Category

Donor Cultivation

Don’t Fear DAFs (Donor-Advised Funds)

By | Annual Giving, Current Events/News, Donor Cultivation, Fiscal Management, Fundraising, Grants, Insights, Major Gift Solicitation, News You Can Use, Stewardship | No Comments

Katie Lord
Vice President

Over the past several months there has been a lot of negative media attention cast upon the nonprofit sector relating to Donor-Advised Funds (DAFs).  But before I dive deeper into my thoughts about the matter, let’s start with the basics.

I have to say you may have your head buried in the sand if you haven’t read something about a DAF, but here’s a refresher.  A Donor-Advised Fund is a philanthropic vehicle established at a public charity.  It allows donors to make a charitable contribution, receive an immediate tax benefit and then recommend grants from the fund over time. Whew! That was a very scholarly explanation from AFP.  In layman’s terms, a DAF is a way for individuals or families to save money or “funds” for philanthropic purposes which they can give out over time.

I know what you’re thinking: “Why don’t they just give all the money to charity now? And better yet, why not give it to my charity?”  As we all know, donor intent can difficult to pinpoint. This vehicle allows donors to give money with the intention of charitable purpose while still researching and identifying the impact they wish to make. It’s far more likely the gift wouldn’t be made at all (to any organization) if the donor is not crystal clear on desired outcomes. As a fundraiser, we know purpose and discovery of desired impact is one of the most special roles we can play in a donor’s journey. The DAF gives time for that process.

While DAFs have gained in popularity, the concept has been around since 1931 when the first DAF was created by New York Community Trust. Over the past few years, with the rise of Community Foundations and organizations such as Fidelity, Schwab and Vanguard Charitable, DAFs have garnered new attention across the philanthropic and financial industries. It’s fair to say we have come a long way!

According to the most recent data for 2016, it is estimated there were just under 300,0000 DAFs in the United States. Last year alone brought staggering growth.  According to the Giving USA Special Report “The Data on Donor-Advised Funds: New Insights You Need to Know” giving to DAFs made up 8% of annual charitable giving – $23.27 billion 2017.  Of course, this could have been partially due to the new tax legislation, but there has been a consistent rise in DAFs over the last 10 years.

This pales in comparison to foundations, which hold a total of $890,061,214,247 in total assets, according to Foundation Center’s Aggregate Fiscal Data of Foundations in the U.S. 2015 data, which can be viewed here at http://data.foundationcenter.org.

So how do I feel about the DAF and how do I incorporate it into my nonprofit practice?  I’m so glad you asked (well, read this much of my article, anyway…) Due to my love of all things “philanthropy” and my deep belief in donor-centric strategies, I am a strong supporter and advocate for the DAF.  Any vehicle created for the benefit of the nonprofit sector and gives donors and nonprofits alike another funding opportunity is great news for our industry and the overall advancement of philanthropy.  The more options we have and the easier we make it for people to be charitable, the higher the likelihood we move the needle of American philanthropy from 2% of GDP (around which it’s been hovering for close to 40 years) to higher levels.

Let’s also admit the last thing we want our donors or well-meaning individuals to do is start another foundation that only gives out an average 5% each year. DAFs typically grant 24% of their funds annually.

Tools such as a DAF are not inherently good or bad.  Unfortunately, as with everything, I’m afraid, some funds are not created with the best of intentions of the greater good, but rather for the greater tax benefits of the donor.  This does bring up the discussion and conversation about oversight but let’s remember one bad apple doesn’t always have to ruin the bushel.  As we move into the “new era” of DAFs, I do believe there are some tweaks and regulations needed in transparency,  reporting requirements and time limits for fund inactivity – all to ensure DAFs are dispersing gifts for philanthropic support.

On the other side of the coin however, donors who have DAFs should be able to pay pledges and the tax-deductible portion of events out of their funds.  This account was created for a donor’s philanthropic use and as long as no goods, services or other benefit are provided to the donor I don’t see what the point in making a fuss.

We need to remember as fundraisers, we should seize any and all opportunities to build strong relationships with our donors. We shouldn’t be afraid to discuss giving vehicles other than cash  with our donors.  A DAF is simply another tool in the fundraising toolbox to help donors maximize their impact and giving potential to your organization. It’s our responsibility as fundraisers to understand DAFs and discuss them with our donor prospects.

I leave you with a few points to ponder as you explore and integrate a DAFs into your fundraising plan:

  • Do your major donors have DAFs? Would they like to contribute through one?  If you don’t have those answers, there’s one way to find out:  ASK them.
  • Does your organization’s website or donate page have a function through which donors can easily grant you a contribution from their DAF?
  • Do you have an organizational profile on your Community Foundation website? Do you update it annually?
  • Do you sit down with your Community Foundation or National Fund officers on an annual basis and ask for your grant report?

