Fundraising is fundamentally about two partners — the nonprofit and the donor — working together to achieve a shared mission. Donor relationships built on trust and transparency can propel nonprofits toward greater impact and financial sustainability in the long term.
But for many nonprofits, fundraising doesn't feel like a partnership. Sometimes, it feels like an intimidating or awkward process — and a burden to be avoided as often as possible.
Other times, fundraising is like a pestering pebble in your shoe, and you can’t slow down to deal with it. You’re busy placing solar panels on rooftops, building community programs to end youth gang violence, or educating children in conflict-affected areas. Any time spent on other tasks feels like a distraction from the people you serve.
If these feelings resonate with you, you’re not alone. You might be wondering: How can I start thinking differently about fundraising?
Whether raising major gifts from individual donors, partnering with local businesses and corporate giving programs, or writing grant proposals to foundations, many social innovators share a few “mistaken mindsets” about nonprofit fundraising.
Headstreams is a nonprofit that believes in the power of play for childhood learning and development. Their mission is to bring play-based curriculum and learning spaces to public schools, libraries, child care centers, and other community settings in low-income areas of Karnataka, India.
Even on the most demanding of days, Naveen Thomas, co-founder of Headstreams, found excitement and fulfillment from delivering these programs. Fundraising, however, always felt like a chore.
“We saw fundraising as an energy-draining and unproductive use of our time,” Naveen said. “We pushed it until we couldn’t push it any longer.”
Several years into their journey, Naveen realized that Headstreams’ approach to fundraising was preventing the nonprofit from carrying out more ambitious programs.
“As a project was coming to an end, we would suddenly realize that we had to either find a new donor or go back to an old donor,” he explained. These small, short-term grants didn’t allow Headstreams to plan for multi-year programs that would reach a larger number of children.
For Headstreams to achieve its mission, Naveen knew he needed to take a different approach. He enrolled in Nonprofit Fundraising Essentials, a free online course from Acumen Academy that introduces entrepreneurial mindsets and strategies for nonprofit fundraising.
“The change in perspective was empowering,” Naveen said. “I feel more equipped to look at fundraising as a part of our mission, rather than disconnected from the rest of the work that we do.”
Fundraising challenges like these are common across nonprofits. But with a fresh mindset and proven strategies, you can build lasting partnerships and escape from the cycle of fundraising despair.
Building Trusting Relationships
Fundraising is all about partnerships: The donor and the nonprofit work together to achieve a shared goal, and each partner brings their unique resources to the table. Building effective partnerships like these requires cultivating relationships based on trust, transparency, and honest conversations.
Partnering effectively takes time and commitment. If we believe that moral revolution requires everyone, we must become skilled at building trusting partnerships across sectors. Honing this skill almost always requires a shift in both assumptions and behaviors. - Jacqueline Novogratz, Founder and CEO, Acumen
In this guide, you’ll learn how to
identify common fundraising mistakes,
adopt tools and strategies to avoid them, and
build stronger, trusting relationships to secure and scale your funding.
You’ll hear from Hannah Wheatley, Head of Acumen’s Business Development in Europe, about the common mistakes fundraisers make and how to prevent them.You’ll also learn from other experts in the field and social innovators on the ground about how cultivating relationships based on trust and transparency can lead to greater impact.
If you’re seeking funding for a for-profit social enterprise, you may want to read this guide on how to think like an impact investor to raise money for your social venture. The guide walks through how to maximize your chances of connecting with mission-aligned investors and forge strong investor partnerships.
If you're a nonprofit leader seeking to avoid common fundraising mistakes and build successful partnerships, then read on.
Mistake 1: Not Doing Enough Research
Many fundraisers feel let down when they see foundations giving large amounts of money to other organizations, despite their own efforts to make a connection. Others feel confused when an individual with deep pockets isn’t interested in funding their highly successful program, even after a seemingly persuasive pitch.
According to Hannah Wheatley, Head of Acumen’s Business Development in Europe, one of the biggest mistakes fundraisers make is not doing enough research before approaching a donor. Without the right research, you’re likely to miss the mark and lose an opportunity to make the right connection.
Research is critical because it helps you identify your target audience, their interests, and their financial capacity to give, Hannah said. Research can also help you learn the best time to approach a particular funder.
If you’re wondering why you haven’t secured a donor you’ve been working hard to cultivate, perhaps you need to reevaluate why you’re connecting with them in the first place. Have you taken the time to learn all you can about their interests, motivations, and ability to give? The more you learn about a prospective donor, the more integrity you bring to the conversation.
HOW TO START YOUR RESEARCH
While research is a critical first step to successful fundraising, you may be unsure about how to get started. This is especially true if you don’t already have an existing rolodex of contacts.
Below are a few strategies to help you start your research.
RESEARCH YOUR ECOSYSTEM
You can begin to understand the funding ecosystem by searching keywords related to your scope of work. For example, searching for “65 foundations that fund nonprofits in Africa” or “10 high-net-worth donors that fund early childhood development” can help you find funding opportunities that are relevant to your activities and geography.
“You should also research other organizations like yours,” said Alexandra Trabulsi, Head of West Coast Business Development at Acumen. “Find out who is funding them. That could be a good signal of who is willing to fund you.”
Start by searching databases like Charity Navigator and GuideStar to create a list of “peer organizations,” which are nonprofits that are similar in size, mission, or region. After you have a list of peer organizations, you can find their funders and revenue sources in their website and annual report.
There are several other resources you can use to find this information. In their Field Guide on Relationship-Based Fundraising, in partnership with the Ford Foundation, I.G. Advisors suggests that nonprofits explore these resources:
• International databases about giving, such as Foundation Centre
• Reports about giving, such as the Coutts Million Dollar Report
• Your country’s charity and foundation database, such as the Charity Commission
• The annual reports of organizations working in your sector
Doing research within your ecosystem — which includes donors that are funding your line of work and organizations that are similar to yours — can help you start a strong list of prospective donors.
RESEARCH YOUR NETWORK
During your initial research stage, you should also take a closer look at your existing network. When it comes to fundraising, everyone in your network counts.
