As the economy slowly shows signs of improvement, we are seeing more nonprofits exploring the idea of conducting a capital campaign. A question we have fielded many times during our 23 years consulting to nonprofits is, “How do you really know when the time is right to begin a capital campaign?” We often use Giving USA, an annual report on the state of philanthropy published by the Giving USA Foundation and the Center on Philanthropy at Indiana University, as the best gauge on giving in our country. The latest study, released June 2011, shows charitable giving continuing a modest, but upward trend of 4% from the previous year. Beyond this statistic, there are several elements your organization should consider before committing to a campaign. A few of the most important are outlined below.
First, it’s imperative you have an understanding of what is really involved in a campaign and how your organization will manage it. The nonprofit must be willing to invest the time and money in this intensive volunteer-led effort in order to ensure a campaign’s success. Most campaigns could take between 24-36 months, although larger campaigns may take longer. Investing in a third party fundraising counsel to conduct a pre-campaign planning study is an important first step. In this process you will determine if the campaign has the necessary volunteer leadership to raise the money needed. This is primarily done by identifying the top ten leadership donors whose gifts will comprise majority of the campaign goal.
Second, your nonprofit should have an outline of the organization’s needs and the community benefits addressed by the capital campaign. Much like developing a business plan for a new venture, a nonprofit needs a compelling message and a detailed budget for the project. When you move into a campaign you should be prepared to share with your potential donors their projected return on investment when they are considering a gift to the project.
And third, the organization must have sufficient staff and infrastructure in place in order to manage a campaign. In addition to having outside counsel to guide your strategy and take you through the many steps of raising capital, you should have sufficient development staff to handle the daily tasks of campaign management. Additionally, an organized and updated donor database is integral to tracking all campaign activity and recording and acknowledging gifts. Current policies, such as naming rights and gift acceptance procedures, need to be reviewed prior to the launch of any campaign. Efficient operations prior to undertaking a campaign are critical to the success.
These are just a few of the items on our check-list of when to know an organization is ready for a capital campaign. We will be discussing in depth the concept and process of a planning study, referenced above, in our upcoming fall newsletter. We hope you will take the time to read our publication due out in a few weeks.
Leave a Reply