If you have more questions or thoughts about DAFs, I’d be more than happy to visit with you.  You can reach me at klord@fundraisingJBA.com. Don’t fear the DAF. Just put it to work for your organization.

Fundraising Fitness Test Guru Led a Workout in KC

By | Annual Giving, Capacity Building, Database Management, Donor Cultivation, Fiscal Management, Fundraising, Insights, Major Gift Solicitation, News You Can Use, Stewardship, Uncategorized | No Comments

Jennifer Studebaker
Coordinator of Administration + Consulting

And oh boy, was it a good one! Erik Daubert, MBA, ACFRE and Chair of the Growth in Giving Initiative and the Fundraising Effectiveness Project came to Kansas City for Nonprofit Connect’s 501(c) Success National Speaker Series on September 11. Erik dived right in with the history, purpose, and goals of the Fundraising Fitness Test. This free tool was developed as part of the Fundraising Effectiveness Project in an effort to help nonprofits understand and evaluate the performance of their development efforts. Requiring only three fields from your database (Donor ID, Donation Amount and Donation Date), the pre-programmed Excel document calculates key performance metrics such as your donor retention, gains and losses, and donor dependency with the Pareto principle.

The Fundraising Effectiveness Project does have reports that you can benchmark your organization against. However, Erik advised that the best organization to compare yourself against is your own. The Fundraising Fitness Test allows you to do this by comparing year over year data, showing your growth in giving over time. The 6 year trend tab lets you to step back and see the impact that known events had on your organization’s giving. The arrival of a new CEO may spark an upward swing, while the loss of a Development Officer may have led to a shortfall from the previous year. This is the type of data that you can take to your Board to celebrate wins and highlight opportunities for growth.

Erik warmly welcomed up our guest panelists, the true heroes of the day! Megan Sturges Stanfield of Junior Achievement, Cindy Wissinger of St. Paul’s Episcopal Day School, and Laci Maltbie of Sherwood Autism Center braved the stage to share their own experiences taking the Fundraising Fitness Test. They were all surprised to learn how quickly they could complete the test and impressed at the value of the information they received. Laci did run into some roadblocks in getting the data extracted properly from her database, highlighting one challenge that other CEOs and Presidents may encounter. Cindy Wissinger noted that her first run at the test was skewed by their capital campaign donations, and she is looking forward seeing the results with only her annual fund donations. Megan was wowed by the ease of the test, and she could immediately see impact of development decisions her organization has been making over time. All panelists happily endorsed the Fundraising Fitness Test, and Jeffrey Byrne + Associates does as well!

You Can Change Board Conversations Around Philanthropy By Using the Fundraising Fitness Test

By | All Posts, Annual Giving, Boards + Leadership, Campaign Planning + Management, Capacity Building, Database Management, Donor Cultivation, Education, Fiscal Management, Fundraising, Insights, News You Can Use, Organizational + Personal Development, Stewardship, Technology | No Comments

Erik Daubert, MBA, ACFRE

Chair of the Growth in Giving Initiative and the Fundraising Effectiveness Project, Faculty at Lilly Family School of Philanthropy at Indiana University, LaGrange College, and Saint Mary’s University of Minnesota

Originally posted on Nonprofit Connect

I have worked with hundreds of nonprofit organizations who have used the Fundraising Fitness Test (FFT) and I am often asked, “How should I use the Fundraising Fitness Test with my board?” (Available for FREE at www.afpfep.org)

The answer is, “Effectively!”

At the Growth in Giving Initiative and the Fundraising Effectiveness Project, our goal is for fundraising to be more effective, and this is just as true with your board of directors as it is with your overall development program.

So, how can you be most effective at using information from the Fundraising Fitness Test with your board?

The first thing to decide is, “Which data points are right for our organization to share?”  While this answer is not always clear at the onset, you should begin by analyzing your test results.

