For those who run small nonprofit organizations, the very worst job is asking people to donate stuff to you. Whether you’re seeking in-kind donations like office equipment, volunteered time, items you can sell, or cash donations, it’s incredibly intimidating to start raising money.
But money is the blood of a nonprofit, just as volunteers are the muscle and brain. You must have some sort of cash flow or your organization will fail.
Methods for Soliciting Donations
The hardest part of developing your nonprofit is finding ways to solicit donations. People seem so unapproachable sometimes, it can be intimidating. Your first step is to set up a database and put the name, phone number, and address of every person and business that your nonprofit has come into contact with in it. A large, well-maintained donor database is an essential part of your nonprofit’s success. And you should always solicit donations from those who make money from you; they will feel guilty if they don’t give something back!
Mass Mailings – Many nonprofits start with mass mailings of solicitation letters. I advise against this, even though you can get a reduced rate from the post office for nonprofit mailings. Why? Because even simple mass mailings can cost you as much as fifty cents per piece. Save mass mailing for later, when your organization is a little more developed.
This is not to say that mass mailing is not good for your nonprofit. On the contrary, when done well a mass mailing can help you keep track of your database address changes (if the person’s not there, the post office will either forward it, return the letter with the address change on it, or return as an unknown address). It can also keep your organization in the front of your potential donors’ minds when they are ready to donate money.
With mass mailings, make every appeal personal. In your letter or packet, tell one of your organization’s success stories, with pictures if possible, and let the potential donor that it is up to him or her whether you have another success like this one. Never address a solicitation letter as “Dear Sir.” Learn how to mail merge, and send each letter to an individual.
Telephone Solicitation – Depending on what you want to achieve, telephone solicitation can be one of the best methods for raising funds and gathering other donations. For instance, if you’re planning to have a silent auction, calling around to businesses that sell unique items will often give you an in-kind donation if you promise them free promotion in return. When I worked for nonprofits in Louisville, I used this technique successfully to get a Louisville Slugger baseball bat, a $100 gift basket from Taste of Kentucky, a similar gift basket of tasty fudge and cheese from Gethsemane Monastery, and free tickets and passes to hordes of places in town.
In-Person Collecting – The only nonprofit I know of who does in-person collecting successfully is the Salvation Army. I advise strongly against any kind of solicitation at stores or door-to-door for a new nonprofit; it could even get you arrested for trespassing.
Using Events To Raise Funds – It’s a lot of work — a LOT of work — to organize an event, such as a festival or area yard sale. If you have a good corps of volunteers and run it like a business, though, an event can be a real moneymaker. It can also become an area tradition, bringing you sustainable income year after year. One popular trend: hiring carnivals to set up, then selling day passes. You pay the carnival a set price (they also get the income from carnie games and food booths) and your charity pockets the rest of the profits. It can also be a great time to set up booths to raise awareness, recruit volunteers, and get lawmakers and celebrities down to promote your charity. Often, radio stations and television stations will set up as well to provide you with that other wonderful thing — free publicity.
Trading Services – Often, charities with large volunteer pools can trade services with area businesses to get the things they need. This is not necessarily a donation (though it could wind up being one) and you really need to research area rules; your local United Way will have a handle on it and will almost certainly share their information if you ask nicely. This is a good way to, for instance, get job training for the people you want to serve — you provide the business with interns, and they help your clients get experience and references. Use creativity with your people resources to come up with ways you can trade services to get what you need.
Teaming With Compatible Charities – Suppose you know a church that runs a soup kitchen, and you have hordes of clothing you’ve collected for the needy? A sensible pairing would be for the two of you to get together and help a lot of people one day. Or if you run a Salvation Army with an overflow of furniture and know someone working for Habitat for Humanity — you can furnish a new house for its new and needy owners. This won’t get you income. But charities teaming up like this make really great news. One good news story on an event like this can get you a lot of donations.
