Finding the Funding: A Hands-on Approach to Fundraising Essentials

8/14/2019 Finding the Funding: A Hands-on Approach to Fundraising Essentials

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Finding the Funding: A Hands-on Approach toFundraising Essentials

Presented by

Ann Fitzgerald, PresidentAC Fitzgerald & Associates

October 6, 2006

Milwaukee, WisconsinHilton Milwaukee City Center


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Finding the Funding: A Hands-on Approach to Fundraising Essentials

PROPOSAL WRITING FOR THE NON-WRITER 3

25 QUESTIONS TO ANSWER BEFORE WRITING A PROPOSAL 3NOW TELL A STORY 4PROPOSAL STRUCTURE 5PROPOSAL ATTACHMENTS 6

DIRECT MAIL ON A LIMITED BUDGET 7

ARE YOU READY TO START A DIRECT MAIL PROGRAM? 7HIGH-DOLLAR PROSPECTING ON A $1000BUDGET 9IF YOU HAVE MORE TO SPEND 10AWORD ON STATE REGISTRATION FEES 11

DEMYSTIFYING DONOR MEETINGS 13

QUALIFYING QUESTIONS 14OVERCOMING OBJECTIONS 18FOLLOW-UP QUESTIONS 19

QUESTIONS FOR FOUNDATIONS 20

A.C.FITZGERALD &ASSOCIATES 703-528-3310 WWW.ACFITZGERALD.COM


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PROPOSAL WRITING FOR THE NON-WRITER

Ive never worked on a successful proposal that didnt require a lot of effort fromthe organization involved. Its hard work to define the project, the need, and theexpected results. However, I found that the effort was well worth it. By spending

some time answering these questions, you will be well-prepared to write a fullproposal, and report back to the donor once the project is underway.

25 questions to answer before writing a proposal

Background

1. Who is the audience?

2. What do you know about them? What is their mission?

3. What motivates their interest?How will this project meet the donorsneeds and interests?4. Have they supported your organization before? What did they give to?

5. Who else do they support?

6. Has anyone met with them recently?

7. What is your relationship with the organization? Board members?Staff?

I n t roduc t ion

8. What is your organization?

9. What is your mission? Vision?

10.What are your organizations qualifications to do this work?

Case for Need

11.Why is the project important?

12.Why is it relevant? Urgent?

13.What was the catalyst for this project?

14.How do you define success?

15.Who benefits if this project is done well?

16.Who is hurt if you do nothing?

Project Descr ipt ion

17.What is the project?

18.Why is this project unique?



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Measurement s / Expect ed Outc omes

19.What are your goals and objectives?

20.How will you measure your results?

Personnel

21.Who are the key personnel working on this project?

22.What are their qualifications?

Request for Suppor t

23.How much will this project cost?

24.How much are you asking for?

25.How will you fund it after the grant is spent?

Now tell a story

After you gathered the basic information for your proposal, make it aspersuasive as possible by telling a story.

Why tell a story? People understand and relate to them.

People remember them.

Stories best represent the passion we feel for our cause.

What are the elements of a story?

Characters: The villain, the victim, the hero

Conflict: The problem you are trying to solve Resolution: The program that you want funding for



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Proposal Structure

FOLLOW THE FOUNDATIONS GUIDELINES!!!

Unless you have been given other direction, the proposal should be limited to 10pages or less.

If the foundation does not have specific guidelines, include these basiccomponents to tell your story.

Component Description Ideal Length Story ElementExecutive Summary The case statement and

summary of the entireproposal

Severalparagraphs to1 page

The introduction of thecharacters (Villain, Victim,Hero), the problem, and thesolution

Introduction Puts your work incontext.

Severalparagraphs to1 page

Highlight the heros credibility(your mission statement andsuccesses)

Statement of Need The facts and evidenceto support the need forthe project

1-2 pages The tension or conflictbuilds by describing theproblem in detail.

