Podcast: How to Build an Effective Gift Range Chart for Your Capital Campaign

Season 5, Episode 2

In this episode, Amy Eisenstein and Andrea Kihlstedt explain why a gift range chart is one of the most essential planning tools for any successful capital campaign. They break down what a gift range chart is, how to create one, and why it can guide your campaign from start to finish.

By the end of the episode, you’ll understand how a thoughtfully constructed gift range chart can help you anticipate challenges, guide donor cultivation, and keep your campaign on track from start to finish.

Listen Now:

---

Andrea Kihlstedt:
There’s more to a gift range chart than meets the eye. And today, we are going to dig under the surface.

Amy Eisenstein:
Hi, I’m Amy Eisenstein and I’m here with my colleague and co-founder, Andrea Kihlstedt, and today we are talking about the very important topic of gift range charts and why they matter, what they are and why they are an important key roadmap and tool for your campaign.

What is a Gift Range Chart?

So Andrea, as always, get us started. What is a gift range chart? Let’s start with some basics.

Andrea Kihlstedt:
Yeah, let’s start with some basics. Everyone knows that little chart that shows how many gifts you need at what levels, right? It’s sort of ubiquitous in the capital campaign world, but very few people really understand its full power or how actually to develop one in a way that is going to work for your organization.

But to be really clear and simple, a gift range chart is indeed a simple chart that shows how many gifts you need in order to reach the goal of your campaign, starting with one gift at the top and then gradually broadening the number of gifts as the size of the gifts go down. And you all know that.

These things are all over the place on every campaign brochure, in all campaign materials, you see these little charts. And by and large, people look at them and discard them and move on. Then they want to talk about the case for support.

Amy Eisenstein:
Right. And just to back up a teeny bit, you may think of it as a gift pyramid because ultimately that is what it looks like. There’s a few gifts at the top and then it gets broader as it goes down in terms of gift size and there’s many more gifts needed at the base. But let’s talk about the top of the gift range chart, because that’s really where the rubber meets the road in your campaign.

The Power of Developing a Good Gift Range Chart

So how do you think about developing a gift range chart? How should listeners think about it, and why is it so powerful, as you say, Andrea?

Andrea Kihlstedt:
Yes. I think the best way to think about a gift range chart, about developing a gift range chart is to think about it as a thought exercise, a brain exercise. And if you really do that, if you really are thoughtful about the way you develop it for your organization, it will help you understand the parameters of your campaign in a way that very few other tools do. And you will then use it really as a guide for your campaign that when there are challenges and troubles in the middle of your campaign, one of the best answers to solving a problem is to say, “Well, let’s go back and look at the gift range chart and see where we are in this campaign.”

So it is an important tool right from the beginning and through your entire campaign. That pattern of gifts from the top all the way down through the bottom is the tool that will guide your campaign.

How to Create a Gift Range Chart

Now, how do you do it? How do you create one for your organization? So you start out of course with some idea of how much money you might need to raise. Typically, let’s say you’re going to do a building renovation and you will have your plans in place and you will have all of, you’ll itemized all of the things you’re going to need in order to have that and perhaps some additional things you want to accomplish. You’re going to add up what all of those things cost, and that number is going to give you a preliminary goal for your campaign.

So for the sake of ease, why don’t we say that all those numbers add up to $10 million. That’s a nice round number, easy for us to think about that number. Now, if we want to raise $10 million for our building and new programs and other things that are on the table —

Amy Eisenstein:
Endowment.

Andrea Kihlstedt:
Endowment, then how do we think about our gift range chart? And the first place to begin is always by figuring out what the top gift should or might be.

Now, the standard that we use is that your top gift needs to be at least 20% of your campaign goal, perhaps higher, but if you are figuring it out lower, you’re going to be in trouble. If you have a top gift that’s lower, you’re going to be in trouble. So you might say, “All right, 20% of $10 million, that’s $2 million. Maybe we need our top gift to be $2 million.” Then you’re going to ask yourself this question, what is the shape of our donor base? Do we have a tremendous amount of donors or is our organization fairly small? Do we have a limited number of people we can go to for the rest of our campaign?

