Capital Campaign Feasibility Study: The Ultimate Guide

Feasibility studies build confidence and credibility for capital campaigns. Rather than just diving into a capital campaign with a very big goal, most organizations begin with a study to evaluate the potential of the campaign. They want some degree of certainty that the campaign has the potential for success.

For decades, organizations have brought in an outside consultant to conduct their feasibility study. A consulting firm conducts interviews with the most influential people including, if possible, the organization’s largest donors. The consultant then collates the results and sets out campaign recommendations for the board and staff.

Here at Capital Campaign Pro, we have developed a new model in which we guide clients through the study process, but rather than have an outside consultant conduct the interviews, they are conducted by the nonprofit’s leaders. We have found that organizations benefit when they use the study process to meet directly with their prominent supporters and build stronger relationships prior to the start of their capital campaign.

Quick Links — There’s a great deal to know about capital campaign feasibility studies. We’ll jump-start your understanding of this important topic in the sections below:

What Is A Capital Campaign Feasibility Study?
Before You Hire a Capital Campaign Consultant
A Common Misconception About Feasibility Studies
Feasibility Study Interviews: Have a Discussion with Your Donors
Analyzing the Feasibility Study Responses

Read on to learn the ins and outs of conducting a feasibility study for your capital campaign.

Let’s get started!

What is a Capital Campaign Feasibility Study?

A feasibility study is a way of testing your plan and goals for an upcoming capital campaign by asking the advice and opinions of your largest donors and other community leaders. Their collective advice will help determine whether your plans are sound, your case for support is compelling, and your financial goals are realistic and feasible.

Traditionally, feasibility studies are conducted by capital campaign consultants who help design the study, conduct the donor interviews, develop a report and present the results to your board.

During conversations (or “interviews”) with these largest donors, the consultant presents the preliminary campaign plans and collects feedback.

A typical feasibility study involves many participants. Speaking with potential major donors and opinion leaders will ensure that you get feedback about your project from influential people representing different viewpoints in your community.

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Don’t just turn to your database of past donors to find feasibility study participants. Consider speaking to all of the following:

Potential major donors for your campaign.
Long-term supporters with a proven track record.
Representatives from foundations in your community.
Heads of large local corporations.
Current and past board members.
Founding members of your organization.
Leaders in your community.

Though a traditional feasibility study relies on hiring outside consultants, some organizations prefer to conduct the conversations/interviews themselves. Read the next section to learn more about the alternative approach.

Have more questions about how capital campaigns work? We’ve compiled a complete FAQ list answering common questions about capital campaigns.

Before You Hire a Capital Campaign Consultant

You may think that the first order of business is to figure out how much money you can raise by hiring a consultant to do a feasibility study. And of course, many consultants will be happy to have you think just that.

But STOP right there. If you want to increase the chances that your feasibility study will result in the recommendations you want – namely that you are ready to raise lots of money – you’ve got some work to do before you even think about hiring a consultant.

Test a Specific Plan with Your Feasibility Study

Feasibility studies don’t tell you how much money your organization can raise in general. A feasibility study tests how much money you can raise for a specific project or set of objectives. And you won’t want a consultant out talking to your donors until you’ve developed clear plans and have engaged some of your most important prospective donors around those plans (more on this in the next section).

Five Must-Do’s Before you Hire a Consultant

1. Determine your preliminary campaign objectives.
Clarify all of the things your campaign will raise money for. Which of these will your campaign include? A building fund, building maintenance costs, fundraising expenses, additional staff, endowment, operating funds, etc.?

2. Engage your board in getting ready for a campaign.
Is your board ready for a campaign? Have they been engaged in figuring out your plans and exploring the opportunities? Do they know what will be involved?

3. Develop a preliminary campaign fundraising goal.
Attach dollar estimates to your campaign objectives so that you can estimate how much you need to raise.

4. Write a draft case for supporting the campaign.
Write a draft of a compelling case for supporting your campaign. There’s nothing like writing to help you become clear about your plan. It may take you five or ten or even thirty drafts before you’ve captured the essence of what’s important, but this process is critical for your success.

5. Engage your most important donors.
There’s no more effective way to set up a large gift than to engage someone in your organization’s planning. You won’t want to wait until the feasibility study to do that. Ask their advice as you get ready.

A Common Misconception About Feasibility Studies

When you began to research conducting a feasibility study for your campaign, you undoubtedly ran into one specific piece of advice over and over again: Hire a capital campaign consultant to conduct the study and talk to your top donors.

