Fundraising + Science = ?

test tube2Did you have a chance to read the Chronicle of Philanthropy in April? The one titled “Science Unlocks the Secrets of Giving”? Because it was … provocative!

I am a prospect research professional. I love data! Poring over the latest wealth study and pulling out bullet points and formulas to use in researching prospects brings me joy! So why did the Chronicle of Philanthropy’s coverage in April make me uncomfortable?

First, I’d like to say that being uncomfortable is not altogether a bad thing. Pushing outside the comfort zone can yield growth and innovation. And I really hope that happens when it comes to applying science to fundraising. But something isn’t lined up properly.

What Using Science in Philanthropy Means 

As I argued in my Innovate or Die article, fundraising must change in response to the economic, cultural and other shifts occurring. What the Chronicle of Philanthropy articles were suggesting was that fundraising should be using the human research and fundraising-specific research studies to craft fundraising strategies and programs.

Human research? Yes really! Such as neuroscientific research delving into what is happening in the brain when someone gives. Research into “how the body’s hormones can affect the reward-giving dopamine levels in our brains that create feelings of generosity and trust”.

There was also a short story on how an organization gave up on an experimental fundraising strategy that involved direct mail with a do-not-solicit-option for the donor that promised not to solicit ever again if a gift was made. The organization was uncomfortable with having no way to build a relationship with the 46% who had made a gift under the do-not-solicit-option … even though they were raising more money from those gifts than with the traditional approach.

I understand the discomfort, but I don’t understand mailing to all those people who will never give again anyway. (Don’t be over-optimistic here; how many of your donors have permanently lapsed after the first gift? Do you even know? And do you continue to mail to them for years, hoping?)

Changing Perspective, Not Changing Values

 A slight shift in our perspective on donors can better align our organization with reality. We can maintain the same mission and values, but when we recognize that our donors are not “our donors”, but “people who have a made a gift to our organization” we have room to see things differently.

The science might be saying that we are raising more dollars by not stewarding people who don’t want to be stewarded, but from a new perspective we can translate that into … we will respect the wishes of people not to be contacted and we will honor those who do want to be contacted by spending more of our resources building relationships with them.

The science says we will and are raising more money with a specific strategy. Our shift in perspective allows us to say we will and are raising more money using the same integrity and values we have espoused all along – the donor’s right to make choices.

Sure, neuroscientific research studies can be a little bit difficult to decipher and boil down to actionable bullet points. Yes, fundraising research can be in opposition to long-standing traditions and beliefs about donors.

It can make us uncomfortable.

We have to question our resistance. We have to change the angle from which we view the situation. Why would we not want to respect the wishes of someone who has made a gift to us? Even when it is a wish not to be contacted.

Research is suggesting, nigh, demanding that we do our fundraising differently. Innovate or Die!

But we must do ‘different’ with a balanced approach. We must shift our perspective so that we can make decisions that accept reality and yet still align with our mission, values and the trust the public has for our organizations. The trust they have in us.

More Resources:

Female Fundraisers Talk About Wealthy Women Philanthropists

World Map VectorI’ve selected three recent articles written by female fundraisers about wealthy women philanthropists. Enjoy!

Understanding High Net Worth Women’s Philanthropy

By Marge King, InfoRich Group

Lately, I have been seeing a lot of research studies on the topics of how women save money, invest money, and spend money-studies done by Fidelity Investments, U.S. Trust, and similar financial services organizations, on a regular basis.

It doesn’t take the proverbial rocket scientist to understand why the financial industry is spending money on studies analyzing women’s money habits.  A significant number of women-often the financial decision makers in their families-now contribute to the economy with their earnings. >>>Keep Reading

What Women Donors Want

By Adrienne A. Rulnick, Ed.D., Grenzebach Glier + Associates

Fundraisers need to broaden their “toolkits” in thinking about what motivates and incentivizes women donors. Recently, a fundraiser from my undergraduate alma mater called me in the lead up to our quinquennial reunion celebration at the recommendation, she told me, of two classmates who were also friends.  They wanted me to complete the funding for a scholarship that they had seeded in honor of our reunion. Although the ask represented a stretch gift for me, I immediately agreed. >>>Keep Reading

Rating Girls

By Preeti Gill, Sole Searcher Blog

Did my headline grab your attention? Good. Here’s my contribution to the prospect development community’s great capacity ratings debate. This post isn’t about how to rate prospects. Nope, not going there. This post is about who gets the rating inside your database, once you’ve crunched the financials on an individual, couple or household. The one who gets the rating then gets pulled into your prospect pipeline for closer consideration. >>>Keep Reading

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5 Benefits to Make the Case for Prospect Research at Your Organization

Guest Post by Sarah Tedesco

bulbpencilSMThink of your nonprofit like a light bulb and money as the filament. You’ve got plenty of conducting wire to glow for a long time, but are you shining as bright as possible? Is your light reaching as far as it could or are you casting shadows upon donors just out of reach?