And if the answer is that you have a tremendous number of donors, that you’ve been doing fundraising for a long time, you have thousands of donors, then perhaps 20% for your top gift is going to be good. But if you only have 250 donors altogether or 300 donors altogether, you won’t be able to raise as much money from the rest of your donor base as if you had a broad pool. So then your lead gift, your top gift may well have to be 25 or 30% or even more of your campaign goal.

Amy Eisenstein:
Right. So let’s give some really basic examples of that. So a children’s cancer center that’s, or research fund that’s well established in your community may have a really broad base for support because lots of people can relate to and understand and are compassionate about children with cancer. On the other hand, a small independent school with 150 families has many fewer donors.

And so those might be two examples, maybe extremes of an organization that has lots of donors or an organization that has a few donors. And it really does impact the shape, whether it’s narrow or broad, of your ultimate gift range chart, because you have a much broader base of people to go to at a larger organization with more supporters than you do at a smaller organization with less supporters. So if you’re starting out, I always like to start actually with a top gift of 25% and then go up or down from there based on what you find in your donor base.

Andrea Kihlstedt:
I like that. I like that.

Figure Out the Preliminary Goal for your Campaign

Now, just to recap, the first steps to figuring out your gift range chart is to figure out what the preliminary goal for your campaign is going to be and then figure out using Amy’s number, which I actually like better than 20%, using Amy’s number of 25%, you take 25% of that amount and say:

“Well, let’s try that as our top gift and let’s think about whether we should adjust that up or down.”

And the way to think about that is to think about how many donors we have in the rest of our donor base. If we have a lot of donors in the rest of our donor base, then maybe we’ll just stick with that 25%. If we don’t have very many donors, if we are a narrow organization, organization with a narrow donor base, maybe we’ll bump it to 30 or even 35% for our top gift.

And so that’s always the way to start working on your gift range chart. And it’s a thought exercise, right? You’re not having to go and look at your donor records. If you’ve been working in your organization for a while, you’re going to know whether your organization has a broader and narrow donor base, right? You’re going to have some sense of what the campaign goal is going to be because you will have done that work. So that thinking is going to give you the first brush at the top gift for your campaign. Let’s go back to our $10 million campaign, right?

Gift Range Calculator Tool

Amy Eisenstein:
Okay. So first I want to encourage listeners, we actually have a tool that they can use at the Capital Campaign Pro website. If you go to capitalcampaignpro.com/gift-range-chart-calculator, we have set up all the fields and the calculations for you.

So if you put in your campaign goal and your top gift or two, it’s going to show you what it could look like, and you can look at how would the pyramid be affected if you put in 20% for the top gift, and then how would the pyramid reshape if you put in a top gift for 30%? And you can start to play with real numbers.

So head on over to the Capital Campaign Pro website and check out that gift range calculator. You can also Google gift range calculator, and the Capital Campaign Pro tool should pop right up.

Andrea Kihlstedt:
Okay, wait a minute. I just want to say that what Amy just said, the language she used was exactly right. This calculator is something you can use to play with the numbers. It is not something that is going to spit out your gift range chart for you, because to do a gift range chart takes judgment and understanding of your particular organization.

When Using a Gift Range Chart Caclulator

So the way these calculators work, or the way ours work, which is the right way, is that you put in your campaign goal, then you put in, well, what percentage of that goal do we want to try out for our top gift? And it will calculate one formulation of the rest of the gifts. That may or may not be the right formulation for your organization, but it gives you something that’s easy to change and to see what happens when you change the figures at the top. You’ll get to see what happens at the bottom in order to make your campaign goal.

So this is a tool, not a magic formula.

