The 22 Immutable Laws of Fundraising
Used with Permission
- All fundraising is marketing. Don’t think of marketing as something distasteful. On the contrary, Peter Drucker defined marketing as “solving other people’s problems.” What problem is your nonprofit trying to solve? What problem does your donor want you to solve?
- Nonprofits are brands. Like Habitat for Humanity or the Red Cross, having a brand means not needing to explain who you are. It gives immediate credibility when raising money.
- No one ever gives away money for nothing. Raising money is what business people call a “value proposition.” What does the donor get for their money? It could be publicity, or a positive feeling for doing something good. Whatever it is, discover why donors give you money.
- You don’t get money unless you ask for it. Though it sounds simple, nonprofits often fail to do the one thing that gets money. “Ask.” It may not necessarily happen right away, but if you don’t ask, you won’t receive.
- Most people are afraid to ask for money. We’re afraid of rejection. That’s why it’s best to have two people, not just one, go on fund-raising visits and make the “Ask.” There will be rejections, but the sale only begins when the customer says “No.”
- All fundraising is local. Donors want to see their gift has an impact in their own backyard.
- All fundraising is personal. It’s all about relationships. When you discover and remember this fact, fundraising becomes magical and even enjoyable.
- You can’t say “Thank You” too many times. Say thank you when the gift comes in, but later on, too. It’s another opportunity to raise more money and remind donors what they’ve accomplished.
- The most important things we need to hear from our customers (donors), they can’t tell us. Forget survey research, focus groups, and all the rest. Discover why they give so you can get the next gift.
- It takes 20 years to build a reputation…and 20 minutes to lose it. Think of the fast food operation Jack in the Box hamburgers and what do you recall? Food poisoning. People remember bad news and scandals. And they don’t forget.
- Self-promotion fails. PR succeeds. Read Al Ries on The Fall of Advertising and the Rise of PR. There are just too many ads, they lack credibility, and they’re too expensive. Third party ‘buzz’ is much better and it costs less.
- Never lie to your donors. You want to give good news to donors and you should. But never deliberately put out false statistics, fake stories, or exaggerated claims. “It takes 20 years to build a reputation …” etc.
- People don’t give money if they think you’re going broke. Would you invest in a company about to file for bankruptcy? Put the focus on why you need the money. Never give the impression that you’re in financial trouble.
- The 80-20 rule still holds: 20% of your donors will give 80% of your gifts. When they asked Willie Sutton why he robbed banks, he replied, “Because that’s where the money is.” It’s the same for donors. Put the effort on the people who have the money and can give the most.
- Hidden money is hard to find. Forget all that expensive “prospect research.” The most available money is actually “hidden.” But you can find it by personal connections and word-of-mouth. Your Board and your network of friends are the key.
- Use friends to find new friends. Bring your active fund-raising volunteers together in face-to-face groups and brainstorm about ‘who-they-know.’ Take notes and follow up. It works like magic.
- Stories deliver the message. We remember powerful stories that connect with us emotionally. Stories are the heart of your fundraising message. Keep an ongoing “Story Bank” and add to it whenever you find a story that works.
- Some people love fame and some people love anonymity. Some donors like public recognition. So give it to them, again and again. Others flee from being singled out. So give donors as much visibility as they want.
- Have a diversified portfolio of revenue sources. Asset allocation and diversification aren’t just for investments. Too many eggs in one basket is a recipe for disaster.
- Fundraising should be fun. It sounds strange, but it’s true. Focus on the relationships and it will be fun. Special events are not the key here. They can be good for building positive feelings or bad if they drain staff time. But activities that are fun will keep your attention and your excitement.
- Successful nonprofits always make a profit. Nonprofits need to have “reserves,” excess of income over expenses. Don’t fall into the trap of thinking that you don’t need to make a profit. Otherwise you may be out of business.
- Hope is not a strategy. Magical thinking lulls us into believing that “something will turn up.” But it won’t unless you have a plan to make it happen. Follow the “22 Laws” and you’ll get there.