Consultants offer a variety of reasons why their role as outside experts gives them objectivity and credibility. Some say that major donor prospects are more likely to be honest if they’re speaking to a third party. Others argue that it’s crucial to have an unbiased eye when evaluating the results of the campaign.

We’ve found that there’s a better way.

Why a Consultant Shouldn’t Conduct Your Feasibility Study Interviews

The fact of the matter is, consultant-led feasibility study interviews can fail your campaign.

It’s a missed opportunity for you to build relationships. The feasibility study interviews provides your leaders (as opposed to an outside consultant) with a valuable opportunity to build and strengthen their relationships with major donors early in the campaign planning process.
Collated and confidential responses leave gaps in information. When consultants conduct the interviews, they often don’t share essential information they learned from their interviews because the interviews were confidential. You may feel confused by the report because you won’t learn which donor said what or how much a specific donor indicated they might give. As a result, a consultant’s recommendations often lack transparency.

For these reasons, we recommend you consider an alternative approach.

Try a Guided Feasibility Study Instead

At Capital Campaign Pro, we recommend a Guided Feasibility Study. This allows your team to speak directly with donors while also having the hands-on guidance of an experienced campaign advisor. We believe an advisor-guided study is superior for the following reasons:

You build relationships between your organization’s leaders and key donors prior to the campaign. This might even result in early gift commitments!
You learn what your most important donors really think and can shape your plans accordingly.
You have the expert advice you need to do it properly. All materials, interview processes, and recommendations are guided by experienced campaign advisors.

If your organization is getting ready for a capital campaign, a feasibility study will be an important part of your planning process. Done well, it will help you plan a campaign that is likely to succeed and give you an opportunity to engage your top donors in the process.

You should speak with at least three consulting firms about feasibility studies. Be sure to explore both the traditional model in which the consultant conducts the interviews and the Guided Feasibility Study model, in which the consultant will help you plan and organize the study process but your leaders will conduct the interviews.

After speaking with a number of firms, you will be able to select the approach and firm that best suits your needs.

Feasibility Study Interviews: Have a Discussion with Your Donors

Whether you decide on a traditional study or a Guided Feasibility Study model, the conversations with donors cover similar topics.

Feasibility study conversations go through standard discussion areas. The topics shown below are standard to most studies. The discussions should flow comfortably from one topic to the next in a conversational style.

Your Organization

You will want to discuss the organization, its strengths and its weaknesses, taking particular care to give the interviewee permission to talk about their concerns and suggestions. You’ll want their sense of the organization’s reputation in the community.

Of course, some interviewees will know more than others about the organization, so this may be a good chance to both learn what they think and tell them things they don’t already know.

Campaign Leadership

During the conversations you will want to find out what people think about both the executive leadership and about the board. You may wish to show the interviewees a list of board members and ask them who they know and what they think?

Case for Support

A key portion of the discussion will be spent talking about the project or projects that the campaign is going to raise money for. You’ll want to know if your case for supporting these projects seems compelling to the interviewees.

Campaign Feasibility

Because you are testing a plan to raise money for specific projects in the interviews, you will try to find out if the interviewees think the plan and the campaign are feasible. Donors will draw from their own experiences to help assess those questions and make their own judgements.

Leaders and Donors

You will want to discuss ideas about people who might be great campaign chairs and others who might be interested in learning more about the campaign.

Personal Commitment

Of course, no feasibility study interview is complete without asking the person for an indication of their willingness to help and to make a campaign gift. Together, these indications will provide critical insight into setting a working goal for the campaign.

Analyzing the Feasibility Study Responses

The interviews, particularly if they are conducted by your organization’s leaders, will paint a picture of how your most important donors view your organization and the plans you have developed for a campaign. You will be able to get a sense of whether people were generally positive or if they had serious reservations.

If the answers were generally positive, you’re probably ready to move ahead.
However, if the answers were mixed or somewhat negative, you may have some work to do before launching a campaign.

Before you consider leading your own feasibility study interviews, check out how a Guided Feasibility Study works. You get all the benefits of building relationships with your donors, plus the support of an experienced campaign expert to guide you through the process, from start to finish.

And — even more important — a Guided Feasibility Study conducted with expert guidance will give your board the confidence they need to accept the recommendations and move forward.

Watch the Video Below for More Information

Learn more about conducting your own Guided Feasibility Study »

To learn more about conducting a successful capital campaign, explore the following additional resources:

Capital Campaign Feasibility Study: The Ultimate Guide