“Everyone has a network,” said Aaron Kirunda, co-founder of Enjuba and Acumen Academy East Africa Fellow. His organization focuses on improving children’s education in Uganda through teacher training, textbooks, and spelling bees. During the nonprofit’s first two years, Aaron depended on donations of money and office space from the founding team’s network.
“Think about the people from your high school, your university, your former employers, and your church. All the workshops you have attended. All the cities where you have lived. When I challenged my colleagues to do this exercise, they realized they knew a lot more people than they thought.”
This is known as “network mapping.” One way to start is by listing people from the networks of your staff and board members. This includes donors, volunteers, colleagues, classmates, friends, family, and more. Then explore how this network could contribute to your nonprofit by asking questions like these:
Who could make an introduction to a corporate giving program?
Who could donate supplies or professional services?
Who has a large number of followers on social media?
Who has the ability to make major gifts?
Use your personal platforms like Facebook, Linkedin, and Instagram to learn more about your network.
CONNECT WITH YOUR TARGET AUDIENCE
After you’ve researched a list of prospective donors, you should begin to narrow in on your “target audience,” which consists of donors that care deeply about your mission and have the ability to give.
According to Hannah, using your research is an effective way to help you find and connect with your target audience. The goal is to identify the right people whose attention you want to catch and whose heart you want to inspire. In the end, you’re looking to make a human connection and build a partnership based on trust, understanding, and transparency.
APPROACH THE RIGHT PEOPLE
Your research will help you approach funders that align with your nonprofit’s unique mission and needs.
If your organization is looking for seed or operational funding to get started, your target audience will include donors who are excited about funding new ideas or initiatives. By contrast, a foundation interested in funding established programs with rigorous data and success stories will not be a good fit.
CULTIVATE IN THE RIGHT WAY
Once you’ve found a potential donor that aligns with your mission and needs, dig deeper to understand their interests and motivations for giving. This will help you make a more persuasive pitch.
“You need to align your ask to the specific niches of the funder,” said Lynda Mansson, Director General of the MAVA Foundation. “This requires research and discussion, but you’ll have a much higher success rate if you figure out what the funder wants to fund in great specificity.”
For example, if your nonprofit works with rural farmers in India, you might learn that a donor is particularly interested in funding programs related to climate resilience. Even if your nonprofit has a broader range of activities, you should target the particular donor by sharing this specific part of your work.
You can explore a list of questions for understanding a prospective donor’s motivations in Acumen Academy’s Nonprofit Fundraising Essentials course.
FIND THE RIGHT TIMING
By researching a funder’s website or giving history, you can also determine how to time your “ask” appropriately.
Let’s say you’ve come across a foundation whose interests align with your organization and the programs you deliver. You spend hours drafting a compelling email and you wait with optimism for a response. A foundation officer finally replies with a polite reminder that their last funding round closed a month earlier. “You’ll have to wait until next year,” they say.
Knowing the right times to pitch to foundations or individual donors can help you save time, energy, and avoid frustrating rejections. This strategy can also help you plan ahead, knowing when and how to best connect with each prospect on your list.
MAKE THE RIGHT ASK
Not all funders have the same capacity to give. This is an important point that fundraisers often overlook. Asking an individual donor for a gift that is above their capacity can make them feel uncomfortable. But requesting a small amount from a large foundation can be a waste of your time.
Suppose your mission is to raise awareness about how young women and girls can take control of their reproductive health. One of your goals is to reach a wide audience of women while also collecting donations for your cause. In your research, you’ve come across a global foundation that funds women’s health initiatives. You review their past funding awards and realize it’s a much larger amount than what your organization can realistically handle.
Instead, you consider carrying out a crowdfunding campaign. You start to prepare a social media strategy that targets women between the ages of 18 and 25 who care about their health. However, your research shows that this age group is likely paying student loans and car payments. They don’t have much to save, but they are still interested in giving to your cause. You decide to ask for an amount that won’t intimidate them and that will inspire them to give again and again.
Mistake 2: Having Unclear Fundraising Goals
In the previous section, you learned that research is an important process for both identifying and connecting with your target audience. You cannot make meaningful connections without understanding your donor’s interests, motivations, and giving capacity.
To build a trusting and transparent relationship with a funder, you must also understand your financial needs and how the resources you’re requesting will help your nonprofit achieve its intended outcomes. Many times, fundraisers fail to make a clear connection between what they're asking for, and why they're asking for it.
According to Hannah, fundraisers should be able to provide a “clear and compelling vision of what it is that you want to achieve, what you need financially to move forward towards that vision in a meaningful way, and also have a really clear call to action.”
If you’re unclear about your nonprofit’s fundraising goals and how to discuss your financial needs with a prospective donor, be sure to read on below.
TIPS TO DETERMINE YOUR FUNDRAISING GOALS
Many fundraisers mistakenly think fundraising is only about filling the gap between your revenue and expenses. But there are other factors to consider when setting your fundraising goals, such as:
Are you dependent on a single donor or grant?
Is your cash flow (or the flow of cash in and out of your nonprofit) reliable?
Do you have reserves set aside for unexpected disruptions?
Do you intend to scale your programs or geographic reach?
Start by calculating your funding gap. Then identify these other needs. Keep the size and capabilities of your team in mind as you think through this.
Once you’ve made an assessment, define your fundraising goals using “SMART”:
Specific: Your goal is clearly defined and understood.
Measurable: You can measure whether you have achieved your goal.
Attainable: Your goal should be ambitious, but realistic for your team.
Relevant: Your goal should advance your mission.
Timebound: You have a deadline for achieving your goal.
Say you’re an education nonprofit seeking to grow your program innovation. Your goal might be to raise $25,000 from high-net-worth donors before March 2022 to support research and development on a new distance learning program. To achieve this, you’ll carry out research to build a pipeline of 30 prospective donors and plan to bring five individual donors at $5,000 each.
If your nonprofit needs help exploring what types of funding sources can help you achieve your goals, then read about how to create a Nonprofit Fundraising Plan.
