I just talked to my friend who is also my personal banker and is in charge of giving for his bank in my home town.  He is a great guy who cares about philanthropy.  He has been supportive of me in the community.   In our conversation, I told him that the Giving USA Report had come out and 2009 went down 3%.  He said, “Bob, I came to your house for that reception, and a fundraiser for a local museum and another for a social service organization came up to me and asked to visit sometime. I said ‘sure.’  That was seven months ago and neither has called me.”

Did you get that?  Neither one called in over a seven month period!

Giving went down $10,000 as a result of negligence on the part of two fundraisers.

I know both of them.  They had both had talked a lot about how difficult fundraising was for them in this economy.  And yet, they walked away from a gift.

That baffles me.  Why would they do that?  Are they too busy to raise money?  Are they worn out by “beating the streets?”  Did they say “no” for him?  What do you have to do?

It reminded me of a fundraiser for a domestic violence facility who said last year, “This is why we have reserves.  We shouldn’t be asking people for gifts now.  Nobody is giving any money away.”

So three different fundraisers, for very different causes, bought into the common view that no one was giving away.

Did you see the latest Chronicle on Philanthropy article on 50 large institutions that have had increased fundraising in the first quarter at more than 30% over the past year?

You may be hearing two stories.  One story is that “people are saying” no one is giving money away.  The other is based on fact and last quarter data on actual dollars raised.  It says money is available for those who are willing to go the extra mile, get creative, and demonstrate a compelling, urgent need.

Which story do you choose to believe?

The myth that small budget nonprofit organization cannot or should not pursue multimillion dollar campaigns is exactly that: a myth.

The size of your nonprofit organization’s operating budget does not dictate its fundraising prowess.

How do I know? The nonprofits who have been successful:

A battered women’s shelter with an annual budget of $90,000 raises $2.1 million

A youth summer camp with an annual budget of $300,000 raises $8 million

A community arts groups with an annual budget of $160,000 raises $3.8 million

A statewide professional society with an annual budget of $40,000 raises $7 million

A small town Boys & Girls Club with an annual budget of $280,000 raises $2.5 million

A group helping sexually abused children with an annual budget of $450,000 raises $4.5 million

A community based drug and alcohol recovery organization with an annual budget of $150,000 raises $1.3 million and 30 months later raises another $1.1 million.

There are more examples, but I think you get the point.

There are always reasons not to pursue a comprehensive campaign:

“The economy is poor.”

“We don’t have enough staff.”

“The board is not engaged.”

“We don’t have answers to a lot of our questions answered yet (I call this one paralysis thru analysis).”

“We have no big gift donors (and you won’t if you don’t do a campaign).”

“There are groups currently doing campaigns in our city.”

“We’ve never done a multi-million dollar campaign before.”

And my personal favorite, “No one knows who we are (beyond money, campaigns serve to greatly increase the visibility and profile of an organization).”

All of these dynamics were true for these nonprofit groups. Still, they went on to raise major dollars in service to the clients served by their nonprofit group.

Each of these groups had a different mission and a different type constituency. What these successful organizations have in common is a desire to better serve their clients and to serve more people in need. These groups engaged fundraising counsel and each pursued a major campaign. On any given day they had their doubts and concerns about their fundraising, but each trusted and pressed forward with the fundraising process.

Most importantly they did not allow their doubts and fears to delay or high-jack their ultimate goal of raising more money to better serve their clients.

If an organization of any size allows the current view of itself, including the size of its annual budget, to influence its future it strikes me that its future will be much like its past.

by Guest Blogger Robert Swanson, Vice Chairman, Hartsook Companies

Robert G. Swanson has worked with fundraising and nonprofits since 1987. He completed his nonprofit career as CEO of the Emporia State University Foundation. He has worked with nonprofits in 16 states and over 200 communities. His current client roster includes nonprofits in Arkansas, Kansas, Louisiana Missouri, Nebraska, and Oklahoma. He is the author of Fundraising Magic: Turning Board Members into Fundraisers.

This was not the headline of the Chronicle of Philanthropy or the news release issued by the group announcing the study.  Their headline was along the lines of, “Two thirds of Americans to give less or the same in 2010.”  If you read their articles, they say that 53% of Americans were going to give the same, and 11% were going to give less.  Therefore, 36% were going to give more.
Did you hear that? 36% WERE GOING TO GIVE MORE IN 2010!

Which nonprofit anticipated 36% of their donor base was going to give more this year?

I say again, “Huh?”  The real headline is the one I started with.  (By the way, I’ll give credit where it’s due: Philanthropy Journal’s headline was closer to the report.)

I’m certain every one of the over three hundred clients we represent like to hear that 89% of their donors would give the same or more.  That would be some pretty good news!

