Finding Major Gift Prospects
Hands down, if you want to raise more money or diversify your funding streams, you need a strong major gift program. National data suggests that individuals give 80-90% of donations to all types of organizations. For nonprofits with budgets of less than $2 million, that percentage drops to 50% which still means that you need to meaningfully engage major donor prospects.
If these data do not convince you, try this. Raising funds from major donors ranks as the most cost-effective way to raise a dollar. On average, it costs only 5¢ to 10¢ to raise each dollar through major gifts while it costs a dollar or more to raise a dollar through the mail and as much as 50¢ or more through events. While it takes time to identify and engage potential major donors, the payoff makes it worth it.
Before we jump into how to engage major donor prospects, let’s assure that we have similar definitions. In short, major donors require a personal, face-to-face ask. For some organizations, that might mean $500, for others, $1,000 while still others might define a major donor as someone who gives more than $5,000. The dollar amount matters less than the fact that you need to engage them on a more personal level than you can through a letter or social media.
Looking at the dollar amount of the top 10% of your donors provides another way you can think about the level of a major gift for you. Remember that 90% of your funds should come from 10% of your donors. What this means will differ from organization to organization.
So how can you find potential major donors for your organization?
Start with your board. Your board should all make meaningful gifts to your organization, ranking it within their top three charities. Take the time to meet with each board member individually to ask them about their giving and encourage them to make a larger gift. This also becomes good practice for asking for a gift personally – and with friendly faces who will hopefully give you some grace if you don’t start perfectly the first time.
Look in your database for consistent donors and large dollar donors. These become good potential major gift donors. Call and ask them to tell you their story about why they support your organization and to make a larger gift to help with your mission.
Watch incoming gifts from the mail. As a rule of thumb, someone may give 10 times more if you ask them for a specific dollar amount than if they decide their own gift amount. That means that anyone who makes a gift of $100 or more through the mail deserves a phone call and invitation to meet for coffee to see if they will give $1,000.
Review event attendees. The people who attend your events just spent a few hours learning about all the wonderful work you do. They left inspired and maybe spent a few dollars. Give them an opportunity to continue to invest in your mission. Review your attendees for people who might have the capacity to give more – and ask your board members to do the same. If you can identify possible major gift prospects and engage them in your mission, you can expand the money raised from your event throughout the year and for many years to come.
If you have limited time, start small. Set a goal to call 2 people each week. By investing less than about an hour a week, you will end up reaching out to 100 new potential major donors. If 25% of them respond – the best practices average – and each makes a gift of $1,000, you just raised $25,000 in new dollars – and set the foundation to raise even more next year.