BE TRANSPARENT ABOUT YOUR FUNDS
Explaining how donations will be used is critical to gaining the trust of potential donors. Once you’ve defined your nonprofit’s fundraising goals, you can have transparent conversations about your needs and resources.
Nonprofits that can clearly and accurately explain their financial story and resource needs are prepared to make a stronger case for support, according to the Nonprofit Finance Fund. They recommend you tell an honest financial story like this:
Revenue: Your revenue is predictable and reliable.
Expenses: You’re transparent, understand the full costs of your work, and account for these costs in your budgets.
Profitability: You have a consistent surplus that allows you to pay debts, purchase equipment or infrastructure, and fund savings or growth.
Liquidity: Your nonprofit can meet obligations and respond to risks and opportunities with available cash.
Financial planning: Your nonprofit can plan for the future and access timely and accurate financial data.
Balance sheet: Your balance sheet represents the difference between everything you own (assets) and owe (liabilities) at a moment in time.
Whether you're seeking funds for a particular project, or pitching to a donor for general operational support, having clear funding goals and an honest financial story helps donors build greater trust in your organization’s ability to thrive.
UNDERSTAND YOUR CAPABILITIES AND WHEN TO SAY NO
You can’t be honest with a donor if you aren’t honest with yourself. Your nonprofit should share an understanding of both the direction you want to grow and the resources and expertise your team currently possesses.
Before you take on any funding opportunity, your team should honestly assess:
Are we capable of delivering this project successfully?
Does the project support or distract from our mission?
When funding is scarce, many nonprofits are tempted to take on a grant even if they don’t have the staff and resources to deliver the project successfully. Similarly, some nonprofits feel financial pressure to accept a large grant that is unrelated to their mission, and realize years later that they’ve become a different organization.
Sustainable social initiatives require both a mastery of the business fundamentals and the practice of moral leadership. In the process of scaling your impact, it’s important to stay grounded as a leader. Social Entrepreneurship: What it is and How to Use it for Change explains how you can make the most of your business acumen and moral compass to assess what’s right for your mission and your team.
A LONG-TERM VISION FOR A SUSTAINABLE PATH FORWARD
Securing funding and learning to navigate donor expectations can be challenging for nonprofits. Pausing to reflect on your long-term vision can help you plan for a sustainable path forward.
Krupa Patel is an Acumen East Africa Fellow and co-founder of Anza, which is a business incubator, investment readiness accelerator, and co-working space with a mission to drive job creation and scale businesses that provide life-improving products and services in Tanzania.
Krupa was born in the United Kingdom to parents who were born and raised in Uganda, and who left the country as refugees in the 1970s. She and her sister knew they would return to East Africa one day. In 2009, they sought out a gap they could fill in the market.
“We realized that entrepreneurs had a significant ability to drive improvements across all sectors of society and to provide access to basic services in healthcare, education, water and sanitation, energy, and the agricultural value chain,” Krupa said. “However, the entrepreneurial journey is a difficult one, even more so in an economy like Tanzania that ranks among the lowest on the scale of ease of doing business.”
To ease the burden on entrepreneurs, Krupa knew she needed to provide a range of meaningful services through Anza, as well as flexible and affordable capital.
Before she could grow her social venture, Krupa needed to learn how to navigate the expectations of donors and understand when to say “no” to a funding opportunity, which is often challenging for newcomers to the sector.
After three years of growing Anza, Krupa was invited to her first meeting with a regional family foundation. She jumped on a bus and traveled to a coffee shop several hours away to meet with a program officer at the Segal Foundation, which funds grassroots leaders in Africa.
“By this point, we had a lot more clarity around our programs and the methods we used to support our entrepreneurs,” Krupa said. “However, I couldn’t respond to any of their technical questions. They asked about our plan for monitoring and evaluation, and I didn’t know what that was.” Many of the funder’s questions focused on the nonprofit’s finances, such as its operating budget and percentage of earned revenue (or self-generated income). They also asked about the nonprofit’s theory of change and how Krupa would know if the interventions resulted in the outcomes she expected.
“You could see they were not surprised, but perhaps more concerned,” she said. “I remember getting so flustered and thinking, this is way too early to start talking to these large, formal foundations. Let’s close our doors, go into hibernation for another year, figure out these technical terms, and get all these systems into place.”
Then Krupa received surprising news: The Segal Foundation decided to fund Anza. In the end, the foundation combined grant capital with training and technical assistance to ensure Anza would be ready for success. “I think what I really appreciate about them — and what I now look for in any funding partner — is that they met us where we were,” Krupa said. “Over the years, I’ve learned that even the largest not-for-profits are a work-in-progress. We’re all progressing toward something.”
“I think it’s important to be transparent in your relationships with funders, especially in the early days,” she continued. “It’s kind of like dating, right? At some point, they will wake up and understand the reality of who you are. I think our transparency at that early stage helped the foundation know our gaps, and then they could provide technical assistance around our needs.”
As Anza grew and took on more funders, Krupa learned the importance of having a long-term vision and a clear picture of her financial needs.
“You start by saying, ‘We want to be here in five years,’” Krupa said. “Therefore, these are our strategic priorities for the next 12 months, and we’ll need these programs and staffing. That is the overall scaffolding of an operating budget.”
By starting with her budget and strategic priorities, Krupa understood exactly why she was fundraising and how much she hoped to raise. She also learned when to say “no” to an opportunity.
“We’ve experienced one or two partnerships that overstretched us,” Krupa said. “It’s important to take on the right type of capital. It can be a difficult decision — for example, there may be a period of time where you need cash flow to make payroll and you will be tempted by a large grant.” “But unless it is truly mission aligned, it could end up taking you on a detour,” she said. “It might not seem like a terrible thing, but a few years later, you’re a very different organization from the one you initially intended to become.”
Today, Krupa sits on the Board of Advisors at Anza. One of the board’s responsibilities is assessing whether a funding opportunity is aligned with the nonprofit’s theory of change.