Prospect research provides philanthropic and wealth data that helps you to spot the major gift prospects who will donate the additional funds that you need.

Below are five ways to convince the head honchos of your organization to make a strategic investment in prospect research.

Benefit #1 – Receive more information about existing major donors

Does your prospect have a good poker face? Does he enjoy bubble baths with a glass of red wine? Is he an ancient Greek pottery aficionado? Prospect research won’t answer those questions, but it will deliver the sort of information that you need to improve your major gift fundraising.

Prospect research provides:

  • Philanthropic histories – Know who your donors have given to and how much.
  • Wealth markers – Discover what your donors invest in, such as stocks, real estate, etc.
  • Group analysis of long donor lists – Receive comprehensive reports that summarize donor lists according to where they donate, how much, and more.
  • Business relationships – Discover your donors’ employers to discover if they work for companies that offer matching gift programs.
  • And more! – Different prospect research companies and consultants can deliver different types of information in different ways, so be sure to conduct research before you commit to a company or private researcher.

The fundraising experience becomes more personalized when you know more about donors. Your loyal donors are your most important donors, and remaining abreast of who they are and how to best continue to solicit donations ensures that your relationships will last.

Benefit #2 – Fundraise more efficiently!

While you’re busy hosting events, managing staff, and taking care of other tasks, your most valuable resource is always tick, tick, ticking away… Time.

With prospect research, you can pick out the highest quality major gift prospects on your list and dedicate your time, staff, and resources accordingly. Your fundraising efforts will be focused on the prospects who can deliver the biggest impacts for your organization.

Prospect research methods include:

  • Screening companies – After compiling data from a plethora of databases, screening companies return comprehensive philanthropy and wealth data to help you identify your major gift prospects.
  • Prospect research consultants – Consultants can provide you with a deeper level of research and fundraising insights on specific prospects. They can also help you streamline and coordinate all of your prospect research efforts. It’s important to know what you want from your consultant to achieve the best results.
  • Do it yourself – There is an abundance of search tools out there, and you can teach yourself or get training for yourself or a staff member on how to conduct and manage prospect research.

Benefit #3 – Find and convert new major gift prospects

While modest donations help, major gifts deliver big, immediate impacts for your nonprofit, and finding more major gift donors is the fastest way to increase fundraising. However, when it comes to increasing your number of significant donors, new isn’t always better.

The top indicator of a major gift prospect is previous giving to your nonprofit, but that doesn’t mean that the previous giving is in the $5,000+ range of a major gift. Despite only giving modest amounts, your loyal donors are your most fertile source of new major gift prospects.

Annual donors, no matter how little they give, have a demonstrated, consistent affinity for your organization. Some of these donors can’t give more, but prospect research can reveal which ones can. However, if loyal donors have the capacities to give more, and care so much about your organization, then why don’t they give more?

The explanation may be as simple as that you’ve never asked these prospects to give more, so they’ve never thought to do so. There may be other reasons, and a thorough job of prospect research can help to solve the mystery, so you can turn these annual fund donors into major gift donors.

An old rule of prospect research is that 80% of funds are raised from 20% of the donations, although many organizations claim that it’s more like 90% of funds from 10% of donations, and others find that an even larger portion of their money comes from an even smaller contingency of major donors. You likely have several major donors, but the more the merrier, as these are the people who will provide most of your annual revenue.

Benefit #4 – Clean up your donor databases

Ring. Ring. Ri…

Prospect: Hello?

You: Hi! Is this Mr. Major Donor?

Prospect: I think you have a wrong number.

Fundraising doesn’t have to be like that phone call. You can call the right numbers more often than not, but only if you have up-to-date information.

Prospect research keeps crucial contact information up to date, such as:

  • Phones numbers
  • Email addresses
  • Mailing addresses
  • Spousal information
  • Hobbies and preferred activities
  • And more!

Don’t just take this new information and throw it into a cluttered closet. Embrace the opportunity to clean up your database, so that your donor records are easily searchable and accessible.

