Welcome to the world of nonprofit fundraising, where every dollar raised gets you closer to achieving your mission and positively changing the world.
If only it were that simple, right?
You know that finding the right fundraising strategy goes beyond asking for donations or getting grants. Instead, you must find the right combination of methods and donors to ensure the most sustainable approach. On top of that, you need to avoid mission creep and diversify your revenue stream while working with your board and managing your full plate of work. No pressure!
The good news is: You can do it, but only when you match your fundraising strategy to your mission.
To do that, you need to do three things:
- Understand where your organization sits on the appeal spectrum
- Know the signs of mission creep
- Realize what diversifying your revenue stream means
Your Nonprofit’s Place on the Appeal Spectrum Steers Your Fundraising Strategy
A donor has a range of motivations for giving to a particular cause. If you can identify what type of donor aligns with your mission, you can make your strategy that much more efficient because you know exactly who to target.
Enter: The Appeal Spectrum, a concept from author Tom Ralser’s book, ROI for Nonprofits: The New Key to Sustainability. Use the spectrum to identify donors likely to align with your organization’s mission — and invest in it.
On one end of the spectrum: Organizations with heartstring-tugging emotional appeal. Think animal shelters, advocacy groups, or food banks for refugees. This end of the spectrum is attractive to individual donors, certain foundations, and occasionally corporations because the mission encourages:
- Fostering community
- A desire to do good in the world
- Being a part of something bigger
At the other end of the spectrum are organizations that go after long-term impact over decades of policy change and conversation. These are your think tanks and organizations like the Brookings Institution, which focus on advancing certain values. They’re big picture and don’t do direct service. This end of the spectrum is attractive to foundations and corporations with specific goals, and the organizations they support are a means to achieve that goal.
Donors focused more on long-term progress (and who have more resources to move around) will typically be more attuned to investing in those big picture ideas. Donors who want to see a straight-line impact from their giving will be more likely to invest in direct service organizations.
Most organizations fall somewhere in the middle, meaning their fundraising strategy could appeal to a combination of donor types. But the bottom line is: Not all types of fundraising are the right fit for every mission. And that is ok.
The sooner you identify the donors most motivated to advance your cause, the more efficient and effective your fundraising strategy will be.
Protect Your Nonprofit From Mission Creep to Increase Fundraising Success
It’s normal to think you should pursue every funding opportunity that comes your way. But if you do, you can quickly find yourself knee-deep in money chasing and mission creep — a quagmire of expectations and projects loosely tied to your mission that eat away at the time and resources you should be applying to your core work.
It’s a short-term gain with long-term negative consequences.
There are obvious ways that mission creep takes shape, like if your organization accepts donations from a corporate sponsor whose agenda is night-and-day different from your organization’s mission — and then requires you to do work that supports their mission, not to mention corporate giving policies adopted by the board of directors that outline what types of corporate funding an organization is willing to accept (a clear thanks, but no thanks).
It’s the subtle ways that are more problematic, because they may not feel like that much of a stretch.
Often, this takes the form of a foundation funder (or other donor) that is loosely aligned with your mission. They may offer your organization a funding opportunity that takes you off your charted strategic course — but only slightly.
While the slight difference might not seem that drastic, it can result in your organization losing sight of your strategy to fulfill the interests of the funder so you can keep receiving their donations.
This sounds scary, but having a strong strategic plan will keep you out of the quagmire. Setting clear guiding goals and objectives protect your organization from being lured away in the name of funding and bind you tighter to types of funding that are right in line with your mission.
Don’t be swayed by short-term gains that could ultimately lead to long-term derailment. By staying true to your mission and focusing on the right types of funding sources, you can maintain your integrity and set your organization up for long-term success.
Leave Nothing to Chance by Diversifying Your Fundraising Strategy
This is where the rubber meets the road. You’ve looked at what type of donors your organization appeals to. You’ve steered clear of mission creep. Now, to round out an effective fundraising strategy that’s tied to your mission, you need to diversify your fundraising strategy.
Diversifying your fundraising strategy is about expanding your efforts beyond just a few key sources of income. It’s also about reducing risk and making sure that you have a steady flow of revenue coming in.
But here’s the thing: It doesn’t necessarily mean having multiple types of revenue sources like government funding, individual donors, and foundations. Rather, it can look like having multiple sources within the same revenue category.
You might find success in expanding your strategy to go after many funders in a certain vertical. Or maybe you’re confident that focusing on two or three verticals — and not pursuing others — will yield the results you’re looking for.
Not every organization is going to have success with every kind of funding source. And the great part? There is nothing wrong with that. This should alleviate the pressure your nonprofit may feel to fundraise from every angle — and help you avoid dangers like mission creep.
It’s also important to remember that diversifying your fundraising efforts takes time and energy, which is why building it into your long-term fundraising strategy is vital. Having a clear and accepted theory of change and mission will guide you to build a successful and diversified pipeline — and a sustainable fundraising strategy overall.