector. Rather than pull back the curtain on the systemic hurdles causing the nonprofit sector’s money woes, I fear that this report lays much of the blame for financial dysfunction at the feet of individual nonprofit leaders.
Because in my mind, the real problem is not the approach of individual nonprofit leaders, although that is important. I think the financial problems of the nonprofit sector run much deeper. If we truly want to address those problems we must have bigger conversations, and ask harder questions, like:
- Why is there a lack of financial acumen (how to effectively attract and employ money) throughout the sector (present among both nonprofits and their funders), and how do we solve that?
- Why is long-term organizational and financial planning not encouraged and supported throughout the sector?
- Why is there not enough investment in the financial function of nonprofit organizations (the staffing, systems, technology, planning, and marketing necessary to build sustainable financial models)?
- Why aren’t there many, many more funders like The Haas Fund discussing and investing in solutions to the sector’s money problems?
- Why are we still focusing on philanthropic dollars alone when we need to understand and integrate money as a whole into social change efforts?
And that’s just a start.
My fear is that if we place the full weight of nonprofit financial dysfunction on the shoulders of an individual nonprofit’s culture, or if we look only at fundraising, we shirk our duty to dig deeper and remedy larger, structural dysfunctions in the sector.
I applaud the Haas Fund for their determination and courage to create a space, through their capacity investments and on-going research, for the incredibly important conversation about money in the nonprofit sector. But I would love to see this effort grow to become a bigger conversation about how we solve the endemic financial challenges nonprofits face.
Photo Credit: The Evelyn & Walter Haas, Jr. Fund
Fundraising is such a misunderstood enterprise. And it’s not just misunderstood by nonprofit leaders in the trenches.
I was talking to a normally very savvy foundation program officer the other day who wondered if one of his struggling grantees should think about launching a new gala event to raise some additional money. I swallowed my first inclination to scream “NOOOOOO!” in the middle of a crowded restaurant and instead calmly explained why events are a bad money fix, and why any short-term money generating strategy is probably a really bad idea.
But this well-meaning program officer is far from alone in his understanding of financial sustainability in the nonprofit sector. If I had my way, nonprofit leaders would stop making these 5 big fundraising mistakes:
- Taking a Short-Term Approach
If you don’t have enough money today, a single fundraising activity isn’t going to solve the problem in the long-term. If you want to solve your ongoing money woes, you have to create a long-term plan. The single best way to bring more and larger dollars in the door is to create a smart, long-term strategy for your nonprofit. And that long-term strategy must include a corresponding long-term financial strategy. With a compelling Theory of Change (an articulation of the value your nonprofit creates), what you are hoping to accomplish, and how you will get there, you will be better able to convince funders (no matter what your financial model) to come aboard. People invest in a compelling and believable vision for the future. If you are just raising money for the day-to-day, you will always struggle.
- Looking Under the Same Rocks
Often when there is a money shortfall, nonprofit leaders think they simply need to ask the same people to give again or more. If only it were that easy. To attract more people and organizations you have to have a wider net. But not just on your Facebook page or in your mailing list. A wider net means that your board’s networks need to grow, your distribution channels need to grow, your friend-raising activities, your strategic alliances need to grow — the overall network of your nonprofit needs to grow. You need to think holistically about how to grow the reach of your organization and get everyone involved in making that happen.
- Chasing A Magic Bullet
Seriously, listen when I say this: There Is No Magic Bullet to Fundraising. Fundraising, like so many things, often falls victim to shiny object syndrome. From the Ice Bucket Challenge, to crowdfunding, to social media, it seems there is always something new that nonprofit leaders, philanthropists, or board members think will finally solve a nonprofit’s money woes. But the reality is that finding enough and the right kind of money for the results you want to achieve as an organization is hard work. There is no easy fix. Instead you have to get strategic and create, and then systematically execute on, a financial plan for your nonprofit. It may sound boring, but believe me, once you attach strategy to money, the transformation — to your staff and board, to your funders, to your financial model, to your overall results, to your effectiveness and sustainability as an organization — can be incredible.