Benefit #5 – Identify planned or deferred giving prospects

You know that you can find new major gift prospects among your current donors, and that you shouldn’t overlook even low-level donors, but there’s also a specific type of major gift to be aware of.

Many donors save their biggest donations to be planned or deferred gifts, and, according to a planned giving expert, planned gifts typically come from regular, modest donors.

Prospect research provides the data that reveals potential planned giving donors.

Landing donations, and especially planned gifts, can be a long game, and donors have long-term value that might be patient to reveal itself. Prospect research helps you to find all of these people and delivers comprehensive information that allows you to make more individualized pitches that will better resonate with prospects and land more major gifts, even if they’re gifts that you have to wait a little longer to receive.

These tips should help you make the case at your organization for the importance of investing in prospect research! You’re a nonprofit with a bold heart and an important mission, so increase your fundraising with prospect research in order to focus on what you’re meant to do.

About Sarah Tedesco

TedescoSarahSarah Tedesco is Executive Vice President at DonorSearch, a prospect research and wealth screening company that focuses on proven philanthropy. Sarah is responsible for managing the production and customer support department concerning client contract fulfillment, increasing retention rate and customer satisfaction. She collaborates with other team members on a variety of issues including sales, marketing and product development ideas.

Connect with Sarah:

 

Forbes Billionaire List Alert: What you’re missing

dancingwomensmWomen may be just under half of the world’s population, but they represent 11% of the 2015 Forbes World’s Billionaires List. Of the 197 women on the list, 29 are self-made billionaires. These may not sound like inspiring numbers, but consider the women on the rise.

Elizabeth A. Holmes is the youngest self-made woman billionaire – ever.

And she happens to be female. And she founded a company using her scientific prowess. So if you’ve been reading all the nasty headlines about how women suffer from misogynists harassing them in the tech field, consider that some uber-successful women have simply stepped around that hot mess!

Ms. Holmes is 31 years old, has retained 50% ownership of her company Theranos valued at around $9 billion, and makes time for philanthropy:

  • Board President for Improve International, an organization launched by fellow Georgia Tech alumna Susan Davis, which is devoted to education, partnership, and monitoring the sustainability of water and sanitation projects worldwide
  • Active mentor for young professionals within Elavon, a payment processing company
  • Volunteer at Georgia Tech, participating annually as a judge for TAG’s Educational Collaborative
  • Member of Women in Technology and On Board
  • Financial supporter of Girls Inc.

The real question is this: If Ms. Holmes wasn’t on the Forbes list, would you even know she existed?

Because I bet there are many sweet major gift prospect gems inside your databases and within your organization’s social circle, but you have no clue.

How Do Women Hide in Your Database?

Of the 168 non-self-made female billionaires on the list, many inherited their wealth from fathers and husbands. But don’t let that fool you. They own it! Did you pay attention to those women before their fathers and husbands died? You should have.

Even before they are widowed these women are usually the influencers and even the drivers behind household philanthropic decisions.

In her debut publication What About Women? prospect research professional Preeti Gill suggests you take a walk through your database …as a woman.

  • When a couple makes a gift, do you credit them both?
  • When you have a couple as donors, do you create a separate record for the woman?
  • What salutation does the woman have?
  • Are you paying attention to how she wants her name listed?

How Do Women Hide Among Your Organization’s “Family”?

Perhaps the easiest way wealthy women are hidden and not recognized by the organizations they love is when they are never entered into the database to begin with. Way too many organizations do not track and include volunteers in their fundraising vision and plans. Your prospect research professional can’t find major gift prospects in your database if they aren’t in there.

And what do we know about women? They do their due diligence before investing! And part of that due diligence is often volunteering for the organization.

Wealthy Women are Still Women

Ignore women in your fundraising at your own peril! Women are different from men. They think about money differently. They want different interactions with your organization from men. And they might even give differently from men.

Fundraising with a focus on women will require adjustments and adjustments require time, money and resources.

But very wealthy women are on the rise and they bring rewards:

  • Quick to make referrals through word of mouth
  • Frequently give unrestricted gifts, small and large
  • Loyal donors who advocate to others within their network

Are you interested in learning more and staying current on women in philanthropy? Click here to sign-up for the What About Women? email list.

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Researcher Sued for Scraping!

Can you imagine if that headline was about you? How would that impact your organization and your fundraising career? Would it be fatal or a blip in the radar?

I’m an emotional person. Because of this I could easily spend hours chatting about the law and ethics. But when I talk with a highly analytical, logical person, the conversation is usually quite short. Is it legal? Is it public? What’s the problem? Emotions! That’s what!

