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Five Steps to Optimize your Fundraising Capacity

May 2020

A mastery of fundraising demands much more than the ability to ask for money. Use the five steps of the Funding Cycle  below to map out your fundraising strategy, help your organization define the tasks and actions needed to build your donor base, and strengthen relationships to effectively increase your fundraising capacity. 

  1. Identify. 

The first step of the funding cycle is identifying potential donors and prospects.
Start by analyzing your existing relationships and building up your list of potential donors. Add one time gift donors, low level donors and volunteers to your prospect list. You should also add prospects who have expressed interest in your cause by signing up for a newsletter, attending an event, or reaching out to connect with your organization.  
Bulk up your list by doing research on prospects in your community.  Use a variety of methods to gather data such as Google searches, government records, social media platforms, research databases and prospect generator tools. 

Next, use data segmentation to organize your donors by different demographics and interests. Useful categories include: 
  • Amount of previous gifts
  • Engagement level 
  • Age
  • Gender
  • Income level
  • Communication preferences
Use this information to identify and target your high potential prospects and determine the appropriate strategies to connect with each group. If you don't have this information, consider sending out a survey or holding focus groups with donors to gather baseline data. 

  1. Communicate

Utilize effective media and outreach strategies to communicate with each group of donors. Keep in mind that different demographics have different preferences for receiving communication. For example, members of Generation Z and Millenials are more comfortable with digital communications, while Baby Boomers respond best to  phone calls or face-to-face conversations. To reach your entire prospect audience, you will likely need a combination of print communication, email marketing, social media messaging, and phone communication. 

Regardless of which channel you use, you need to communicate with clear, targeted messages that explain the mission, vision and action of your organization. Donors want to know that their gift will make a tangible impact to a cause that is passionate to them before they hand over a check. Articulate your mission and clearly demonstrate that supporting your organization is the best way for donors to be a part of a meaningful, positive change. 

  1. Cultivate

Cultivating relationships over time is crucial donor retention--and to the continuity of your organization. The most important indicator of a prospect's gift potential is their previous giving history, so you need to ensure that you are continuously engaging appropriately with your prospects and past donors. 

As you start building the relationships, connect the appropriate organizational ambassadors with each prospect or donor. Connect organizational leaders to the higher prospect donors, and make sure that the agent you send from your organization has a personality and interests that will enable them to connect authentically with the potential donor. 

Throughout your communications, ensure supporters and prospects "feel" the mission and have a sense that they are a part of the positive impact that your organization is making to set you up for success before you make the ask. 

  1. Invite Investment

Evaluate clues that you have gathered through your initial research and ongoing conversations to determine highest potential for support and personalize your ask to each prospect. Personalize all your marketing materials, letters and conversations based on the information you have gathered in the first three steps. Also, use this information to determine who will facilitate the conversation, how much you will ask for, and when you will make the ask. 

Regardless of the response you get, listen closely to the prospect after you make the ask. Making the donor feel heard is important to build an authentic relationship. Receiving feedback is also valuable to help you improve your fundraising process as you can learn from your successes or failures and adapt your process in the future. 

  1. Stewardship

After the ask, you must continue to strengthen your relationship with your donors through recognition and stewardship.  Personalize attention and gratitude to the donors to demonstrate your appreciation for their support and loyalty. Spend more time customizing communication for multi-year donors and increased donors to demonstrate your appreciation. 

Communicate regularly with your donors. Send your donors notes through their preferred communication style, hold donor appreciation events, and keep them updated on key happenings in your organization to make sure they stay connected and engaged.