Once you have run the Fundraising Fitness Test and reviewed your results, you should ask some key questions:

  • What opportunities stand out in our analysis as areas of opportunity?  Some examples of this may be findings related to new donor acquisition, specific donor group retention strategies, Pareto Principle analysis and comprehension, Gain/Loss indicators and more.  Having a good understanding of the information found in the report empowers you to have and lead strategic conversations about how to improve development performance going forward.
  • What does leadership think about how things are going, based on information appropriately shared from the FFT?  One of my favorite quotes in fundraising is, “The best idea is someone else’s!”  By this, I mean, when a board chair or a CEO thinks something such as, “We need more major donors” or “We need to broaden our base of support of donors”, I almost always say, “You are right!” Because these ideas are “theirs”, you don’t have to do the heavy lifting of convincing them to embark on these efforts…that part of the work is already done!  The FFT reveals all kinds of information in the results, and will, perhaps, spark important ideas for your Board on where to spend their energy!  For example, by seeing your organization’s major donor acquisition, upgrades, retention rates, and more, you can have strategic conversations about how to best make more, good results happen in your future fundraising efforts.  You can use your past performance as your “baseline” while also using information available at www.afpfep.org/reports to see what is happening in the broader nonprofit sector.  Nonprofit organizations can compare against themselves (By comparing against previous year’s past performance) and also against other nonprofits in their sector and  region of the country.
  • What is the best use of board member engagement and/or development committee engagement at this time?  If having board members do critical development work like solicitation, recognition, cultivation, stewardship or other activities is the goal, you can use results from the FFT to share why this is a good idea.  By leveraging key data points such as “We are behind the national average for Human Services organizations on repeat donor retention” you can help to shape and guide key conversations around development program improvement.

So, how should you use your FFT with your board?

  • Determine which points you should highlight.  Share some points to celebrate (they are there!) and also points to work on and improve.
  • Share these findings with key leaders such as your CEO, Board Chair, Financial Development Committee Chair, or other key leader as appropriate to your organization.  Have conversations about what is working and what can be improved.  Talk strategically about what you might do to make the results better for next year.
  • Mutually decide which points should be shared with the overall board.  Be transparent both in the celebration of great work, and recognition of the work yet to be accomplished.
  • Remember that while the Fundraising Effectiveness Project has information on how other nonprofits are doing with regard to these metrics, the best comparison of all is against your own organization!  Look at how you did last year, two years ago and beyond, and look at what is working and what is not.  These findings can be used as a basis for well- informed conversations – about personnel, budget, strategy, tactics, focus and more – to create a better future for your nonprofit organization and your financial development efforts.

For more information about how to engage your board with data and the Fundraising Fitness Test, check out the tools and resources available at www.afpfep.org.  There you can find tutorials on how to run the Fundraising Fitness Test in addition to key resources and reports outlining findings by our senior research and data compilation teams.

We hope you will find these resources helpful and thank you for raising more funds to make the world a better place!

Written by Erik J. Daubert, MBA, ACFRE Chair, Growth in Giving Initiative/Fundraising Effectiveness Project Work Group.  Erik serves as Faculty at the Lilly Family School of Philanthropy at Indiana University, LaGrange College, and Saint Mary’s University of Minnesota in their various philanthropy programs, in addition to serving as an Affiliated Scholar with the Center on Nonprofits and Philanthropy at the Urban Institute.  He also works as the Director of Financial Development Education at the YMCA of the USA.  Erik may be reached via email at daubert.erik@gmail.com

The Growth in Giving Initiative’s work to date is often recognized by our work on the Fundraising Effectiveness Project (FEP) which includes tools like the Fundraising Fitness Test.  The FEP was launched in 2006 to help nonprofit organizations measure, compare, and maximize their annual growth in giving.  The FEP is focused on “effectiveness” (maximizing growth in giving) rather than “efficiency” (minimizing costs).   Check out FREE resources at www.afpfep.org

Is Your Nonprofit in Shape? Don’t Miss Erik Daubert and The Fundraising Fitness Test in Kansas City

By | All Posts, Annual Giving, Campaign Planning + Management, Capacity Building, Database Management, Donor Cultivation, Education, Events, Fiscal Management, Fundraising, News You Can Use, Organizational + Personal Development, Prospect Research, Stewardship, Strategic Planning | No Comments

How can you put your data to work?

Utilize the Fundraising Effectiveness Project (FEP).

The Fundraising Effectiveness Project has developed a tool kit for nonprofits to harness their fundraising data. One of the largest philanthropic research projects in the world, the FEP was established in 2006 by the Association of Fundraising Professionals and the Center on Nonprofits and Philanthropy at the Urban Institute. Its aim was to conduct research on fundraising effectiveness and help nonprofits increase their fundraising results at a faster pace. FEP provides free tools like the Fundraising Fitness Test for tracking and evaluating an organization’s annual growth in giving. Explore the FEP and Fundraising Fitness Test here.

For those of you in the Greater Kansas City area, join us on Tuesday, September 11 for the 501(c) Success National Speaker Series with Erik Daubert, MBA, ACFRE, Chair of the Growth in Giving Initiative and the Fundraising Effectiveness Project. Erik will demonstrate how nonprofits can use the Fundraising Fitness Test to understand their own financial development data – and ultimately make better fundraising decisions. To reserve your spot now, register here.

