There are many different ways organisations can raise money for a good cause. Most go down the route of appealing to the masses, like the general public. But, one of the most overlooked yet important options to consider is major donors.
Studies have shown that around 88% of all non-profit funds come from just 12% of donors - these being major donors. This proves just how essential it is to understand this donor group in order to achieve significant financial support.
In this blog, we introduce you to major donor fundraising and explain how your organisation can strategise for success.
What is a Major Donor?
A major donor is a person who offers a large sum of money to an organisation. Usually, this donation makes a great impact on the work offered by the fundraising group. For example, it could be used to help a charity fund research, or provide support to those in need.
There is no exact threshold for what can be considered a ‘major donation’. For some, it may be a couple of hundred pounds - for others, it might be in the thousands. Either way, it is classed as an amount that has the power to make a substantial difference to the cause.
Donations such as these can be given over a certain length of time, or they can be made as a one-off bulk payment. These are different from grants, as you have to endure a rigorous process of applying and surpassing competitor organisations. With donors, it is entirely focused on building connections and relationships with influential people.
Often, major donor fundraising will involve a number of people working together as a team to create solid strategies. It could be the CEO, trustees, executives and assistants all accumulating together to refine a plan of action. Mostly, time is spent doing research, networking, initiating meetings and organising events before a donation is even made. It may sound like a risky tactic, but charitable organisations must put the effort in to understand and persuade such high-profile individuals.
Think of it this way: you wouldn’t want to ask a major donor to contribute straightaway, as you run the risk of damaging that relationship before it has even begun. If they don’t believe the passion is mutual, then they will assume you only want funding from them with no real interest in creating a partnership. You have to spend time proving why your organisation should receive that donation, all whilst working hard on building a bond to create a lasting relationship.
Strategies for Success
If you’re wondering how to find and entice future major donors, there are several smart ways this can be done.
But first, in order to develop a major donor fundraising strategy, you need to first assess your organisation’s needs. Ask yourself: what would you regard as a major donation? What would you use a major donation for? By determining these, you can then start planning major donor outreach efforts and marketing tactics such as:
Offer a Permanent Feature
In today’s digital world, you can easily create a space on your website to give your major donors a spotlight. Whether it be to welcome them on board, provide a biography or announce their contributions - it is a great way to honour them in a meaningful, permanent way.
When doing outreach, you can promise potential donors a dedicated space in your virtual ‘hall of fame’. You’ll also be able to convey the depth of your appreciation, all while making them feel respected and valued by your organisation.
Spend Time on Research
Research is key for finding new people to approach. One method you could undertake is prospect research. Many fundraisers use this to work out who is most likely to become a major donor out of their existing supporter base.
Often, this is done through using a database which can determine characteristics that match other major donors. These follow indicators such as past giving (whether it be political or charitable) and wealth factors (such as property ownership, share buys etc.).
Appoint a Dedicated Team
If you are going to make major donors a priority, then hiring a specialist team may be the best decision. Think of it like a group of staff who solely focus on bringing in new business to benefit the organisation - like a business development department.
They can be in charge of research, outreach, communications and conversions. Their other duties will revolve around:
Preparing educational and promotional materials
Handling prospect files
Building the prospect base
Presenting to prospective donors
Writing proposals
Maintaining relationships
Seeking upgrade opportunities when appropriate
It is important to note that you should only appoint an experienced person to undertake such a big responsibility.
Show Return on Investment
As donors are giving you the opportunity to fulfil your goals, they will understandably want to hear about the tangible results of their gift.
What you accomplish is far more important to donors, as it is an investment that they have bestowed upon you with great trust. Obviously in the beginning, you put a convincing case forward in order to secure the funding - but the efforts to impress should not stop there. It is likely that you set out aims and objectives when asking for funding - so you should ensure that these are at the forefront of your mission.
Setting milestones is another great way to keep track of return on investment, e.g. ‘By month X, we want to achieve XYZ’. This way, you can regularly update your donor and prove to them that you were worth investing in, as this can lead to more opportunities for funding in the future.
At S3 Solutions, we provide bespoke workshops and consultation approaches to help clients strategise for the future. If you are interested in venturing down the route of major donor fundraising, get in touch with our team today.