In Praise of Small Events

Many of the people and organizations I talk to about development strategy think that fundraising is all about big events like walks, runs, and galas.  They do not seem to realize that these things take a great amount of time, manpower, and money, so the net returns are not as great as many would assume.   An organization must pay for their employees’ salaries who plan and work the events, the food and drink, T-shirts and gift bags, fees, space rentals, sound systems, etc.  Understand, I am not totally against these things, but I have enough experience to know that events are some of the least effective ways to raise money for a nonprofit organization, especially a small one with limited resources.

Yesterday, an old friend, I should say a long time friend, that I have known since seventh grade, posted on Facebook that she had a number of friends over for cocktails.  While they enjoyed drinks and conversation, she passed around an envelope asking for donations for Doctors Without Borders and raised a thousand dollars.  Not a bad result for an improptu ask for a good organization.  I am pleased by her actions and the generosity of her friends and associates.

More organizations should use this strategy to raise money for their programs.

Small, intimate events held by individuals, whether Board members or donors, can be quite successful.  Let me tell you why and how they can be exactly what your organization needs.

  1.  Large events don’t allow you to spend much time getting to know your donors and potential supporters.  Big events like galas usually last two to three hours, and the number of guests usually number in the hundreds.  The Executive Director and the Development Director cannot possibly have time to genuinely get to know people and find out what their interests are in the organization and its programs.  Conversations are short and impersonal, reminding me of going through the rush events of fraternities and sororities in college. “Hi, what’s your name?  What’s your major?  What’s your father do for a living?” Small events are more intimate, relaxed, and personal.  You have more time to find out what interests the potential supporter and use that information for further conversations in the future.
  2. Costs are far less than a big event.  A big gala or athletic event like a run or walk can cost the organization thousands of dollars.  A small get together of twenty or so people can cost a couple of hundred dollars in food and drinks, and can be held in a Board member’s or supporter’s home.  The host will generally provide the necessities, but an organization can certainly help pay for the party supplies.
  3. The hosts are in charge.  They do the heavy lifting, so to speak.  Let them take charge.  Planning is relatively simple and painless for the development staff.  The hosts know who they want to invite to their gathering and what to serve their friends.  They have a better idea what their guests’ interests are and the giving capabilities of their guests, far better than the Development Director would have.
  4. Since the hosts of the event are doing the planning, the ED and DD have time to think about the message they will be sharing and the stories of the organization’s successes they will tell.  They can talk about their plans for the future and how the guests can be a vital part of that future.  The talk can be informal.  Guests can ask questions, and the staff attending can answer them then and there to the best of their ability.
  5. Hosts have a great number of options for their events to choose from.  They can have a simple cocktail party like my friend, or they can go all out with a formal dinner party.  They can have a barbeque in the backyard, have a picnic at a park, or they can invite people over to watch a baseball game, football game, or watch a movie.
  6. These events can be for asking for financial support, or they can be an introduction to the organization and its mission.  Remember, the goal is not just about raising money.  It’s about building lasting relationships with potential partners to achieve your mission’s goals.  When you meet in smaller settings, the more intimate conversations shared over drinks and dinner can be far more productive in achieving this goal.

If you are a small organization with limited means, small events can be the answer for your needs.  Even if you are a large organization, a small event with key donors and potential supporters can build new and lasting relationships.

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Greece, Illinois, and Lack of Common Sense

Does it make sense for a nonprofit arts organization to ask a homeless person to contribute to a fund to buy an expensive painting for a museum?  Does it make sense for a charity to ask a business that is going under to give a major gift to their organization?  Does it make sense to ask an individual who has lost their home to foreclosure for a donation for an animal sanctuary?  Does it make sense to ask a person who was recently downsized (laid off) at the end of their career to make a large pledge for a children’s summer program?

If you have read or watched the news over the past few months, you are aware that Greece is  in some financial hot water.  The country’s leaders have borrowed money to run their country for such a long time and at such an unsustainable rate, that they have dug themselves a hole so deep that they will probably never get themselves back in the black.  They spent more money than they had coming in, and now that spending has come back to haunt them.  They nearly left (or were forced out of) the Euro zone, and now they are  forced to comply with more austerity measures in order to borrow more money so they can make a payment to their lenders.  The fact is, they continued to spend more than they had, instead of making cuts and changes at an appropriate time, and now the chickens have come back to roost.  The Greek people are not happy, the other countries in the European Union are not happy, and the economy there will suffer for years.