No matter what your personality type, the only thing that really matters is what your donors and the community believe. Because if they perceive that you have done something unethical and possibly illegal it can be very damaging to your fundraising revenue, not to mention the organization as a whole.

Sarah Bernstein did a very good job of examining the APRA Social Media Ethics Statement so I won’t go over that here. Instead I’d like to have a very specific conversation evaluating a specific situation – scraping on LinkedIn.

Scraping LinkedIn

I’m not starting this conversation. That already happened on the PRSPCT-L list-serv. You can search the archives for these threads:

  • Using Scraper with LinkedIn
  • Experience with ProspectVisual’s LinkedIn Alumni Employment Info?
  • INFO: LinkedIn.com and permitted uses

As a prospect research professional I would love to have a way to get all that wonderful LinkedIn data in a format that I could use for analysis!

According to Wikipedia, Web Scraping is a software technique that simulates human exploration of the web and transforms unstructured data on the web, typically in HTML format, into structured data that can be stored and analyzed in a central local database or spreadsheet. Because it is automated the software can process large amounts of information.

An example of successful scraping we take for granted are the giving databases we subscribe to. We know that the vendor scours the web for giving recognition reports and other public information about giving. The vendor indexes the information and we merrily search the resulting database.

LinkedIn Public Profiles

The first question in the LinkedIn Scraping discussion is whether the information being scraped is from the outside of the service – the public-facing side – or whether it is being scraped from behind the login – the private-facing side.

ProspectVisual, a relationship mapping software, scrapes LinkedIn data from the public-facing side. ProspectVisual never logs in to the software. It doesn’t have to. For example, my LinkedIn profile is almost 100% public. You can find my LinkedIn profile on a Google search and never login.

At the very beginning of the LinkedIn User Agreement in Section 1.2 it states:

You agree that by clicking “Join Now” “Join LinkedIn”, “Sign Up” or similar, registering, accessing or using our services…you are entering into a legally binding agreement.

 

 

 

 

ProspectVisual never enters into the agreement. That’s quite clear and simple from a legal perspective. And given the prospect research field’s warm embrace of many other vendors who scrape the web, it would seem it passes the ethical test too.

LinkedIn Private Profiles

Once you login to LinkedIn you are now bound by the LinkedIn User Agreement.  A search in the agreement for the word “scrape” brings up this line under Section 8.2, the things you promise NOT to do:

Scrape or copy profiles and information of others through any means (including crawlers, browser plugins and add-ons, and any other technology or manual work);

 

 

 

 

The question on the list-serv was whether it was okay to login and scrape small amounts of data for the purpose of identifying new prospects for the nonprofit organization.

Illegal

It could easily be argued that this scraping is illegal and violates the user agreement because scraping, automated or manual, implies taking a bulk of data from LinkedIn and transferring it for another purpose.

Legal

But how much data or at what frequency crosses the line into scraping territory? And if you are not scraping information to re-sell it, but instead to further your fundraising, is that a use that is either appropriate or unlikely to be prosecuted?

Ethical or Unethical?

If it is unclear whether our scraping data when bound by the user agreement is illegal or not, is it ethical to continue scraping? How would our donors and network feel about the way we are accessing the data they have placed behind the LinkedIn login?

Healthy Conversation

Ethics stirs emotions. But that doesn’t mean we can’t engage in healthy conversation. I was delighted that the most recent thread had all the hallmarks of a mature debate:

  • Asking lots of questions
  • Making statements based on found information, not pure emotion
  • Not disagreeing quickly, but working to be sure you understood the other person
  • Recognizing that others may disagree in part or in whole and that’s okay

Now at your next staff meeting you have a juicy topic to bring up under “New Business”. And if you are a blogger, maybe there’s a piece of this conversation you’d like to take on?

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Speedy Research Verification

1160561_45274657Looking back on 2014 I realize that I’ve done quite a few screenings and research verification projects. And that means I’ve had lots of conversations with fundraisers who ask a lot of the same questions. I thought you might like to eavesdrop on some of those Q&A’s!

Very soon after I get into a conversation with a fundraiser about prospect screenings, this question gets asked in some form or another:

Why should I get the results verified? Does that mean the results aren’t accurate?

Every organization has different needs, but generally speaking, verifying results is necessary for at least three reasons:

  • Lots of people have very common names – this can confound even the most talented prospect research professional and it certainly confuses computer algorithms!
  • Sometimes the data going in is less than perfect, so the data coming out is less than perfect too.
  • Prospect screenings were never intended to be accurate to the last detail. That would be nice, but the primary function is to prioritize a large list of names based on limited pieces of information. Some mismatches and omissions are a necessary result and that’s okay.