Answer why? (Why are wedoing this work? Why shouldthe donor be interested?)

Project Description /

Goals & Objectives

How the project will

be implemented

2-3 pages The resolution to the problem;

the heros role / your programConclusion A summary of the

proposals main points,including need forsupport

Severalparagraphs

The epilogue; and a possiblesequel (plans for the future)

Include funding request

OrganizationInformation

The history andgoverning structure;your primary activities,audiences, andprograms; keypersonnel. An annualreport can be

substituted

1 page

Budget The financialdescription of theproject

1 page



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Proposal Attachments

If the donor does not ask for anything specific, include:

501(c)(3) letter or the IRS determination letter Board of Directors list with professional affiliation Organizations annual budget Audited financial statement (if available)

A few proposal tips

FOLLOW THEIR GUIDELINES for submitting your request. Somefoundations want an initial letter of inquiry before you submit a proposal.

Meet their deadlines. Remember, most foundations dont accept proposalsdelivered overnight by UPS or FedEX; plan accordingly.

Remember to proof!

Make sure that the name, address, and phone number of the contact from yourorganization appears on the proposalnot just on the cover letter.

Put your organizations name in the header or footer of the actual proposal.

Most proposals are photocopied and distributed at Board meetings. The bestpresentation is black ink on white paper. Dont use colors or fancybindings.

Call the funder a couple of days after sending the proposal to make sure it wasreceived.

If you get the gift, write a thank you note promptly (within 48 hours).

If you dont get a gift, call to thank the foundation for reviewing your requestand find out why it was rejected. (This could be useful information for futurerequests and will help build a relationship.)

Dont ignore the funder once the gift has been received. Make sure you sendperiodic updates on your work.



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DIRECT MAIL ON A LIMITED BUDGET

Direct mail is a cost-efficient and effective way to identify a large number of prospectivedonors for your cause. It also allows you to:

Build and cultivate long-term relationships with supporters

Identify prospective major donors for future follow-up

Raise awareness about your organization

Promote your organization in the region

Embarking on a direct mail program is a serious commitment for any organization.Before you make this investment, review these factors to determine:

Are you ready to start a direct mail program?

Y/N

YOU HAVE DEVELOPED A 3-5 YEAR STRATEGIC PLAN.As part of this plan, youhave tracked your current sources of income (e.g. foundation, corporate,

individual, and identified a need for increased support from individuals.

YOU HAVE A STRONG DESIRE TO INCREASE INCOME AND BUILD A LARGERNETWORK OF SUPPORTERS.You want to broaden your base of support and youare ready to follow up on the major donors you identify.

YOUR SENIOR MANAGEMENT AND/OR BOARD OF DIRECTORS ARECOMMITTED TO DIRECT MAIL. To prepare and sustain a direct mail program,you need to be very committed to the work it will entail. Even if you use outside

vendors, you will have to approach this as a new program that will requiretime and resources.

YOU HAVE DEVELOPED A STRONG CASE FOR SUPPORT THAT ADDRESSES WHYYOUR ORGANIZATION IS UNIQUE AND WHY YOUR WORK IS IMPORTANT.Whenit comes to preparing an actual letter you will need to identify a problem you

are trying to solve, your solution to the problem, your strategy for solving the

problem, and the benefits to the contributor if he supports you.

YOU UNDERSTAND THAT IT WILL TAKE 18-24 MONTHS TO RECOUP YOURINVESTMENT.Most organizations lose money on their prospecting programsso you need to budget accordingly.

YOU HAVE DEVELOPED A COMPREHENSIVE BUDGET.This includes the costs of

internal staff to manage the project, state registration fees, a copywriter, mailhouse services, list rental, postage, etc.

YOU HAVE A FUNCTIONING DATABASE. Your database (whether its afundraising program, contact management system, or Excel file) is able to

capture relevant contact and gift information for each donor.