Writing Grants – Grantwriting is a traditional method of getting money, but recently it’s become a much tighter market. More grantgivers want to see projects that will assure a nonprofit a steady stream of income, and fewers are awarding “bricks and mortar” grants. Your best bet for a small startup is to keep it local. Find out what companies in your area give grants out, and get in contact with their nonprofit executives personally. When they know who you are and what you do, it really gives you an edge over everyone else.
Newspaper Advertisement – While newspaper advertising for donations does work to a certain degree, the return on investment is usually not worth it. I’d avoid this. Ditto for television and radio advertising. The one exception: approach local media outlets to see if they do pro-bono ads for local nonprofits. If the answer is no, concentrate on getting them to cover your organization’s story, services, and events instead by writing press releases that need minimal change to become articles.
Website Advertising – Every single nonprofit needs a website. Period. List your website in every letter, every business card, every brochure, every media contact. This can be your best source of PR. Look into ways of accepting credit card donations on your website; if you have a 501(c)(3) nonprofit, you can open a free account on PayPal to collect donations as well.
NEVER Use Emails – Even for your regular donors, never send mass email solicitations out. It’s rude. Exception: if you have sent out donation letters, and your donors have opted in on email solicitations to save you the cost of printing and mailing. But that’s going to be a small enough category when you start out that it’s not worth the extra work for a small nonprofit.
Rules for Solicitation
There are several things you can do, regardless of the solicitation type you’re using, to make your donation drive more effective and efficient.
Always follow the law. There will be some strict local laws about solicitation. For instance, no one can solicit on military housing reservations without getting written permission from the housing office. You can’t collect donations outside a store without written permission from the manager. There are laws preventing certain criminal classes from contact with children. Know all these rules before you start soliciting; one lawsuit can ruin your charity.
Always follow significant donations with a thank-you letter. This means anytime someone gives you ten bucks, or a computer, or provides some sort of skilled service for free. You can find letter templates online to make this easy. This thank-you letter isn’t only polite, it’s a way to keep interested community members interested. And it works as proof for the IRS that you received a donation from that person.
Make donating easy. If they have to come down to your office to get a receipt, donors won’t donate. Some salvage nonprofits like Salvation Army run trucks through neighborhoods to pick up donations. Most nonprofits give an easy donation button on the front page of their websites so donors can donate right there. The easier it is to give, the more people will be likely to give.
Enlist celebrity help. Fred Grandy, erstwhile Gopher on The Love Boat and a U.S. congressman for a while, became Goodwill’s president largely because he could bring celebrity status to the organization (he had other skills, but this was a big one). A celebrity can mean the difference between your event success and total failure. It draws almost guaranteed media attention, and that means attention from the community for your charity.
Community support building is more important than getting maximum donations. Instead of hitting people up for tons of money in the beginning, start slow. Tell everyone your story. Let them know what your goals are, how it will improve the life of each person in your community, how important it is that this work be done. When you are accepted, then you can start your large campaign drives.
Give them something for something. Unfortunately, doing good for the community is not enough to get most people to donate. A lot of charities have been sending out little gifts — pens, magnets, even rulers and calendars — in their solicitation letters. I think that’s too expensive, both in purchasing the gifts and in the increased postage costs. You can, however, organize events that have value in themselves; for instance, carnivals and sponsored marathons have always been great fundraisers over time. Entertain them, and they will come.
All large solicitations should come from either the top executive at the organization or a recognized local or national celebrity. This means if you want Ms. Rich to leave you a bequest in her will, you don’t delegate the duty to your secretary. The president of the organization or a local celebrity should approach her personally, explaining to her in the nicest possible way how her bequest can make a difference, and how you will memorialize her if she donates to you. This sort of solicitation is generally the best bricks-and-mortar fundraiser, but it’s a lot harder to get.
Always make solicitations do double duty: every time you ask for money in the community, you should be raising awareness of what your organization does. This does not necessarily follow in reverse; often, when the community is aware of who you are and can easily find ways to donate to you, the donations will come. Don’t ask for money every time you get publicity.
Ultimately, soliciting donations is very much like sales, only harder. You are selling the benefits of your nonprofit organization to the community in which you live. If you approach it like that, you’ll find your fundraising much more effective.
