Building a Culture of Philanthropy

1. Building a Culture of Philanthropy MPS 519, Resource DevelopmentDePaul University School of Public Service Meagan Downey, CFREApril 20, 2013

2. Definition • Culture of philanthropy: a set of organizational values and practices that support and nurture development within a nonprofit organization

3. In Practice • Most people in the organization 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 mission-aligned program of the organization. • Organizational systems are established to support the act of giving. • The executive director is committed to and personally involved in fundraising.

5. Climate: Instability in the Development Director Role Development Directors Leaving the Organization or Field by Organizational Budget Size Underdeveloped: A National Study of Challenges Facing Nonprofit Fundraising, Bell and Cornelius, CompassPoint, 2013

6. Climate: Executive Directors Dissatisfied and Unprepared Underdeveloped: A National Study of Challenges Facing Nonprofit Fundraising, Bell and Cornelius, CompassPoint, 2013

7. Climate: Executive Directors Dissatisfied and Unprepared Underdeveloped: A National Study of Challenges Facing Nonprofit Fundraising, Bell and Cornelius, CompassPoint, 2013

8. Climate: Board Members Not Sufficiently Engaged In Philanthropy Board Member Engagement as Reported by Executive Directors by Organizational Budget Size Underdeveloped: A National Study of Challenges Facing Nonprofit Fundraising, Bell and Cornelius, CompassPoint, 2013

9. Climate: A Vicious Cycle • High turnover rate of development staff, due to dissatisfaction and termination • Misunderstanding about the development profession leads to unrealistic expectations of fundraising staff • Fundraising becomes “a necessary evil” instead of an opportunity for engagement • Donors lack meaningful relationships to the organizations they care about, or worse, they lack trust in organizational leadership and fundraising staff

11. Breaking the Cycle • Continual education • Creating and communicating opportunities for engagement • Communicating impact

12. Education and Training Resources • Association of Fundraising Professionals • BoardSource • Donors Forum • Chronicle of Philanthropy • Fundraising and board development consultants • Executive coaching • CFRE International • IUPUI School of Philanthropy • Integration of training in basic staff and board orientation • Harvard Business Review • Donor surveys and focus groups

13. Engagement: Demystifying the Donor DONOR

14. Engagement:Demystifying the Donor • Board members • Former board members • All staff • Leadership • Volunteers • Activists • Members/subscribers • Beneficiaries • Audience goers/attendees • Grateful patients • “Family” friends

15. Engagement:Demystifying the Donor Successful fundraising professionals develop close relationships with all staff and volunteers who have contact with these constituencies. They make fundraising success everyone’s success, and fundraising challenges everyone’s challenges.

16. Impact:Fundraising Metrics Development raised $XX,XXX,XXX!

17. Impact: Fundraising Metrics • Metrics are ideally represented in fund development plan and integrated into organizational strategic and operational plans • Metrics address costs (hard and soft), revenues and health of donor base • Targeted improvements in metrics are closely tied to budgetary needs/budgetary cuts (staffing, technology, prospect research, etc.) • Relevant metrics are regularly communicated to staff and volunteers who are not development professionals • Metrics inform rather than overwhelm.

18. Impact: Fundraising Metrics Metrics can show what is happening, but not necessarily why. Discussing the why can be a valuable engagement exercise for executive directors, board members and fellow staff, and help to create buy-in for fundraising strategies undertaken by the organization.

19. Impact: Fundraising Metrics Cost per dollar raised Net ticket revenue Average lifetime value Renewals Attrition rate # of meaningful contacts What is “good”? Email click-through rate Response rate # of face-to-face solicitations % board giving # of event attendees Email open rate Upgrades/downgrades

20. Impact: Fundraising Metrics Good is better.

21. Cost Per Dollar Raised • Often an oversimplified metric, at times sensationalized by the media and misunderstood • Considerations include type and age of the organization and mix of fundraising programs • Returns on investment in fundraising programs don’t necessarily show up in the same fiscal year • Generating $4M at a cost of $1M (25% CPD) is preferable to $3M at a cost of $600K (20% CPD) because the end result is $600K more to spend on mission Association of Fundraising Professionals Resource Center; Hot Topic: Fundraising Costs

22. Cost Per Dollar Raised Dan Pallotta: The Way We Talk About Charity Is Dead Wrong; Ted; http://www.youtube.com/watch?v=bfAzi6D5FpM

23. Impact: Fundraising Metrics • Identify who needs to know what • Give partners simple benchmarks that they can follow over time • Communicate trends • Engage partner stakeholders in determining the why, then test assumptions together • Never underestimate anecdotal feedback to weave into metrics to create a compelling narrative • Succeed together, fail together, innovate together • Institutionalize opportunities for communicating impact

24. Discussion