Economic Trends, Philanthropy and Civil Society: Dr. Patrick Rooney and Giving USA 2018 in Kansas City

By | All Posts, Annual Giving, Capacity Building, Commentary, Current Events/News, Donor Cultivation, Fundraising, Giving USA, News You Can Use | No Comments

Dr. Patrick Rooney
Executive Associate Dean for Academic Programs and Professor of Economics and Philanthropic Studies at the Indiana University Lilly Family School of Philanthropy

On June 15, JB+A welcomed Dr. Patrick Rooney, Executive Associate Dean for Academic Programs and Professor of Economics and Philanthropic Studies at the Indiana University Lilly Family School of Philanthropy, back to Kansas City for his 13th year of presenting Giving USA.  This year’s report was presented as part of the 501(c)Success National Speaker Series program of Nonprofit Connect, sponsored by Jeffrey Byrne + Associates and U.S. Trust.

Powered by a booming stock market and a strong economy, charitable giving by American individuals, bequests, foundations and corporations to U.S. charities surged to an estimated $410.02 billion in 2017, according to Giving USA 2018: The Annual Report on Philanthropy for the Year 2017. In addition to his presentation covering the sources and recipients of giving (check out the 2017 charitable giving numbers here). Dr. Rooney provided insights about five key areas that impact philanthropy:

  1. Civil Society
  2. Tax Policies
  3. Disaster Giving
  4. Donor-Advised Funds
  5. Generational Giving
  1. Civil Society
    We’ve heard it before from Dr. Rooney:  more people give than vote, and that trend hasn’t changed. A study found that in every presidential election year (for which there is data), more Americans have donated than voted!  As the world of politics becomes more and more turbulent, don’t lose sight of the role charitable giving plays. In some cases, changes in public policy or budgets actually drive giving (think ACLU for example, or “rage giving”.)  But these reactionary gifts haven’t quite “moved the charitable giving needle” overall.
  2. Tax Policies
    Dr. Rooney addressed the misperception that people donate because of a tax deduction. He pointed out the irrationality of that behavior (if someone only cared about himself he would never give, because one is always in a better fiscal position by NOT giving away money). BUT, theoretically anyway, a tax deduction lowers the “cost” of giving (the after-tax price) and consequently, eliminating the tax deduction increases the cost of giving.  Dr. Rooney’s research concluded a 35% tax rate and an increased standard deduction would reduce charitable giving by more than $13 billion, and that didn’t include impact from dropping corporate tax rates or doubling the exemption for the estate tax. The research also noted that adding an expanded charitable deduction would increase charitable giving by $4.8 billion. Bottom line, tax and fiscal policy decisions impact charitable giving and the nonprofit sector.
  3. Disaster Giving
    Does giving to disasters usurp giving to other sectors? This is an understandable concern, given the phenomenal response we’ve seen over recent years to both domestic and international disasters.  But Dr. Rooney reassures us that research indicates there’s not significant displacement: gifts to disaster response average $50 and are in high quantity immediately following a disaster but tend to (but not always) taper off with time and as media coverage shifts away from the disaster. Studies support that there are no permanent effects on giving – to either disaster relief organizations or other charities.
  4. Donor-Advised Funds
    The dialogue and debates surrounding Donor-Advised Funds (DAFs) seem endless – but for better or worse, DAFs are here to stay (DAF asset values have more than doubled between 2010 and 2015, from $33.6 billion to $78.6 billion) and are likely to become even more popular with the doubling of the standard deduction, given they are a useful way to “bunch” gifts in a year and maximize tax deductibility. DAFs are often the recipients of “liquidity moments” – meaning, donors can easily place their resources into a DAF and then allocate gifts through the DAF to charities over a period of time.Dr. Rooney cautioned against assuming all gifts to DAFs would have been made directly to either public charities or private foundations if DAFs were not available.  He reminded us all DAFs end up in charities eventually (for example, commercial holders of DAFs have policies in place to ensure funds are donated from “dormant” accounts after a set period of time) and are really permanent commitments to philanthropy.  It’s still unclear if/the extent to which DAFs cause displacement or reallocation of giving.
  5. Generational Giving
    Dr. Rooney shared observations on generational succession in American giving and stressed the importance of understanding differences by generation.  The Greatest and Silent generations (born before 1945) had a sense of common purpose, a high confidence in institutions and were active in civic participation. They overcame the Great Depression and World War II and created Social Security. These generations had a larger percentage of families who gave large amounts than later generations.Boomers, GenXers and Millennials (all born after 1946) place a higher emphasis on autonomy, have a lower confidence in institutions and demonstrate less empathy.  These generations also participate less in formal religion and experienced more political and economic scandals.  These generations have a smaller percentage of families giving large amounts than the Greatest and Silent generations, but among these generational families who do give large amounts, the level of giving is higher than or similar to the level of previous generations. Dr. Rooney stated a critical statistic is that donors are down, and dollars per donor are up but starting to slip. He stressed it seemed unlikely we would increase total giving by applying more pressure to existing donors – rather, we need to have a clearer understanding of why donors are down and better grasp gender differences by generation.

