The Enduring Connection: Individual Donors and Nonprofit Organizations

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Editors’ Note: NPQ likes to hear about what actually works in the trenches. We asked some well-known fundraising advisors help us identify groups doing a good job with grassroots fundraising. We didn’t want fancy but we did want effective. Many thanks to Stephanie Roth, Andy Robinson, Gayle Gifford and Simone Joyaux for putting us in touch with those interviewed below, and for commenting on first drafts of the article (of course any deficiencies remain the responsibility of the NPQ).

Grassroots fundraising can be a boon to a wide range of nonprofits—from the very small to the very large. It is certainly not in the exclusive domain of “grassroots organizations”; it can be used with much success by virtually any organization that has appeal to individual donors. This is the generally the working criteria to use to determine whether grassroots fundraising will, for you, be worth the effort that it takes: Does your organization’s work have, or should it have, popular appeal?

We don’t want to sell this mode of fundraising on its cash value alone, though. Grassroots fundraising emphasizes the connection between the moral beliefs and commitments of the giver, and the work of a particular organization. (See the NPQ Winter 2004 interview with Eli Pariser on this topic, also available at: Thus, it ideally creates a community of intention, allowing individuals to act on their principles—as agents of some change they want to see, or of some value they wish to preserve. This community spirit can show itself not just through a direct contribution, but also through the same individuals becoming involved as volunteers, advocates, and message spreaders. Grassroots fundraising, therefore, is an essential part of an organizing strategy—whether that strategy is focused on building a network for disaster relief, keeping the local scout troop or wild animal shelter alive, or protesting a war.

Grassroots fundraising is, in some ways, the wisest course a nonprofit can take to finance itself. It provides a higher measure of equilibrium than many other financing models because it is dependent on many source points and, unless you break trust pretty publicly, you are unlikely to lose a big chunk of your operating income all at one time. It also has the great virtue of allowing the organization more flexibility than many other sources; it is one of the few sources of “unrestricted” revenue that can be used for agency operations as necessary. Restrictions on individual gifts are only as you declare them.

Grassroots fundraising can be defined as any effort to raise funds from individuals through direct solicitation, events, sales, or appeals. For many groups, broad appeals and events are used to acquire the names of people who may be willing to support the organization on a longer term basis. These activities may have other benefits besides attracting donors (for example, education and community-building), and they may turn a profit of some magnitude. Generally, however, most organizations experience that the core benefit is to establish relationships with individuals that result in sustained giving and participation over time. Different mixes of activities work for different groups; there is always much to be learned by watching what others do and thinking about how it may apply to your organization and its work.

This article tries to act as a facilitator of such sharing. We have focused on nonprofits with small to mid-size budgets ($150,000 to $1.8 million) because larger organizations tend to work with higher level systems.This article is intended to be useful to groups with or without sophisticated systems.

For the groups we interviewed, this method of raising funds is either their central funding strategy or a necessary complement to other types of fundraising. Grassroots fundraising is a way for these organizations to stay grounded and broadly supported by people who believe in its mission.

Rhode Island may be small, but it is also extraordinarily beautiful—with lots of natural nooks and crannies to which people are attached. The Wood-Pawcatuck Watershed Association, a waterways protection and environmental organization based there considers grassroots fundraising as part and parcel to their mission in that it keeps large numbers of people feeling that they have responsibility for the land and water that they love. Lori Urso, the organization’s executive director, explains, “What works for us is cultivating the people who have a connection to the area. A lot of our supporters who aren’t from Rhode Island either grew up in Rhode Island or came down and fished on the Wood River when they were kids. We always nurture those types of connections, that kind of stewardship, and I think that really works best.”

Maintaining a grassroots base of funding, however, takes care and attention. You can’t imagine that things don’t change for your donors from year to year. Alicia Cipriano from the Domestic Violence Resource Center of South County observes that the organization’s base of individual contributors has changed. “Acquiring and retaining donors has become more of a challenge. While 45 or 55 percent of our budget is now covered by individuals, it requires intense effort to maintain this level of support. The result of this shift is that we are getting a broader base. In some ways we are more secure because although the donations individually may not be as large, each year there are more individuals contributing to our cause.”

Changes in the organization can also alter the situation. Alex Momtchiloff, of Breast Cancer Action in San Francisco, observes that, “Our individual donations have consistently increased. However, as a proportion of our fundraising as a whole, individual giving has decreased slightly over the last couple of years. Part of this is due to an overall increase in support from institutional donors, but as our goal is to increase the percentage of our revenue that comes from individuals, we’re hoping to see this balance shift in the coming years.” This kind of foresight is the soul of good fundraising practice.

