Fundraising In A Tough Economy Archives

I am compelled to write this timely note to our clients because I know many around us are engaged in the election, and there is going to be a reaction about change. I want you to know you are in good hands. Your mission was important before and it is important now. Through the years, Hartsook has defied the naysayers time and time again. This week, we are releasing our new book, $231 Billion Raised and Counting which highlights our record-breaking successes over the past 30 years in business.

In 1975, Doc Smith told me that I had learned a valuable lesson: “There is no security, there is only opportunity.”

With full confidence, I have encouraged our team to counsel our clients that now is the time to seize opportunity. Thousands of nonprofits will retreat until calm occurs. Years ago, Hartsook embraced Sam Walton’s view of success: “When everyone else is moving in one direction, opportunity frequently lies in the opposite direction.” In 1989, I led Wichita State to one of only thirty successful $100 million campaigns in America – five years before Kansas’ flagship University, the University of Kansas passed that level. And that success was in the midst of the 1987 recession! As he was leaving the announcement of the Wichita State University campaign, the Chair of Campaign Kansas said to me, “WSU can’t do this, KU can’t do this.” I was right, and he was right: KU couldn’t do it.

Hartsook has exceeded client goals during the 90’s dot com bust… after the September 11, 2001 assault… following the 2008 historic financial crash… and for the last several years of US low financial performance. Through it all, Hartsook clients have set records. Year after year, Hartsook fights the headwinds of the nonprofit and fundraising commentators who forecast doom and gloom… and wins.

Now is the opportunity to exceed goals!

Other nonprofits will, like sheep, follow people like Professor Rooney who recently embarrassed himself. In The Chronicle of Philanthropy, he predicted philanthropic decline as a result of the election. In the days following the election the market set record-breaking levels. Professor Rooney should limit his comments to predicting the past as he does in the Giving USA Report. He should leave the future to those who have a vision, fortitude, and a good plan to succeed.

While others “wait and see,” Hartsook clients are raising money.

As a Hartsook client, you are a part of the Growing Philanthropy Movement. Keep moving, and charge ahead. To encourage you further, I want to make sure you get a complimentary copy of our newest book celebrating Hartsook’s 30th Anniversary, $231 Billion Raised and Counting. Click here and we will send you a copy.

And remember another Hartsook truth, “Somebody is making money all the time!”

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Fundraising Excellence is Alive and Well

For many, June 30th is the end of their fiscal years.  I want to take a moment to single out and recognize some of our clients that I work with personally.  I can hear people saying, “Here we go, bragging again.”

Okay, sure.  But this isn’t about me.  Many of the clients I work with have been with me for a long time, and for a long time they have been very successful.  Through 9/11 recession they raised money and through this most recent crash in 2009, they raised money.

Is it hard?

You’re damn right it is hard.  But these groups and most of our clients know that if they don’t raise the money, the people they serve go without.  They take this responsibility very seriously.

Harvesters, the Community Food Network in Kansas City, has been a client for 11 years.  Each year they have exceeded the past year and this year raised $13.6 million in cash and acquired 42 million pounds of food valued at $69.3 million for a record annual total of $82.9 million.  Eleven years ago, they were doing a third of the food and about a million dollars in cash.  In the eleven years they have generated for their network $740 million in food and cash to deal with the hunger issue in their community.  Hartsook is proud to be a small part of that success. Joanna Sebelien is their Vice President for Resource Development.

The Heritage Foundation in DC is not on a June 30th fiscal year, but is ahead of budget on major gifts with a goal of over $80 million for the year. Since Hartsook has been counsel for Heritage, in six years they have raised over $700 million.  John Fogarty is the Vice President for Development and John Von Kannon is their Vice President and Senior Counsel.

Shawnee Mission Medical Center in Kansas City is approaching their $30 million capital campaign goal supporting the building of a new emergency department, intensive care and now women’s health facility.  This is the largest campaign in their history.  Lou Gehring is the Senior Executive Director of the Foundation

Truman Medical Center, a partner in the designation as a national Cancer Center, raised over $9.5 million in commitments this year toward a variety of causes.  This is the largest annual support they’ve had in several years.  TMC has been a personal client of mine off and on for almost 20 years in three campaigns raising now nearly $100 million. Jim Dawson is Executive Director of the Foundation.

Avila University is in the quiet phase of a $43 million campaign, having committed $19 million as they begin to bring others to the table.  Avila has been a client and partner for more than a decade.  The campus has added and is adding more campus housing, academic facilities, and athletic facilities.  It is a different place.  Lifetime giving during their relationship with Hartsook is over $50 million.  Long time friend Angie Heer is the Vice President for Advancement; this is her second time working with Hartsook  (Angie was Harvesters Director of Development) to record giving.

Tulsa Boys Home, another long time friend of Hartsook is in the first year of their $28 million campaign.  So far, they have raised $10 million, including a $2 million and a couple of million gifts.  This is an endowment and capital campaign led by President Gregg Conway.