All in all, Krupa’s unrelenting focus on her long-term vision has helped Anza grow sustainably. When you’re clear about your resources, capabilities, and mission, you can build transparency with your partners and operate with greater impact.
Mistake 3: Building A Communications Strategy Without Your Funders In Mind
As you learned in the section on research, it’s important to keep funders’ interests and motivations at the center of your fundraising strategy. Communicating with funders effectively helps prevent your donor from having to guess how or where they fit into the mission of your work.
“Sometimes we fall into the trap of letting the donors do the hard work of figuring out exactly how it connects and what their donation or investment will achieve,” said Hannah. “Make sure that connection is crystal clear and aligns with exactly what they're trying to do.”
To avoid this mistake, place your funder at the forefront of your communications strategy and clearly express how their contributions are going to make an impact. When they see themselves in the work, they will trust you to take them on the journey with you.
TAILOR YOUR COMMUNICATION STRATEGY
You should always communicate in a way that will interest your potential donors. Hannah recommends “putting together a tailored engagement and communication strategy, depending on who your audience or prospect is.”
Some funders are interested in hard data. Others prefer to hear about stories from the ground. Even the frequency of your communication should be donor-specific: Some donors prefer a monthly update, while others expect to hear from you in an annual report.
Below are important concepts to help you communicate with donors more effectively. With greater clarity on your mission, theory of change, value proposition, and impact you can avoid leaving donors guessing on how your visions align.
YOUR MISSION STATEMENT
Your mission statement expresses your nonprofit’s main goal to potential donors and wider audiences. It should be simple, memorable, and inspirational.
Here are three examples of effective mission statements:
“A world where all women and their families experience childbirth safely and with dignity” — Jacaranda Health
“Bringing clean, safe drinking water to people in developing countries” — charity: water
“Reconnecting Africa’s wild spaces to create a future for man in harmony with nature” — Peace Parks Foundation
While defining your mission may seem simple, many nonprofits make the mistake of drafting a mission statement that is difficult for a donor to follow. This can make them feel confused, skeptical, or distrusting.
Rachel Stephenson Sheff is a Senior Advisor at I.G. Advisors, working to bridge the gap between fundraisers, businesses, and philanthropists. She offers tips for how organizations can get funding for their work and emphasizes the value of a clear mission and vision statement.
She wrote, “There are countless times where, after many minutes of scrolling a charity’s website, I still can’t articulate what it actually does. Too often, charities coat their activities in jargon using words such as ‘catalyse and ‘empower.’”
One effective way to avoid jargon is to try the Eight Word Mission Statement, introduced by Kevin Starr, Director of the Mulago Foundation. According to Kevin, the Eight Word Mission Statement “jump-starts a productive and respectful conversation that doesn’t waste anyone’s time.”
It consists of three parts: a verb, a target population, and an outcome. Here are two examples:
“Rehabilitating coral reefs in the Western Pacific”
“Preventing maternal-child transmission of HIV in South Africa”
Take a moment to write out your mission statement using the Eight Word Mission Statement framework. Consider how your choice of words will make your donor feel. Then consider how well you’ve described your work with this simple statement.
It will take some time and team effort for your organization to strike the right balance between what to say and how to say it. But working through these exercises will lead to more effective and honest conversations with potential donors.
YOUR THEORY OF CHANGE
Before approaching a donor, you should be able to effectively communicate your organization’s theory of change. A theory of change describes the reasonings or assumptions for why your nonprofit’s activities will lead to long-term impact.
It can be helpful to think of your theory of change as an impact hypothesis: “If we do X, then Y will change, because…”
A theory of change for a nonprofit that distributes solar lighting products to improve health and incomes for families without reliable and clean energy in Kenya might look like this:
“If we deliver solar lighting to low-income households, then families will be less likely to have respiratory infections and lung cancer, because our research shows that families with solar lighting reduce their use of kerosene lamps.”
Today, many funders — such as foundations, development banks, and corporate social responsibility programs — request some form of a theory of change in grant proposals.
Even if a theory of change is not formally required, the process of explaining how your activities turn into impact will help your potential donors better understand your vision.
Acumen Academy’s Social Impact Analysis course goes in depth on how to craft a theory of change and assess your impact.
For organizations of all sizes, impact measurement is always a work-in-progress. But learning to effectively communicate your results to a donor is an important part of your fundraising strategy.
Imagine you work for a nonprofit that delivers financial skills workshops to women in rural villages. Which of these metrics would you share to convince a donor that your nonprofit is achieving its mission?
25 women participated in a 4-hour workshop
75% of workshop participants paid off their debt to moneylenders within three months
Many nonprofits make the mistake of focusing on short-term activities and outputs (A), instead of longer-term outcomes and impact (B).
“In pitches, we often hear about the process: ‘We held four workshops and had 95 conversations and talked to the government minister,’” said Lynda Mansson. “What happened next? What did those activities lead to? You need to focus on the impact, not the process.”
Leading with your impact is an effective strategy for motivating and inspiring your donor. While your activities are an important part of explaining your processes, your impact shows your donor how their contributions are going to make a difference in the world.
YOUR VALUE PROPOSITION
Together with your impact, your value proposition will provide the answer to every donor’s question: “Why you?”
In their Field Guide, I.G. Advisors defines a value proposition as “an articulation of your organisation’s unique strengths, and why your organisation is different from other non-profits in the sector.”
To determine your nonprofit’s value proposition, I.G. Advisors suggests that you ask yourself this question: “Imagine you’ve inherited $1 million and want to make a donation. Why would you give it to this organisation instead of another non-profit in the same sector?”
Our job as fundraisers is to transmit our passion. And the only way we can transmit our passion is, first of all, we have to actually be passionate. And second of all, we have to help the person we’re talking to see what we see. And they can see the challenge that we see, although more often than not, it’s better to have them see the opportunity that we see. - Sasha Dichter, co-founder of 60 Decibels
If your nonprofit has two different scopes of work, anticipate that you may need to ease a donor’s concerns. According to Hannah, the best approach is to be honest. You can explain that you’re working on really tough and complex challenges that need a multipronged approach.