So, what are organizations doing to keep existing donors engaged and to build out from there? They are focusing on giving people new ways to participate. Sandra Malmquist from the Connecticut Children’s Museum in New Haven explains how the organization now handles its annual fundraising party: “One of things that we did after fits and starts with our original party is that we created a host committee of people. There were 60 people for our host committee—a no-meeting committee, which they love. Host committee members agreed to buy a ticket themselves and to bring two other people that either they paid for or they got to come. These are people who are committed to the museum and know all of its programs, but they are busy. All they have to do is come to the annual party and bring two other people. All the new people are added to our donor list. With this strategy we tripled our individual donors in the space of a year, which is a huge leap for us as a small organization.”

Grassroots appeals and events have to be paced right to work well. The Domestic Violence Resource Center runs an auction every two years. “It started out in the mid 90’s as an heirloom day, where people could bring their antiques and Sotheby’s appraised the items. Over the past few years we turned it into a simpler event with dinner, cocktails, and, live and silent auctions. We have to host it every other year because it requires a substantial amount of staff and volunteer time to organize the event, and it’s a lot to ask the community to support it annually. However, it raises quite a bit of money, sometimes as much as $225,000, and the event is well known in our community.”

The vehicle for attracting and maintaining donors also have to be geared to the organization’s culture and purpose and even very simple efforts can work very well if they are well suited to the mission of the organization. The George Wiley Center, a statewide community organizing and advocacy organization with seven chapters in Rhode Island, puts out a newsletter as a way to connect with donors and activists. “It’s different in that it’s low-budget, it has hardly any pictures, but we put it out whenever we win a victory or there’s a really hot issue with some substance,” says Bill Flynn. “It’s stuff that people wouldn’t necessarily get details about in the newspapers because the newspapers don’t cover it. We find that people do read it—even some of our really big donors who are very busy corporate types.”

Reflecting what is unique about you in a fundraising piece can be an act of love. In that many organizations also regularly use direct mail as a way to raise funds from individual donors, it becomes a challenge to make a request stand out. The Connecticut Children’s Museum faced this challenge straight on last December, in one of the busiest fundraising seasons of the year. “We took photographs of kids participating in some of our programs, and we just ran it off on our black-and-white printer,” explains Sandra Malmquist. “So when the recipient opened the envelope, out fell six little pictures in black and white, and each one of the pictures was of a child doing something amazing, as they always do, with a little caption under it that said, ‘Give children the gift of books…and help us to create readers,’ or another picture, ‘Give children the gift of early childhood education…where they can learn to be scientists and change the world.’ So we gave potential donors photographs of kids engaged in activities that they could fund and a choice about which of these programs they wanted to support. It worked very well.”

But even successful strategies become less effective over time. Stephen Slaten, of Jewish Family Service of Worcester, Massachusetts, has experienced this. “My sense is that you can’t keep doing the same thing. People don’t notice it anymore. There are so many appeals that people get. Some of the good news is that there is an opportunity to catch the attention of someone to become a new donor, with something that is important to them and is new, but that it may be hard to keep people year after year unless you approach it somewhat differently to keep their interest.”

For activist organizations, raising money is about getting donors aligned with the organization’s mission and also mobilized to take action. These organizations see giving as the first part of a process of engagement and are constantly looking for ways to get their donors and members involved in social change. For these organizations, an appeal for funds is usually accompanied by a request for action. Such is the case for Breast Cancer Action. “We’re an activist organization and we encourage all of our members to take action,” says Alex Momtchiloff. “We help people find ways to do something besides worry about the issue. Making a donation is one way that people can do that, but we also ask them to contact their legislators, write letters to the editor, and host house parties in their communities.”

The Dogwood Alliance in North Carolina, which works to protect southern forests, has an annual budget of about $445,000. Approximately 40% of it comes from grassroots fundraising. The remainder is from foundations. Of the grassroots money, 85% is from major individual donors, which for Dogwood is a contribution of $250 or more. A smaller part, 15%, is from prospecting—finding members and renewing them. “We do that through being out in the community at tables, presentations, conferences, meeting folks and asking them to join, and also through renting lists,” explains executive director Sarah Hodgdon.

This advances the mission of the organization by attracting new members to participate in its social change process. Dogwood Alliance has to negotiate with big paper and suppliers like Staples and Home Depot to convince them to increase recycled content and stop using fiber from endangered forests. “I think the reason we ascribe so strongly to this method of fundraising is because we believe that our campaigns are successful because of the numbers of people who are involved, and we believe that our organization exists because of the number of people who support it financially,” says Hodgdon. “We believe we will be far more successful if there have been many people involved and companies with whom we have negotiated an agreement know that many people care about this policy and are watching for it to succeed.”

