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Kim Klein is the founder and publisher of the Grassroots Fundraising Journal and the author of a number of books on fundraising, including Fundraising for Social Change and Fundraising for the Long Haul. She is on the Steering Committee of the Building Movement Project, which helps nonprofit organizations become more effective examples of social justice.
Promises, promises
Dear Kim,
My organization recently had a major event, with varying sponsorship levels. Many people pledged the amount they wanted to give towards the event and followed through with their pledges. But, many people have yet to fulfill their pledges. What is the proper way of reminding those individuals to follow through on their pledges? Also, what is appropriate for a second reminder to some that you have already reminded once?
Promises, promises
Dear Promises,
Unfortunately, in all fundraising we have to budget for unfulfilled pledges. This is sometimes called the "discount rate" and it runs 10-15%. So, know that no matter what you do, short of breaking their kneecaps—which I don't recommend—you will not get all the money that was promised.
To insure that you keep your rate of fulfillment as high as possible, be sure to send a letter that looks like a friendly invoice and shows very clearly the amount that is owed. It should have this tone: "Thanks so much for your pledge of $500. You will be pleased that we netted $10,000 from our event and your commitment is a big part of that. I am enclosing a reminder card and a stamped return envelope. We look forward to hearing from you at your earliest convenience." Then add either a pledge card or another sheet of paper which they can include in the envelope.
For those who don't respond to that, I would suggest dividing them into categories:
- Category 1
Those people or companies who are known to a board member or staff member. The person who is the contact should call them and see what is going on.
- Category 2
Those people or companies who pledged over $500. (Many of these are probably in Category 1). They need to be called also.
- Category 3
Those who pledged less than $500 and who no one knows personally. You need to decide how much more time and effort you want to put in to collecting those debts. I would suggest one more reminder mailing. At a certain point, you will have spent more time and money trying to collect the pledge than the pledge is worth. You will also have your greatest unfufillment in this category.
For Category 1 and 2, offer people the option of paying their pledge in several installments. Anyone who does not pay after the phone call should get one more letter, and then let it go.
It is frustrating that people make a pledge and don't pay, but sometimes something comes up for them—a financial emergency, a death in the family—and they triage all other commitments. Some people have such a hard time saying "no" that they say "yes" and mean "no." And sometimes, the person who solicited the pledge heard "yes" when the person being asked said, "I'll think about it" or "I think I can do it, but I have to get back to you."
Ultimately, the best way to insure pledges are paid is to make sure that you have set out the terms of the pledge at the time it's made. For example, Dave, who owns Dave's Electronics, pledges $2500 for your event. He makes this promise to a board member who has been trained to say, "Dave, that's fantastic. Thank you so much! How would you like to pay that?" Or, "Would you like to pay that right now, or would you prefer to get an invoice in the mail?" Or perhaps, "We'd like to collect all the pledges before the event. What would be the best way for me to collect your pledge in the next week?" You get the drift.
Good luck.
Kim
Backseat Driver
Dear Kim,
I'm a 27-year old Development Associate with a strong writing background and
less than two years of experience in the development field. My organization
is 90% funded by private foundations, most of which have long-standing
relationships with our ED (Executive Director).
I've expressed to my ED that I want to do what it takes to be promoted to
Development Director (I'm the only development person in the organization).
His response was that a Director is someone who "drives" a program. Yet
he's given me little guidance on how I can step up to fulfill this role.
His main message is that it's just "time." This is a frustrating answer,
especially because all of our funder relationships are his relationships.
It seems like grant writing is almost a formality in this world, and the
relationships are the most important. He's the one that has known our
funders for years, goes to visit them in New York, etc.
Being so green, I don't yet have the connections to match my motivation and
ambitions. What are some ways that I can begin to "drive" our fundraising,
even without having any long-standing relationships of my own?
