Introduction
Non-governmental organizations (NGOs) and community groups play a crucial role in society by addressing needs and advocating for change. However, many NGOs struggle to secure the necessary funding to fulfill their missions. In "Make a Better World: A Practical Guide to Leadership for Fundraising Success," I explore how NGOs can optimize their business models to attract more donors and achieve greater impact. This blog delves into the essential strategies and lessons learned from successful fundraising efforts.
Challenges in Fundraising
If you work in an organization as a fundraiser, you might often hear questions like:
“Why aren’t you raising more money? I’m doing my job. You do yours!”
“What can we do to help you earn the trust, respect, and support of donors?”
National data in most countries suggest that NGOs are not living up to their potential or meeting the needs of society because they are failing to earn the trust and support of donors. In the United States, charitable donations are only about two percent of national income. In 2023, it actually fell to 1.7% of disposable income (Giving USA). The majority of nonprofit organizations struggle to secure the funding they need for programs. Why? What is wrong?
Understanding the NGO Business Model
The basic “business model” of nonprofits is to raise money from one set of stakeholders to help another set of stakeholders. In this model, money flows from donors to provide help to program beneficiaries or participants. Visionary leaders who run nonprofit organizations are driven by their organization’s vision and mission and are focused on making this world better. This is admirable. But what is missing?
In this book, I present a comprehensive approach to develop essential capacities throughout the organization, so it can perform well and be attractive to donors in order to increase its revenues. This will enable your organization to more fully achieve its mission. Learning how to step up as a leader – even when you are not the boss – is an important first step.
Focusing on Both Fundraising and Program Delivery
I believe many organizations, maybe most, fail to give adequate attention to the fundraising side of their operation and focus mostly on the “fund-helping” side. Sure, I completely agree that programs are why these organizations exist, but I also know funding is how they exist. When leaders focus too much (or overwhelmingly) on programs, it means the organization is neglecting donors and what is needed to attract their support. Organizations cannot have programs without funding, that is: No money = No programs.
Working Together for Fundraising Success
In many organizations, fundraising and “fund-spending” are both managed exceptionally well, and fundraisers can focus on the task of fundraising. But in organizations where the focus is disproportionately on “fund-spending” in programs, the board members, executive director, and staff actually neglect the fundraising side. In organizations struggling for growth or even survival, many executive directors and boards stay focused on matters other than fundraising, although I cannot understand why!
It is clear to me that nonprofit organizations that dedicate the right amount of attention to fundraising are growing, and we see a trend around the world of a small percentage of NGOs getting even bigger. It is self-evident that the best nonprofits are those giving the right amount of attention to fundraising. They are the ones growing fastest – and having the greatest program impact, like Save the Children where I used to work.
The Role of the Fundraiser, Board Member, or Volunteer
Donors don’t give their money just because a fundraiser asks them to support a worthwhile cause. They give their support because everything about the organization appeals to them – its mission, values, communications, results, and reports. They believe the organization is responsible and accountable, effective and efficient, ethical and trustworthy in carrying out its work.
The smart fundraiser knows that fundraising success depends on the organization being effective, well-functioning, ethical, and attractive to potential donors. My objective is to challenge you – the board member, fundraiser, or volunteer – in a nonprofit organization or informal community group – to step up to new leadership responsibilities, whenever and wherever needed, to assure all systems throughout the organization are functioning well enough to earn the trust and support of donors.
Lessons from the Sasakawa Peace Foundation Study
A study of international NGOs I did for the Sasakawa Peace Foundation identified four reasons for insufficient funding: unproven results to participants, insufficient value to donors, questions of trust and reliability, and lack of enough fundraising effort. None of these reasons are traditionally seen as the responsibility of the fundraising director. Nevertheless, for the fundraising director to succeed, it is necessary he or she makes sure all other issues are adequately addressed and corrected. Unproven results, poor value for donors, lack of trustworthiness, and insufficient effort would make fundraising success highly unlikely. Wherever you are in a nonprofit, you can step up to make things better!
Key Lessons
The three key lessons I took from the study for Sasakawa are:
Fundraisers represent the totality of the organization.
Fundraisers must step up to ensure everything functions well.
Organizations must be attractive and appealing to donors.
Conclusion
Charity is based on trust and confidence in the organization. Donors want to know that their individual gifts are making a difference, and they want to be assured that their funds are producing results. They want to know that the board of directors is providing oversight, management is effective, and the organization is responsible, accountable, trustworthy, and achieving real impact.
To succeed, the fundraiser needs to step out of the single focus on raising funds and step up to other issues of organizational results, performance, and trustworthiness.
For more insights and practical strategies on effective fundraising, visit NGOFutures.com for free resources and access to discounts on my books.
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