Remaining aware of the deeper variables that impact giving will help us understand our donors and prospective donors better, and enable us to build stronger relationships with them – ultimately improving the overall outcomes of philanthropy, and most importantly, improving our communities.

Giving USA: Interesting Reading or Fundraising Guide?

By | All Posts, Annual Giving, Capacity Building, Commentary, Current Events/News, Donor Cultivation, Fundraising, Giving USA, News You Can Use, Organizational + Personal Development, The Giving Institute | 2 Comments

Jeffrey D. Byrne
President + CEO

We’re approaching that most wonderful time of the year: Giving USA 2018: The Annual Report on Philanthropy for the Year 2017 is on the horizon. We’re ready to welcome Dr. Patrick Rooney back to Kansas City as he gives us that coveted first look at giving data for 2017 and provides critical observations and interpretations about the state of philanthropy in the U.S. This will be our 13th year of presenting the report with Dr. Rooney in Kansas City, and I am proud of our partnership and friendship with this nationally-recognized (and fun!) expert on philanthropy.

It’s no secret I’m a fundraising “nerd,” and so many questions come to mind as I eagerly anticipate the release of our most trusted and comprehensive annual giving report: Will charitable giving rise for the fourth straight year? How did rage giving and tax reform affect philanthropy? Will the other recipient sectors continue to close the gap on or even surpass giving to religion? How did the economy impact giving?

But here’s the most important question about Giving USA to consider:  How can nonprofits use the report to improve their fundraising?

Don’t treat Giving USA the way some organizations treat their strategic plan and simply place the report on a shelf as you go about your daily routine. Read the report.  Understand the report.  Share the report.  Refer back to the report.  Make changes to fundraising strategies based on the report.  At JB+A, everyone carries a copy of Giving USA (perhaps my good habits ARE rubbing off on others)and we make notes, discuss the trends, identify nonprofit sector needs, successes and failures, evaluate our clients’ fundraising progress and brainstorm new strategies and tactics to improve fundraising.  Remember that great American Express ad campaign, “Don’t leave home without it”?  The same goes for Giving USA.

Here five ways Nonprofits can use Giving USA to improve their fundraising:

  1. Understand the correlations between giving and economic factors
    The stock market, personal wealth, personal income, GDP, corporate pre-tax profits and unemployment rates impact giving by all four sources (individuals, foundations, bequests and corporations). Trends are closely monitored by people “inside” and “outside” the philanthropy sector. Be aware of changes in these indicators, anticipate how changes will impact donors and adjust fundraising strategies accordingly.
  1. Confirm or dispel myths about giving
    Economic and political scenarios, complex societal issues, diverse giving platforms, wealth and capacity are just some of the drivers behind philanthropy. Understand the context of these drivers, help manage expectations about giving and set realistic and achievable goals for your fundraising plans.
  1. Educate Board members, volunteers, donors and staff about the broad context of philanthropic giving
    Help stakeholders better understand your organization’s funding patterns and potential. This isn’t so much about “keeping up with the Joneses of fundraising” but rather, what can we learn from their success and what can (or can’t) we emulate?
  1. Be nimble in your fundraising and stewardship
    Nonprofit fundraising must evolve as philanthropy evolves.  We are seeing an increase in the popularity of non-traditional giving vehicles (such as donor-advised funds and non-cash assets) and donors want more evidence of the impact of their gifts. What do your donors expect? Listen to your donors and prospective donors – and tailor your strategies to match their needs and expectations.
  1. Recognize the “individual giving effect”
    An estimated 87% of total giving in 2016 came from individuals, bequests and family foundations. There are human beings involved in every gift, and unfortunately sometimes, we forget this. Focus on developing and maintaining meaningful relationships with not simply the “concept of donor” but on an individual basis…with Bill and Marcia, with Joe and Liz, with Emma, with Peter and with Shane.

One last thought: Americans give an average of more than $1 billion a day to help others. So, you can also use the report to remind yourself (and others): nonprofits are doing very important work.  Good job.