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YOU HAVE THE ABILITY TO PREPARE AND MAIL AN APPROPRIATE, PERSONALTHANK YOU LETTER WITHIN 24-48 HOURS OF A GIFT. The first step to yournext gift is through the thank you letter so these letters should mail promptly

with a proper IRS receipt.

YOU HAVE DEVELOPED A CALENDAR OF COMMUNICATION FOR THE NEXT

12 MONTHS.It is helpful to develop a table which lists all the mailings youhave planned, including both fundraising appeals and relationship-buildingmaterials.

YOU HAVE DEVELOPED A PLAN TO SECURE SUITABLE LISTS.Ensure that thelists you use contain active direct mail donors; you have the right amount of

names; you have the appropriate dollar select for your package; you have

made a list of organizations that are similar to yours which you will approach

for lists.

YOU ALREADY PRODUCE REGULAR COMMUNICATIONS TO YOUR DONORS ORCONTACTS.Successful direct mail programs are those in which donors receiveregular communication. You will be well-prepared for this if you already have

experience in communicating regularly with donors or contacts throughmailings such as newsletters.

YOU ARE PREPARED TO TRACK THE RESULTS OF EACH MAILING INCLUDINGCOST, RESPONSE, INCOME, AND AVERAGE GIFT.It is also important to codeyour lists properly in order to measure your results.

YOU HAVE LINED UP VENDORS.Ask other groups for recommendations ofcopywriters, mail house services, and list brokers.

YOU HAVE A STAFF MEMBER OR CONSULTANT WHOSE MAIN DUTY IS TOHANDLE DIRECT MAIL.Direct mail can be time-consuming; consider tappinginto outside help.

IF YOU ALREADY HAVE INDIVIDUAL DONORS, YOU HAVE DONE SOME BASIC

SURVEYS TO UNDERSTAND WHAT MOTIVATES THEIR GIVING.Why do donorsgive you to you now? Understanding what motivates them will help as you

reach out to new prospects.

YOU HAVE MET OR SPOKEN WITH OTHER ORGANIZATIONS WHO ARESUCCESSFULLY ENGAGED IN DIRECT MAIL.Other similar organizations will bea good source for vendor recommendations, suggestions and ideas.



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High-Dollar Prospecting on a $1000 Budget

Can you start a direct mail program with a very small investment? Its possible butfinding new prospecting names will be an ongoing challenge. Here is one scenario:

BUILDING YOU R L IST COST

Use existing contacts (from meetings, events, etc.) $ 0

Ask Board Members for their contact lists $0

Ask current donors to refer a friend $0

DEVELOPING T HE APPEAL COST

Maximize existing communications such a newsletter to ask for gifts $ 0

Buy and read Mel Warwicks book, Writing Fundraising Letters $27.95Become a direct mail donor to four groups (at $25 each) and read theirletters

$100

MAILING YOU R APPEAL COST

Paper (3 page letter; printed on both sides with on page reply form for500 names)

$300

Envelopes (carrier or outside envelope; reply envelope for 500 names) $350

Postage (First class postage for 500 letters) $195

State registration fee (on average for one state) $50

TOTAL COST: $1022.95

RESPONSE(A SSUMES 2% RESPONSE RATE) 10

AVERAGEGIFT (A SSUMES .7 0 PER $1.00 SPENT) $71.54

GROSS INCOME: $715.40

NET INCOME(GROSS INCOME MINUS TOTAL COST): ($307.55)

This scenario assumes your prospecting lists are solid and that you are asking donors fora gift of $100 or more.

At the end of this process, you will have lost $300 but gained ten new donors whomyou can solicit for additional gifts throughout the year.



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If You Have More to Spend

Direct mail is a long-term investment in both time and resources.Organizations that have active prospecting programs to find new donors can

spend thousands of dollars on each mailing.