Domestic Violence Intervention Services (DVIS,) also in Tulsa is a new member of the my family of clients. The are just starting a $20 million capital and program campaign.  Already, in the initial stages of requests with her Board and four gifts, they have raised nearly $1.5 million, including a $1 million from a former Board Chair.  A new shelter, transitional housing and an office complex will change the face of DVIS in Tulsa.  Tracey Lyall is the Executive Director.

I also am counsel to the Humane Society of Greater KC and the Florida Hospital Tampa Foundation, both in the early stages of developing their fundraising plans.  But when they look to the seven long time personal clients of mine and know that these institutions have collectively raised over $1.6 billion dollars for their causes during their Hartsook relationship, I’m sure they find that compelling. They know they can achieve greatness, too.

As I said, this is not about me–but in a way, it is.  My clients achieved greatness because they worked with Hartsook, not just Bob Hartsook.  Each of our consultants gives his or her clients the Hartsook quality of counsel that helps them raise unprecedented fundraising success.  We all have a list like the one above that is full of client successes and those who have trusted us over the years.  But this blog is my ink, so I get bragging rights here.

Of course, I am proud of each of my clients’ achievements but I want to be careful not to take credit for all of this.  Each of them has been blessed with creative, skilled, dedicated staff and volunteer leadership.  While we have been their coach, confidant, mentor and friend, the successes are theirs.

Fundraising is a team sport, we are grateful that we are on each of these successful teams.

New team members are always welcome, by the way. It’s not without a lot of hard work, but who wouldn’t rather be on the winning team?

Read that headline again: Gene Tempel—long time Executive Director of the Center on Philanthropy, currently Indiana University Foundation President—has returned to his favorite assignment.  But this time he is there to organize what so many of us have dreamed of for so long: a School of Philanthropy.

Congratulations to Gene.

The Growing Philanthropy Award for Founding the Growing Philanthropy Movement was given to Gene at the initial Growing Philanthropy Summit co-hosted by Blackbaud and Hartsook more than a year ago in Washington, DC.  Gene was the moderator.  As he has done for his entire career, as moderator of that event, he brought people together and unified ideas toward a common goal.

Now, he has a chance to put an “!” on his already illustrious career.

Hartsook has had a long, great relationship with Gene and has been a steadfast admirer of his leadership.  Our mentor and Chair Emeritus, Art Frantzreb, was a founder of the Center and a pioneer in philanthropy. Hartsook is the major funder of the Fundraising Lectureship in his name at IU.  Art started the first published list of million dollar gifts.  After his firm was acquired by Hartsook, I agreed with him to give that List to the Center; it’s now an important asset of the new School.

A few years ago, when Gene was recruiting Adrian Sargeant to IU’s Center of Philanthropy he asked me to endow the first Chair in Fundraising, which is now history.  Of course, I did.

At one time Hartsook was the largest individual donor to the Center. Maybe—since Gene has returned—we will be again.

Gene has a lot to do, building a School on the foundation he created for the Center.  We are all eager to hear his plans and directions.  He’ll have good answers.  But what Gene does best is ask the right questions.  I’ve learned this over time, but this talent comes naturally him.

Well, as a colleague of mine said, “It’s about freakin’ time.”  I couldn’t have said it better.

Skin in the Game

Dan Moore, a great friend of Hartsook and former senior executive with Guidestar and now the owner of his own consulting practice–cleverly called Dan Moore Consulting—was the most recent visiting lecturer for the Hartsook Institutes Masters in Fundraising Management class at Avila University in Kansas City.

Dan is the “go to” resource for an understanding of government regulation of both the fundraiser and the fundraising professional in America. I first met Dan at a Blackbaud joint-sponsored program in DC last year.  After the first of the year, I need to write a blog on Dan’s view of regulation and how nonprofits need to manage it.  Like they have so often, our students at Avila get to talk to the prominent people of our profession. Dan is one of them.

Usually, by the second paragraph I’ve gotten to my point.  Let’s get to Dan’s point.

The charitable deduction is at risk.  Readers here know that while we are obviously against such a move, we are at least talking about it, unlike so many that put their collective heads in the sand.

Dan told a story that is an old fable, but is pertinent in this context.  If you think about breakfast (I am on Weight Watchers, so I think about breakfast all the time) there are two major players in your eggs and bacon: the chicken and the pig.  The chicken is involved; but the pig is committed.  That is literally “skin in the game.”

Well, for the charitable deduction, we as fundraisers have skin in the game.  Thank you, Center on Philanthropy and others who have done analysis of the impact of the President’s tax increase on wealthy people by changing the tax deduction.

They report that about one billion will be lost in the first year and a couple or more in subsequent years.  That has been characterized in the nonprofit media as modest.  Where were those headlines when giving went down in 2008 and 2009?  You would have thought the world was coming to an end when giving went down the same percentages.