Amy Eisenstein:
Right. And let me tell you, the way you can tell if you’re on track or off track or one of the ways anyways, if you put in 20% and it trickles down and calculates the rest of the gifts, if you look at the bottom of the pyramid and it shows you that you need hundreds of donors of gifts of under 5,000 or under a thousand dollars, which the bottom row will be, right? Gifts of under 5,000 or even a thousand dollars, and it shows you need 800 gifts, and you say, “Well, I don’t even have 800 people in my database.” You know that you need a larger gift at the top of the pyramid, that this isn’t going to work.

So campaign math is really clear. This tool points you in the direction and you can show people, all right, we only have 500 people in our database and 200 donors, and it shows that we need 600 donors in the bottom category. Let me tell you something, social media is not going to unearth 600 new donors of a thousand dollars. You’ll know you’re off track. And so this is a great way to start playing with the numbers.

You Will Already Know Your Top Donors

Andrea Kihlstedt:
All right. Now, once you have these preliminary numbers and you have a chart that sort of makes some sense to you, then of course you’re going to have to go and say, “Well, in these top gifts, these top two or three gifts we’re looking for,” do we have any donors in our donor base that we might remotely anticipate giving at that level, that we have any indication that they have the capacity or inclination to give at that level? And that’s going to take some real thinking.

Now, chances are these are not going to be people who are unknown to you. If you have these people, they will already have been giving to you. So don’t think that Oprah Winfrey or Bill Gates or whatever the rich person out there at the moment is —

Amy Eisenstein:
MacKenzie Scott. MacKenzie Scott.

Andrea Kihlstedt:
MacKenzie Scott. Don’t think Mackenzie Scott’s going to ride in on her white horse and give this to you. These gifts are going to come from some people you know.

Amy Eisenstein:
Okay, let me just add yes and here, that the people that are already giving to you won’t be giving to you at anywhere close to the level of that top gift that you need. Your instinct may say immediately, “Well, we don’t have any donors at that million-dollar level, right?” $2 million level in our example of a $10 million goal. You need a donor at two or two and a half or $3 million to get to your goal. And you’ll say, “Well, of course we don’t have any donors like that.” Well, that’s true. These may be your 10,000 or your 25,000 or your $50,000 donors that don’t give anywhere close to a million yet.

But one, you haven’t had a multi-million-dollar idea or project before, and two, you’ve never asked them for such a big gift or a bigger gift before. So you may know that they have the capacity because they’ve done that kind of thing at the local hospital or at their university or that they have a family foundation. There will be indicators that they could and might give significantly bigger gifts even though they’ve never given that to you. And that’s perfectly fine.

Your Top Gift Should Require Someone to Stretch

Andrea Kihlstedt:
Yeah. In fact, the top gift should always be a gift that is beyond what you already know. It should be something that would require someone to stretch, because you’re always in a capital campaign wanting to be stretching the possibilities, stretching the potential, right? Even if you end up not getting that top gift, I’d rather have you do that than shooting only for the gift that you already know about. So put that top gift almost out of reach. I mean, not exorbitantly out of reach, but a little out of reach. That’s another good rule of thumb as you’re putting your gift range chart together.

As you begin to look at your donor base for those top two or three donors, you might find that you really have no one that fits into that category, that you’ve done your prospect research, that you’ve really done some deep dives into the people who are your largest donors, and no one has ever given a million-dollar gift before ever to anybody.

Well, that would be an indicator that you need to think twice. So what happens if that’s the case? You have your gift range chart, but you can’t find donors where you would have even a remote hope that they would give you at those levels. Well, the simple answer is not that you’re going to broaden the bottom of the chart. The simple answer is that you may have to reduce your campaign goal and start this exercise again. You may have to say, well, that our top donors, we could only imagine that our top donors even in a big stretch would give us a million and a half dollars, not $3 million. So then what happens to your campaign goal?

Maybe you don’t have a $10 million campaign. Maybe you have a $7 million campaign and you borrow the rest of the money that you need for your project, or you fund it from cash reserves or whatever, but you don’t just stick on that number if as you do your homework looking at your top donors, it feels utterly undoable. Then you’re starting to pull your chart down. And the way to pull it down is by lowering those top expectations.

