To make real impact, we need to start thinking small.
Ask any executive director who is trying to balance a budget and stabilize their programs and they’ll tell you it’s very difficult – and they are right. Nonprofit organizations in the United States are now being challenged by major demographic, economic, technological, and social factors outside of their control.
Large, established organizations have many of the resources to address these challenges, but the vast majority of nonprofits do not have the ability to easily adapt to changing in funding or new demand for services. Consequently, most face significant financial hardship, an uncertain future – and don’t know what to do.
These same small nonprofits, with operating budgets of less than $2 million, spend roughly $33,000 each year on consultants, training, conferences, and software, all in hopes of raising more money. Not only do 77% miss their budgeted revenue goals, but they are actually raising less money than the previous year. That means that even with all of the products and people being invested in, the majority of organizations are actually losing ground.
Nonprofits need real results and help, not just affordable software and tools.
In the last fifteen years, Network for Good has helped over 125,000 “tiny giants,” organizations making big impact with small budgets, raise more than $1 billion with its online giving training and tools. We are proud of this milestone, but it is only our first.
In 2015, we asked ourselves, the organizations we serve, their boards, and funders, “What do small nonprofits need, but don’t have or can’t afford, to effectively raise more money?” We took those answers, arrived at some big conclusions, and with all of our data and determination, merged DonorPath.org with Network for Good and now, we have turned our focus outward to launch the Fundraising Readiness Project.
Reintroducing the Fundraising Readiness Project – Version 2.0
In response to state budget crises around the country, DonorPath launched an ambitious effort to help small nonprofits who found themselves flat-footed in the wake of big cuts in public funding to give them their first- and next-steps to diversify revenue to become more sustainable. Now with the resources and reach of Network for Good, we’ve relaunched the Project, with the objective to bring it to every community in the country, beginning with yours.
The Project will begin with an on-site town hall in your community, inviting executive directors and board chairs to not only learn about how to participate in the 12-month series of live-streaming online lunch hour workshops, but how to create a right-sized 12-month fundraising plan and case for support.
The Project is designed to address the big needs and challenges small nonprofits have – and augment existing capacity-building programs in your communities, concentrating on some of the conclusions from our research:
Being tax-exempt does not mean small nonprofits can be technology-exempt.
In a time where social media, text messages, and email are the most prevalent ways people communicate, not just Millennials, nonprofits needing to establish or diversify revenue can no longer rely on events, a single grant, or a letter to effectively sustain, let alone expand, programs. Instead, nonprofits must consistently and credibly engage their donors, volunteers, and communities – and personalize the experience for each in a way that creates a real and lasting relationship.
Existing and will-be donors, along with every US consumer, expect nonprofits to be technologically literate, responsive to their personal interests, and constantly generating fresh content, despite an organization’s time and budget constraints. This expectation creates a formidable challenge for a smaller organization; it isn’t staffed or structured to allow for rapid innovation, nor is it equipped to personalize their audiences’ experience in ways that YouTube, Netflix, and Google can – but they need to be.
Fundraising needs to be a central leadership priority, not an administrative task.
The basic revenue model for nonprofit organizations is eroding as the values and priorities that underpinned it have shifted. Public funding at federal, state, and local levels is declining and overall philanthropic and corporate funding is not growing at pace. As such, the revenue model that has sustained many organizations has forever changed.
While the sector has seen a general increase in giving, nationally, that growth does not reach the more than one million nonprofits with operating budgets under $2 million because acquiring donors is expensive and time consuming, especially when a nonprofit doesn’t have the budget, staff, or a plan to get started.
Nonprofits don’t have nor can easily afford the fundraising help they need.
The skills needed for effective nonprofit leadership today are complex and numerous. While there are workshops, conferences, publications, and literature available, these assume you have the resources to hire and retain your own full-time, professional fundraisers long enough to raise enough money to pay their salaries, then for your programs. We think that’s the wrong approach. Dollars raised need to sustain programs and mission, not just fundraising.
While some small organizations are able to reallocate line items in their existing budget and partner with a major donor or foundation to secure seed funding hire their first, full-time fundraising professional, that individual often times has little experience raising money and reports to an executive director that may also have limited fundraising experience. As a result, executives are quickly frustrated that their investment isn’t paying off and, on average, that new fundraiser leaves the organization within thirteen months.