Be sure to register now for the 501 (c) Success National Speaker Series Giving USA 2018: The Annual Report on Philanthropy for the Year 2017 with Dr. Patrick Rooney.  Details are below.

Friday, June 15, 2018
7:30 – 9:00 AM
7:30 a.m. – Breakfast | 7:50 a.m. – Program
Kauffman Foundation Conference Center
4801 Rockhill Road
Kansas City, MO 64110

Why Major Gifts? Why Now?

By | All Posts, Capacity Building, Commentary, Database Management, Donor Cultivation, Fundraising, Major Gift Solicitation, Prospect Research | No Comments

How many of us wish there were more hours in the day to focus on our major giving program and donors? Some of us may be one-man teams, but even those of us lucky enough to work in a fully-staffed, robust development office wish we had more time to reach out to more donors and have more meaningful conversations. Some of us don’t work on major gifts because there isn’t time and we don’t really see the need: “Why would I spend the time on major gifts if I’m getting by with annual gifts, grants, earned income, etc.?”

Good question. And below is arguably a good answer.

First, let’s reference GivingUSA: The Annual Report on Philanthropy published by The Giving USA Foundation, an arm of The Giving Institute. Of the approximately $390 Billion dollars given by Americans in 2016, 72% was given by individuals.  Add in the 8% giving through bequests (which are also given by individuals, technically) and the 7% from family foundations and the total is closer to 87% received from individuals.  That leaves only 13% given by foundations and corporations. Also, foundations are only legally required and mostly stick to a 5% mandatory distribution requirement.

Donor-Advised Funds and non-traditional giving methods allow for a myriad of possibilities and vehicles for individuals to use to invest in causes and programs about which they care deeply. It is also easier and a better use of staff resources (including time!) to cultivate and grow donors you already have, than to go out and identify new donors.  This is especially true when you look at the national statistics on donor retention. The 2017 Fundraising Effectiveness Survey Report found donor retention year-over-year averages 45%, meaning more than half of your new donors will not give a gift a second time.

A major giving program gives your donors a path to a deeper relationship with your mission and allows for greater impact through financial investment. With donor acquisition costs on the rise,  spending time examining your current donor base is a better use of time and results in a higher ROI. These individuals have already self-selected and said “yes” to you and your work at least once, but how well do you really “know” them? When was the last time your organization (or have your ever?) conducted a wealth screening? You may know who your top donors are, but do you know who are your most loyal?

To implement a major giving program, organizations should rely on the four pillars of a successful solicitation:

  1. You need a major giving case for support that clearly explains your mission and needs and expresses the impact major giving investments will have on your nonprofit.
  2. It’s imperative that we really “do our homework” and know our donors by understanding their past support, motivations to give and philanthropic goals. This is where the art and science of fundraising converge at the intersection of qualitative and quantitative knowledge.
  3. Utilizing this knowledge, we can develop personalized cultivation strategies, guided by best practices, to present the strongest solicitation possible.
  4. We need to steward our donors by identifying meaningful recognition and continuing communication.

By now, I hope you you’re thoroughly convinced individual donor prospects and major giving are elements you need in your resource development plan.  But do you still wonder if you have the time and resources to implement a major giving program your own organization?

Well, you can quit wondering.

JB+A is pleased to present a solution, in partnership with Softerware, Inc.: DonorPerfect Consulting Services Powered by Jeffrey Byrne + Associates is a 12-month, one-on-one phone and web-based consulting service that will help your organization institute major giving best practices and will offer advice crafted for each organization’s unique needs.  Expert coaching provided by us (JB+A) while utilizing DonorPerfect software and DonorSearch wealth screenings will help you identify and achieve your organization’s major giving fundraising goals.

Want to learn more?  Give me a call at 816-237-1999 or email me at KLord@FundraisingJBA.com.

A Remarkable Act of Generosity

By | Donor Cultivation, Fundraising, Major Gift Solicitation, News You Can Use, Stewardship | No Comments

John Marshall
Senior Vice President

We have all heard about donors making million-dollar-plus gifts and the impact such generosity had on the recipient charity. Americans are clearly the most generous people on the face of the earth with million dollar gifts occurring annually in the thousands.

Like most fundraisers, I think about what truly motivates a person to give that much away and what I can do to secure such a gift for my clients. There is no doubt a worthy organization with a particularly compelling need can be successful in attracting seven-figure gifts. But, I have found over the years, that what is almost as important is taking the time to get to know your donors and paying particular attention to “the little things.”

I’ll never forget a meeting I had very early in my career with Dr. John Hanna, former president with Michigan State University and one of the most beloved figures in the history of that school. After about a 10-minute conversation he concluded our time together by giving me some sage advice: “John, whatever you do while you are here at MSU, don’t ever forget that people always come first. If you pay attention to them and show you care every bit as much about them as you do their philanthropy, well, truly wonderful things can happen.” It was a lesson I have carried with me ever since.