Once we start talking about where the data comes from and why there are bound to be some errors and omissions, the next question is this one:

What exactly does “verify” mean? What are you doing when you verify?

Verify means deciding which pieces of information are most important and then checking or verifying those pieces of information. It’s like a quality control check in manufacturing. Instead of each garment getting a sticker that says “Inspector #32”, each name gets a once-over by a prospect research professional.

Following are some illustrations of how this might differ from organization to organization:

  • In a small office with a total of three fundraising staff, the development director might eyeball the top-rated prospects, look up their company bio in Google, and make a phone call for a visit. Batta-Boom-Bang!
  • Another organization might hire an intern to check the top-rated prospects and leave it to the intern to figure out what that means.
  • A solo prospect research professional might select a portion of lesser-known prospects in each capacity or likelihood to give range, verify key items such as real estate, occupation, largest gifts, and volunteer leadership, and make recommendations for discovery call assignments.
  • A prospect research department supporting well-paid, highly-skilled major gift officers might take the top tier of top-rated prospects and go beyond verification to qualify that the prospect does indeed match the vendor’s capacity range and likelihood to give rating. They might then methodically verify and make recommendations, working their way through the tiers of prospects.

Why such variation in approach? Always look for the money! Spend the most time and resources where it will bring in the most gift dollars. Common sense tells us that there should be a different approach for verifying results where the highest gift capacity is $500,000 from verifying results where the highest gift capacity is $100 million.

And then people always want to know:

How long should it take to verify a name?

By now you will probably understand when I say, “It depends”. How long depends on how much you are verifying and at what capacity rating levels. Sometimes there are lots of assets and hundreds of possible gifts – that could take a while. On the other hand, prospects with less capacity can sometimes verify quite quickly.

Take a name or two in each category you plan to verify and time yourself. Now you have a good idea of timing.

Data >> Information >> Insight >> Action

Everyone in the fundraising office needs to know a few things about data these days. We need to turn data into information and information into actionable insight. That requires both fundraising and research knowledge. But you knew that, right? Because you are the future of fundraising!

 

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Prioritizing Corp & Fdn Prospects

1334987_68502097Corporate and foundation research is different from individual research. Could it be so simple? About as simple as stating that boys are different from girls! They are different, but also the same in many ways. It’s complicated! Let’s take a quick peek at how corporate and foundation prospects differ when we need to identify new prospects or prioritize a long list.

Identifying Corporate and Foundation Prospects

There are some great tools out there for creating a good list of corporate and foundation prospects. Foundation Center Online and Foundation Search immediately come to mind. Pretty quickly you can create a long list of good prospects that fit some general criteria. Unlike individuals, many corporations and foundations don’t require a deep, personal connection to make a substantial gift.

And yet many times when you start digging deeper to craft your proposal, you realize that the prospects on your list aren’t as good a fit as you originally thought. For example, maybe they are listed as giving nationally but have only ever made gifts in Pennsylvania and Delaware. Or maybe they give to education, but only scholarships and not program.

Early on in my Aspire Research Group LLC career I was not interested in generating corporate and foundation prospects lists. There were plenty of grant writers around who could do that very well – and write the grants too!

But later on I started getting calls from people who had received a long and very broad list from a consultant or sourced the list themselves using products like Foundation Center Online. Now they were facing 100 or more prospects with no idea where to start and the pressure of meeting a fundraising goal.

When it comes to individuals, there are some great tools for narrowing a list like this. We have wealth screenings, predictive modeling scores and often, some giving history to our own organizations. As the Giving USA research has made quite clear, individuals provide the clear majority of overall fundraised dollars and it’s not surprising that the industry has invested in developing great tools for individual prospects.

Nevertheless, corporate and foundation partners are important players for many reasons, not the least of which because they help us engage with the individuals they employ and sell services to. And starting with the letter “A” and working through to “Z” is rarely ever the best use of time and resources.

I wanted to help people prioritize their corporate and foundation prospect lists, but in a way that would give them a good return on investment. In other words, I needed a way to prioritize that wouldn’t take much time so I could charge less. So I got creative. Maybe you have done this too?

Simple Scoring Scores!

Whenever I take on a prospect ID or prioritization project now, I create a simple worksheet based on my first interview with the client. Then we walk through the worksheet together answering the questions about what a really good prospect should look like. A fundraiser might want a prospect who will give to a certain project, but I make sure we get specific.

