Take Your Major Donor Fundraising Strategy to the Next Level
Four key steps for fundraising success
The fundraising and non-profit sector as a whole has had a tough few years. During the pandemic, causes that rely on fundraising events in particular had to cancel face-to-face activities, leading to a real drop in donations. Those dedicated towards medical research for example lost upwards of £174 million in the first half of 2020 alone.
But this is changing. Research has shown that charity donations from the extremely wealthy hit an all-new high of £4.3 billion in 2021, a 36.1% rise compared to the year previous. The top 1% alone give away about £2.5 billion annually.
With events slowly opening back up and society gaining confidence in hosting larger scale events again, there’s never been a better time to level up your major donor fundraising strategy. There are more opportunities than ever, and advancements in technology have only made it easier to find potential donors.
Suggested Reading: Combine your reading with our guide Update Your Fundraising Policy for 2022 to truly take your fundraising strategies to the next level.
New opportunities, and new risks for non-profits
With new opportunities come new risks. The Mosley Oxford University donor scandal in 2021 and the fallout of Oxfam’s safeguarding failures which led to spending cuts exceeding £16 million are prime examples.
A rock-solid due diligence process is not just about risk mitigation. It can also help to form stronger relationships with donors, past, present and future.
Cultivating a deeper understanding of your fundraisers creates a symbiotic relationship — a relationship that can be more productive for your non-profit’s goals, values, and principles.
This article will explore how to take your fundraising strategy to the next level.
Step 1. Identifying your donor
The traditional prospecting process relies heavily on word-of-mouth and the social connections of a charity’s board, existing donors, founding members, and employees.
It’s also possible to identify donors through their prominence and associations with charitable giving, or their links to charities and large businesses that are involved in non-profit projects. Identifying donors based on their cultural ties, passions or interests provides yet another avenue that is assisted by open-source media.
Ways to take it to the next level
Established non-profits may already have a database of donors. Explore your database for existing major donors and identify others based on their connections, e.g. their business partners or third-party relationships. Consistent donors might be willing to provide a larger donation and mid-level donors might have experienced a change in circumstances that enables them to take their donations to the next level.
Prospecting donors revolves around the identification of names, but names provide just a minuscule piece of the puzzle. It’s critical to unravel all available information about who that person is.
Keep the following thoughts and questions in mind:
- What makes the donor relevant: Does the donor have links to relevant sectors, industries or charitable interests that would support them making a genuine donation?
- Who the donor is: Is the donor’s identity verifiable? Do they have an established reputation?
- The donor’s background: Can their source of wealth be effectively traced to provide clarity on its origins (as was overlooked in the Mosley money case)?
Non-profits must adhere to strict rules and regulations surrounding the legal status of the donor and the legitimacy of their donation. Due diligence is not optional — it is a legal duty for those that fall under the charity law. Failure to carry out robust due diligence carries a risk of accidental money laundering and the facilitation of tax evasion. Fraudulent donations are on the rise and the government has urged those receiving charitable assets to assess their due diligence process when identifying new potential donors.
- Start with word of mouth.
- Expand your search based on research into existing databases to identify wider business connections and opportunities.
- Understand and comply with relevant regulations, and your own institution’s individual policy regarding due diligence and exposure to reputational risk.
Step 2. Building your approach
Major donors should be approached with a tailored strategy informed by their background, interests, work history, historical ties and donation history.
This approach should invoke knowledge uncovered during the due diligence process. Be proactive, pragmatic, and engaging; you are selling your organisation, project, or non-profit objectives whilst also providing the donor with an opportunity to support something that matters to them.
This is why building a symbiotic approach is critical — major donors are looking for non-profits to support in the long term and want to see genuine tangible impacts. Establish a strong understanding of your donor’s prior fundraising activity before you contact them, and build a tailored approach that allows them to visualise the trajectory of their potential donation.
Ways to take it to the next level
The more information you can discover on your potential donor, the better. Building an understanding that goes beyond the superficial level is critical to building a tailored, symbiotic approach.
Whilst major donations are often made in receipt of certain benefits (e.g. having a building named after them or a place at a gala dinner), it’s still essential to foster a personalised approach that takes the following into account:
- Be clear on your intended results: Donors don’t want their money to simply wash away and need to be assured that their contributions will be put to good use.
- Show your research: Symbiotic relationships rely on mutual understanding. Use information uncovered during the due diligence process to form an in-depth understanding of the donor. Keep relevant teams updated so they can integrate this information into their strategy.
- Appeal to their cause(s): Bear in mind that whilst many major donations are made in receipt of tangible benefits, altruism often remains at the heart of the decision. This is best to tap into if you have a sense of the specific causes that are close to a particular prospect’s heart.
- Always have a game plan for the long term.
- Do your homework on your (potential and existing) donors.
- Don’t hold back from getting personal.
Step 3. Establish a deep relationship
Non-profits should aim to build long-term relationships with their donors. The in-depth information and knowledge gained in the due diligence process can be exceptionally useful here, as it provides a genuine means to understand who the donor is, their interests, and history of charitable or non-profit giving. Use this information to your benefit whenever possible.
