Nonprofit Fundraising and Finance Management - dummies

Nonprofit Fundraising and Finance Management

By Steven D. Peterson, Peter E. Jaret, Barbara Findlay Schenck

Most small and medium-sized nonprofit businesses earn at least some of their money from fundraising events, which range from silent auctions and dance-a-thons to special presentations. Some nonprofits depend almost entirely on fundraisers.

If your group plans to raise a chunk of its cash from such activities, your business plan should address the details — including both how much the fundraisers will cost and how much you plan to raise. If the fundraiser is a very big part of your revenue, it deserves a business plan of its own.

Successfully running a big fundraiser is a lot like running a small company. In fact, if you’re a small nonprofit planning a big event, you may need to hire an event-planning professional. The more carefully your organization thinks through all the aspects of a fundraiser, the more successful it’s likely to be. Consider the following points when planning a fundraiser:

  • Know your purpose. Fundraisers are to raise funds, right? Only partly. They can also publicize what your nonprofit does, help enlist new volunteers, and win community support. Outline your goals and objectives thoroughly as part of the planning process.

  • Pick the right venue. Seek out a spot that’s conveniently located, comfortable, and an appropriate size for what you plan to do. Obviously, a venue that’s too small is a problem, but so is one that’s too big, because it can make even a successful event look poorly attended.

  • Think like your guests. Spend time brainstorming about what your guests are likely to want and what will encourage them to donate. Think through what a typical guest’s experience will be from arriving to leaving the event.

  • Plan advance sales. Selling tickets in advance helps you know how many people are likely to attend your fundraiser and also gives you cash upfront to produce the event. Consider offering discounted prices for advance tickets. If you aren’t charging for tickets but still hope to get a handle on how many people will attend, request an RSVP.

  • Keep them entertained. Speeches may be an essential part of your fundraiser, but keep them short. Provide entertainment, when appropriate. If hors d’oeuvres or a meal is involved, make sure the quality is appropriate to the event. You probably don’t want to serve caviar at a fundraiser for a homeless shelter. But you also don’t want processed cheese and crackers at a high-end art auction.

    If you’re planning music, make sure it’s not so loud that your guests can’t carry on conversations. When appropriate, include a variety of entertainment options, such as bingo for adults and a clown or magician for the kids, for example.

  • Be careful if you decide to serve alcohol. Offering wine, beer, or spirits may be appropriate for your fundraiser. If guests are paying a hefty ticket price, you may even host an open bar (or at least offer a chit for one free drink.)

    Or you may decide to keep ticket prices priced lower and charge for drinks. Either way, make sure to check with your local alcoholic beverage commission for the rules and regulations that apply when serving alcohol. And make sure the people serving alcohol are on the lookout for people who have had enough. Any problems that arise could be your responsibility.

  • Offer multiple ways to donate. Don’t just rely on entrance tickets. Include a silent auction, a raffle, games of chance, or other moneymakers. Provide a way for people who can’t attend the fundraiser to donate, such as an online auction.

  • Give something back. Consider offering attendees a little something as a way of saying thanks — a tote bag, T-shirt, or wine glass embossed with the name of your nonprofit, for instance. Make sure the thank you gift is appropriate to the nature of the nonprofit and the fundraising event.

  • Account for all donor levels. Some of your support may come from very deep pockets, but chances are you also depend on small donors. Make sure a fundraising event allows donors at all levels to participate.

  • Get out the word. The best-planned fundraising event will flop if people don’t know about it. Contact local media, put up posters, post updates on Facebook and Twitter, and send out email blasts to make sure people know about your event. Make sure you start publicizing your event well in advance to give prospective donors plenty of time to plan and make room on their calendars.

  • Say thanks. You may be amazed at how many nonprofits stage an event, count the proceeds, and never say thanks to their donors. Thanking people individually helps ensure that they’ll be back next year. Personalized notes or emails are more effective than a generic boilerplate thank you, of course.

    Be sure to thank donors big and small. Today’s small donor could well become a much bigger supporter next year. And don’t forget to thank the staff and volunteers who help put the event together.