Some time ago, I was reminded of what Dr. Hanna had said while I was working with The Salvation Army in New York City, one of the Army’s largest divisions in the world.

In early December, The Salvation Army’s Greater New York Division holds its Annual Christmas Luncheon. The luncheon attracts a crowd of approximately 1,600 and serves as the official “kick-off” to the Army’s Christmas Campaign in New York City. It also is an event where individuals are publicly recognized for their extraordinary support to The Salvation Army. Since 1948, luminaries such as General Dwight D. Eisenhower, Catherine Marshall, Dr. Billy Graham, Helen Hayes, Bob Hope, Nancy Reagan, Rudolph Giuliani, Yogi Berra and many others have received the Army’s prestigious Pinnacle of Achievement Award.

In 1993, Mr. & Mrs. Smith, an elderly couple who had for years been very generous donors, were chosen to receive the Army’s Community Service Award. Shy of being in the spotlight, Mr. Smith chose not to attend but his wife Lois did and joined a very distinguished group of VIPs including Mrs. Margot Perot, wife of the noted philanthropist. After receiving the award, Lois spoke very humbly about being honored and simply stated that she and her husband dearly loved the Army and its work with the underprivileged.

The following year, one of the worst hurricanes in history struck Florida, precariously near the home where the Smiths spent their winters. Knowing they were in Florida, we decided to have the Divisional Commander (the Army’s equivalent to a CEO) call the Smiths just to say hello and to ask if they were safely weathering the hurricane.

Lois answered the call and was quick to express her appreciation for the Colonel’s call and to say that she was safe. She also shared with him that just two months earlier, her husband had passed away from a heart attack.

Prior to the conclusion of their conversation, the Colonel asked if he could offer a prayer for her during which Lois openly wept. When he concluded, she said “Colonel, when I return to the city could you please visit me in my home?” Of course, he agreed to do so without reservation.

Several weeks later, the Colonel and I were sitting with Lois in her beautiful and very posh Upper East Side penthouse home. In fact, being very private people, this had been the very first time a representative of the Army had been in her home.

“Colonel,” Lois said, “I can’t thank you enough for your phone call. That was a very difficult time for me and it meant so very, very much to me. I would like very much to make a gift in honor of my husband. Can you please give some thought as to how a seven-figure gift might be put to good use? I am particularly interested in something that will benefit children.”

A series of more visits, conversations with her financial advisor and a site visit to two locations in the Bronx followed.  We showed her two daycare centers that were in dire need of significant renovations. She soon became very interested in helping with these particular facilities and asked that we put together a request that would completely cover the cost of the renovations.

Several weeks later, back in her home and in the presence of her financial advisor, the Colonel and me, Lois signed an agreement outlining the specifics of her gift and how it was to be utilized.

Her gift was for $10 million, at that time the largest gift from an individual the Army had ever received in New York City.

Now, I am absolutely certain that honoring Lois and her late husband played a role in her making such an extraordinary gift. But I am just as certain the Colonel’s phone call, reaching out to her in a time of crisis, was even more of a factor.

The truly successful charities in the world are those which understand that stewardship is far, far more than just sending out a timely thank you letter. As Dr. Hanna said, “Don’t forget that people come first.”  It can make a huge difference – just ask The Salvation Army in New York City.

 

Questions about Donor-Advised Funds? Get them Answered Here: The Giving Institute Webcast on Donor-Advised Funds

By | All Posts, Annual Giving, Capacity Building, Current Events/News, Donor Cultivation, Fundraising, Giving USA, Grants, News You Can Use, The Giving Institute | No Comments

Until this Giving USA Special Report, there has been little aggregate information available about the granting side of the donor-advised fund equation. How much do donor-advised funds give to nonprofits annually? Which types of nonprofits do donor-advised funds support, and which types receive the most and the least from donor-advised fund grants? How have these trends changed over time?

Register now for “The Data on Donor-Advised Funds: New Insights You Need to Know,” The Giving Institute’s complimentary webcast exploring donor-advised funds – one of today’s hottest topics with donors, nonprofits and public policy experts.

Thursday, March 1
1:00-2:30pm Central

Register Here 

Expert panelists will discuss the latest Giving USA Special Report on donor-advised funds (DAFs), taking a rigorous, new and in-depth look at where DAF money goes. The webcast will address these pressing questions and offer guidance on how to incorporate this giving vehicle into your fundraising plans.