“Gives to after-school education” becomes “Has made a gift to a similar initiative of $5,000 or more”. I will probably try to define “after-school education” more specifically too. Are we talking science, computer literacy, reading or all of them?

While we are going through the questions on the worksheet I might add or delete some of my questions as I learn more about the projects and needs. I also keep my ears open on which criteria are the most important. When we are finished with the questions I summarize and confirm which criteria are simply preferable and which ones will disqualify the prospect entirely.

An easy example is geography. If the foundation only makes gifts in New York City and the client organization is in New Jersey, the foundation is not a prospect.

The next step is to translate the worksheet answers into a rating legend. And by playing a little bit and giving some criteria extra weight – a higher rating value – I can get the prospects to sort out in a very obvious way based on the client’s funding needs.

By taking time up-front to determine what disqualifies the prospect and what is most important, I can zip right through the project. Doesn’t give where my client is located? Done with that one. Next!

CFRlegend

All’s Well that Ends Well

Some of my prospect ID projects have gone stunningly well and others not so much. The difference has usually been the quality of communication with the client and how early I discover that what the client wants just doesn’t exist. I’m careful now to do an initial search and communicate quickly if I am struggling to identify prospects that meet the agreed criteria.

Your organization might have a straightforward relationship with corporate and foundation funders such as asking for a grant and getting a grant, or you might have many layers to your corporate and foundation relationships such as providing the funder with volunteering, cause-marketing, or fulfilling other needs.

If you are tasked with corporate and foundation research you know you have just as much opportunity to help create wonderful and rewarding relationships as with individual prospects. Maybe you have helped the frontline fundraiser connect with your organization’s vendors, sourced donor relationships with corporate foundation executives or leveraged your organization’s constituency in other ways to identify prospects.

However you do it, identifying corporate and foundation prospects is different from individuals. And as is usual when working with together with other humans, success often requires good communication matched with the creative application of skills!

Do you have a prospect identification success story? Have you heard about new technology solutions for corporate and foundation prospecting? I hope you’ll share with us!

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Innovate or Die: Post-Recession Impact on Finding Donors

Broken LightbulbThe future has a way of entering slowly, day-by-day. But sometimes the writing is on the wall. The words I see on the fundraising wall are Data Analytics. Sure, you say, we all know that. But what does it mean to your organization? To you? Answer: Innovate or die.

That may sound extreme. And it is. But it doesn’t make it any less possible. Before you dismiss that answer, let me tell you how I arrived at it.

The economic environment is affecting our donors – dramatically.

My favorite magazine of all time is The Economist. Lately they have been writing frequently about the growing inequality around the world and in America. How capital is taking a far greater share of wealth and how income, in the form of wages, is stagnating. Companies froze wages pre-recession, but even though profits have returned wages have not risen.

In his blog post “Where have all the donors gone?” Mark Noll makes the case that the result of these economics is the missing middle donor. Post-recession, people may be employed again, but too often at a lower wage. Where will our gifts come from?

In her book, Nonprofit Essentials: The Development Plan (2007), Linda Lysakowski, ACFRE is but one of many fundraisers talking about how Pareto’s 80/20 principle has turned into the 95/5 principle or worse. Way too much of our funding is coming from a tiny sliver of very wealthy. And where do the very wealthy like to give their gifts?

According to the Million Dollar List maintained by the Lilly Family School of Philanthropy, fifteen of the twenty largest multi-million dollar gifts by value were from individuals to private foundations associated with their families. Higher education receives the highest number of million dollar gifts.

In the Agitator blog, Roger Craver writes:

“Giving USA 2013 is but the latest report to make pretty clear that sitting on the sidelines waiting for recovery [from the Great Recession] is a strategy only for the suicidally inclined…demands on charities [is] rising at the same time giving is nearly flat….”

 

 

 

 

 

 

It’s pretty clear that if fundraisers fail to innovate the organizations they serve will suffer.

So what does all this gloom and doom have to do with data analytics?

Data analytics is the cold method behind a warm philosophy: listen to people when they tell you something. And when thousands of people are telling you something, not only listen, but start digging deeper and ask more questions.

Data analytics allows us to “hear” from our constituents in ways we are physically incapable of hearing. If the data tells us that a large number of constituents click through on messages about one of our program outcomes regardless of where we put those messages (social media, print, etc.), but are not responding to messages about another program we planned to make our strategic direction for the next year – we should re-think that direction, right? Maybe.