Signed,
Backseat Driver
Dear Backseat,
Your Executive Director seems to be having a hard time bringing you into his relationships with these long-term funders. You are completely correct that relationships with funders are key. I wouldn't go so far as to say the proposal is a formality, but it is more of a write-up of an agreement already made than a true proposal.
You say that your organization is 90% foundation funded. This is foolish and an accident waiting to happen. I suggest not trying to get in on these long-term foundation relationships which are working just fine, but instead developing your own relationships by creating and building an individual donor program. Your organization needs to diversify its funding, and you are key to doing that. Your boss will continue to do what he is good at, and you will develop a much-needed series of non-foundation income streams. Learn all you can about major gifts and direct mail and work on that. Individuals account for 85% of all the money given away by the private sector, which is composed of foundations, corporations and individuals. Foundations only account for 10%. Both stability and growth come from having a variety of sources of income and a broad donor base.
In addition to suggesting some ways to work inside the organization, your question raises issues of professional development. If you cannot grow in this job, you will want to consider moving on. In the meantime, you may want to volunteer in another organization so that you can have more hands-on fundraising experience. In addition, you may want to join the Association of Fundraising Professionals and attend their meetings. Talking with other development directors, particularly those with more experience in the field, will help you figure out whether you can work effectively with your executive director. Finally, it is possible that your Executive Director does not know that much about working with a development director and would respond well to some coaching or consulting help.
Good luck.
Kim
In an ethical quandary
Dear Kim,
Recently the primary cultural center in our town, always known for its progressive arts and film premieres, accepted a large donation from a corporate weapons manufacturer in our state. Our cultural center has promoted many programs related to peace making and the questioning of war, and some of us in the community feel the acceptance of this corporate gift is in conflict with the center's goals and mission. I have been unable to find articles discussing the ethical dilemma facing progressive non-profits that accept corporate funds. What are your thoughts and can you make any suggestions on where I can read further about the subject?
Thanks,
In an ethical quandary
Dear Quandary,
Your dilemma illustrates why all organizations should have a Gift Acceptance Policy, which forces you to discuss these issues while they are still theoretical and make a decision about what kinds of gifts you might or might not accept before they are offered to you. There are a number of articles that have been written on this topic: the National Committee for Responsive Philanthropy ( NCRP.org) has a booklet on creating Gift Acceptance Policies. I have a very popular article called "The Perennial Question of Clean and Dirty Money" which you can download from my website at www.grassrootsfundraising.org.
However, the organization has already accepted the gift and it is already causing problems. Here are some questions you may want to raise with the cultural center before you get too upset.
- Did the organization solicit the gift? If not, it is possible that someone in the corporation likes the work of the cultural center and wants to support it, and that this person arranged for the gift. Perhaps a board member works for this corporation and is having his or her gift matched. Organizations sometimes accept gifts that are employee driven because they reflect the commitment of the employee and not the corporation.
- Did the gift come with any strings attached? Your letter does not indicate any. A "gift" from a corporation that insists on having its name on the program or asks that you tone down your work is different from a gift that is simply given to do your work. That doesn't mean the organization should accept it, but I think it has a different flavor.
- How much is the gift? I have seen organizations spend hours and hours debating the ethics of taking a donation from some person or place, and then it will turn out that the gift is tiny. There needs to be some kind of threshold that would cause you to be upset. You can't trace the source of all your money and for all you know, other funding is indirectly derived from the weapons business. If the gift is under $2,500 I would be less concerned than if is over $5,000.
- Do you think it will affect the mission of the cultural center? And if so, how has it come about that the mission is for sale?
Using these questions as points of discussion, as well as referencing the articles above, will help you sort through the issues in deciding whether to let this go or to ask the cultural center to give the gift back.
It is a sign of health that the organization has people like you involved and caring about the work that it does.
Hang in there.
Kim
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| If you have a question you would like Kim to answer please email lea@idealist.org with the subject line Dear Kim. Please note: due to the large volume of email Kim will not be able to answer all questions she receives or respond to emails personally. |
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