Should we have a Give or Get policy?

A Give or Get policy (also affectionately known as the Give, Get or Get Off policy) mandates that each board member is personally responsible for raising a certain amount of money. Let’s say the give or get policy is $2,000. In this case each board member must either give or get $2,000 on behalf of the organization. So, if you have 15 board members, you’ve got $30,000 coming in annually. Not too shabby. So, should organizations have get policies?

My answer is an unequivocal NO!

While you MUST (not should!) have 100% giving from the board, mandates like a Give or Get policy, while well-intended, can have unintended consequences. Inclusive boards that strive to include representatives from across the community (e.g. a child abuse prevention organization with advocates whom live in public housing, teachers, corporate executives, and retirees on the board) will actually become exclusive in many ways by requiring a certain dollar amount from each and every board member. Allowing certain board members an ‘out’ on the policy is also detrimental, and even somewhat paternalistic.

My suggestion is that each board member agree to make a Personally Significant Financial Contribution to the organization. What’s personally significant to one board member is not likely the same for others. One board member might give $25,000 each year, while another board member might give $5 a month – depending on how much how much his electrical bill is that month. Thus, by requiring a Personally Significant Financial Contribution from each board member, organizations can ensure 100% board participation without tacitly requiring a certain dollar amount.

However, when it comes time for the annual campaign, you should strive to involve all of your board members in the campaign. While some board members will have contacts they approach for $250 and others will have contacts they can ask for $2,5000 – all board members should be involved in the campaign. Those board members without financially well-heeled contacts could be provided with contact information for past donors to the organization.

Board members making calls can then state, “I’m a board member of XYZ organization and I’d like you to join me in making a personally significant financial donation.” This works almost every time! Well — as long as you can get the board members to make their calls, but that’s another posting for later!

From endowments losing 30% of their value to staff furloughs to job layoffs and job enlargement, the fundraising landscape is not too friendly. Ironically, stronger nonprofits with a diversified funding base are doing okay ~ not great, but not terrible. In particular, nonprofits that have developed relationships with their donors, particularly individuals, are seeing major gifts increase rather than disappear. That is, major donors across the country are “doubling down” their investments in nonprofits where they have established relationships. On the flip-side, nonprofits relying on the mailbox (direct mail) are suffering big time as impulse gifts are way down.

In 1992 it was “It’s the economy stupid”, but in 2011 “It’s the relationships stupid”.

Now more than ever nonprofits need to mobilize their Board Members, Executive Directors, Development Directors and key staff to meet donors where they are at to get to know each donor’s motivational triggers and find out how the donor’s interests overlap the organization’s vision and programs. Then, institutionalize that knowledge and leverage it in all future communication with donors. This will create a stronger and more mutually beneficial relationships between nonprofits and donors and result in more funding for nonprofits that engage in such relationship building efforts.

Let’s assume you plan to meet with a trustee from a foundation to request funding. You don’t want the trustee to think the foundation is  the only funding source for a project and you want to provide an accurate picture of where the foundation’s funding fits in your overall budget.

This Example Budget Template helps you provide a more accurate view of funding to prospective funders, board members, and staff.

I’ve used this budget with many nonprofits and funders really like it. Put it to good use in your nonprofit.

In graduate business school (circa 1993) there weren’t sector specific programs for MBAs to pursue in social entrepreneurship. Instead, it was the Capital Asset Pricing Model, Option Puts, decision trees, and way too many professors who had never worked a day in the real world and took their revenge on students by making them buy their books and stressing that the sole purpose of any corporation is to maximize shareholder wealth. BLEH!

Luckily, the Frank Hawkins Kenan Institute for Private Enterprise and Dr. Jim Johnson were leading the way in putting business skills into community economic development organizations, and I left B-school for the promise land of North Carolina. That was 1995….Now, thankfully, there are under/graduate programs with a social entrepreneurship bent everywhere!

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I was just cleaning up my hard drive and came across a file on social entrepreneurship that is worth sharing. A while back I was working at TROSA which is one of the best social entrepreneurs around. As a nonprofit, they earned almost 90% of their $6M annual budget. An amazing organization. I was obsessed with the Roberts Enterprise Development Foundation box set, and put it to use every day. I was also working with domestic violence shelters across North Carolina to help shelters determine if launching a thrift shop or entrepreneurial venture was a good idea.