Analytics alone is not enough.

It’s pretty amazing that we can “hear” our constituents through data, but don’t be mesmerized by all that glitters. We also need innovation in our approach to attracting donors, finding the “best” out of those and asking them for gifts. If the reality is that we will mostly have very large and very small gifts, how can we change our approach?

In 2012 the Chronicle of Philanthropy featured the Kauffman Center for the Performing Arts in Missouri, which raised $416-million, in part by attracting modest gifts such as $1,000 multi-year pledges. This gave smaller donors the opportunity to express their interest and commitment and to be recognized. Crowdfunding is a similar approach, but might be improved upon to become less transactional. People want to give; people take pride in giving. It’s our job to figure out how to make it easy to give while building affinity.

In addition to gift size there are other changes we need to adapt to. Population changes cannot be ignored. Preeti Gill has written a provocative piece about identifying women philanthropists. In “Hey, Ladies! Thanks for giving. Sorry we missed you,” she notes that many multi-million dollar bequests come from women who are “outside of our databases and away from the corporate and media glare”. In other words, traditional prospect research techniques are failing to identify them.

International donors can’t be ignored either. Harvard University just announced a $350 million dollar gift from a wealthy Hong Kong family. Have you looked at population trends and predictions for your organization?

Are your donors from the local community? Are they international graduating students? You need fundraising programs that meet the needs of the constituents you have and will have in the future, not the ones you wish you could have. Data has to come from outside your organization as well as inside.

It’s All About the People

Data analytics helps us find answers and sometimes it can even help us ask questions, but most of the time data analytics requires someone with curiosity and creative problem-solving skills to direct it.

Fundraisers need to shake themselves awake from the traditional and begin interacting with the data so that they can better meet the philanthropic desires of (all) real people.

Organizations need to be willing to take risks, fail a little and ultimately win.

Ask Kodak or IBM about listening and innovating in the face of change. Innovate or die. It doesn’t sound so extreme now does it? And it is doable.

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Research Strategy: Qualification vs. Solicitation

digital world webI’ve been all about the prospect profile for a while – presenting at APRA’s conference in Las Vegas, teaching at the Prospect Research Institute, and creating a profile collection. The one question that has come up repeatedly is “What’s the difference between qualification and solicitation research?”

Many people that have just transitioned into prospect research, especially if they have other duties as well, are often not asked to do a lot of actual research. They are asked to pull reports from products like DonorSearchiWave PRO,Blackbaud’s ResearchPoint and WealthEngine, verify and distribute the results.

Which points out the direction of the prospect development field, doesn’t it? Knowing how to effectively manage the information is becoming just as important as being able to research to find information. Those research screening tools are getting very good! They are so good that you might be wondering if qualification research is even necessary. It is.

The Big Picture – Strategy

The premise behind qualification research is that we need to determine if a prospect is indeed capable of giving at an amount we decide is a major gift and if the prospect is philanthropically inclined. It’s a bit like a home inspection. Before I bought my house I paid for a home inspection and was so glad I did. There’s nothing like a trained professional to point out what you missed, but more importantly, to pull it together intelligently so you can make decisions. Qualification research should do that for your gift officer.

Solicitation research is prepping to ask a prospect for a gift and although the effort varies depending on what kind of research was done prior to this stage, generally we are laser focused on what information will help the gift officer ask for the largest, most appropriate gift. For example, we don’t need to list every gift found. Instead we need to provide as much detail as possible on the kinds of gifts made that relate to the gift we are planning to ask for.

Actions to Achieve the Strategy

So what does the difference look like in terms of actual searching behavior? Qualification means QUICK. Solicitation means FOCUSED.

Qualification is QUICK when you…

1)  Know what you want and need to find

Do you know what will qualify your prospect? This is where a good profile template or in the case of entering directly into the database, a good checklist, will save you time and sanity.

2)  Know exactly where to find that information

Now that you have a template, what is the fastest way to fill in the blanks? My strategy is to start with what I know already (your own database and your organization’s website), then your paid tools and then your collection of frequently used websites. I usually save giving for last because we can only match the gift to our prospect based on his name and what we know about him, such as where he went to school, what state he lives in, his service on nonprofit boards, etc.

3)  Have the discipline to stop looking

Sometimes this is the biggest obstacle for the prospect research professional. We love researching! But nine times out of ten this is NOT the time to follow clues, detail her family history and read countless news articles. If your prospect is listed on the Forbes Billionaire List, why would you detail her real estate holdings? Find her home and favorite vacation spot, but heck, she’s a billionaire! Write a quick summary sentence for the rest. For the majority of nonprofit organizations, being a billionaire qualifies her for capacity to give. End of story.

