Major Gifts, How Much Are They is fundraising veteran Jim Eskin’s answer to the often asked question, “How much is a major gift?” Here’s Jim’s take on this common query:
As a fundraising trainer/consultant I hear this question often. And I hear a variety of responses, typically crafted on strong rationale. The truth is that there is no one-size-fits-all answer.
Don’t get caught up in a numbers game — $1,000, $10,000, $25,000, $100,000 or $1 million.
Major gifts have different meanings for non-profits depending on their size, maturity and external factors.
But this is a common denominator: They are essential — and growing more and more essential — to non-profit success each day.
We used to talk about the classic 80/20 split in philanthropy with 80% of total gift income coming from just 20% of the donors. That has evolved into a 90/10 split in which 90% of total gift income comes from just 10% of donors.
In most cases the 90/10 split applies to a great majority of America’s 1.5 million non-profits. Success hinges on the discovery, cultivation, solicitation and stewardship of a non-profit’s most generous donors.
Some small and mid-size non-profits might feel they are at a disadvantage when it comes to acquiring major gifts. I disagree because the major gift can have much greater impact. Let’s take a look at some of the principles, strategies and best practices of major gift programs for non-profits, regardless of size and sector.
Major Gifts, How Much Are They?
1. They are all driven by the passion of donor prospects. How boldly is the philanthropic vision of the donor prospect aligned with the nonprofit’s mission, vision and values? Non-profit leaders tend to overvalue the role of wealth and giving capacity. For sure, it is a major factor. But just because an individual has the capacity to give doesn’t mean they are necessarily philanthropic, or deeply care about your mission. Remember, it is enormously difficult being a donor, no matter how wealthy, because you are forced to make difficult decisions, not between the good and the bad, but between the good and the good. Those who have a special place for your mission in both their hearts and heads will likely give beyond expectations.
2. The gift’s purpose is especially crucial. Is it for an exciting capital project, endowment, new project? Or a response to a new challenge? It must elicit a “Wow!” reaction. This is where you can align the imagination of donor prospects and non-profit to come together to turn a dream into a reality.
3. Your best major gift prospects are right in your database. They have demonstrated a genuine connection to your organization. Your task is through wealth screening and peer assessments to determine those who have the ability to give at higher levels than in the past and challenge them. Pay special attention to those with a consistent history of three or more years in supporting you. The starting point for these conversations is easy because you should be communicating gratitude genuinely and profusely.
4. Cultivation — forging a personal and emotional bond with donor prospects — is essential in securing all gifts. In the rarefied air of major gifts, it has Herculean importance. Donors, like all people, are very different with different personalities, styles and preferences. You must become intimately familiar with them so you can carry out a cultivation plan that is a strong fit. Some donors may enjoy site visits, private meetings with non-profit leadership, or personal meetings with the beneficiaries of their generosity. At the top of the to-do list is actively listening to their aspirations and what they want accomplished with their gift dollars and demonstrating and reporting on those results.
5. It is almost trite to hear that fundraisers are in the business of building relationships. For major gifts, we must reach for something much more meaningful and sustainable — friendships. (I once heard relationships defined as something you have until something better comes along.) Major gift friendships are for the long run and grow deeper and more satisfying to both parties over time. They can overcome bumps along the way and occasional declines to requests.
6. When donors have passion for your cause, you need to work creatively together on pathways that enlarge giving capacity. The opportunities are numerous and growing all the time:
• Multi-year pledges of 3 to 5 years.
• Gifts of stock and other assets which provide significant tax benefits.
• In-kind gifts of valuable products and services.
• Legacy gifts which typically increases gift size several fold over gifts from income. The most popular options are charitable bequests, retirement funds and insurance policies. There are attractive opportunities for blended gifts combining current and deferred dollars.
• Donor advised funds or DAFs have quickly emerged as the most dynamic component of American philanthropy. Recognize them on your websites, marketing material and particularly in your solicitations.
• New forms of charitable donations are emerging all the time, such as Bitcoin and other cryptocurrencies, which have become popular among Millennials and Gen Z.
7. Encourage donors to bring other voices into the conversation that can provide expertise and personal perspective in the gifts. These include family members of different generations, attorneys, CPAs and other trusted advisors. These individuals can not only reassure the donor that larger gifts are possible but encourage them that they are the right thing to do.
8. Your current major gift donors can be your strongest links to new major gift donors. They likely have affluent networks and access to set up introductory meetings. Plus, they have the power of friendship and trust to influence decisions.
9. Stewardship — like cultivation — is very personal. Some donors enjoy high-profile recognition such as having their names — or names of loved ones — displayed in perpetuity on buildings and facilities. Other donors opt for anonymity. Frank discussions will empower you to figure out which choices best fit your donors.
10. The late Jerold Panas wisely said that it is ultimately the donor who determines if the gift should be described as a major gift. A winning attitude is to treat all donors as much as possible like major gift donors. America has about 22 millionaires and 1,000 billionaires. Appearances can be deceiving as many people choose to live beneath their means. Every year we are uplifted by the examples of so-called modest individuals making million-dollar gifts.
Many in our profession like to categorize major gifts describing them as leadership, principal, lifetime and other labels. That is fine. But the common denominator is its impact in both the lives of the non-profit and donor prospect. A major gift has the profound power of changing both forever and for the better.
Jim Eskin’s consulting practice, Eskin Fundraising Training builds on the success of his more than 200 fundraising workshops and webinars and provides the training, coaching and support services that non-profits need to compete for and secure major gifts. He has authored more than 100 guest columns that have appeared in daily newspapers, business journals and blogs across the country, and publishes Stratagems, a monthly e-newsletter exploring timely issues and trends in philanthropy. Sign up here for a free subscription. He is author of 10 Simple Fundraising Lessons, which can be purchased here.
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Jim Eskin’s consulting practice, Eskin Fundraising Training builds on the success of his more than 150 fundraising workshops and webinars and provides the training, coaching and support services that non-profits need to compete for and secure major gifts. He has authored 100 guest columns that have appeared in daily newspapers, business journals and blogs across the country, and publishes Stratagems, a monthly e-newsletter exploring timely issues and trends in philanthropy. Sign up here for a free subscription. He is author of 10 Simple Fundraising Lessons, which can be purchased here.
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