Here are some great links to all things social entrepreneurial. I’m not as into social entrepreneurship as before, having moved along to focusing more on Social Return On Investment (SROI), but wanted to at least share these links. More on SROI in another posting (yes… you can hardly wait…..)…..

The Roberts Enterprise Development Fund
This is a Foundation dedicated to developing and studying innovative approaches to social issues. This is one of the best sources for the latest information on social enterprise development.

The Foundation’s Publications are AMAZING. If you are on the Board or staff of a domestic violence shelter and you are thinking of starting a thrift shop – read some of these publications PRIOR to launching that shop!

also see:
REDF Links Page which provides an exhaustive list of contacts and information on social entrepreneurship.

HOW TO: Social Entrepreneurship
Authenticity Consulting’s “Social Entrepreneurship” page. Unbelievably relevant and useful!

Community Wealth Ventures, Inc.
A consulting firm that assists in all aspects of entrepreneurial wealth creation for the social sector. Community Wealth is a social enterprise, a for-profit subsidiary of Share Our Strength.

Echoing Green
Foundation providing seed money and technical support to individuals starting new public service ventures

Ashoka
Nonprofit investing in social entrepreneurs throughout the world.

1) don’t exist

2) were last updated in 1874

3) are drenched in legalese such that only a talented lawyer could understand

4) don’t include necessary updates to comply with Sarbanes Oxley

Template time! I’m a big believer in the concept of R&D (Rip-Off and Duplicate) and offer up these bylaws I’ve used with several clients. If your organization’s bylaws need updated or you just want folks to understand the ‘rules of the organization’ a little bit better, you should R&D these bylaws for your organization.

I’ve highlighted in yellow areas where you’ll need to update to include your nonprofit’s name and mission – as well as other areas to consider (e.g. length of board terms, etc).

A solid set of bylaws will not only help board members better understand their role, they will also help you as you recruit new board members — an absolute fundamental step in building a fundraising board.

I’m amazed at the money that pours into elections – while the nonprofit sector fights to keep preparing hot meals for the elderly, finding forever homes for abandoned animals, teaching financial literacy to at-risk kids or providing health prevention programs that return $33 for every dollar invested in the program.

You know your investment in a nonprofit will pay off, but these days you can’t be too sure about such an investment in an elected official. I still want my $100 back from John Edwards.

Just lately we’ve dealt with failings of our governments and elected officials, including:

The debt ceiling crisis and the posturing and lies associated with politicians playing politics with the economy.

Legislatures across the US trying to roll back smoking bans in public places.

The NC legislature overriding a veto to require women have a state mandated lecture and 24 hour waiting period before receiving a legal medical procedure.

The US Interior Dept suspending Charles Monnett, a leading polar bear researcher and global warming expert – but assuring the suspension has nothing to do with politics.

Florida refusing $50M of federal funding to prevent child abuse and maltreatment.

The Mayor of Toronto’s response to world class bike lanes and public transit is to declare it, “A war on cars”. My response, is, — well, yeah, what’s your point? Also,  the mayor could afford to exercise on a bike or two himself before he closed all the lanes down.

Voter suppression legislation being enacted across the United States just in time for the US 2012 election. Remember Florida cleansing the voter rolls in 2000?

And how about the fight to close down many of Toronto’s 98 public library branches? One of the highlights of moving to Toronto thus far was getting my library card today!

When we can’t count on elected officials to represent us and not just their social values or the concerns of the super wealthy, we can count on the work being completed by hundreds of thousands of nonprofits – the nonprofit sector – the Third Sector.

However, so many organizations fail to even STORE their data safely much less LEVERAGE their data. And what about leveraging your WEBSITE as a tool for donations, registrations, volunteer sign-ups and having that information automatically populate in your database?  This is where an investment in fundraising software can make the difference.

This is a cottage industry and unfortunately Blackbaud owns – and is still buying – up most of their competition. Blackbaud’s premier product is Raiser’s Edge and please don’t make the mistake of buying this product, unless you are from a large university. You will need so much training to figure out even the basics, and don’t get me started on the fees for modules and online gift processing.