My point isn’t to take sides here.  No, wait . . . I am taking sides.  We allow our political leaders on both sides to begin to erode the charitable deduction, and it is a slippery slope to reduced philanthropy in America.

And more important it is naive to be giving up on the deduction loss so early in the debate.  One writer with the Nonprofit Quarterly commented, “Since the loss is so modest, is it worth the fight?”  As a former lobbyist, I submit that in these early days of a serious debate, that position is a strange one for us to take.

Those who say we should take our share of the cuts are forgetting that the burden of our society is being passed on to the nonprofit world by the government cuts that are taking place.

Finally, this is going to go on for the election year.  I don’t see this change occurring before the election and if it did, it won’t impact until 2014.  But headlines announcing the deduction has been saved are over stated and premature.

For a couple of days, I’m going to “stick my head in the sand” and enjoy the holidays.  But I won’t stay there, and I hope you don’t either.  We have a powerful voice on this and other issues.  Let’s use it in 2012.

Lessons from Three Legends

Holidays give me time to ponder.  I’m sure some of the Hartsook staff wish I wouldn’t think so much because I have a reputation of making more work for everyone.  But this Thanksgiving, I didn’t think of more we needed to do to grow philanthropy.  Instead, I was in a very reflective frame of mind.  I thought of three who are not merely making a difference in growing philanthropy, but who have reached “legend” status.

You know Hartsook Institutes gives the Growing Philanthropy Award to individuals and institutions that demonstrate fundraising success through innovation and creativity.  You have read their names, you have seen the announcements, and some of you have even been present when we gave the awards.

Just for a moment, I invite you to look at the back story of three of the legends who received the awards with lessons that can help us emulate them and grow philanthropy.

Most recently, Roger Lowe, retired Senior Vice President of Wichita State University, received the award.  Some of you may have thought, “CFO’s are usually pains in the neck to fundraisers, dismissing estate designations, discounting pledge values, and wanting only unrestricted money and money they can ‘book.’”  Right?

Well, Roger is different.  He does not impede the fundraiser; rather, he tries to remove obstacles so money can be raised.  Imagine!  Let’s say you have a restricted gift to do a project, but not quite enough.  Roger searches for ways to legitimately use other funds to help reach the goal.  Or what if your CEO wants you to raise money for a project that isn’t very flashy. Roger jumps in, looking at alternatives.  To him, where the money comes from isn’t as important as getting the project done. Roger is a rare breed of CFO.  He is a rare problem solver and a good fundraisers greatest ally.

Next, Harvesters, Kansas City’s Food Bank’s Karen Haren and Joanna Sebelien took an idea of creating broadly restricted targets – Initiatives – of Child Hunger, Family Feeding, Nutrition, and Senior Feeding to present their case.  Instead of whining about hunger, they demonstrated how they were going to solve a problem.  It was not a public relations stunt when they brought their CFO (another good CFO model) to the same table and worked on an Initiative Budget for the entire organization.  They presented the cost of each program from a comprehensive point of view.

As a result, they have grown annual fundraising from $2 million a year to $14 million in six years.  Their own national organization gave them an award for this, then didn’t follow their example.  While they’re having a big year in fundraising, they are laying off people because they didn’t do the budget relieving part of the strategy.   They didn’t understand that it’s not a gimmick.  It’s real, dedicated organizational change.

Finally, our own Chair in Fundraising, at Indiana University, and his colleague, Jen Shang gave us the research on bequest pledging.  Among the findings is a simple, transformative idea that everyone can make a bequest just as they can an annual fund gift.  This 2008 research is slowing catching on.  We have three bequest pledging organizations in which the numbers are fantastic all over.  In less than 10 months, Tulsa Boys Home asked each of their 44 board members to give through a bequest.  Only one turned them down and they have nearly $5 million committed in six months.

As a national organization, The Heritage Foundation has the challenge of communicating with their donors through direct response and then following up.  Asking for bequests, they have closed 221 bequests this year valued at over $20 million, almost three times the average of previous years.

Finally, the Humane Society of Greater Kansas City is in a campaign but has discovered the inclination of their membership to give has raised $5 million in bequests just from their Board of twelve.  In the Sargeant/Shang research you’ll learn that an agency is 17 times more likely to get an estate gift if they ask.

At Wichita State University, thirty million dollars was raised from 276 donors as a result of the Bequest Giving Strategy; over $75 million in fundraising growth because an organization was thinking from the donor’s point of view and established a partnership with the CFO instead of focusing on the competition.  This innovation changed the direction of a university.

Some may dismiss this as just another series of random stories and situations.  No, each of these was as a result of a strategy to grow philanthropy in America and in the world.

What is different here is that we observed, watched and recognized with the Growing Philanthropy Award, that each model of behavior can change fundraising in the world.

This past holiday, that’s what I thought about.  It was a great a Thanksgiving.

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