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Planning a Capital Campaign

Planning a Capital Campaign. Linda Lysakowski, ACFRE Judith Snyder, MPS, CFRE Congress 2001 Greater Toronto AFP Chapter. What is a Capital Campaign?. A good basic definition of the capital campaign seems to be:

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Planning a Capital Campaign

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  1. Planning a Capital Campaign Linda Lysakowski, ACFRE Judith Snyder, MPS, CFRE Congress 2001 Greater Toronto AFP Chapter Capital Venture 2001

  2. What is a Capital Campaign? A good basic definition of the capital campaign seems to be: the mounting of a significant fund raising effort to provide for major institutional needs, i.e., buildings, endowment or current expenses. Such an effort involves sound research, long-range planning, persuasive campaign literature, effective organization, application of proven procedures, careful scheduling and publicity -- all within a specified time period and a prescribed budget. Capital Venture 2001

  3. The Seven Deadly Sins . . .Which Can Cause Campaigns to Fail 1) Failure of the advisory board to recognize and accept its responsibility to the campaign, to be thoroughly involved in the strategic planning process, and to commit whole-heartedly to the campaign’s support. 2) Failure of the institution’s administration to schedule a 3rd party feasibility study in order to arrive at a realistic assessment of the campaign’s receptivity and potential for support. Capital Venture 2001

  4. The Seven Deadly Sins . . .Which Can Cause Campaigns to Fail(continued) 3) Failure of the institution’s administration to involve community leaders and providers in the campaign planning process, thereby sacrificing the opportunity for these influential folks to take a decided interest in the project and to support it accordingly. 4) Failure of the institution’s administration to devote sufficient time to campaign preparation and organization, preferring to get the asks out and the drive over with. Capital Venture 2001

  5. The Seven Deadly Sins . . .Which Can Cause Campaigns to Fail(continued) 5) Failure of the institution’s administration to recognize the critical need to schedule sufficient time to run an orderly course, to sustain momentum, and to realize the greater gifts which come through patient cultivation. 6) Failure of the institution’s administration to retain counsel to provide the experience necessary to guide the campaign to a successful conclusion, and leave the institution’s development staff all the better prepared for further fund raising activities. Capital Venture 2001

  6. The Seven Deadly Sins . . .Which Can Cause Campaigns to Fail(continued) 7) Failure of the institution’s administration to take advantage of its annualgivingprograms in order to broaden its donor base, upgrade the giving, and test for greater giving potential in anticipation of the approaching capital campaign. Coupled with this is a regrettable tendency to ignore the giving potential of the loyal donor base and concentrate on the known wealthy who may have money, but no interest in the institution. Credit to H. Martin Moore, CFRE Capital Venture 2001

  7. Pre-Campaign Planning • Campaign steering committee • Internal readiness • Project plan and budget • Preliminary case for support • Planning study Capital Venture 2001

  8. Capability (Affluence) Give at a Meaningful Level Influence Promotion of Organization Promotion of Campaign Access to Potential Donors Board Responsibilities • Willingness • Board Participation • Campaign Leadership Capital Venture 2001

  9. Development Staff FunctionsDuring Capital Campaign • Coordinate meetings and events • Prepare reports for Board, CEO, Cabinet • Support volunteers • Internal Communications • External Communications • Clerical Support • Solicitation mailings, acknowledgments, reminders, meeting agendas, minutes Capital Venture 2001

  10. Campaign Volunteers • Campaign Cabinet • Campaign Committees • Division Committees - Leadership, Major, Small Business, General, etc. • Event Committees • Public Relations Committee • Finance Committee • Building Committee Capital Venture 2001

  11. Role of Campaign Volunteers • Guide campaign and project • Identify prospective donors • Cultivate prospective donors • Identify campaign volunteers • Give $$$$$$ • Ask for $$$$$ Capital Venture 2001

  12. On Hiring a Consultant . . . Almost every organization that runs a capital campaign does so with the assistance of a professional fund raising consultant. Why? - Large amounts of money are at stake. - You are dealing with a limited amount of time. - To avoid the possibility of failing publicly In other words, you can’t afford to experiment. You need to rely on someone else’s expertise. Remember, Consultants don’t raise the money for you -- they help you and your volunteer solicitors raise it. Capital Venture 2001

  13. Role of the Consultant In a Capital Campaign • Development audit -- Internal readiness • Feasibility Study -- External readiness • Planning and organization • Case development • Donor screening • Volunteer training • Communicating with CEO/Board Capital Venture 2001

  14. The Consultant Provides: • Objectivity • Creativity • Experience • Knowledge Capital Venture 2001

  15. Who Gives the Money $203.45 in Billions for 2000 Source: AAFRC Giving USA 2001 Capital Venture 2001

  16. Who Gets the Money $203.45 in Billions for 2000 Source: AAFRC Giving USA 2001 Capital Venture 2001

  17. Canadian Giving Increases • Ninety-one percent (91%) of all Canadians ages 15 and older made a charitable contribution in 2000. • Donations in 2000 increased an estimated eleven percent (11%) to over $4.9 billion. • The average donation was $70 up from $60 reported in the 1997 NSGVP. • Canadian donors gave an average annual total of $259, an increase of $20 over 1997 statistics. Source: 2000 National Survey of Giving, Volunteering and Participating (NSGVP) Capital Venture 2001