For example, you could tell a compelling story about how you started with one issue but then realized in order to address it, you actually had to tackle another issue, and that led you to implement the program you’re now pitching.
Sharing the evolution of your organization’s journey – where you are and where you want to go – can help donors identify and connect with your value.
FUNDRAISING IN DIFFICULT CONTEXTS
For any nonprofit working in a difficult context — such as in rural communities or places where armed conflict and violence are prevalent — it can be hard to convince donors to fund a project.
If the location of your program is difficult to reach, donors may have a hard time feeling connected because they cannot see the work firsthand. Similarly, if you’re creating solutions in places where violence is common, many corporate foundations might hesitate to partner with you for fear of threatening their brand.
Nevertheless, the people you serve need you. In order to serve them, you need to secure funding. This requires a communications strategy that will engage and inspire donors to support your important work, no matter how far or how complex it may be.
Acumen India Fellow Ashish Shrivastava discusses below how he navigated this difficult terrain.
ADOPTING A DONOR-FOCUSED STRATEGY IN A DIFFICULT CONTEXT
In rural and tribal areas of Chhattisgarh, India, many schools have been shut down or destroyed by violent extremism. More than 30,000 children are losing their opportunity for an education.
Ashish Shrivastava founded the nonprofit Shiksharth to improve the quality of education in these conflict-affected areas. Shiksharth is directly serving more than 6,000 children by creating academic resources that are appropriate for tribal areas and working in partnership with local governments.
“We create solutions in three ways,” Ashish explained. “We provide access to schooling because it doesn’t exist. We create safe spaces for the children so they can express and experience compassion and empathy. Finally, we make learning contextually relevant for them. When teaching the ABCs, an airplane doesn’t make sense for a tribal child, but an arrow does.”
However, due to the nature of the work and its remote location, Ashish had to figure out how to win the hearts and minds of donors from afar.
“We are in a conflict zone and the nearest city is 400 kilometers away,” Ashish said. “We hardly get visitors. Nobody can see what we do or validate our work. So how do you build credibility?”
“We don’t have access to corporate social responsibility because most corporates will avoid working in conflict areas and taking on any risks that might dilute or become a threat to their brand,” Ashish added. To overcome these challenges and fundraise successfully, Ashish needed to strengthen the ways he communicated with funders, including high-net-worth individuals, small donors, and corporate giving programs.
“At the beginning, there was no structure to our fundraising,” he said. “Whenever we needed money, we would reach out and say, ‘Can you donate?’ We didn’t have a strategy or engage with donors in between the gaps.” In his first year of fundraising, Ashish said his greatest mistake came from not differentiating Shiksharth in his communication with potential donors.
Ashish had to pause and reflect on Shiksharth’s value proposition: What made them different from others in their sector?
Donors “have seen a lot of educational organizations,” Ashish said. “In India right now, every city has hundreds. But when I pitch that I am working for tribal children who are affected by conflict, this is something new that they haven’t been exposed to before.”
But for some donors, the rural and tribal focus was not enough. Ashish needed to create an emotional connection to the work.
“For any donor in Mumbai or Delhi, they can easily go to a slum near their home and support a child,” he explained. “What would motivate them to support someone in a tribal area?”
“Donors always connect through stories,” he continued. “If you say that every child deserves a peaceful childhood, then the donor should immediately remember his childhood and imagine what these children are experiencing. That personal connection is important, and initially, we didn’t do it well.”
Over time, Ashish learned how to pitch Shiksharth in a way that spoke to a donor’s motivations.
“Individual donors often have different motivations than corporate social responsibility initiatives,” Ashish said. While corporations are interested in the unit impact of grants — for example, $1,000 in exchange for reaching 500 children — many individual donors are seeking out solutions with systemic impact.
“To these donors, I explain that our work is not only about these children, or this particular geography, but about building peace in the larger ecosystem,” he said.
Finally, to encourage small donors to support Shiksharth, Ashish illustrates the impact of their modest contribution.
“A lot of small donors get overwhelmed by the magnitude of the problem,” he said. “Then they tend to get disillusioned. They think, ‘If I’m donating one thousand rupees, how is this going to change anything in this country?’ So it is important for them to visually see how even one dollar can have a transformational impact.”
By understanding his nonprofit’s value proposition and tailoring his communication for each donor, Ashish has managed to create reliable revenue streams — including crowdfunding campaigns, individual donors, and corporate giving — in the most difficult of contexts.
Mistake 4: Undervaluing Your Existing Network
Fundraisers often undervalue their existing network. They believe that the only way to secure more funding or larger gifts is to reach out to a new group of people, instead of tapping into their existing network first. This results in missed opportunities and prevents you from building deeper connections with funders who have already supported you in some way.
Each of your friends, family members, and professional contacts have their own broad networks. Your existing network can connect you with these potential donors and boost your nonprofit’s credibility.
Ashish found this to be an effective way to grow his donor base as he and his nonprofit worked to improve the quality of education in conflict-affected areas.
“We started with our school friends and the first thing they did was reach out to more people,” Ashish said. “Crowdfunding helped us build a lot of credibility initially. People could see that we had individual supporters backing us and they became our ambassadors, which led to us getting additional funding from high-net-worth individuals.”
According to Hannah, “More often than not, it's your existing donors who might be able to give a larger gift in the future, once you've proved you can spend the money effectively and deliver the change you've promised.”
There are several strategies you can implement to make sure you’re valuing your existing network. One effective way is to grow from small to large donations.
GO FROM SMALL TO LARGE DONATIONS
Many fundraisers mistakenly believe that once they’ve secured a small donation, they don’t need to do much more work to keep that donor engaged. But failing to cultivate relationships with current donors, whatever the size of their donation, is a lost opportunity to grow a relationship from a small donation to a larger one.
According to Hannah, some of her most successful donors have been “those people who started off with smaller gifts and I've really cultivated them over time and made them feel a part of the work.”
One way to gradually grow a donor from a small donation to a larger contribution is through a membership model.
