In a recent blog post on The Chronicle of Philanthropy’s site, Clara Miller writes about the case of “Sister Rose,” who runs a nonprofit with a $30 million annual budget. Miller presents Sister Rose’s fundraising burnout as an example to shatter the myth that nonprofits need to diversify their funding revenue.
But I submit that Sister Rose’s problem is not that her revenue is overly diversified but that her development program is mis-focused.
First, because 70 percent of her revenue comes from government grants, which are restricted to some degree, she needs to diversify in order to raise unrestricted dollars. Much of the 15 percent she gets from corporations and foundations is also restricted.
Second, Sister Rose is raising the other 15 percent through a dinner dance, golf outing, bingo, car wash, and direct mail campaign—nothing about major gifts. Why in the world is a $30 million organization doing a car wash, bingo, and golf tournament? Frankly, why would a $300,000 organization be doing these instead of major gift fundraising? No wonder she is exhausted—special events do that to you.
Why do nonprofits continue to think a development program comprises special events, bingo, in-kind donations that aren’t helpful, and other activities that typically generate a poor return on the dollars and time invested? It’s time for Sister Rose to invest in building capacity in her development program, and that means focusing on major and planned gifts.