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Fundraising Planning
- A Vital Key to Nonprofit Success
By Ken Goldstein
As a professional
grant writer and consultant, I am often amazed at how few nonprofit
organizations actually have a fund development plan beyond a vague
idea of applying for a few grants and sending out an annual appeal
letter. Recognizing that lack of planning, I am not amazed at how
often these same organizations have rounds of emergency budget cuts
when they realize that they have no assured streams of income.
Very typical
is the agency that has received a large grant to run their programs
for one year. Then, in the tenth month of the grant period, comes
the realization that they have no idea how they will fund the next
year's programs. With less than two months of money left in the
bank they go into emergency fundraising mode. Their first impulse
is to start applying for another large grant. But at most foundations,
the process - from letter of inquiry to proposal to acceptance -
typically takes at least three months, and often six to eight months.
Their next idea
is to turn to their individual donors with a panicked letter that
essentially says, "Send us money now or we might go out of business."
That, of course, is the least effective fundraising letter you can
write. Donors want to invest in your successes, not bail out your
failures. So, how do they avoid these situations?
The answer is
to plan.
Through the
planning process, you will achieve the following:
Limit crisis
fundraising: This, as the example above illustrates, is our primary
reason for creating a fund development plan, but there are others
as well...
Diversity builds
in flexibility: Changes in other sectors of the economy can have
a major impact on nonprofit funding. A cut in the state budget can
be passed down as fewer contracts for local service organizations.
The dot-com bust of a few years back cut foundation endowments,
reducing the funds they had available to grant. Agencies that had
become comfortable relying on one or two sources of funding found
themselves struggling to survive these changes. Those with plans
and diversified funding bases had the flexibility to adapt and survive.
Planning for
diversity brings in more opportunities: Through the planning process
you come to identify funding opportunities you never knew existed.
Further, when you stop having to scramble to pay next month's bills,
you will be able to devote more time to developing new sources of
income for your agency.
Setting priorities,
strategies, and goals: New opportunities present themselves all
the time, if you are open to receiving them. But which opportunities
should you pursue? When you have a clear mission and a plan, the
answer becomes clear. By following the plan, you know where your
efforts are most needed at any given time, and you can turn down
distractions that don't further your defined goals. Increasing board
involvement: I always hear nonprofit staff complaining about either
their un-involved board members or board members who meddle too
much without knowing what they're doing, and yet they don't create
opportunities for the board to be constructively involved. Asking
your board to be a part of the development planning process will
both motivate them and educate them at the same time.
Integrating
fund development with other program activities plans: If you're
lucky enough to have staff who work on fund development full-time,
you're also risking a disconnect between program people and fundraisers.
The result is an annual event that's held the same week as the busiest
part of the program staff's season. Written plans that are shared
by all staff help to avoid such conflicts and encourage a working
team environment.
Most productive
use of team's time: The bottom line is that by being organized,
and having clarity as to what is expected of every team member,
all your activities will be more efficient. So what's holding you
back? Put your team together and start planning for success today!
* * * *
Ken Goldstein
is a grant writer and consultant working and living in Silicon Valley.
Since 1989 he has been an executive director, a board member, volunteer,
and consultant to nonprofits. His education includes a BA in Politics
from UC Santa Cruz and a Master of Public Policy and Administration
from CSU Sacramento. Goldstein Consulting can be found at www.goldsteinconsulting.com
.
Ken is also
the author of "Introduction to Fund Development Planning" - Please
see www.fundraisingplanbook.com for more information.
© 2006 by Ken
Goldstein, all rights reserved. You may re-print or re-post this
article only complete and un-edited, and including the author information,
active web links, and copyright notice.
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