For example, The Nature Conservancy encourages its supporters to become a “member” for a contribution of at least $15. In return, they receive an annual calendar, a subscription to Nature Conservancy Magazine, and a monthly newsletter. To encourage larger donations, the organization provides tiers of membership with different benefits.
You can also encourage your supporters to give “recurring donations.” Studies have found that monthly donors are more likely to continue giving the following year, and they have a higher “lifetime value” than one-time donors.
Charity: water refers to their monthly donors as The Spring, a “passionate and determined group of monthly givers on a mission to end the water crisis in our lifetime.” The Spring’s webpage features photos and quotes from donors, and a live update of the number of people who will gain clean water as a result of the monthly donations.
When you meaningfully engage your existing donorship, they will gradually become more invested in your work. As they grow with your organization, their contribution is likely to grow as well.
BUILD DEEPER CONNECTIONS WITH YOUR CHAMPIONS
If you have a special group of donors that you consider “champions” of your work, and who you think might have a greater propensity to give in the long run, it’s important to invest time in nurturing these relationships.
Hannah offers a short list of ways you can engage your champions and build deeper connections:
1. Ask them to introduce you to potential donors.
When an individual is willing to make an introduction, it means they can vouch for your work. They are confident that your organization is doing the right thing, in the right way. And they’re willing to share your work with others.
Don’t just ask your champion to introduce you to a potential donor — involve them in the process. Ask them to help you frame why this would be an interesting exchange for that specific person. This will also help you walk into the conversation with a better indication of that contact’s interests and motivations.
2. Ask them to host an event.
Ask a champion to host an event or social gathering about a topic related to your work. This is a great opportunity to present yourself as an expert and introduce your organization and the work you’re doing. A virtual event of the same style would also be effective.
3. Position them as advocates on your virtual platforms.
There are many ways you can position your champions as advocates. You can ask them to write a blog post for your website, ask them to give you a shout-out on social media, or ask them to share a specific ask with their networks on their own platforms.
4. Give them a specific role and title.
Invite your champions to join your board or create an advisory group around a particular issue or campaign. This will make them feel closer to the work and valued as a connector and champion. It will also provide greater legitimacy when they approach their network on your behalf.
EXPAND YOUR REACH BEYOND YOUR NETWORK
If you don’t have a group of champions you can leverage, there are other ways to expand beyond your existing network. Refer back to the research section above and consider these suggestions:
1. Be active on LinkedIn and other social media profiles.
If you make it a point to be active on social media, people who are interested in your work will be able to learn about you and engage with you directly.
2. Participate in events and conferences.
Be on the lookout for advertisements about events related to your sector. You’re likely to find events that are looking for panel speakers or offering other ways to get involved. You should position yourself as an expert and reach out to others who can connect you to events happening in your field.
3. Advertise or promote opportunities to participate in your organization.
Providing opportunities to participate in your organization is a great way to draw attention to your work beyond your network. For example, you could advertise openings on your board of directors to senior executives, or share opportunities for volunteering and pro bono support.
Following the pandemic, networking has become a virtual experience. If you’re wondering how you can connect with donors in this way, read our blog post on Virtual Fundraising During The Pandemic to learn some effective tips for fundraising and building meaningful relationships online.
Mistake 5: Approaching Fundraising with a Limited Mindset
Many nonprofits feel like their relationships with funders are one-sided: the funder gives and the nonprofit takes. You might hold your funder on a pedestal. However, this is a limiting mindset that is preventing you from building an honest and fulfilling relationship with funders.
Similarly, people often feel shame or fear about asking for money. If you feel this way, you are not alone. But instead of focusing on the potential for rejection or awkwardness, flip your mindset: Every funding relationship is an opportunity for a true exchange of value between partners.
FLIP YOUR MINDSET
To be a successful fundraiser that builds meaningful, honest, and genuine partnerships, you need to flip your mindset and start thinking differently about your donor relationships.
Fundraising is not about begging. It is sharing an opportunity with people who want to help. There are many people out there who want to support something they believe in. They want to support something that will make them proud. – Aaron Kirunda, co-founder of Enjuba
“Are you trying to make sure that women have a safe, affordable place to give birth? Creating a way for people to have clean drinking water so they and their children don’t fall ill? Protecting refugees from genocide? Providing after school tutoring for at-risk kids?”
“You’re devoting your life, your spirit, your energy, your faith into making the vision you have of a better future into a reality. So why are you so scared to ask people for money?”
Remember, your nonprofit is providing donors an opportunity to get involved in something incredible. Without your organization’s hard work on the front lines, donors would have no means to contribute to social change.
Donors want to have an impact, but they can’t do it without you. When you reframe your relationship as a partnership between equals, both partners will have an opportunity to grow, learn, and benefit from the collaboration.
HAVE ROBUST CONVERSATIONS
Nonprofits employ people with ambitious visions. You may sacrifice paychecks and spend sleepless nights in service of your mission. Through it all, you become an expert in your field and can provide valuable insight for people on the outside looking in.
“Feel free to gently and politely challenge some preconceptions or ideas that a donor might have,” said Hannah. “You probably know a lot more about a specific issue than they do, and they will appreciate your willingness to share what you’ve learned with them.”
Earlier in this guide, you learned how to position yourself as an expert to gain exposure and build your network. Similarly, when connecting with your donors, you should also feel confident to have robust conversations about your experiences and expertise.
Having thoughtful conversations with your donors can also help you gauge the right time to pitch your program and invite them into a partnership.
Mistake 6: Not Knowing When to Make Your Ask
Many fundraisers struggle with knowing the right time to make their pitch. But if you’ve been following the advice in this guide, the moment may come naturally.
According to the Field Guide from I.G. Advisors, “The art of directly asking for support can be intimidating, but here’s the good news: if you’re doing cultivation right, and building a strong relationship based on mutual values and strategic alignment, then solicitation becomes a natural extension of that conversation, and oftentimes donors might ask you first!”
“If you’re not sure if now is the right time to make an ask – ask! Donors are just human beings and they feel awkward about these conversations, too.”