- Giving People a Free Pass
When you tell certain board members or certain staff members that they don’t have to worry about money, you are essentially giving them a free pass and placing a larger burden on the rest of the organization. While money must be led by your Chief Money Officer (whatever their title — Executive Director, Development Director, CDO), it must be a team effort. Your money person’s job is to develop an overall money strategy and then mobilize all her resources (staff, board, other volunteers, technology, systems) to bring that money strategy to fruition. She CANNOT do it alone or with only half a board. Money has to be part of the conversation for everyone in the organization.
- Not Fundraising for The Fundraising Function
If you want to get better at raising money, you must invest in the right strategy, staff, and systems — your fundraising function –to raise that money. You need to pay market rate for a fundraising person who is a smart, strategic leader. You need to put time and effort into an overall financial strategy, and you need to create the infrastructure (technology, systems) to make that financial strategy a reality. To make these investments, you might have to raise capacity capital from your donors, a one-time infusion of significant money that helps strengthen your organization. A capacity capital investment in your fundraising function can more than pay for itself in a few years when your transformed financial engine is running at a much more profitable rate. But failing to invest in your fundraising function means you will continue to struggle financially.
Oh nonprofit leaders, please stop hitting your heads against the fundraising wall. I promise you, a more sustainable financial engine awaits if you simply invest the time and energy into a smart strategy, a broader network, effective staff and systems and a real team effort.
Photo Credit: hobvias sudoneighm
It seems I raised controversy with my recent post, “Is Your Nonprofit Board Avoiding Their Money Role?”. The hot button issue, not surprisingly, was my assertion that boards should be charged with raising 10% of a nonprofit’s budget.
As I put it:
I know it’s heresy, but I believe that a board should be charged with raising at least 10% of a nonprofit’s annual budget. But that doesn’t mean they all have to write personal checks (or get their friends to write them). Rather, there is an endless list…of ways board members, who are fundraising shy, can bring money in the door. Because why should the entire financial burden be left on the shoulders of the staff? That’s just not sustainable. And if you can’t get your board to step up to the financial plate, how will you have any hope of getting others to do so?
In my 30 years of experience, the most sustainable organizations financially are those that rely little on their board of directors for their financial success. I just wonder why it is that these governing volunteers, who are charged with so many more weighty responsibilities for sustainability, are held to such a double standard when it comes to revenue development. Imagine the absurdity of you pronouncing: The Board of Directors must be responsible for managing at least 10% of the organization’s programs.
I argued back that we must define board contribution to the financial model of a nonprofit much more broadly:
The point is that board members should not be allowed to ignore the financial realities of the organization, and it is impossible to ignore something when you have a responsibility for a piece of it. In the examples you give, I would wager that if you calculated board involvement in a much broader way, you would find that at least 10% of that money could be attributed to board involvement. And if not, yikes! Because that means it is all resting on the shoulders of the staff, and that simply is not sustainable. The board must be much more supportive of the nonprofits they serve, and in my mind that means they need to show up, and show up in a significant way, to the financial engine of their organization.
But Gayle was not having it. She responded that just as the board should not be expected to deliver on programs, they should also not be expected to contribute to the financial model:
In very brief, the role of the board as governors is to ensure that the organization is delivering on its mission, that it has a business model that supports its ability to deliver its social impact and that the organization has a human resource and operation plan to make that happen. That it is trustworthy and worthy of support. This is the absolutely best fundraising work that they can do. Boards are totally within their governing role to decide that the way to meet the organization’s revenue needs is hire professional staff and have them do what they are in fact trained to do. I would hypothesize that organizations that do that are more likely to successfully achieve their revenue goals (actually, there is research data to back this us -see “Nonprofit Fundraising Study” of Nonprofit Research Collaborative 2012 ) than the wishful and largely unmeasurable objective of 10% standards pulled out of a hat. BTW, I don’t understand why it is unimaginable to say that the board is responsible for delivering 10% of programs, or 10% of operations, if you set up a standard of attributing 10% of revenues? What makes one different from the other in terms of sustainability or professional expertise?
