Don’t Let Your Capital Campaign Cannibalize Your Annual Fund
What do you think is the most common worry board members have when they are considering a capital campaign?
If what came to your mind was the worry that a capital campaign would cannibalize their fundraising for operations, you’d be right.
Of course they also worry about whether their campaign will be successful, whether they have any donors who will give the big gifts, how much they’ll be asked to give, and more. All of those are reasonable concerns for board members.
But the worry that seems to override all of the others is the concern that the campaign will undermine the organization’s annual giving.
Are Comprehensive Campaigns the Solution?
In the hopes of heading that problem off at the pass, some organizations combine their capital campaigns with their annual fundraising. To do that, they raise the campaign goal by the amount of money they anticipate raising in their annual fundraising for the years of the campaign.
So, for example, if an organization raises $250,000 each year though their various annual appeals and they anticipate that their campaign will extend three years, they will increase their campaign goal ($12 million) by $750,000. If they are thinking carefully, they may increase the campaign goal by $1,000,000 to account for an annual increase in their recurring fundraising each year.
Their campaign goal calculations might look something like this:
Then, aiming for a goal that accommodates both, they will ask every donor for one gift that combines both the donor’s capital gift and their annual fundraising.
These so-called comprehensive campaigns have gained popularity over the last few years and I understand why. But no matter how hard I try, I don’t like them.
Donor’s Like Making a Big Difference… Occasionally
Let’s look at it from the donor’s point of view.
Many donors give habitual amounts to organizations they support annually. They might give $100 or $500 or even $1000 to an organization every year. They probably have several organizations they give to at that level.
But many of those donors have the capacity to give more, sometimes much more. So when a special opportunity comes along to give a bigger gift that will boost their favorite organization to make a bigger difference, they may well make a one-time gift that is far bigger than anything they’d give annually.
A donor who gives $500/year might be able to give $50,000 or even $500,000 when the expectation is that the gift will make on out-sized difference and they won’t make that larger gift year after year.
So, rather than combining annual and capital requests, I think there’s greater potential if you keep them distinct. That way, you can talk to your donors explicitly about the need for both annual and capital without causing confusion.
Let’s take it one step farther…
Protect Your Annual Fundraising from Your Capital Campaign
You can protect your annual fundraising by establishing policies for your campaign that make the funding priorities clear. You can specify that campaign gifts are over and above annual support. If a donor elects to give only one gift, that gift will be apportioned first to the annual operating fund and then to the campaign.
Keeping your campaign goal separate from your annual fundraising goal makes it clear and easy to understand. And one way to make sure that happens is to use what is sometimes called “Double Mention, Double Ask.”
If you are in a capital campaign, when you ask your donors for their regular annual gifts, mention that you are in a capital campaign and will come to talk to them later about a special gift to the campaign. Then when you ask for the campaign gift, you should mention their on-going annual support.
You can make clear that you are raising $250,000 that year for annual support and are launching a special capital campaign to raise $12 million to boost the organization’s capacity and impact.
Don’t Worry About “Donor Fatigue”
You probably worry about wearing your donors’ generosity thin. And you may well do that when you ask them again and again for money that goes to the same thing – annual appeals, galas, golf tournaments, auctions, walks, raffles and more annual appeals. That kind of repeat asking does wear a donor out.
Create opportunities for donor excitement!
But when you ask your donors for something special that will make a big, extraordinary difference in the lives of people you serve, you give them a chance to do something special and exciting.
Special campaigns to fund specific things have a remarkable way of engaging or reengaging your donors.
So stop wearing your donors out by nickel-and-diming them. Instead, invite them to help your organization take a big leap forward and in doing so to make a bigger difference.
How Can You Excite YOUR Donors?
Want to find out how you can structure your capital campaign to create excitement rather than fatigue for your donors? Apply for a free capital campaign strategy session and talk it over with an expert.
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