What “Fundraising” Means Depends on the Type of Organization

CAKEThe dictionary defines fundraising as simply, “the act or process of raising funds.” But what that literally means depends on what sort of organization you’re working with. In particular, fundraising techniques, cycles, and cardinal rules look very different depending on whether you’re with:

  • a small or volunteer-led effort such as a start-up nonprofit or a school, church or temple, or community group, or
  • a nonprofit that’s big or established enough to have at least one development staffperson (or perhaps an executive director committed to fundraising efforts).

What’s different about the fundraising experiences of these two types of groups? Here are some of the biggest variations:

  • Volunteer-led efforts may lack continuity. Particularly in schools, where the population of parents changes every year, it can be difficult to plan beyond the next 12 months. While a few people may stay on, other key participants may drop out, and vital information about previous activities or donors may be lost. The constituency may change, as well, making it difficult to develop and maintain relationships with donors. Larger more established groups, by contrast, can and should develop an annual fundraising plan and foster long-term relationships with donors.
  • Volunteer-led efforts rely on what volunteers are willing to do. That sounds obvious, but if you look at how it plays out, the significance is huge: Most volunteers hate asking people for money directly.¬†They may eventually learn that it’s not so bad, but on the whole, this tendency leads to a huge proportion of volunteer-led fundraising activities that are special events (bake sales, pancake breakfasts, auctions, fairs, carnivals, benefits, and so on). Special events are the least efficient way to fundraise, as the larger more established groups have mostly learned (sometimes the hard way). But for certain types of groups, special events not going to go away anytime soon.
  • Volunteer-led or smaller groups may have a constituency with a direct, personal interest in the cause. It can certainly be easier to get people involved when they are the literal beneficiaries of the group — the parents of kids in school or on a sports team, the patrons of a local library, the members of a house of worship, and so on. Not everyone will feel a sense of responsibility or be able to follow through, but many will “get it” that if they don’t take part in fundraising activities, the service will go away. This can be good for fundraising via methods that involve large numbers of people, such as a walk-a-thon or auction.
  • Smaller or less established nonprofits may face greater challenges obtaining grant funding. Foundations and corporations like to see that a group has a track record of using funding wisely, and that’s hard to show if you, uh, don’t. Then again, a nonprofit that’s new may at least be able to show prospective funders that it’s doing something exciting and different, instead of just trying to continue last year’s program.
  • Smaller or less-established groups may lack infrastructure, resources, and storage space. They’re often going without a donor database, a dedicated office space, a place to put the goodies for their next auction, and so on. Individuals often end up borrowing their own homes or even office space for the cause.
  • Larger groups must raise larger amounts just to cover the basics. With various commitments such as rent, salaries, and other operating costs, a larger organization may find that a big part of its fundraising efforts serve just to keep the lights on. They have a harder time being nimble in responding to change.

No doubt this list could go on. In the meantime, you can learn more about each of these two different fundraising universes by reading one of the two books offered by Nolo: The Volunteers’ Guide to Fundraising; Raise Money for Your School, Team, Library or Community Group; or, for the larger, more established groups, Effective Fundraising for Nonprofits; Real-World Strategies That Work.