But in my mind, there is a critical role for the board in both mission and money, and you cannot have one without the other, as I replied to Gayle:
I completely agree with how you characterize the role of the board (“to ensure that the organization is delivering on its mission, that it has a business model that supports its ability to deliver its social impact and that the organization has a human resource and operation plan to make that happen. That it is trustworthy and worthy of support”). However, the missing link (so very, very often) in nonprofit organizations is that the board thinks that showing up to meetings and hearing the development report is enough. Raising money requires that the board take an active role. And that active role means opening doors, making connections, providing intelligence, offering insight. This can actually also be true in delivering programs — the board should not only help provide the overall program strategy and theory of change for the organization, but also help to open doors and make connections to key decisionmakers, advocates, or others outside the organization walls who are critical to effective delivery of the organization’s mission. In all of this, I am simply asking that the board step up and take an ACTIVE role, as opposed to a passive role of “hiring professional staff and have them do what they are in fact trained to do.” There must be an effective partnership between the board and staff in developing and executing on a robust financial model, just as this partnership between board and staff must exist in delivery on mission, because at the end of the day there is no mission without money. Maybe 10% isn’t the right number, but I believe you have to set a significant goal if you truly want the board to take notice and actually step up.
You can read the full debate here.
To me, this is such an important topic because it helps uncover our underlying assumptions about the role of the board versus the role of staff. In my mind, we must elevate the expectations we have for the nonprofit board of directors, and one way to do this is to set clear, specific, and lofty goals for them.
What are your thoughts?
Photo Credit: Ron Cogswell
Fundraising is, for the most part, a fundamentally misunderstood activity. There are a lot of misconceptions, among nonprofit leaders, board members — even donors — about effective ways to bring money in the door.
Here are are a few of the worst delusions about fundraising that persist in the sector:
- Events Are Fundraisers
Very few nonprofit events generate a net income after you factor in the direct (food, venue, invitations, entertainment) and indirect (board and staff time) costs that go into them. They simply are not profit-generating activities. If you are looking to your events to bring in a profit, calculate the cost to raise a dollar to see if they actually are. Some nonprofit leaders argue that events generate value beyond profit, vague terms like “awareness” or “goodwill.” That may be, but unless you follow-up with individual event attendees to turn that increased “awareness” or “goodwill” into money, there is little financial value to events. Turn your energies instead to low-cost, mission-focused cultivation and stewardship events for your major donors and major donor prospects, then you might have something.
- Crowdfunding Creates Revenue
Nope, it doesn’t. Revenue is the on-going money you need to keep your doors open and your operations running. A crowdfunding campaign, by definition, is a one-time deal. It is organized around a specific need or timeframe. Therefore the money it generates is not easily or regularly repeated. Crowdfunding could make sense for a nonprofit hoping to raise startup, growth or capacity capital (all one-time infusions of money). But that Kickstarter campaign is not going to keep the lights on, so look elsewhere (like a financing plan) for sustainable revenue.
- Major Donors Can Be Recruited En Masse
Major donors are secured through a long-term, systematic, one-on-one process. There is no quick way to bring large donors on board. My issue with mass major donor fundraising programs (like the Benevon model) is that when you ask people as a group to pull out their checkbooks, you are leaving money on the table. The check someone feels compelled to write after watching a 20-minute presentation with their friends pales in comparison to the one they will write after you’ve built a one-on-one relationship with them over time. Put together a strategic major donor campaign, along with the infrastructure and systems to execute on it, and you will create a long-term major donor base (and its corresponding revenue stream) for years to come.
- Skimping on Fundraising Staff and Systems Saves Money
While you may save a few thousand dollars in salary by hiring a novice fundraiser (instead of an experienced one), you will cost the organization hundreds of thousands of dollars in missed revenue. The same is true with cheap fundraising systems like an ineffective donor database, an unresponsive website, a cumbersome email marketing system, or a poor (or non-existent) marketing strategy. Figure out what it will really cost to build the fundraising team and systems you need and then raise the capacity capital to get there.
- Endowments Solve Money Woes
Let’s face it, an endowment makes sense for very few nonprofits. Even if you were able to convince donors to let their money just sit in a bank account (which is a big “if”), that money won’t really impact your bottomline. Even if you raise an endowment of $1 million, it will only generate $50,000 (assuming a 5% return) of operating revenue each year. Instead raise a much smaller amount of capacity capital which you could use to strengthen your fundraising infrastructure (more staff, better technology). Those improvements could increase your annual revenue by many times more than $50,000.