The state of Illinois, my birthplace and current home, is in a similar predicament.   The irresponsible legislature and past governors have continued to spend money they did not have for years, signing contracts with scores of nonprofit organizations for human services, and provided grants for others, all the while skipping payments to their employee retirement system and taking out loans that they cannot pay back, and now their actions have come back to haunt the state.

Frustrated voters elected a new governor to turn things around, but also re-elected the same legislators who caused the mess in the first place, and problems continue here.  The Legislature proposed a new budget with a gap of over four billion dollars, and Governor Bruce Rauner refuses to sign it into law.  Many organizations have been informed that their contracts have been cancelled, and now many will have to reduce services and some will close their doors.

The financial messes in both, Greece and Illinois, have been going on for years, but many nonprofit organizations continued to exacerbate the problem by continuing to approach the governments for their financial support.  And sadly, many still do seek more support from governments that do not have money.  In Illinois, the state enacted a temporary tax hike that caused scores of businesses to leave the state for greener pastures, creating more unemployment and a lower revenue base.

I believe it is time for these nonprofit organizations to stop blaming the governor who is trying to fix a problem that has been brewing for years and years, and start blaming those who are truly responsible for their financial woes:  The irresponsible politicians in the state capitol and those who look back at them in the mirror.  They were aware of these financial issues, but refused to step away from the food trough.  In my opinion, their willful blindness has sealed their fate.

It’s something called common sense.

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Should Your Organization Keep Walking?

About forty years ago, I participated in my first fundraising walk.  I can’t remember which organization it was for, but I do remember getting the sponsorship form and going around my neighborhood and getting people to agree to donate a certain amount of money for each mile I walked.  I think I got a T-shirt for my effort, and I recall the good feeling I had for supporting a good cause.  I ended up participating in other walks and rides as I got older, so it was an early start to my desire to eventually raise money for other causes.

However, at that time, walks and rides were relatively new for fundraising events.   Since then, it seems that as nonprofits have proliferated, every organization has started having these events, and that has not been a really great thing.  It seems that there is a walk or a ride event just about every weekend for every cause under the sun.  There are so many that attendance has dropped, so fewer people are raising money for these organizations.  According to an article in the Chronicle of Philanthropy, results of these events have decreased by ten percent in recent years.  They are still raising money, but just not the amounts that they have in their more successful past.

The costs of holding these events have risen in recent years.  In a past post I wrote a few years ago, “Walks, Runs, and Rides: There’s Much You Should Know“, I discuss the costs of salaries and benefits for the staff members who put these events together, the swag the organizations provide their participants, the upgraded technology participants use to connect with their supporters, and the fees that many cities now require of the groups holding these events.  My eyes were opened during a discussion with city department in Portland, Oregon, that works with nonprofit organizations in the city which hold these types of fundraisers.  They are not cheap, let me tell you.

Another issue to consider is that creative organizations have found other ways people can use to gain support for their missions.  NPR recently reported that many organizations are turning to other ideas to raise money for their missions.  St. Baldrick’s Foundation has raised a great deal of money holding “shave-a-thons” to raise money for pediatric cancer research, and who can forget the ALS Ice Bucket Challenge that brought in over $200 million last year?

Personally, I don’t think walks, rides, and runs will completely disappear, but I do think that some groups should consider looking for alternatives that will help them stand out among the crowd. Being different can be an advantage when it comes to fundraising, but being the same as everyone else may not.

It’s a matter of supply and demand.  With the vast growth in the nonprofit sector in recent years, and the number of organizations that duplicate their services and fundraising methods, I believe the financial results of these athletic events will continue to drop.  Their excessive numbers are unsustainable.  Some organizations will be winners, but unfortunately, others will be losers.

 

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Where Does the Money Really Go?

I was sitting in one of my favorite watering holes recently and needed to use the cash machine which doubles as a redemption machine for the video slot machines.  I stood behind someone who was cashing in a ticket from one of the video gaming machines, and I noticed something that caught my eye.  The individual had some change coming to them as part of their winnings, and the machine “asked” if they wanted to donate the change to charity.  The options were “helping needy children” or “helping needy children and families.”  It didn’t mention the names of the organizations that would be recipients of the gambler’s largesse, and that concerned me.

When I sat back down at the bar after my transaction, I asked the bartender if she knew where that money was going to.  She had no idea and told me that it was the vendor that supplied the machines that was in charge of the donations.  I asked her to ask the vendor the next time he came in, because I really would like to know.