By now, you know how to research a donor’s ability to give, understand whether your motivations are aligned, and build a strong relationship. If you’ve followed those steps, then you’re headed in the right direction in asking for their support.
As you strive to build partnerships based on meaningful interactions, you might also find yourself wondering how to strike a balance between asking for money and asking for advice. As the saying goes: “If you want money, ask for advice. If you want advice, ask for more.”
“This can be a tricky space to navigate,” Hannah said. “You may have approached the wrong prospect that isn't aligned, either from a capacity perspective or an interest perspective. Or you've simply mistimed the ask.”
If you do receive advice instead of money, “you should really listen to that advice,” Hannah said. “If it's someone that you admire, you know they've been successful, and it’s someone you aspire to emulate their success (not necessarily their idea), make sure you take that advice.”
CHECKLIST TO KNOW YOUR READINESS
According to Hannah, you’ll know that you’re ready to make your pitch when you can answer the following questions:
How much money do you need?
How will you spend the money?
How do you anticipate this money will have an impact on the people you serve?
Why is donating to your organization the best way for this donor to make meaningful social change?
If you’ve checked off everything on the list but still feel hesitant or nervous about pitching to an audience, you may want to read our guide: Overcome the Fear of Public Speaking with TED’s Chris Anderson. It shares tips for structuring your talk from the curator of TED and advice from Acumen Academy’s accomplished TED speakers on how they overcame their fears of public speaking.
WHEN YOU'RE READY TO PITCH
In addition to the checklist, Hannah suggests that you measure your pitching readiness by thinking through these two questions:
1. Is your message clear to funders?
During your initial conversations, observe the prospective donor closely: Are they getting the point? If you notice there are questions around the most important aspects of your work, reframe your pitch so that it connects in the right way.
2. Are you prepared with follow-up information?
You should be prepared with a clear and compelling vision of what you want to achieve, what you need financially to move toward your vision in a meaningful way, and a clear ask or call to action. If you understand your funding goals, you should be able to answer these questions compellingly.
Partnering effectively takes time and commitment. This preparation will help you get the most out of your relationship with a funder, whether in the form of a gift or otherwise.
Mistake 7: Making a Pitch That Doesn't Resonate with Your Funder
Nonprofits often make the mistake of delivering pitches that focus mainly on their own challenges and needs. While this approach may seem appropriate — after all, your nonprofit is asking for funding for a reason! — it fails to connect your ask with your funder’s own interests and motivations. The most effective pitches will show the funder how their contribution helps them achieve their own goals.
Look back on all your research and preparation to craft a compelling, personalized pitch.
REFER TO YOUR RESEARCH
During your research, you learned a lot of information about your donor, including their interests, motivations, and ability to give. Before your pitch, make sure you can answer these questions in response to the particular donor:
Are you showing how your impact will help achieve their own goals?
Are you leading with the value proposition that is most interesting to them?
Does your mission and vision show you’re values-aligned?
Are your needs clear and is your “ask” precise?
Is your financial story honest and transparent?
Is the amount of your funding request appropriate?
Think of a foundation that funds environmental conservation, a corporate giving program at a technology company, and a high-net-worth donor with a passion for childhood learning and development. What kind of language would they use? How would their goals differ? Now, incorporate those factors into your pitch.
Hannah shared an example: “If a corporate foundation has a goal to reach a certain number of people in a specific place and they want to see a tech-enabled intervention, make sure that you're framing your work in the language and in the goals that they understand and are trying to achieve.”
Together with your research, these questions will help guide you in preparing a unique pitch that resonates effectively with a given donor.
If you want to learn more about preparing a compelling pitch, Acumen’s Storytelling for Change course introduces an “Audience, Benefit, Goal” framework to help you better connect with your audience and inspire action.
BE CREATIVE IN YOUR DELIVERY
Now that you have the essential elements in place to prepare a pitch that resonates with your donor, your final step is to make it sound meaningful and compelling.
Crafting your message using storytelling techniques can inspire donors to connect emotionally with your mission, which can move them to take action and support your work.
You can use these elements to present a powerful story to your donor:
Main Character: These are the people who are directly impacted by your nonprofit's work. Describe their hopes, fears, and daily lives.
Conflict: What challenge is affecting your main character and/or their community? It might be lack of access to nutrition, education, job opportunities, or health and safety.
Action: Explain how the actions of the donor and your nonprofit will help your main character overcome this challenge.
Impact: Conclude by illustrating how your nonprofit is making a measurable impact in the lives of others who are facing this challenge, but there is still work to be done.
In Acumen Academy's Guide on Public Speaking this example shows how you can use storytelling to pitch your mission to a funder:
Acumen India Fellow Yogesh Kumar is the founder of Even Cargo, a female-driven goods delivery company in Delhi. For Yogesh, the mission is to “create a gender-just society, to challenge gender norms by allowing women to have equal opportunities and come into professions that have been traditionally inaccessible to them, to have equal access to public space, and to increase their participation in the workforce.”
Narrating Even Cargo’s impact around one of their female drivers, Tabbasum, can help funders connect to the problem and the mission. Before, Tabbasum’s household income for a family of 11 was 9,000 rupees per month, dependent on her father’s earnings as a cook. Now, with the earnings from her work at Even Cargo, she has more than doubled her family’s income, earning 15,000 rupees per month.
Another creative approach is to present a personal story about your journey as a founder.
Acumen Global Fellow Steph Speirs is the CEO of Solstice, which is a social enterprise that provides affordable renewable energy for households in the United States. The story of her nonprofit is personal:
“I was raised by a single mom who had three kids on a salary below the poverty line. I watched her struggle my entire life to pay the electricity bills. For the first time, we can get people like my mom, the people who need solar savings the most, access to affordable solar.” she said.
Stephanie SpeirsSteph is a community builder and the Co-Founder and CEO of Solstice, a company that provides community-shared solar power to Americans that cannot install a sys...
Why am I the right person to be doing this work?
Why is this work important right now?
Why is this work important to me?
In the Acumen Academy guide: Learn the Art of Storytelling to Tell Stories That Matter, we break down how to find clarity on the story you want to tell, the motivation behind why you want to tell it, and how to shape it to inspire and active action from others.