A challenge for this type of organization is to make the appeal interesting and give a sense of urgency without making the situation sound desperate or hopeless. Bill Flynn, of the Wiley Center, explains how his organization handles this dilemma: “While we may be quoted in the paper that some things are really bad, our focus with donors and members is on the fact that we win stuff—we don’t just fight, but we win. In other words, we make sure we ultimately give a positive message—when we do accomplish something, to make sure members and others know it. And we always appeal to donors with a positive, powerful message: ‘We can win this and we need your help to win it.’”

One recent change these groups are experimenting with is the use of new technologies for raising money. This includes sending out appeals through the Internet and providing the ability to give online. Most of the organizations interviewed for this story are in the early stages of this work. They use the Web to increase visibility and to facilitate giving, but none of these organizations has turned its Web site or the Internet into the main vehicle for giving. This is consistent with trends in online fundraising within organizations of this size and capacity.

They are getting their feet wet, though. Megan Wenrich, development director for the Vermont Youth Conservation Corps, says her organization is just starting to use the Internet to reach out to supporters. “We don’t do a specific appeal online, although we do a monthly e-newsletter for the whole organization,” she comments. “We do ‘reinforcements’ on our monthly e-newsletter when we send out our spring and fall written appeal. When we send out the e-newsletter we reinforce that message by saying, ‘The solicitation letter probably just came in your mailbox. Please turn it in as soon as possible and help us reach our spring goal,’ for example.”

Breast Cancer Action does an e-newsletter as well, and is poising itself to increase online giving. “We have the ability to accept donations through our Web site, which is very highly visited in the breast cancer world,” says Alex Momtchiloff. “In our e-newsletter, there’s always a subtle request to give online but we need to move to the next level by increasing the sophistication and regularity of our online requests.”

For some organizations, developing the ability to appeal to their donors online is particularly relevant. “Because our mission is to protect forests and change paper, we’re trying an experiment now to move away from prospecting with a paper letter onto the Internet,” says Sarah Hodgdon of the Dogwood Alliance. “We’re just getting that started. Our goal is to move away from paper fundraising, so that we’re more in line with our mission.”

From the interviews, it appears that while grassroots fundraising remains challenging, most people doing this work continue to be optimistic and enthusiastic about the future of individual giving—not just for the sheer amount of dollars that can be raised, but for the relationships as well. Many of the people we interviewed personally review the list of donors because they want to know who is supporting the work—but they do not always think about trying to systematically upgrade donors. This may mean that they have far more potential than they realize.

The Vermont Youth Conservation Corps has found that the capital campaign on which they have recently embarked is simultaneously raising capital and increasing the gifts to the annual fund. Wenrich says that it is all of a piece: “I think this is because we’ve had a lot more public recognition in media, and our campaign, which is a bricks-and-mortar campaign that’s highly visible in the media, pulls on a whole lot of different constituencies. It’s the restoration of a 100-year-old historic barn and conserving 250 acres of land and then restoring that to become an education and training center. So it appeals to historic preservationists, to land conservationists, to youth and education, to workforce investment people. It has a very diverse appeal.

“It’s really inspiring,” observes Wenrich. “We’ve never before dedicated enough staff time to creating personal relationships with our donors. We have people who’ve been giving $250 for 10 consecutive years and we have not asked for more until now. We’ve asked some of these folks for $50,000 and they’re saying yes. There’s all this untapped potential within your constituency—people who believe in your mission—and you need to present them with meaningful opportunities to invest in your cause. We’re really thrilled with the response.”

Those who directly manage the relationship with donors understand the personal investment and connection that donors make when they endorse an organization with a contribution. Sarah Hodgdon says: “Our development director always says that fundraising and giving, both sides of the experience, are joyful experiences. When she was talking at our last board meeting about what a joyful experience it is, people were really moved because it puts the experience under such a positive light.” It is for this reason that so many donors like a personal relationship and personal contact with an organization. Suki Molina, deputy director of the Idaho Conservation League, believes this is the key. “We find that personal contact makes a huge difference—whether a note or a phone call. We do as much as we can to let our donors know that they make a difference.”

Many of those interviewed for this article not only saw the need for personal connection and relationships, they consistently think about accountability and management of resources as well. “Stewardship is a big buzzword for us,” says Lori Urso. “That goes both in terms of funding and inspiring people to act and be involved. I think another word is ‘sustainability.’ I’m finding that organizations and foundations want to give to organizations that aren’t poor, that have some resources, some capacity, and can deliver what they’re promising to deliver.”

Ultimately, individual donors help organizations spread the word about mission and create a presence in the community. That gives a double reward—funding support and a set of ambassadors for your organization’s unique role in the community. “One of the things in our mission statement is that we want to be rooted in the community,” says Sandra Malmquist. “And so, the broader the base, even if the donations are very small, the better for us because the buzz stays out there in the community. I find that that’s one of the most important aspects of grassroots fundraising. You remain very present in the community.”