A couple years ago, I got a request to write some content for the website of a “nonprofit” organization in another state.  I called the individual who contacted me and asked for more information.  According to my contact, the “group” supports those who suffer from two completely unrelated diseases, and they solicit businesses and individuals for support.  He thought that my content could persuade more people to contribute.  But something didn’t feel right to me, so I politely asked for some time to do a little research and I would get back to him with a decision.  I thought it was prudent to look into who I would be helping, and I am glad that I made the effort.

The first thing I did was to check with Charity Navigator, Guidestar, and the the BBB Wise Giving Alliance, and I was surprised to find that none of those organizations had any information on the “organization.” I then used several different search engines to find any information I could.  After several different searches, I found some information about a group that had registered a nonprofit with that name, but the 501(C)(3) had been expired for several years.  I finally contacted the state where the group was located and found that it was not registered with the Secretary of State’s office as required by law.  I explained to the individual who I spoke to at the Secretary of States office my concerns, and this prompted an investigation.   Considering what I found, or did not find actually, I contacted the individual who contacted me and declined his request.

A few weeks later, I received a call from the investigator in the other state.  He told me that he made contact with the “nonprofit” and told me that he talked to the individual who contacted me.  He said that the group was not a valid charity, but because the group took in a limited amount of donations (under $20,000 annually), the state would not prosecute them.  He thanked me for reporting the issue, and then ended the call.  To be honest, I am not sure what bothers me more, a group masquerading as a charity or the state that doesn’t prosecute them because they don’t con more people out of their money.

Recently, four “charities” made national news for similar actions, but apparently the amount they took in was enough for the government to notice and to take action.  The charities, Cancer Fund of America, Children’s Cancer Fund of America, Cancer Support Services, and Breast Cancer Society were all controlled by James T. Reynold Sr., his son, and other family members, and took in $187 million, but only a miniscule amount went to cancer patients.  The rest was spent on themselves and their friends.  The organizations have now been closed down, but in some cases, the money will not be returned by the fraudsters because of settlements with the government.

Although the percentage of charities who do this kind of thing is quite small, it is large enough to effect giving to valid organizations.  Stories like these make big news, and every time they are told, people think twice about giving, and really, who can blame them?

We in the nonprofit sector must do more to make sure that we do more to prevent this kind of misuse of donor funding.  Surely, those who worked in these “charities” were aware of the problems its leadership spending of organizational funding for personal use, yet it continued for years.  There are laws that protect whistle-blowers, so if you know or suspect that wrong doing is occurring, report it to the proper authorities.

Seth Godin said it well in his post today, “Kneejerks“:

“The most powerful thing we can do to earn respect from those around us, though, is to call out one of our own when he crosses the line. “People like us, we don’t do things like that.” This is when real change starts to happen, and when others start to believe that we really care about something more than scoring points.”

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Another Lesson from My Squirrels

Earlier in the year, I posted a Tale of Two Squirrels, that described my relationship with two neighborhood squirrels, one black and one gray.  This is a follow up and another lesson that development professionals should heed.

A few weeks ago, I last saw my two squirrels, Shadow, the black female, and Cotton Ears, the gray male.  They regularly came to my apartment for a handout of peanuts.  As I mentioned in my previous post, Shadow stayed to visit when she came by, but Cotton Ears always took the peanuts and went elsewhere.  I liked having my almost daily visits.

Shortly after my last visit, I spent five days in Seattle, where I wanted to meet with a couple of colleagues in person, but most importantly, watch my daughter graduate from college.  Sadly, I couldn’t schedule the visit with the colleagues, but another opportunity will come up in the future.

When I came back from Seattle, I thought I would start seeing my furry friends, but it has been almost three weeks without a visit from Shadow or Cotton Ears.  I did learn a day or two ago that Cotton Ears died after a receiving a deadly shock on a wet night from an electrical line.  It saddened me, but I am comforted to know why I haven’t seen him.

What does have me concerned is the lack of Shadow sightings.  I know she had a litter of babies recently after noticing she had pulled a lot of fur out to line her nest.  I am hoping she will return, but no knowing is discomforting.  I don’t know if she may have been killed and eaten by a bird of prey, a neighborhood cat or fox.  I don’t know if she found another source of nourishment, especially since many maples are dropping their helicopter-like seeds.  I don’t know if she simply moved on or will ever return.  It’s the anxiety of not knowing that bothers me.