Panelists include:

  • Mike Geary, Attorney at Law, LLC, at Geary, Porter & Donovan, P.C.
  • Pam Norley, President of Fidelity Charitable
  • Una Osili, Professor of Economics and Associate Dean for Research and International Programs, Indiana University, Lilly Family School of Philanthropy
  • Dave Scullin, CEO of the Communities Foundation of Texas

The Giving Institute webcasts always include time for questions from the audience, so don’t miss out on your chance to have your most burning questions about DAFs answered!

 

Donor-Advised Funds: Stronger than Ever

By | All Posts, Capacity Building, Current Events/News, Donor Cultivation, Fundraising, Grants, News You Can Use, Planned Giving | One Comment

Heather Ehlert
Vice President of Client Services

As fundraisers and nonprofit managers, we know donor-advised funds (DAFs) have become a very popular – albeit somewhat controversial – giving vehicle in philanthropy. Their role in shaping the charitable landscape continues to grow, as evidenced by recent data reported by both commercial and community foundations about their donor-advised funds in 2017.

Fidelity Charitable, for example, has operated as an independent public charity since 1991 and currently sponsors the nation’s largest DAF program. It is also the nation’s second-largest grant maker, behind the Bill & Melinda Gates Foundation. In its recently released 2018 Giving Report, Fidelity Charitable shared the following information and insights about the behavior of its nearly 180,000 donors in 2017:

  • There were more than 1 million donor recommended grants, a 25% increase over 2016
  • Donor recommended grants totaled $4.5 billion, a 27% increase over 2016
  • Donor recommended grants went to 127,000 different nonprofits in every state and around the world
  • Individual grants of $1 million or more grew to 505 last year, a 25% increase over 2016
  • 30,000 new donors established more than 21,000 new Giving Accounts

Fidelity Charitable also shared some of the factors behind this DAF activity:

  • Donors gave appreciated assets, such as stocks, which often allows them to give more to charity than by donating cash; non-cash assets made up 61% of 2017 contributions
  • Non-publicly traded assets, such as restricted stock, limited partnership interests and real estate valued $916 million in 2017 donations to Fidelity Charitable
  • Cryptocurrency (such as bitcoin) saw a nearly tenfold increase in usage over 2016 with $69 million in donations; this helps donors eliminate significant capital gains taxes on the appreciation while giving the full fair market value to charity

Donor-advised funds are the fastest-growing way to give in the United States, as illustrated by Fidelity Charitable data: the number of Giving Accounts held at Fidelity Charitable has more than doubled in the last decade and grew 20% between 2016 and 2017. And DAFs are not exclusively for the wealthy: the median account balance at Fidelity Charitable is $19,157, with more than 50% of the accounts having balances under $25,000. The money isn’t necessarily sitting, either. Fidelity Charitable reports donors are actively recommending grants to charities from their Giving Accounts: within five years of a $100 contribution to Fidelity Charitable, $74 has been granted to charities. After 10 years, $88 has gone to charities and only $12 remains to be granted.

Not surprisingly, 2017 saw an emphasis in donor giving from Fidelity Charitable Giving Accounts in response to natural disasters. The American Red Cross made the top of the charity recipients list and Samaritan’s Purse made the list for the first time. The Salvation Army, Habitat for Humanity, Oxfam and UNICEF also say increases in giving, most likely due to natural disasters, especially those that happened in late 2017. Impact investing was also noteworthy in 2017 – Fidelity Charitable made more than 4,000 donor recommended grants totaling nearly $19 million. Donors are also requesting more frequently that their Giving Account balances be invested in Fidelity Charitable’s impact-investing pool.

There are certainly clear advantages to using donor-advised funds: flexibility, convenience, investment growth, tax benefits and empowering strategic charitable giving and financial planning.

And of course, there’s the flip side to DAFs:  costs to society in tax revenue, oversight and payout requirements, treatment of sponsoring organizations versus community foundations and the overall impact on donors, nonprofits and other forms of giving.

Most importantly, nonprofits should position themselves to work with and benefit from this giving vehicle. DAFs aren’t going away. So don’t forget some basic DAF best practices:

  • Flag the DAF and gifts in your donor database
  • Recognize the donor in stewardship, not the DAF sponsor
  • Seek to engage the donor, even if the initial gift is small
  • Be sure to include DAFs in your organization’s “Ways of Giving”

Don’t miss The Giving Institute’s Live Webcast of “The Data on Donor-Advised Funds: Insights You Need to Know.”  You can expect to have your most pressing questions about donor-advised funds and how to incorporate this giving vehicle into your fundraising plans answered.

Thursday, March 1
1:00-2:30pm Central
Register Here