It’s time to face the facts. There are smart ways to raise money and there are delusional ways to (not) do it. Embrace the power of money and use it as a tool to create a more effective, sustainable organization.
Photo Credit: TaxCredits
One of the things I love about summer – aside from the obvious loves like swimming, family trips and watermelon – is that the slower pace allows time to take a step back and find a better way forward. For nonprofit leaders, summer is a great time to take a hard look at how you bring money in the door and figure out a more sustainable way to do so.
It’s time to trash your ineffective fundraising plan.
A Financing Plan, unlike a traditional fundraising plan, is an integrated, thoughtful, and strategic way to help a nonprofit raise enough money to achieve its programmatic and organizational goals. Instead of asking the question:
“How much can we accomplish with what we can raise?”
you are asking the question:
“How much should we raise to accomplish our goals?”
The Build a Nonprofit Financing Plan Guide walks you, step-by-step, through building a financing plan for your nonprofit. It shows you how to:
- Align Money, Mission and Competence
- Create Revenue Goals
- Create a Capital Goal
- Create a Fundraising Infrastructure Goal
- Operationalize the Plan
- Monitor the Plan
This guide gives you the knowledge and the step-by-step guidance to get more effective at bringing money in the door.
Here’s an excerpt from the Build a Nonprofit Financing Plan Guide:
The Financing Plan Framework
Your final financing plan will be made up of goals, objectives and an operational plan. Here’s how the financing plan framework breaks down.
Your final financing plan will have approximately 5 broad goals. These goals come in three types: revenue goals, a capital goal, and a financing infrastructure goal. Below is what differentiates these three types of goals. And don’t worry if this is still a little muddy, I will go into more detail and give you some examples a little later in the guide.
1. Revenue Goals
Remember, revenue is the day-to-day money you need to meet the expenses of your strategic plan. You will have 1 revenue goal for each revenue source that is appropriate to your organization:
- Private dollars (foundations, corporations, individuals)
- Public dollars (government grants)
- Earned revenue (sales of goods or services)
Your revenue goals will make up 3 of the 5 goals of your final financing plan.
2. Capital Goal
Remember, capital is the one-time organization-building money you need to fund special or infrastructure-related purchases within your strategic plan. So it might be the money you need for a program evaluation, or a new data-gathering system, a new database, etc. If you require capital investments to make your strategic plan a reality, one of the goals of your financing plan will be a capital goal.
3. Financing Infrastructure Goal
This goal is not a money goal, but rather an activity goal. If you want to significantly grow the revenue that flows to your nonprofit, you will have to make some improvements to the financing infrastructure of your organization. This means you might want to add additional development staff, buy a new donor database, upgrade your website, create marketing materials, etc. One of the goals of your financing plan should focus on what improvements you will make to the internal systems, staffing and technology you use to bring money in the door.
Each of these goals will be broken down into objectives (or pieces) to make them achievable. For example, you might have a revenue goal that describes how much private money you will raise. You would then break that total private revenue goal into the individual donor, corporate donor and foundation grant objectives necessary to achieve that goal.
Once you establish your goals and objectives, you will break each objective into the activities, deliverables, people responsible, and due dates. This becomes your very tactical operational plan with which you will execute on and monitor the financing plan. It ensures that the goals and objectives actually come to fruition.
So let’s get started creating your financing plan…
To continue reading and building your nonprofit’s financing plan, download the Build a Nonprofit Financing Plan Guide now.
Photo Credit: Steven Depolo
I am really in to Slideshare lately. I uploaded my first Slideshare presentation, Calculating the Cost of Fundraising, last month and people seemed to really like it. So I plan to create regular Slideshare presentations and share them on the Social Velocity Slideshare site.
Today’s Slideshare is 7 Ways to Kiss Fundraising Goodbye. Traditional nonprofit fundraising is broken. It lock nonprofits in an endless cycle of chasing low return activities. A much better approach is to create a sustainable financial model that aligns well with your mission and core competencies. Nonprofits must move from Fundraising to Financing.
If you want to move your nonprofit from a Fundraising to a Financing approach, download the Build a Nonprofit Financing Plan Step-by-Step Guide.