Strengthen major donor fundraising with this intelligence

There’s a changing tide in major donor fundraising — a new wave of high-net-worth individuals are replacing the traditional everyday donors. Altrata’s recent report found that ultra-high-net-worth individuals (those worth $30 million or more) now account for 38% of all individual giving worldwide. 

Moreover, the 2023 Edelman Trust Barometer Global Report found that ultra-wealthy donors trust nonprofits more than anyone. Among them, education is the most popular cause, capturing 54% of their contributions. This is followed by arts and culture at 32%, and health care and medical research at 28%.

Nonprofits that once depended on many donors now need to concentrate on a smaller group of major donors, who are inundated with invites. To cut through the noise, organisations must go one layer deeper when researching potential major donors to uncover actionable insights. We’ll explain how in this blog.

Actionable intelligence for major donor fundraising

Prospect research is the first step in building a targeted fundraising pipeline, using a mix of donor databases and search tools like Google to gather enough intel. On the surface, the process seems simple: you’re looking for potential donors who have the financial capacity, an affinity for your cause, and a history of giving major gifts. 

But this is just the beginning. 

Organisations everywhere are competing for the attention of high-net-worth individuals, who are often inundated with similar requests. To stand out, fundraisering teams need to create messages that resonate deeply with each donor. This starts with gathering detailed information about their background, experiences, and passions. When you understand what truly matters to them, you can craft outreach that feels personal and impactful. The effort spent collecting intelligence can lead to more meaningful and rewarding conversations with donors.

Due diligence also plays an important part

As donation amounts increase, so does the risk of engaging with donors who might have questionable backgrounds. While prospect researchers tend to concentrate on opportunities — a critical part of their role — it’s important not to neglect due diligence. It’ll prevent frustration further down the line and ensure responsible donor relationships.

We were curious about how nonprofits manage due diligence, so we partnered with BWF and Pryo.Talks to survey organisations worldwide. From higher education to medical research and arts & culture, these nonprofits shared their practices with us. We found that only 16% of nonprofits check for risks during prospect research, meaning most organisations wait until a relationship is built to assess any risks in accepting a donation.

Completing due diligence before starting conversations with potential donors ensures fundraisers don’t waste time on gifts that can’t be accepted. This proactive approach helps protect the organisation’s reputation and its relationships with other donors. It also prevents frustration from lengthy gift acceptance timelines. After spending so much time building relationships with high-net-worth donors, the last thing you want is to leave them waiting in a due diligence queue.

Building your major donor fundraising strategy

We’ve talked about why merging prospect research with due diligence can help create a targeted pipeline while reducing the time it takes to accept a gift. The challenge for many prospect researchers is figuring out where to start.

Traditionally, locating ultra-wealthy donors depended on word-of-mouth and the nonprofit’s board members, existing donors, and staff networks. But with the abundance of open-source information available, you can now use the right tools to uncover valuable details. For example, searching news articles about their connections to charities and businesses, or finding interviews that reveal their cultural interests and passions.

How to strengthen your strategy

We’ve all heard the saying, “It’s not what you know, but who you know.” The first step is to explore your database for existing major donors. Loyal donors might be ready to give more, and mid-level donors could have had changes in their circumstances that make them able to increase their support. By understanding your donors better, you can identify those who are ready to give more.

Another great major donor strategy is to leverage their network. Known as network mapping, this approach helps you discover their broader connections, such as business partners or third-party relationships that are publicly known. By identifying prospects with similar backgrounds, you could get a warm introduction through your existing supporters. This way, you’ll have a better chance of opening doors and making meaningful connections. The challenge is how to do it efficiently. 

Most prospect development teams are already stretched thin. Network mapping, a process that involves using multiple tools to connect names and titles, takes a lot of time. Search engines can provide some context, but you won’t find everyone on the first few pages. Plus, you’ll likely encounter false positives—people who share a name with your donor but aren’t the right person.

This work can take hours, even days. But there’s good news: there’s a better way.

Using a prospect research and due diligence tool like Xapien can simplify your search process. Powered by a collection of AI models, Xapien scans the entire indexed internet using just a name and a bit of context. Its proprietary disambiguation engine weeds out false positives, ensuring that the information gathered is all about your subject.

