Thursday, April 4, 2013

How To Raise Money



Yesterday, I spent some time with a friend who runs a non-profit advocacy group.  He revealed that he is stepping down as executive director.  The reason?  He has grown weary of fundraising to support the organization.  This is not an uncommon refrain among non-profit administrators, sadly.

I have worked my entire professional life in the non-profit sector.  Like other non-profit executives, fundraising is a significant part of my job.  Awhile back, I tried to distill some of the lessons that I have learned about fundraising for staff here at the Center for Court Innovation.  (I tried to come up with ten lessons, but ran out of steam at nine.)  I have reproduced a version of that memo here in the interests of helping other non-profit directors avoid burn-out.  One caveat: fundraising is a highly idiosyncratic endeavor;  what works for one person may not work for another.

1. It Ain’t Magic
The screenwriter William Goldman’s famous declaration about Hollywood – “Nobody knows anything” – applies equally to fundraising.  Distrust anyone who tells you there’s a “secret” to successful fundraising.  The real secret is to do quality work.  Good ideas, clearly-thought-out strategies, and well-implemented programs tend to sell themselves.

2. Listen Before You Talk
It is important to know your audience before you open your mouth or put pen to paper.  You need to understand where the funder is coming from in order to craft the best possible message.  Are they Democrats or Republicans?  Do they have a national perspective or are they neighborhood-focused?  What language do they use to talk about their work?  Look at the funder’s website, annual report, and 990.  Look at the grants they have made in the past. You need to show funders how your program’s work connects to their mission.  Lots of funders have their own buzzwords (e.g. “civil society,” “global inclusion,” “place-based initiatives”).  It is always helpful to parrot back to the funder their own rhetoric.  It is also important to be flexible: shape your message to suit your audience.

3. Don’t Flatter Yourself
Many funders hear nothing but good news – day after day, they see a parade of programs extolling their own virtues.  As you might imagine, skepticism is an occupational hazard for most foundation executives.  As a result, it is best to avoid self-congratulation when dealing with them.  Try not to use flat, declarative statements like “Our program is a success.”  Far better to say something like, “Researchers have documented that our program has helped improve compliance rates with alternative sanctions.  This led the National Center for State Courts to give us an award for innovation.”  If possible, let the facts speak for themselves and allow your listener to draw the appropriate conclusion.

4. Admit Your Flaws (But Do It Selectively)
Reality is messy and doesn’t always conform to our desires or best-laid plans.  Some program participants fail.  Some partnerships are fraught with tension.  It is ok to admit to a few shortcomings – in fact it bolsters your credibility.  The trick is to highlight the right shortcomings.   Like a lawyer in court, you should never ask a question or raise a problem that you don’t know how to answer.  An example of a “good” shortcoming to highlight would be: “The hardest part of this project has been our relationship with Probation.  We made a number of mistakes in the early days because we hadn’t identified the right contact person and we hadn’t earned the agency’s trust.  But ever since we figured out a way to get probation officers the information they need quickly, the partnership has taken off...”  This sounds more credible than simply saying “Our relationship with Probation is great.”

5. Less Is More
Both of these statements are 100 percent accurate.   Guess which one is better from a fundraising perspective:

Statement #1: “Our program serves both criminal defendants and walk-ins from the community.”

Statement #2: “Our original vision for the program was to serve criminal defendants, but we couldn’t get judges to send us enough participants, so in an effort to boost our numbers, we decided to accept walk-ins from CFAR and SBLDC, and now we’re serving a mixture, although on any given day, the program might have all criminal defendants or all walk-ins, it just depends upon what day of the week it is, because on Mondays, there’s a judge that loves sending us participants, but on Tuesday, there’s a substitute judge, so we get fewer participants on that day...”

You get the idea.  Whenever possible, keep it simple.  Don’t get bogged down in the details.  Use numbers sparingly.  And by all means, avoid “inside baseball” – stay away from insider jargon, acronyms and abbreviations whenever possible.

6. Tell A Story
Almost every play, movie or novel has a basic three act structure: beginning, middle and end.  We tend to think in stories – it helps us make sense of the world.   Keep this in mind when dealing with funders.  Provide them with narrative arcs whenever possible.  In my experience, the best place to start any conversation or proposal is with a compelling need statement.  Describe the problem that you are trying to address as concretely as possible.  We are, after all, in the business of trying to solve problems.  And wherever possible, use real people to highlight how the program works: the defendant who got clean and sober, the victim who feels safer, the judge who now does things differently, the community resident who thinks her neighborhood is safer.

7. Sell Yourself
Fundraising is, in many respects, like dating.  Funders like to invest in people as much as they like to invest in ideas.  Look for ways to make a personal connection to the funder – perhaps they are a soccer fan like you are.  Or maybe you both live in the same neighborhood.  Or have kids the same age.  Maybe you know someone in common.  Any small connection helps.  Also, as in dating, neediness can be off-putting.  No matter how dire your funding situation, don’t convey desperation.

8. Failure Is Inevitable
There’s an old Nike commercial that I love.  In it, Michael Jordan says, “I missed more than 9,000 shots in my career. I've lost almost 300 games. Twenty-six times I've been trusted to take the game-winning shot…and missed. I've failed over and over and over again in my life.  And that is why I succeed.”  The same wisdom applies to fundraising.  Rejection is part of the process.  You’ve got to risk failure in order to succeed.  For every ten proposals you send out, maybe one or two will come back with a positive response.  Try not to get discouraged.

9. Success Breeds Success
If you can find one funder to invest in you or your idea, you’ll find others.  The bad news is that funders tend to be risk-averse.  Very few like to be the first one to fund something, so finding the initial funder is usually the hardest.  The good news is that, like wolves, many funders travel in packs – if one of them funds you, all of them will.