Major donors care about their legacy and any attempts to engage them with a disingenuous view of simply receiving a donation is a risky approach. Building an authentic, reciprocal relationship is always preferable and leads to better long-term outcomes for all parties.
Don’t forget about the important role that word-of-mouth plays within the sector. A strong relationship with one donor might lead to many more.
Ways to take it to the next level
The process of identifying risk can lead to the development of deep and authentic relationships that create a sense of mutual trust. Here, due diligence and relationship building are synergistic. When conducting background research, take note of your donor’s charitable motivations. This isn’t about finding a cheap way to tug at their heartstrings — and they will see right through that — but building a trustworthy, authentic relationship.
- Develop an effective and efficient due diligence process: An ongoing risk cycle for long-term donors is crucial but can be a drain on resources. Utilise methods of due diligence that keep the process streamlined and productive.
- Keep using that process: Utilise the findings of ongoing due diligence checks to fuel future relationships with new ideas.
- Ensure that you’re getting the most out of your due diligence, including developing your relationships.
- Repetition and constant vigilance only help.
Step 4. Keep the relationship thriving
Staying on top of your relationship with your donor involves maintaining and growing the established mutual trust between them and your non-profit on a routine basis. Donorship is thriving in the UK, providing new opportunities to build a modern culture of charitable giving. Non-profit donor relationships thrive on benefits and impacts — always monitor the impacts of your donor’s money and keep them actively engaged with the real-world impact of their donation.
Keep in touch with your donors constantly and consistently. Organising regular events for donors, or setting up donor clubs or schemes are also popular ways to keep relationships thriving. Donor events also provide an excellent opportunity to inform all major donors of the impacts of their money. Networking events provide value to donors and the adjacent opportunities of such activities incentivise ongoing giving.
Ways to take it to the next level
Building thriving relationships with donors requires pragmatism and positive action. Meanwhile, due diligence remains a priority and conducting ongoing checks ensures compliance and risk mitigation when donorship relationships progress into the long term.
Staying aware of your donor’s ongoing activities is essential, as these may change often. Whilst building long term, fruitful relationships with major donors is ideal, this should not come at the expense of ongoing due diligence. Any forthcoming changes in your donor’s activities might also come with increased risk exposure for your non-profit.
- Keep the momentum going: Managing and fostering a deep relationship relies on excellent communication. Use a variety of passive and active marketing techniques to keep donors in the loop, including regular meetings, events, newsletters, and tailor-made updates.
- Keep partners in the loop: Your donors will want to know exactly how and where their money is being used to catalyse real change, so keep them informed of the project itself, milestones, impacts, etc.
- Check in regularly: Marketing to donors doesn’t cease after you’ve received a donation. Develop an ongoing donor outreach strategy to keep them informed in the long term, even after their initial donation is used up or the project reaches its conclusion.
- Mutual respect and openness is key to fundraising success.
- Take the time to foster your partnerships.
How Xapien can help
The modern non-profit sector is colossal, dynamic, and fast-moving, and the opportunities for non-profits to raise their fundraising game are proliferating. This exciting new donorship landscape can only be taken advantage of by building a modern fundraising strategy to go along with it. Non-profit organisations have to seize these opportunities while maintaining efficiency and saving resources — and automating due diligence processes is just the way to go about it.
Automated due diligence platforms such as Xapien are equipping non-profits with the tools they need to launch robust, accurate due diligence checks without sacrificing speed and agility. Xapien’s powerful due diligence search and background reporting platform can take a small amount of information, e.g. the name of your proposed donor, and produce exceptionally detailed, feature-rich reports in mere minutes.
- Xapien will:
- Equip you with an advanced search platform that extends to all live online data sources, including deep web resources. Discover broad, exceptionally detailed information about your potential donor.
- Perform due diligence that is highly detailed and insightful at a faster rate of delivery, saving time and resources. This also enables due diligence to be carried out earlier into the fundraising cycle so that you can deepen your relationships faster.
- Provide a means to discover new donor prospects through their links or proximity to existing donors. Xapien acts as a complete donor research tool, not just a due diligence tool. Find the donors that will enable your organisation’s growth.
- Locate mentions of your donor across different languages and geographical regions. Perfect when performing due diligence on international and non-domestic donors.
- Automatically screen for risk and other important information. Xapien’s Neurorisk algorithms provide comprehensive risk reports that help your non-profit assess the legitimacy of your prospects to enable genuine risk-reporting.
- Produce high-quality, feature-rich reports to pass to all relevant parties. Keep your fundraising teams informed with the information they need to build long and productive relationships with donors.
The information Xapien uncovers not only informs the due diligence process from a legal or regulatory standpoint, but it also provides numerous avenues for growth. With Xapien, your non-profit can stand out within your sector, putting you in the best place to raise necessary funds, win over major donors, and form productive long-term relationships.
Book a demo today and discover how Xapien can take your major donor fundraising strategy to the next level.
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