As you create your budget for direct mail, you may want to consider that aneffective high-dollar prospecting mailing can cost about $2.00 per package. Thisincludes:

Copywriting services

Mail fulfillment services including

o Package design (Number of pages, design of the envelope, etc.)

o List brokering (Renting lists from other organizations)

o List management (Performing merge/purge of lists)o Personalization (Using the prospects name)

o Production (Printing and mailing)

First-class postage

Direct Mail Checklis t

Register in the state(s) where you will be soliciting funds. (Seepage the next page for more information on this)

Select a mail fulfillment service. They can help you with postalpermits, selecting lists and production.

Write the letter or hire a copywriter.

Draft a thank you letter to send out to donors who respond.

Prepare an IRS receipt or include language in your thank youletter.

Plan your mailings for the year.



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A Word on State Registration Fees

Most states require charitable organizations to register beforesoliciting contributions. If you do not register and you are reported t

the states attorney general (by someone receiving your proletter, for example), you could be subject to significant fines.

o

specting

If you only mail in one state, this process is fairly easy and inexpensive. If yourorganization solicits contributions in numerous states, you probably want toconsider hiring a firm to handle the registrations and the annual renewals. Eachyear several states change their laws and forms.

State Amount Payable To

Alabama $25 Office of the Attorney General

Alaska $40 State of Alaska

California $25 Department of Justice

Colorado $10 Colorado Secretary of State

Connecticut $20 initial; $25 renewal Department of ConsumerProtection

District ofColumbia

$160 biannually DC Treasurer

Florida sliding scale up to $400 Commissioner of Agriculture

Georgia $25 initial; $10 renewal Secretary of State

Illinois $15 Illinois Charity Bureau FundKansas $35 Secretary of State

Louisiana $25 Department of Justice

Maine $100 State of Maine

Maryland sliding scale up to $200 Secretary of State

Massachusetts $35-$250 depending on receipts Commonwealth of Massachusetts

Minnesota $25 State of Minnesota

Mississippi $50 Mississippi Secretary of State

Missouri $15 Attorney General

New Hampshire $25 initial; $50 renewal Attorney GeneralNew Jersey $30-$250 depending on receipts Division of Consumer Affairs

New York $10-$25 depending on receipts Department of Law

North Carolina $50-$200 depending on receipts Secretary of State

North Dakota $25 initial; $10 annual Secretary of State

Ohio $50-$200 depending on Ohioreceipts

Treasurer of the State of Ohio



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State Amount Payable To

Oklahoma $15 Oklahoma Secretary of State

Oregon $10-$200 depending on Oregonreceipts

Department of Justice

Pennsylvania $15-$250 depending on receipts Commonwealth of Pennsylvania

Rhode Island $75 State of Rhode Island

South Carolina $50 Secretary of State

Tennessee $100-$300 depending on receipts Tennessee Secretary Of State

Texas $150-$250 depending on receipts Attorney General

Utah $100 State of Utah

Virginia $30-$325 depending on receipts Treasurer, Commonwealth ofVirgina

Washington $20 initial; $10 annual Washington Secretary of State

West Virginia $15-$50 depending on receipts State of West Virginia

Wisconsin $15 Secretary of State

Source: Labryinth, Inc. Note: Contact each state for the most up-to-date information onregistration requirements.

A Few Direct Mail Tips

Save money by printing as many direct mail components as possible at one

time. While it may be impractical to print a years worth of envelopes becauseof storage concerns, you probably can print six months worth.

Consider what you want to communicate to new members about theirmembership, your organization and your programs. Include this informationwith the initial thank you letter or consider creating a new member welcomepackage.

Write your thank you letter at the same time as when you write yourprospecting letter. This will ensure you can send a prompt thank you letter todonors.

Once you have gained some new donors through successful prospecting, be

sure to keep them engaged in your work with regular communication andfurther solicitation for support. As they say, a donor saved is a donorearned.

Reach out to lapsed donors in your list annually. Often lapsed donorsbelieve they are still giving.