  18. Canadian Giving Increases(continued) • Canadians gave religious organizations forty-nine percent (49%) or $2.4 billion of all charitable dollars given. • This dollar amount has remained “flat” since 1997 and actually declined by 2% points in 2000 • Four percent (4%) of charitable dollars resulted from the wills of deceased Canadians. Source: 2000 National Survey of Giving, Volunteering and Participating (NSGVP) Capital Venture 2001

  19. Benefits of Research and Cultivation Strategies • Allows you to focus your efforts on the prospects that can do you the most good. • Helps you plan how to use your volunteer organization and types needed to build linkages to best prospects. • Builds volunteer and staff confidence for cultivation and solicitation process. Capital Venture 2001

  20. Others Organizations Foundations Interested Alumni Family Parties Parents Board Users Volunteers Vendors Staff Family of Community Businesses Users Prospecting for Donors Rosso’s Concentric Circles • Prospect Research is the process of • Identifying • Interviewing • Involving • Start in-house and move to the outside circles Capital Venture 2001

  21. Seven Key Points forEffective Prospect Research • Identify fundable projects • there must be a case • Match Prospects to Projects • there must be interest • Conduct thorough, realistic research • Goal is to collect enough info to determine how to make a connection with the prospect Capital Venture 2001

  22. Seven Key Points forEffective Prospect Research (continued) • Conduct cumulative and on-going research • Organize prospect information. • Handle all information ethically, accurately, and confidentially. • Involve prospects Capital Venture 2001

  23. Where to Start Your Research • Current and former trustees/directors • Major donors • Major prospects • Key volunteer leaders Capital Venture 2001

  24. The L-A-I Principle • LINKAGE -Who knows whom makes it possible to arrange an appointment to discuss the potential gift • ABILITY - Through research, it can be determined if a particular prospect has the capability to make a major gift. • INTEREST - Interest dictates the size of the gift. Capital Venture 2001

  25. Prospect Screening/Rating • Purpose: develop adequate prospects and research data on prospects • Includes an assessment of prospects’ abilities to make gifts at specific levels, and if possible, a suggestion on cultivation and solicitation strategies • Prospect Identification & Evaluation • Start with top-down, inside-out Capital Venture 2001

  26. Prospect Screening/Rating (continued) • Committee Membership: • key development staff members include staff researcher w/donor records • board chair & other key board members • friends from the community w/influence or affluence, ex: bankers, corporate CEOs, etc. • Discuss L-A-I: Linkages, Abilities, Interest • Stress confidentiality Capital Venture 2001

  27. Screening Sessions • Select participants carefully--people who know the community and are committed to this project. • Stress that the information is confidential and will be shared only with selected individuals. • Prepare a preliminary prospect list based on your donor records and knowledge of the community. • Have an outside facilitator lead the screening session. • Participants can work individually or as a group to review prospect list. Capital Venture 2001

  28. Screening Sessions (continued) • Ask each participant to list the suggested ask amount, any special areas of interest the prospect may have, and who would be the best person to make the ask. • Prepare final prospect list based on the input from the screening session and other research. • Share information gained in screening session only with appropriate staff and the volunteer solicitor(s) who will be calling on the prospect(s). Capital Venture 2001

  29. Information Gathering • Everyone’s job in the office • Debriefing by dictation, in the car or office • include info about the person’s style (chit-chat vs. business), preferences (china vs. styrofoam), choice of location to meet, etc. • Summary inside front cover of file to include: • Giving history last 5 years; highest gift; ask for what; response; significant milestones or messages from donor (reunion year OR come back in two years) Capital Venture 2001

  30. Information Sharing • Document what has been sent to donor • Annual report • Invites to various events • Campaign newsletter • Indicate special interests for future invites, i.e. history or art exhibits • Know your case for support including data about giving to your institution, etc. Capital Venture 2001

  31. Types of Foundations • Corporate Foundations • Private Foundations • Community Foundations • Operating Foundations Capital Venture 2001

  32. Researching Foundations • Foundation Directory and other Foundation Center publications • State directories • 990-PF • Foundation Center Cooperating Collections Capital Venture 2001

  33. Researching Corporations • Standard and Poors Register of Corporations, Directors, and Executives • Dun and Bradstreet Corporate Reporting Services • Corporate Foundation Profiles • Harris state industrial directories • Ward’s Business Directory of Major U.S. Private Companies • Business section of local libraries • Published charitable giving guidelines • Taft Corporate Giving Directory Capital Venture 2001

  34. Pockets of Corporate Philanthropy • Corporate contributions office • Corporate foundation • Marketing/Advertising budget • Local branch management • Research and development • Board of Directors • Gifts in Kind Capital Venture 2001

  35. Pitfalls of Research • Putting off research until you have time • Expecting interns or inexperienced volunteers to analyze the data collected • Sending out cultivators or solicitors with incorrect information • Trying to discover “everything about everybody” Capital Venture 2001

