by Andrae Bailey
CEO, Change Everything / Co-Founder, The Collective
The nonprofit sector of the American economy has never been larger than it is today. There is a nonprofit corporation to serve every cause. And often, there are dozens or even hundreds of organizations addressing the same issue.
But if there is one thing that all nonprofits have in common it is their common need for money. Every nonprofit I have ever seen needs more money than it has in order to pursue the lofty goals it has established for itself.
Why is it then that few nonprofits seem capable of raising the financial support they need to do their work? Why is it that nonprofits have such a hard time adequately funding their work? There are five main reasons.
1. You are “organization” focused instead of “cause” focused.
Outsiders view nonprofits as altruistic, and rightly so. After all, it’s nonprofits that solve our social ills, help our most needy citizens, expand the arts, and respond to every natural and manmade disaster that impacts our world and our communities. Organizations that have earned a tax exemption from the government are supposed to be focused on selflessly meeting the needs of others, not selfishly promoting their own interests or protecting their own turf.
Far too often, nonprofits start looking like for-profit businesses from the perspective of the donor. Nonprofits sometimes come across like companies that are all about money and the bottom line.
At the end of the day, an organization that focuses on itself and not on the bigger cause it is supposed to be addressing is an organization that will lose the support and financial backing of society.
There is a new attitude emerging in our nation, an attitude that says big social problems can only be solved through large-scale cooperation between powerful people and organizations. If your organization is viewed as an entity that is primarily interested in preserving and promoting itself, the public confidence that your organization needs will quickly evaporate… along with the resources that flow from that confidence.
2. You don’t invest enough money in fundraising operations and you don’t invest money properly.
Without money, it is impossible to do anything in this world. Without money, a company can’t hire employees, can’t lease office space, and can’t even build a website or connect a telephone. Money is to nonprofit work what oxygen is to human life. Cut off the money for just a few moments, and the organism dies. Yet many nonprofit leaders give little thought to this vital aspect of their work.
In the beginning, fundraising might be a part-time job for one or two people. But quickly—very quickly—an organization must develop a development department, a team of people whose sole responsibility is to network with powerful people and key influencers to raise the financial resources the organization needs to achieve its mission. Organizations must spend a reasonable amount of money to produce more money. The money they need won’t just fall out of the sky and land at their feet.
Before an organization travels too far down the road toward its ultimate goal, that organization must also:
- plan how it will build a staff of people who are devoted to fundraising and relationship building
- develop collateral materials and a data system that can help the staff maintain records and goals for every donor and potential donor
- identify opportunities for staff to be networking in the community, systematically meeting with people who have the financial wherewithal to underwrite the organization’s agenda
- and more…
There is no way around this practical reality of life. The person who refuses to invest in a retirement plan is the person who will reach retirement age with no savings in the bank. Money won’t just magically appear for him on the day of his retirement.
Similarly, if a nonprofit refuses to invest in structured fundraising operations, that organization will suffer as well. So start small if you must. But get started, and the sooner the better.
3. You fail to focus on reaching the most influential people in your community.
There is a recognizable trend in our country when it comes to wealth distribution and influence.
A steadily shrinking number of people are enjoying a steadily increasing amount of money and power in our society. Good or bad, that is the reality in modern America. But it is especially important for nonprofits to recognize this fact, because the reality of this “power shift” in our society directly affects the ability of nonprofit organizations to do their work.
Today, due to the shift in wealth and rapid changes in communications, powerful people with powerful bank accounts and powerful voices dominate our communities. They dominate the landscape of American society. And a large number of them are rooted in corporate America.
When it comes to a nonprofit’s charitable work, all people should be treated equally. But when it comes to fundraising, a nonprofit can’t afford to treat everyone the same. Financially, all people aren’t equal, and they never will be.
Think about it this way: In a typical workday, you have about 8 hours to achieve your goals. So on this typical workday, would you rather spend 1 hour with 8 separate donors who could each write you a check for $100, or would you rather spend the whole day with one business executive who could write you a single check for $100,000 and introduce you to two more of his close friends?
All people are equal in the sight of God, but all people are not equal in the sight of my accountant. At the end of the day, leaders of successful nonprofits know how to provide their services to as many recipients of those services as possible in an indiscriminate way, but they also know how to fundraise in a smart, calculated, and systematic manner: focusing limited time on the most influential and powerful people who have large bank accounts, a thriving network, and an influential voice.
4. You don’t tell your story well and you don’t tell it broadly enough.
Why do you do what you do? What compels you to get up every day and tackle an entrenched social problem that some people regard as unsolvable?
If you devote your life to a cause, that story can inspire others. But it can’t inspire anybody if you don’t make it clear to them.
Sometimes when I hear nonprofit leaders talk about the work they do, I feel like they are describing mechanical processes or a medical procedures. there’s lots of technical verbiage and data that only an insider could appreciate, but there’s little or no passion behind what they say and absolutely no emotion to give credibility to their facts.
Americans appreciate facts, and they understand statistics. But people in this country want to be inspired. They want to hear stories about the work you are doing and the difference you are making in the world. Sometimes it’s less about the specifics of what you do through your organization and it’s more about the incentive. It’s less about the “what” and it’s more about the “why.”
Do you tell your story well? And when you tell it, is your presentation baked in passion? Do you tell the story of a big vision? Do you inspire people to believe you can actually solve the problem you are addressing? Or is your presentation mechanical and wonky like the verbiage from a tax manual?
And if you do tell your story well, do you tell it broadly enough? Do you use traditional media like television, radio, newspapers, and billboards to help you spread your message? Do you constantly preach your message through social media, as well, and through special events you conduct to get your message out?
This is America. If you are going to be successful in any endeavor, especially a nonprofit endeavor, you will have to compete in the arena of ideas. Your success is not guaranteed, so you will have to convince the world that you are worthy of their trust and support. Are you doing that well enough to inspire people to invest in you? Do you do that well enough to convince people that you can truly change things in our society? Your ability to raise funds will always be traceable to your ability to tell your story well.
5. You are really not trying to solve anything.
Does your nonprofit organization really do anything, or do you simply exist to exist?
Are you actually trying to make big changes on issues that matter, or does your organization merely to move a few pieces around on the chess board so it looks like somebody’s doing something?
The best way to attract resources is to inspire people to embrace big ideas toward community problems. The status quo won’t work anymore. Just doing something to help a few people won’t cut the mustard.
Funders today—big funders—want to align themselves with big thinkers who have big ideas about big solutions that nobody else believes are possible. But donors are savvy, too. They aren’t fooled by slick presentations. They want to see outcomes, and real outcomes are the result of real ideas and real plans to implement those ideas. Do you have any?
The most influential people in our country are people who know only big ideas, and they never waste their time with little things. So these people aren’t frightened by audacious goals. In fact, they are drawn to audacious goals and audacious leaders. So if your goal as an organization is to feed 50 people or to conduct two night classes at a local college, don’t bother the big funders of big ideas. They won’t be interested. But they will be interested in hearing your plan to solve the problem of hunger in your community or to reduce illiteracy in your state by 50 percent in 10 years.
With this in mind, you can forget about your grandiose mission statement. What you should do instead is really think about what you are doing as an organization, and whether what you are doing is making any difference. If your day-to-day work doesn’t reflect the lofty goals you have written in your founding documents, you will have a fundraising problem. Start plotting a real pathway through the maze of the status quo to a real solution, and the money will be there to fund it.
The money is there to finance your dream of a better world. You just might have to do a few things differently to access that money. But the world is changing, and attitudes about nonprofits are changing, too. If you are willing to change as well, you can make the kinds of changes that the world needs and wants.