Solicitation, on the other hand, builds on qualification, including information discovered by the gift officer through cultivation visits. Yes, it usually takes a lot longer, but you should take a very different approach from your qualification research.

Solicitation is FOCUSED when you…

1)  Communicate well with the frontline fundraising staff

If you don’t know what kind of gift is anticipated or what the fundraising priorities are at your institution, you may end up including all kinds of data and spending countless hours being “comprehensive” when that is not what is needed – or even wanted.

2)  Are educated about giving vehicles and trends

If you don’t understand the general concepts of how the very wealthy can make gifts you might overlook important clues. For example, if a prospect owns a few apartment buildings as a way to invest his retirement money, but he still brings in a significant earned income from his job, he might consider giving the apartment buildings’ income to your organization while he retains ownership of the buildings. Now you know that beyond the value of the real estate, estimated apartment rental income could be a valuable piece of information!

3)  Dig deep on relevant clues

So many of us were trained to be comprehensive in our solicitation research, which means that we take as much time as we need to detail every asset and every gift. The closer you work with a gift officer, the more likely you will find that this is not often a useful approach. If I am about to ask a large corporation for a multi-pronged, multi-million dollar gift, what do I want to know the most about? Every division within the company and estimated earnings? Or every detail on how another organization received a very similar relationship and gift? I sincerely hope the answer is obvious!

 Search strategy and experience

 If you are new to prospect research you may be wondering how you will ever be able to learn all there is to know. The good news is you won’t! Part of the joy of our profession is the continual learning. It never ends. Aim for some balance. Learn the nuances of public information and wealth, but also fundraising principles and techniques.

If you are not new to prospect research you might have different ideas on search strategies or stories to tell. Don’t be shy! Why not share?

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So much wealth in China! So little time!

asiaglobe_smThis past weekend I sat down and listened to frontline fundraisers and prospect researchers talk about how they work efficiently and respectfully to raise money in China. It felt long on a Saturday afternoon, but it was worth every minute. If you can find a viewing, go watch it!

If not, here are some of my top takeaways from NEDRA’s Panel: Inside Chinese Philanthropy recorded from their May 30, 2014 event with researchers from Tufts, Harvard, and MIT, and international frontline officers from Tufts and MIT.

On Teamwork

  • Put in place REALLY skilled fundraisers: the prospecting, cultivating and stewarding I heard talked about was very skillful and effective; this is not the time to practice
  • Teamwork between research and fundraiser MORE important: a constant feedback loop between frontline fundraiser and researcher is necessary to tease information out of sources
  • Develop a network of translators: you may be surprised how many people in your organization are fluent in other languages; these people can turn into keys unlocking the one piece of information that leads to a treasure chest full!
  • Contact information is the most important piece of information and the most difficult to find
  • A story was told about a frontline fundraiser sending cold emails in Southeast Asia and securing three $1M USD gifts for a specific initiative! (back to REALLY skilled fundraisers)
  • Get data collection and entry correct, especially events that are actually attended (back to the importance of contact information)

On Research

  • Create search tip checklists for each prospect: you don’t want to forget or make another researcher re-learn all the clever ways you found information on that prospect
  • Capacity requires country context research: because there are often fewer hard asset numbers to gauge capacity, you need to get a feel for how the prospect stands in her own environment
  • Names are so many different ways that it gets difficult (back to search tip checklists)
  • News is the best source for information: Factiva lets you search multi-languages
  • Access and connection is also key: they almost talked about relationship mapping, but didn’t

On Culture

  • Parents: get them in the first year!
  • This is the first generation of wealth: some may want to enjoy their wealth for a bit; don’t forget they grew up without luxuries like refrigerators; they are just reaching middle-age
  • The wealthy are often followers: showing peer giving is helpful
  • Attitude to U.S.: we appear very wealthy when they still have a lot of poverty; business and local pressures to support home projects; may want to show how their U.S. giving helps Chinese at home or abroad
  • Government: there are restrictions on exchanging USD and a cap on giving; may also want to be anonymous or hide wealth; party members and government dominated firms are not going to give

On Patience

  • Must be committed to cultivation over a long time: philanthropic culture is still transactional and local
  • Some programs started in the late 1980’s/1990’s and just now gaining serious traction

Research Tools Mentioned

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