Other squirrels have started to visit, as well as a chipmunk which came out of hibernation, and the numerous birds of various species have been busy at my feeders, but it really isn’t the same as my friend, Shadow.  Time will tell if she comes back, but if not, there are the others to take her place.

Donors and supporters of nonprofit organizations often feel abandoned when they cease to hear from the organizations that they support.  They wonder why, after providing them with financial or volunteer support, they do not hear another word.  They wonder what their support has done for the organization and its mission and how they have made a difference.  “Have I made a difference?” they ask themselves.

Then, after months of getting nothing, they get an envelope in the mail with yet another appeal, but with little news or personal touch.  In meantime, other organizations have solicited the donor, telling their stories and sharing their needs.  The donor, after not hearing from the organization, has lost interest and found another that will keep them informed.  The organization loses because of its inability to stay in touch.

I advise that you do not be like my squirrel friend, Shadow.  Don’t let your nonprofit organization become replaced because you failed to engage your supporters.  Engage and stay engaged to those who share your vision.  Reach out and share your news, and on occasion, ask again.

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The Log in Your Eye

In 2014, the Colorado Symphony Orchestra had an innovative idea.  The voters of the state had overwhelmingly decided to legalize the personal use of marijuana for recreational purposes in a referendum, much to the chagrin of Federal, state and local governments, and the CSO wanted to capitalize on the opportunity by creating a series of events to build a more diverse audience and raise money to support its organization.  The Symphony raised a lot of eyebrows and received a lot of criticism for this choice, and the plans had to be changed to accommodate the pertinent laws, but they went ahead with their plans.

First, I think it should be known that the Symphony did not sell or distribute marijuana products at their events, and they did not encourage their patrons to indulge in the use of marijuana at their events.  The events were sponsored by businesses that are legal in the state of Colorado, and Symphony musicians provided musical entertainment in a private setting.  The purpose of these events was to open up classical music to a more diverse set of supporters, and I hope it did bring in more people including baby boomers and millennials, to help replace the supporters of the CSO who are aging.

However, from the information I gathered in some limited contact with the organization, it appears that this series will not be repeated this year.  According to a statement attributed by Colorado Symphony CEO Jerry Kern,

“The Colorado Symphony does not have any events this season sponsored by the cannabis industry. The CSO serves the wonderfully diverse population of our growing, changing state. Our portfolio of business partners and sponsors also reflects the diverse tastes and demographics of Colorado. Sponsors include major corporations, small businesses, breweries, sports franchises and media outlets. We have an open-door policy to legitimate, legal businesses that support our mission. Support from the business community allows the Colorado Symphony to maintain the high artistic standards that have cemented our status as the greatest symphonic orchestra in the West.”

Unfortunately, questions about the number of attendees or the financial success of these events went unanswered, so I must assume that they fell short of projected goals.  Otherwise, I would think that they would be repeated in the future.

The Symphony has been criticized because they were innovative enough to tie a newly legal vice in the state of Colorado to their fundraising efforts, but nonprofits have long used vices to raise money.  This has happened for decades, so I find this criticism quite hypocritical.  Let me share a few examples with you.

Alcohol, considered a vice by many, is commonly used at fundraising events.  Nonprofits either provide open bars at their fundraising galas to open up the donors’ wallets or loosen the purse strings, or they sell drinks by the glass to increase their revenues.  At one organization I served, we held an “instant wine collection” raffle, where the winner received several dozen bottles of fine wine for their use, and the organization increased the take of the event by thousands of dollars.  I even interviewed for a development position with a nonprofit drug and rehabilitation organization that solicited support from local  in brewers and served drinks at their fundraising events.  The Brewer’s Festival in Portland, Oregon serves beer from craft brewers around the country, and a portion of the proceeds go to charity.  I have been invited to dozens of wine tasting events that supported one organization or another.  According to the National Institute on Health,  alcohol is responsible for thousands of deaths each year, and nearly two thirds of those who enter drug treatment are there for alcohol problems.  Now, I am not saying that patrons of those charitable organizations are alcoholics or will die in alcohol related accidents coming home from those events, but let’s face it, alcohol use is common at nonprofit events and the potential for harm is there.