Amy Eisenstein:
Right. But don’t think you’ll make it up at the bottom of the pyramid. You won’t. We’ve seen this. That’s just wishful thinking. And the truth is, you can just do the math and you’ll quickly realize that it doesn’t work. And so it may be disappointing to discover that you can’t raise what you hope, but campaigns are based on data and research and they’re aspirational and based on reality. And so you can’t pretend or hope that you’re going to raise something that is wildly out of reach.

And so it’s important to plan. As Andrea said, you can look for alternative funding sources. So just because you can’t raise as much as you hope doesn’t mean you can’t do the project. There are ways to think about other revenue sources, government or financing or using reserves that you hoped not to. There are other options. But then at the end of the day, once you’ve exhausted them, you may scale back the project.

You may not raise as much for your endowment. You may not grow in a maintenance fund or whatever. There may be things that can be eliminated or reduced, or you may have to phase the project or scale back the project. But knowing that going in rather than after you’ve already put a shovel in the ground is really important, because it’s really much more difficult and disappointing to realize that you can’t get to your goal after you’ve put a shovel in the ground or two years into fundraising and you’re only 50% of the way there and then you’re stuck. It’s better to plan in advance.

Most organizations require working with an experienced campaign consultant to get to the right number and to plan appropriately and strategically. I mean, campaigns are aspirational. You should be able to raise much more than you ever imagined. The question is, how much is that? And can you do your full dream project or will you still be able to do something amazing, but maybe not the original dream dream?

Final Thoughts

Andrea Kihlstedt:
One of the questions that I think pops up into people’s minds is, “Well, how do I really know if my top donors are going to even consider giving some of these lead gifts on the gift range chart?” And there are a couple of things I think to pay attention to here. One is that it’s very dangerous to try to be the first organization that asks someone for a million dollars. If a donor has never given a million dollars to anyone, to any organization, has never even given a half a million dollars to anyone, to any organization, chances are they’re not going to do it to you.

So you’re looking for people who not only have the financial capacity to do it, but who actually have some practice in giving at those levels. And if let’s say your largest donor gave $5 million to the hospital, that’s a real indicator, right?

Even though your organization may have nothing to do with the hospital, the fact that they’ve given a gift of that size to anyone greatly increases your chance of getting a significant gift from them. So that’s one thing to really do some research about. Have they given a big gift before to anyone? If not, don’t assume. Unless you have good reason to believe that they will do that for you, don’t make the assumption that they will. So giving is in large part habitual and very difficult to be the first organization to get a really big gift from someone.

Amy Eisenstein:
But somebody’s the first, Andrea. I’m going to put in, somebody’s the first.

Andrea Kihlstedt:
True, true, but that should temper your expectations. So then the second way to find out is this is why you do a feasibility study. This is why that’s important.

So let’s say that your top donor is someone who is passionate about your organization, who loves your organization, who is a founding member of your organization, who goes to bed thinking about your organization, but they’ve never given a really big gift before. They have resources, but they’ve never given a really big gift. So how do you find out is this even feasible?

And the way to find it out is to have early conversation with them through a feasibility study. Now, we do a Guided Feasibility Study process where you go and talk to your donors, so we help you do that. But if at the end of a process of talking to your largest donors you find that they will or won’t give it that level, then you can go back and redo your campaign goal and redo your gift range chart once again. So you have a couple of opportunities to rethink these numbers based on additional information that you gather through a feasibility study.

Amy Eisenstein:
Excellent. All right, so if you’re thinking about your campaign and struggling to develop your gift range chart, hopefully we’ve given you some good ideas and a starting place to work from. Again, head on over to the Capital Campaign Pro website and look for the gift range chart calculator. You can Google that also, Capital Campaign Pro gift range chart calculator. It’ll pop right up.

And if you’re thinking about working with a consultant or looking for some expertise or some support for your campaign, we’d love to talk to you. So sign up with your team and let’s have a conversation.

As always, thank you so much for joining us and we’ll see you next time.