I had not heard of Fenton Communications prior to this survey release.  I have contacted them to talk about this survey, but they have not returned my call.  I have gone to their website and they look like a reputable company, but they clearly don’t understand the fundraising and philanthropy sector.  If they had reported that 89% of the American public either support President Obama or will support him more, it would be incredible.

One of the other conclusions of this study was that older Americans are more conservative about giving.  Really?  It has always been that way.  It would have been news if they weren’t more conservative.

The fact that only 11% are going to decrease giving is the story.  The robust love of  America has been highlighted by this study and the expression of this love is philanthropy.

I apologize if I seem to be beating up on the Fenton Group.  I am not.  I am glad that there is more research.  The Chronicle released a study that 50 large charities saw an increase in giving of 31%.  While a decline in individual giving in 2009 was seen by The Center for Wealth and Philanthropy at Boston College, it now projects that will be erased, with more giving in 2010.

Last year, millions of dollars were lost by fundraisers in America because they bought this crap about nobody giving.

They believed the glass was 89% empty.  We didn’t.

Our instincts would tell us that million dollar gifts surely can’t be given as frequently as they were before the market and economy setbacks.  But responsible research isn’t based on instincts.  Patrick Rooney, who heads the The Center on Philanthropy at Indiana University—an organization to which I have endowed a chair, serve on the Board, and am told I am one of the largest individual donors—stated recently, “…wealthy donors appear to be thinking very carefully about how much to give and when in this economy.” 
 
It is troubling that a revered institution like the Center on Philanthropy at IU states this as truth because of the lack of valid research they have done to make such a statement.
 
Rooney’s basis for this statement is a list of Million Dollar Gifts developed many decades ago by my friend and mentor Art Franztreb, and later by me.  This was given to the Center on Philanthropy several years ago by Art and me after Art’s company was acquired by Hartsook Companies, Inc. in the late 90’s.  I know firsthand the purpose of this list.  It was never intended to give a quarter-by-quarter review of current giving; rather, it provides a quarter-by-quarter view of reported million dollar gifts. 
 
Generally that distinction doesn’t matter, but it is huge if you are reporting donor attitude during a specific period of time.  Ever give a million dollar gift or get a million dollar gift for your institution?  I have done both.  And I can tell you that the reporting of the gift was never (that may be too strong a word and though I can’t think of an exception in my 38 years of fundraising, let’s say “seldom”) reported to the news media immediately after the gift was given.  My own gift to the Center was agreed to in March, 2006 and wasn’t reported in the Wall Street Journal until October 13, 2006—more than two full quarters later.  The Center would say there was a new gift in the fourth quarter of 2006 when in fact it occurred in the first quarter of 2006.  To ascribe the economy as a motivation for not giving in the third and fourth quarters of 2008 based on this list is just dead WRONG. 

It is accurate to say the reporting of those gifts publicly went down in the third and fourth quarter of 2008, but that brings me to my second point.  Who reports million dollar gifts to the media?  Primarily higher education, some major health care organizations, a few arts groups and gifts made to fund foundations in the donor’s name.  How many gifts to the Salvation Army are on that list?  How many to the Red Cross?  How many to Boys and Girls Clubs?  Young Audiences?  Local food banks?  I’ve made my point.  Those million dollar gifts not being reported far outweigh those reported.  While the Center adds this disclaimer in the official list, it is never picked up by the media.  And it is certainly not understood by organizations seeking million dollar gifts.  
 
In addition, much has been made of how gifts given during this period are not being reported because of how those donors might be perceived in this economy.  This self conscious behavior is not imagined.  It is very real in my company’s practice with our clients.  But it doesn’t mean million dollar gifts are not being made. 
 
The fact is, this report is not a reasonable or valid tool for measuring million dollar gifts on a quarterly basis.  On my authority as one of the people who developed it and gave it to the Center, I will tell you—it was never intended to.
 
So you all know, I have voiced this objection to the Center and asked them not to report on contemporary million dollar gift activity based on this list.  We might think this is innocent; after all, we all know million dollar gifts must be down this year, right? 
 
Let me tell you the consequences of erroneous public statements from an institution with a trusted perspective.  The Center publishes the Giving USA report which tells us how much was raised in a year (a good report). 
 
I bet you that one influence for estimating what happened to giving in 2009 and 2008 will be this report from the Center.  Fundraisers and board members are being told, “Don’t try for million dollar gifts.  The Center on Philanthropy has said you aren’t going to get them anyway!”  It will be repeated in conferences, board rooms and the media enough times it will become fact.
 
I enjoy my role on the Board of the Center, I use and apply much of the research that is generated by them and others.  But I have also learned what bad research is, and this is a great example.
 
The Center does a great job of reporting well designed and implemented research.  However, their use of this kind of inaccurate measurement diminishes public trust in the Center’s research integrity.

Go out and get those million dollar gifts.  They are still being given away.  And when looking the reporting of research, always question the source.