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DEMYSTIFYING DONOR MEETINGS

While its important to have effective donor communication pieces, persusaive proposals,and good follow-up on the telephone, you will have much more success getting the giftsyou wantin the size you wantthrough face-to-face meetings.

Visits are opportunities to:

Connect donors to your mission Develop a closer relationship

Learn about the donor Ask for a gift

Before meet ing w i th a donor or p rospec t :

1. Do some basic research to learn about the donor.

2. Understandyourorganizations needs and interests.3. Set your goals for the meeting. (Why are you meeting with this

person? To build a relationship? To ask for a gift? To involve thedonor in a program? To learn more information?)

4. Practice your listening skills and rehearse what you want to say.

During t he meet ing :

1. Relax. The hard part is over, you got the meeting.

2. Come to the meeting with empathy, energy and enthusiasm.

3. When you get to the presentation, talk about how the project will

benefit the donor.4. Make the case based on relevancy, emotional appeal and urgency.

5. Welcome objections to probe for concerns: is it our organization?Our project? The amount? The timing?

Af te r t he m eet ing , be sure to :

1. Write a thank you note to the donor.

2. Type up your notes from the meeting and add them to the donorsfile or to your database (what did you learn about the donor?).

3. Frankly assess your meeting (did you achieve your stated goals?).

4. Decide on the next action.



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Qualifying Questions

Part of the fundraisers job is to assess the donors ability and readiness in

making a major gift. In a face-to-face meeting, you will have the opportunity touncover information about the donor such as their motivation for giving, theirfamily situation, their interest in your organization, their philanthropic activity,etc.

The following questions can be asked as part of casual conversations to helpqualify the donor.

Reveals : Mot ivat io n

Thank you very much for your gift. Can you tell me what prompted it?

What are your impressions of our vision for the future?

Do you believe we have a strong case for support? If so why? If not, why not?

To what extent do you believe (the expansion of government, high taxes, decline ofmoral values) are serious problems for our (state, country, world)?

In what ways do these issues impact you, your family, your beliefs, your values?

As you (read, heard) our vision for the future, in what ways to do see our

organization effectively addressing these issues?

Are there other ways our organization could help solve this problem?

In what ways might you help us address these issues?

Are there any questions about our vision, mission, work, priorities that we've notanswered?

Reveals : Other c har i table g iv ing; v iew s on phi lanthropy

What other conservative groups are you involved with? [On the board of?]

How involved have you been with your alma mater?

Which are the top three organizations you support? Why is that?

Where is our organization on your list (if not among the top three)?



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When you give, do you give both annually and to capital projects?

What capital gifts have you given that have given you pleasure?

How did it come about? What made it so pleasurable? Are you still involved withthem?

Under what circumstances would you be willing to make a stretch, capital gift to acharity? To our organization?

Among our fundraising priorities, which do you find the most compelling? Why?Least compelling? Why?

What factors go into your philanthropic decisions?

Reveals: Wealt h

Have you had a chance to take some time off this year? Where did you go?

Do you travel much?

Hows business? How has the economy affected you?

Reveals : Type of conservat ive.

How do you think the [President/Governor/Congressman/State Delegate] isdoing?

What do you think are the top three issues facing our country/state?

Many donors tell me that they are concerned with the direction the country isgoing. What have you seen thats worked? or What do you think would work?

Reveals : Fami ly Back ground; Number of c h i ldren/grandchi ldren;

How involved thei r spouse is in the g iv ing dec is ion.

Is your whole family conservative?

What are the ages, names of your children? Grandchildren? Where do theylive?

Do you get to see your children often? Grandchildren?

In my household my spouse and I make all of our giving decisions together, how doesit work in your household?



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Reveals : In terest in issues/legacy

When you think about your grandchildren, what concerns you the most?

Have you ever made a gift using a planned giving vehicle like a trust or annuity? Howdid that come about? Is that something that interests you? Do you feelknowledgeable about such vehicles? Would you like to know more?

Is our organization a part of your estate plans?