Gambling is another common fundraising tool for many nonprofit organizations.  I remember when gambling was only legal in Nevada and Atlantic City.  Now, gambling is almost found in all states, and it is not only a fundraising method in nonprofits, but also for increasing income for state and municipal coffers.  Most states have specific laws, rules and regulations pertaining to gaming for nonprofit fundraising.  Once again, raffles are commonplace for fundraising in the nonprofit sector.  Some organizations have “Ducky Derbies,” where people buy rubber ducks with numbers on them that are dropped into rivers, and when the winning ducks are pulled out at the end of the race, the winner gets a prize.  Churches and other organizations have relied on Bingo for decades.  Many organizations have “Casino” nights to raise money for their programs, and some have events centered around horse races like the Kentucky Derby.  Even though these activities are legal in most locales, gambling is a cause of heartache and financial distress for many in our country.  I have read numerous articles about officers and staff at schools and nonprofits that embezzled money to cover their gambling losses.  Yet, people don’t seem to bat an eye at organizations that turn to gambling events to supplement their budgetary needs.

Gluttony is another tool that nonprofits often turn to to raise money for their organizations.  Some groups have big food events, whether dinners or all you can eat pig roasts or, as my friend, Michael Rosen told about in his blog post, “Do Not Let Them Eat Cake“, about a fundraising event in Philadelphia where one can buy samples of hundreds of wedding cakes.   Schools have their bake sales where people support a cause by purchasing sweet baked goods, like cookies and brownies.  Girls Scouts sell their cookies and schools sell candy, popcorn, and a myriad of junk food choices.  School groups always seem to have kids selling candy bars, popcorn, and other treats.  America has a widely discussed obesity problem, but rarely do you hear someone complain about those types of   fundraising events.

While what the Colorado Symphony Orchestra attempted was questioned by some in our sector, it was completely legal in Colorado, so I really don’t have a problem with their experiment.  I do have a problem with the hypocrisy of those who criticized their efforts, since so many organizations rely on vices to achieve their financial goals.

As it says in Matthew 7: 3-4, “And why worry about a speck in your friend’s eye[c] when you have a log in your own? How can you think of saying to your friend,[d] ‘Let me help you get rid of that speck in your eye,’ when you can’t see past the log in your own eye?

Don’t criticize other groups for their efforts and methods, if you are doing something quite similar.  It’s really unbecoming.

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Where Will It Go and Who Will Remember You?

I write this post, not only for my regular audience of nonprofit professionals, but also to my friends for whom this applies.

Like most people, I have many friends that I have acquired over my lifetime.  I love them all as individuals.  There are many ways that we are alike, and there are many ways that we differ.  I believe that is the way life is meant to be.  Life would be very boring if I associated only with people who believe or live like I do.

A good percentage of my friends, like myself, are parents.  We love our children, raised them to the best of our ability, and sent them out into the world to live their lives.  Our children find work, perhaps start a family of their own, and hopefully, find success of their own.  They are our true legacy to this world, the most important contributions we could make to the world.  When we pass on to the next step after this life, we will leave them with memories and property.  Some will get more, some will get less, but they will remember us by what we gave them.

However, another percentage of my friends are those who are single or married, but don’t have children.  According to the 2010 US Census, the number of childless couples in the country is almost double of those in 1979.  Whether by choice or by fate, those who never started a family, have fulfilling lives.  Most have great careers, homes, cars, boats, art, musical instruments, or other items of value, but when the time comes and they pass on, what will become of their assets and acquisitions?  If they have surviving family, perhaps siblings or favorite nieces or nephews, they may choose to share their fortunes with them and keep it in the family.  But, if they do not have close family or they feel  that their family has done well enough on their own, they need to make some decisions on how their estate will be used and where they want it to go.

To those of my friends who are part of this latter group, I ask that you start thinking about this issue and your future, as it is something that you need to plan for ahead of time.  Consider what is important to you, and start choosing your priorities.  One friend that I lost in the past year did plan ahead and created a scholarship fund at his Alma mater.  But to my knowledge, the other peers who passed in recent years made no plans.  If there is a cause or causes that you are passionate about, I suggest you start thinking about how you might support them when the time comes.  Think about your legacy and how you wish to be remembered.

To those of you who are in the nonprofit sector, I suggest that you start looking in your supporter files and see if any of them are part of this growing population.  These people should be engaged personally and professionally as potential planned giving prospects.  Help them find their passion.  Invite them for conversations and further involvement with your organizations.  There are many tools that you can use to secure this future support, but you have to make the effort to make it happen.  Your organization and those that it serves will need to be the ones who remember these wonderful people.

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