  36. Definitions proposev.1: to form or declare a plan or intention; 2: to engage in talk or discussion proposal n.1: an act of putting forward or stating; 2: something put forward for consideration or acceptance Source: Webster’s Third New International Dictionary, unabridged Capital Venture 2001

  37. WHO: will implement the project, building campaign, endowment - describe the personnel, the nonprofit, etc. WHAT: are you proposing to do? If an endowment, discuss how the interest will be used. Describe the project, endowment, or building thoroughly yet succinctly WHY : what is the purpose of proposed building, project, whatever? Describe the need here, i.e., what would happen if you did not have this building or endowment, or whatever. WHEN: will the project be implemented or building built or endowment established. Detail timelines. WHERE: where will the building be built? At the wildlife sanctuary, in a laboratory… describe. If endowment, where will the activity or whatever, funded by the interest occur. HOW: will the project be implemented, evaluated, etc. Give detailed goals, objectives, outcomes, and evaluation methods. Elements of a Good Proposal Capital Venture 2001

  38. Table of Contents:if over 10 pages Overview of your institution:develop a case statement - keep it current current Statement & description of your needs: clear - concise - compelling - why your organization, address “problems” opportunities - don't let them wonder -footnote experts in field Match your needs to funder's interests/business:research, ex: Timken Co. (computer equipment), Playtex (women’s products), Kresge Fdn (capital/ endowment projects) Describe other support/ donor listing:update frequently The “ask”/budget - be specific:who, what, why, when, where; include income expected Proposal Outline Capital Venture 2001

  39. Evaluation/Continued Funding (if applicable):more important if project was capital Proposal Summary/ Abstract:where to place - in cover letter? Cover Letter:CEO to CEO - include BOT support Attachments/support letters:IRS letters, BOT listing, annual budget, brochures Follow ALL published directions, call to verify names/titles/current guidelines, write, edit, re-write, allow plenty of time and then some!! It is OK to ask the Program Officer or CEO/ admini-strative insider to review draft of proposal. Finally, Proofread - Proofread - Proofread!! Proposal Outline (continued) Capital Venture 2001

  40. The Most Persuasive Reason To Give: BELIEF IN THE MISSION OF THE ORGANIZATION Capital Venture 2001

  41. Ladder of Effectiveness Most --Person to Person --Personal Letter-Phone Follow Up --Personal Phone Call-Mail Follow Up --Personal Letter --Personal Phone Call --Special Event --Impersonal Letter --Door to Door --Product Sales --Impersonal Call --Media Advertising Least Capital Venture 2001

  42. Opportunities for Participation • Outright gifts • Pledges--two to five years • Appreciated stock • Planned gifts • Named gifts • Matching gifts • Group gifts--class year, etc. Capital Venture 2001

  43. Definitions: What is Planned Giving? • Outright or Current Gift • Often referred to as a Major Gift • A complete transfer of cash or stock • Deferred Gift • Testamentary Giving or Life Income Arrangement • To Be Realized in the Future Capital Venture 2001

  44. Types of Deferred Gifts • Bequests (Wills) • Charitable Gift Annuities • Charitable Remainder Trusts • Life Estate Contracts • Charitable Lead Trusts • Life Insurance Policies • Pooled Income Funds Capital Venture 2001

  45. Donor Attrition A cost of doing business poorly Out of every 100 individuals who stop supporting your organization: • 4 move away or die • 15 decide another organization better serves the needs they care about • 15 are unhappy with your organization (each will share that news with 15 more people) • 66 think you don't care about them Capital Venture 2001

  46. Thank You Letters Within 24 hours Who signs? Handwritten notes Cultivation materials Thank You Phone Calls "Major" Gifts by Users, Board, Staff Visits Cards Birthday Anniversary Holiday Treat all donors with RESPECT Acknowledgment Ideas Capital Venture 2001

  47. Certificates or Plaques Recognition events Nominations for Community Awards Media Coverage Giving Clubs Annual Report, newsletters Named giving opportunities Thank you gifts (tax considerations) Recognition Walls, Walkways Memorial, Commemorative giving Committees Recognition Ideas Capital Venture 2001

  48. Seven Stairsteps in Relationship Building RECOGNITION ACKNOWLEDGMENT ASKING FOR INVESTMENT INVOLVEMENT CULTIVATION EVALUATION RESEARCH & IDENTIFICATION Capital Venture 2001

  49. Make Your Own Pledge First Start Immediately Consider a Team Solicitation Call on your Best Prospect First Prepare for Your Meeting Arrange to Meet With Your Prospects in Person Be Able to Articulate the Case Explore Various Ways of Making a Gift Ask for a Specific Gift Amount Encourage a Pledge But Do Not Leave the Pledge Form Take Your Time and Follow Up with Your Prospects Eleven Steps To Successful Prospect Solicitation Capital Venture 2001

  50. Campaign Timetable • Obtain approval • Select campaign counsel • Determine campaign divisions • Finalize case for support • Assemble campaign cabinet • Hire/train staff Capital Venture 2001

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