Reveals: Values

How and why have you settled on your lifes work?

What are the guiding principles that have helped you achieve in your business

life?

To what extent does our organizations mission dovetail with your beliefs? Howso?

Whats the best decision you ever made in business?

What do you expect from the charitable organizations that you become involvedwith?

How have other organizations demonstrated to you the impact of your giving?

How do you like organizations to demonstrate their appreciation for gifts you havemade?

If I could demonstrate to you the true impact of your philanthropy, would you prefer:something named for your or someone you love; meeting some of the people you havehelped; hearing from some of the people you have helped; receiving a report on howyou money has been spent; all of the above.

Reveals : Know ledge of /In terest in organizat ion

How did you become familiar with our organization?

What interests you most about our organizations work?

What do you believe are the perceptions of our organization nationally?

In what ways do you feel good about the gifts you make to our organization?

What are your perceptions of our effectiveness?



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Reveals : Readiness and Comm itm ent

I remember you saying that (fighting for limited government; our intern program;

our education work) is important to you, is that right?

If I understand you correctly, what you'd like to see is (our conservative values

represented in Washington; more opportunities for young conservatives;

consumer-based solutions to the health-care crises; less regulation of small

business)?

As you think about making a real difference, what projects (priorities, programs,giving opportunities, naming opportunities) have the greatest appeal?

We would like to come and speak with you, over the next few weeks (days,months), about making an investment in our organization. Who should be a part

of that conversation?

As you think about our organization's ambitious goals for the future, which ofour priorities do you think should be the most important? How would you rankthe others?

As you know (insert priority) is a critical piece of our organization's commitmentto the nation (the world, conservatives, young people,etc.) is that something withwhich you agree?

You've shared with me the tremendous impact you believe this project will have

on (Americans; students; etc.) including (impact summary). Is that correct?

Then, may I suggest a next step of....?

Overcoming Objections

(Objection: "That's a lot of money.") It sounds like you're wondering why we

need that amount in order to get the impact we've discussed. Am I correct? The

reason is....

(Objection: "We're over committed.") It sounds like you would like to invest in

our organization but right now you can't see how you might do that. Am I rightabout that? Would it be helpful if I explained some of the ways others have

managed this problem? They....

(Objection: "We don't believe in giving to operating. It's just a black hole.")

Perhaps you'd like to know specifically how your gift would be used. Would that

address your concern? Here's how unrestricted gifts make a powerful and

specific impact on the people we serve...



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(Soft answer: "Let me think about it and I'll get back to you.") What factors will

you consider as you weigh our request?

(After objection is stated) "So, you're concerned about (restate) is that correct? If

that were not an issue, what would you like to accomplish with a gift to ourorganization?"

(After objection is stated) "So, you're concerned about (restate) is that correct? I

remember the last time we met you said that it was very important to you that

(what the gift would accomplish), has that changed for you?"

Follow-up Questions

How so?

Can you clarify that?

Can you give me an example of what you mean?

Do you have any questions about what I just said?

What specific results are you looking for?

Can you say more about that?

Did I understand you correctly when you said...?

Did I answer your question?

How did that come about?

What did that mean to you and your family?

How do you feel about that?

How strongly do you feel about that?

What do you think about that?

What is most important to you?

Are we in agreement?

Are you ready to move forward?



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Questions for Foundations

How are decisions made at the foundation? Who is involved? What is theprocess?

Under what circumstances do you make exceptions to your (giving guidelines,average amount)?

I noticed (organization) received an extraordinary gift from your foundation, whatmade their request so compelling?

If that (some objection to getting involved or giving voiced prior to solicitation) wasnot an issue, in which of our priorities would you be interested?

We would love for the foundation to make a site visit, how can we make that happen?

Under what circumstances do members of the foundation board participate in(activity) of organizations with whom you have relationships?

A C F & A 703 528 3310 ACFITZGERALD

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Finding the Funding: A Hands-on Approach to Fundraising Essentials

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