Xapien then creates AI-generated summaries, covering details like business associates, career history, source of wealth, personal interests, and more. It even maps out business associates, where you can run reports on them with just a click. No more spending hours cross-referencing names online—Xapien takes care of that for you.

Tailoring your approach to major donors

An effective major donor fundraising strategy involves using the information you’ve collected on their background, interests, work history, and donation history to form a strategic outreach approach. If you’ve used a due diligence tool like Xapien, you’ll have all this information at your fingertips. 

Be proactive, pragmatic, and engaging. You’re not just presenting your organisation or project; you’re offering the donor a chance to support something meaningful to them.

Building a symbiotic relationship is key here. Major donors are looking for nonprofits they can support in the long term and want to see genuine, tangible impacts. So, create a tailored approach that helps them visualise the impact of their potential donation. This way, you can build a connection that benefits both your organisation and the donor.

How to strengthen your strategy

Symbiotic relationships thrive on mutual understanding. Use the information you gather during your research to create outreach messages tailored to your potential donors’ individual experiences. The more you know about them, the better your outreach will be. While major donations often come with certain benefits, like having a building named after them or a seat at a gala dinner, a personalised approach is still essential. Make it feel natural and genuine. You’ll connect on a deeper level with a donor when you know which causes matter most to them. 

Establishing a deep and lasting relationship

Nonprofits should focus on building long-term relationships with their donors. The detailed information gathered during the due diligence process is invaluable here. It helps you genuinely understand who the donor is, their interests, and their history of giving. Use these insights whenever possible to strengthen the relationship.

Major donors care about their legacy. Approaching them solely for a donation is risky. Instead, aim to build an authentic, reciprocal relationship. This approach leads to better long-term outcomes for everyone involved. Remember the power of word-of-mouth in the nonprofit sector. A strong relationship with one donor can lead to many more.

How to strengthen your strategy

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 an easy way to tug at their heartstrings — they will see right through that — but building a trustworthy, authentic relationship. Use the findings of ongoing due diligence checks to fuel future relationships with new ideas.

Step 4. Keep the relationship thriving

Maintaining a strong relationship with your donors means consistently building and nurturing mutual trust. Donorship is thriving in the UK, creating new opportunities to foster a modern culture of charitable giving. Nonprofit donor relationships thrive when you monitor and communicate the impact of their contributions, keeping donors actively engaged with the real-world results of their support.

Stay in regular contact with your donors. Organise events or create donor clubs and schemes to nourish the relationship. These gatherings are a great way to show donors the tangible impacts of their contributions. Networking events provide value to donors while offering opportunities that encourage ongoing giving.

How to strengthen your strategy

Building strong relationships with donors takes practical steps and a positive approach. At the same time, it’s important to stay vigilant. Regular checks help ensure compliance and manage risks as your relationships with donors grow over time.

Keeping track of your donors’ activities is crucial because these can change frequently. While nurturing long-term relationships with major donors is valuable, it should not overshadow the need for ongoing due diligence. Changes in a donor’s activities can bring new risks for your nonprofit, so staying informed is key to maintaining strong and secure relationships.

How Xapien can support major donor fundraising

At Xapien, we’ve developed a research tool designed specifically for universities and charities to access actionable intelligence for major donor fundraising.

Xapien automates the entire research process, reducing the time spent on manual searches and analysis. It gathers information from various sources like online media, news articles, corporate records, and more, giving you a comprehensive view of a potential donor’s background. This allows organisations to quickly and efficiently gather detailed insights about a prospect’s donor history, professional and personal background, and potential risks. You don’t need to be a prompt engineer to use Xapien. Just input a name, add some context, press “GO,” and you’ll receive a full due diligence report. 

The information Xapien uncovers informs the due diligence process from a legal or regulatory standpoint and provides numerous avenues for growth. With Xapien, your nonprofit can stand out within your niche, putting you in the best place to raise major gifts, please high-net-worth individuals, and form long-term relationships.

Book a demo today and discover how Xapien can take your major donor fundraising strategy to the next level.