Mistake 8: Not Cultivating Relationships with Funders You Secure
Imagine that you successfully made a pitch and received a large gift. You might be thinking: “I got the gift, they like what I do... Now I don’t have to worry about them until next year when the money runs out.”
However, this mindset can make your funder feel like an ATM, disconnected from your work and the results of their contribution.
In Manifesto for a Moral Revolution, Jacqueline shares the words of Acumen’s Chief Partnerships Officer, Yasmina Zaidman, who said: “If I could have one wish – and this is something I try to practice myself – it would be to enter a new partnership with greater openness to what the other side can offer and a courageous vulnerability to sharing fears – and with the patience to take the time it needs to build trust.”
Jacqueline added: “In other words, commit to the commitment itself.”
In the chaos of fundraising and keeping the day-to-day of your organization afloat, it’s easy to forget your commitment to those who have made a commitment to you. Honoring your donors takes time, practice, and dedication — and it’s an integral part of the process.
Here are a few ways you can cultivate relationships with the funders you secure.
MAKE THEM FEEL VALUED
According to Hannah, donors “want to feel the work, not just hear about it.”
There are many ways you can engage your donors and make them feel close to the work. If appropriate, you could take them on trips to see your projects and have them connect directly with the people their contribution is serving.
Another option is to introduce your donors to members of your team. For example, if a donor has a particular interest in monitoring and evaluating impact, connecting them with your data team could help them feel valued and engaged. Similarly, you might rethink the design of your events so that they serve as opportunities to make your donors feel seen, heard, and special.
As you find ways to make your donors feel valued, make sure you consider their interests and whether it’s appropriate for your organization.
TREAT THEM LIKE A GENUINE PARTNER
Treating your donor like a genuine partner takes thoughtfulness and requires you to open space within your organization for them to truly participate. For example, you could include your donors in brainstorming processes or strategic decision-making to make them feel like a genuine thought partner. Similarly, you might set aside time to ask them for advice on how they would approach a new initiative or tackle a particular hurdle.
Be sure to keep this process donor-centric and focus on engaging them in topics that you know are motivating or interesting to them.
MAKE DONOR-TO-DONOR CONNECTIONS
Surveys find that “donors give more and give over a longer duration if they're connected with other donors in your organization community,” Hannah said.
One way to encourage connections between your donors is to invite them to experience your impact through events. For example, if your nonprofit works to source cacao from smallholder farmers and sell to premium chocolate makers, you could host a chocolate tasting!
Similarly, if you work to build leaders through training and other educational programs, invite your donors to celebrate milestones like the initiation of a new cohort or a graduation ceremony.
The idea is to be intentional about creating and holding space for your group of donors to come together and connect with one another.
Admitting your failures to your donors and being open and honest about your obstacles and setbacks will help you maintain a relationship that is based on trust. Furthermore, it invites your donors to help you overcome these obstacles when they arise.
You build trust by showing up, by listening to what someone else has to say, by keeping promises. You build trust through shared endeavor and by the consistency of your words and actions. You build it by admitting mistakes and by communicating both when things go well and when they fail. – Jacqueline Novogratz
Lynda Mansson explains the importance of cultivating funder-donor relationships with trust and transparency:
“We don’t want to only hear the happy things. It builds trust when you can tell a funder, ‘We won’t reach our goal because of this reason, and we need to reorient the strategy this way…’” she said.
“It shows a lack of transparency and foresight when a grantee calls you the day after a crisis hits, rather than seeking your help months earlier when you could have averted the crisis,” she added.
“Once you have lost trust in a relationship, it is difficult to regain,” she concluded. “You have to ask for more information, check on them more frequently, seek out other opinions...The transaction costs are much higher after trust is lost and we aren’t staffed for that. Therefore, we only want to work in situations where there is trust.”
You can find compelling ways to share your struggles and bring your donor in to help solve challenges or offer advice. If you trust them by sharing your feelings and shortcomings, they’re likely to trust you in return.
Put It Into Practice
Now that you’ve done your research and found meaningful ways to connect your donor with your mission, you can use these practices to build a more resilient fundraising strategy.
As you work to avoid the common mistakes nonprofits make when fundraising, make sure to build out systems within your organization that will help you stay focused and organized.
Customer relationship management (CRM) systems like Salesforce or Raiser’s Edge help nonprofits maintain lists of contacts with past interactions, donation sizes, and reminders to follow up. However, these systems can often be expensive for nonprofits with limited resources.
Fortunately, there are other options for building a system that tracks your donor engagement over time. Ashish described how he created an affordable CRM for his nonprofit Shiksharth:
“I keep an Excel spreadsheet where I’ve listed all of my contacts, organized into categories like ‘college network’ or ‘corporate network,’” Ashish said. “I keep track of when I last reached out and how much they donated. Then I list all the people I could reach out to and identify them as ‘hot,’ ‘warm,’ or ‘cold’ leads.”
Your donor management system should include these details:
Name and contact information
The date you engaged with the prospective donor
The type of touchpoint (such as an invitation to an event, coffee meeting, or a meeting with an executive or program staff)
The next date to follow up
Regardless of the platform or approach, you should implement a system that works best for you and your nonprofit. In the end, the goal is to make connections and secure funding that will help you achieve your mission.
You now have a new mindset around what it means to be a fundraiser who puts meaningful partnerships at the center of their fundraising efforts.
As a following step, we recommend joining the next cohort of Acumen Academy’s Nonprofit Fundraising Essentials to expand your skills in this area.
With practice and experience, you’ll change your mindset to embrace fundraising through courage, humility, and audacious partnerships.
You can start this practice by joining Jacqueline Novogratz’s course, The Path of Moral Leadership, which teaches the hard-edged skills to start building a better world. This course is free when you purchase Jacqueline’s book, Manifesto for a Moral Revolution.
We encourage you to explore our course catalogue for new opportunities to expand your skills as you continue your journey to grow as a leader and expand the work of your nonprofit.