Your nonprofit’s sustainability and success hinge on strategic fundraising. And while it may be tempting to rely on one funding source, it’s a risk you shouldn’t take. From stock market fluctuations to shifts in philanthropic focus, many things can affect your funders’ capacity to give.
It sounds scary. But it doesn’t have to be.
A diversified fundraising strategy steers your organization clear of financial insecurity and fosters its evolution. And getting started is easier than you think.
Let’s dive in.
Gain More Control With a Diversified Funding Stream
Whether your organization gets its support from foundations, donors, corporate sponsors, or others, the only certainty is uncertainty.
Economic shifts have a significant influence over individual donors and corporate giving. And it’s common for foundations to evolve their areas of focus and move on to supporting other causes every so often.
These factors mean much is out of your nonprofit’s financial control, especially when you rely on too few funding sources to fuel your budget. This type of reliance can drive financial uncertainty where funding feels fragile, and you’re limited in how to achieve your mission.
But it doesn’t have to be this way. When you apply a fundraising strategy that accounts for revenue from many different sources, you’ll gain more control of your financial future, putting your mission within reach.
The more reliable funding sources you have, the better protected your budget is when uncertainty inevitably rears its head. For example, when one area of funding falters due to a foundation choosing to support a different project that doesn’t align with your mission, you can lean on funding from other sources. All the while, your organization continues its world-changing work.
The economy will always have ups and downs, affecting individual donors’ and corporate sponsors’ giving. And there will always be other causes to support and leadership changes influencing what foundations want to rally behind.
The good news? It’s going to be ok: A diversified fundraising strategy gives your nonprofit the financial security it needs so you can devote your energy to your mission.
Diversified Funding Means Whatever Strategy Works Best for Your Nonprofit
Diversifying your funding doesn’t have to mean securing a mix of individual donors, foundations, and corporations. Rather, it means ensuring you have a robust mix of funding sources that fuel your mission for your organization.
- Have you had a lot of success with foundations but haven’t seen an increase in your individual donor giving? That’s fine!
- Do you find it easier to secure corporate sponsors and a few individual donors rather than pursuing foundation funding? Keep after it.
- Are you adept at building relationships with foundations and individual donors but haven’t had luck with corporate sponsorships? No problem.
We hereby give you permission to stop chasing every last fundraising source under the sun in the name of diversification.
Every organization—no matter their theory of change or mission—has strengths and weaknesses regarding their fundraising strategy. What matters is identifying what your organization is best at and focusing on pursuing those opportunities. Forget about the rest.
When you focus on applying funding sources that fit, you have more time, energy, and resources to pursue more of them, netting you more support in the long run. Hello, sustainable fundraising.
Kickstart Your Diversified Fundraising Strategy By Sticking to Your Nonprofit’s Mission
It doesn’t matter if your nonprofit has been successful in any one area of fundraising. Implementing a diversified strategy can feel daunting. It requires planning, experimenting, building new relationships—and being willing to try new things.
The key here is not to try new things that don’t align with your mission. Losing sight of your mission happens easily when you’re “chasing the money” in the name of diversification.
You want to stick to your mission as closely as possible by mapping out your best fits. Taking time to map these out sharpens your focus on the types of fundraising that will have the greatest impact. As a bonus, it can steer you away from pursuing unrealistic strategies. Not everyone can befriend Oprah or rub elbows with the Gates Foundation (though we’re not discouraging you from trying!)
Here are a few examples to guide you in what types of fundraising might be best based on your organization’s focus.
- Your organization is an animal shelter. So you’re more likely to have success with individual donors because of people’s deep connections to animal welfare.
- Your organization advocates for policy change; therefore, government grants are unlikely to be your best option. Instead, you’re better off building relationships with foundations that care about that specific policy issue.
- Your organization advances workforce development in a specific field, so corporations that serve this field will likely be good funding partners.
Bottom line: Not all sources of revenue are a fit for all organizations. That’s ok. Find what fits yours.
It’s never too late to start diversifying your nonprofit’s fundraising strategy. By focusing on different types of funding sources that fit your mission and your fundraising strengths, you’ll gain more control of your financial future and achieve your mission.