Chances are you’ll be looking for a WYSIWYG interface that is easy to learn and use. You’ll also need training – far too many nonprofits skimp on training and this is the one piece you should invest in heavily. The sector has quite a bit of turnover, particularly in development, and you need a few folks cross-trained and able to use the system.

Here is a current and really well done analysis on various fundraising software products available.

I’ve been involved in countless conversions to new systems, and my favorite for the value and ease of use is Neon by Z2 Systems. They don’t rip you off by charging you to learn how to use their system. Seriously – way too many companies sell the online training videos for $900 or more. They want to keep you as a customer – not lose folks that don’t pay for extra training. NEON is also the leader in online integration with your database and website. This saves countless hours by freeing up staff to raise money, not do data entry.

Other systems that I like but don’t love include  eTapestry and DonorPerfect. eTapestry was bought by BlackBaud a few years back and that really zapped their creativity and customer service (from what I’ve heard from others0. DonorPerfect is great – but it’s on the high end of pricepoints for cost conscious nonprofits.

You might also consider ZOHO’s CRM tool, which is FREE for up to 3 users. It’s customizable and you can’t beat the price – but the interface isn’t as easy to understand if your staff isn’t pretty decent with technology.

So, let’s assume the board is ready for a fundraising retreat.

Nonprofit organizations (NPOs) could try to do it on the cheap and have the Board Chair or (WORSE YET) the Executive Director / CEO facilitate the retreat. Please, try to find someone other than these two folks to facilitate the retreat. The value of a qualified fundraising consultant can not be over-estimated! Your NPO needs the thoughtful and candid involvement of the Board Chair and Executive Director much more than it needs to save the money on securing a fundraising consultant.

That said, if you don’t have funds to pay a fundraising consultant for board fundraising retreat – NEVER FEAR – I’ve attached a proven template you can use for your fundraising retreat. This is the same format I’ve used in planning and facilitating fundraising retreats with many NPOs.

You would totally expect a fundraising consultant to warn you, “Don’t try this at home without professional supervision.” I do offer that warning, but also realize that many NPOs are struggling in this economy and don’t have the $2,000 to $3,000 necessary to secure a qualified fundraising consultant to facilitate the retreat. In this case – use the attachment! Consider using a skilled volunteer who has experience in facilitation, but don’t put off the retreat.

Email me if you have any questions about putting the attachment into action. Also, email me after you’re retreat and let me know how it went!

One thing to keep in mind, before we even begin talking about board members, is that the structure of boards differs across organizations. There are boards with the majority of directorships going to affiliate organizations or members and only a few at-large members. There are specialty organizations like science-based or legal-based organizations where a majority of the board members are specialists (e.g. scientists, lawyers, etc). There are boards that consist of wealthy individuals for fundraising purposes) and a few community representatives (e.g. from public housing for an organization targeting children in low-wealth communities). There are geographically broad boards where members reside across a wide area. The point I’m getting at here is that the built-in dynamics of board structures require unique and tailored approaches to involving board members in fundraising and these approaches will vary according to your board’s structure.

So, how do you get board members involved in the organization’s fundraising efforts? One very easy way is to involve them in thanking donors. Have board members phone recent donors to thank the donor for her / his gift. This builds a relationship with the donor, and makes it easier for board members to become more involved in fundraising. You can provide a script to the board member to keep her / him on message and so they feel ready to make the call).

DRAMA IN REAL LIFE:  I worked with a donor once (not a board member – but the concept is similar) who was having an event at her home. She told me upfront that she was not going to make one single call for the event. She didn’t like it when others called her, so she didn’t want to make calls. I admired her honesty, and the event was a huge success. A few months later I asked her to join me for lunch with three potential donors. As we got out of the car I let her know we would be asking all three for $2,500 gifts. She wanted to get back in the car, but we were an hour from home and hungry, so we went in for lunch. Lunch went so well that the three prospects made donations before we could even ask. The donor was hooked. A month later, with her as the lead, we asked a major donor prospect for $20,000. She became a fundraising machine!