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FundClass Archives

Capital Campaigns: full opening message

Full opening message of FundClass Topic #11, March 1998

Our facilitator is Greg Jakubowicz

Greg Jakubowicz has a tremendously strong record of successful capital campaign management having worked as a consultant with a variety of national and local non-profits including religious organizations, colleges and universities, hospitals, drug rehabilitation agencies, and homeless organizations.

He has raised over $400 million for non-profits during his 18 years of fund raising experience. He founded Health Solutions and Funding Solutions in 1994 and 1995 respectively to help meet the fund raising needs of non-profits. Services offered by his companies include Long Distance Rewards®, a donor sustaining program developed with FicoTel Corp.; fund raising consulting in capital, annual, and endowment campaigns and a special planned giving program.

Definition of a capital campaign

A capital campaign is when a non-profit organization finds a need to either build a building, provide additional funding for program/service needs, create an endowment to fund building maintenance and/or programs, and any other funding needs that have not been met through regular fund raising programs. An example, your church needs to build a new roof, replace the boiler and do some other renovations to the building. The pastor needs to raise $500,000 to meet these needs. You conduct a capital campaign raising pledges from individual members who fulfill their pledges over a 3 to 5 year period. A school wants to raise an endowment fund to help pay for an education program that is not currently funded. Again, they canvass the parents of the children attending the school for a gift payable over a period of 3 to 5 years.

Capital Campaign Opening Statement

In the nearly 20 years of my fund raising consulting career there is one question that continually arises:

When is a good time for my organization to conduct a capital campaign?

The answer typically is that there is no good time or bad time. The right time is when your organization has the will, commitment, and need for a campaign. This translates easily, for example, when a church needs to replace its roof the time to do it is now. Otherwise it could get awfully uncomfortable for members of the congregation on rainy Sundays. When the case is not as clear cut it is always better to conduct a feasibility study in preparation for a capital campaign.

QUESTION: Why not just go ahead and do a capital campaign without a feasibility study?

ANSWER: Because you want to be successful and raise a lot of money. If you do not conduct a feasibility study you can set your organization on a precarious course, not raise the money you need and be perceived in the community as a failure. All bad images in a very competitive philanthropic marketplace.

A feasibility study sets the stage, clarifies your case for fund raising identifies potential donors and leaders, and recommends a fund raising plan that will help ensure success. The study builds a firm foundation for your organization to not only raise the necessary funds but help you grow into the future.

I have noticed over the years that when an organization purchases fund raising software that a capital campaign is not far behind. Many groups feel it is important to have good records and accounting mechanisms in place before they embark on a major capital effort. I wholeheartedly agree.

WHY PEOPLE GIVE

Before you begin a fund raising campaign, it is first important to understand why people give. Many surveys have been conducted on this question and the following is a summary of the most important reasons why people give generously:

HIGH PRIORITY REASONS

  1. Serves on the Board of Trustees, a major committee, or other official body of the institution.
  2. The leverage or influence of the solicitor(s).
  3. Actually involved on a campaign committee.
  4. General belief in the mission of the institution.

MEDIUM PRIORITY REASONS

  1. Specific interest in the project being funded.
  2. Respect for the institution.
  3. Regard for volunteer leadership on the campaign.
  4. In order to challenge or encourage other gifts.
  5. Fiscal stability of the institution.
  6. Memorial and/or recognition opportunity offered.
  7. Sense of community responsibility and civic pride.

LOW PRIORITY REASONS

  1. Tax benefits of giving.
  2. Guilt feelings.
  3. Appeal and drama of the campaign’s promotional materials.

STEPS TO SUCCESSFUL FUND RAISING
        ---   or WHY DO SOME CAPITAL FUND RAISING CAMPAIGNS SUCCEED?

  1. The campaign was a top organizational priority.
  2. The campaign plan for fund raising was followed.
  3. Fundamental fund raising principals were employed.
  4. Strong institutional leadership was demonstrated.
  5. Volunteers made their own gifts before asking others.
  6. A well-documented case was developed.
  7. There was an emphasis on asking for gifts.
  8. There was peer (face-to-face)solicitation.
  9. Goals were established, respected and met.
  10. The campaign timetable was closely followed.
  11. Specific gift plans with donor recognition were offered.
  12. Sights (gift request amounts) were kept high.

ESSENTIAL ELEMENTS OF THE CAMPAIGN PLAN

A campaign plan is based on sound fund raising principles. The plan emphasizes spending time and energy where the most funds can be raised.

The time-proven principles of fund raising can be summarized in the following points:

  • People give to people.
  • People give because they are asked.   
  • People respond to a winning cause.
  • People give in relation to the person(s) who asks.
  • Donors respond to specific requests for support.
  • Donors respond to peer solicitation.
  • Create a campaign atmosphere.
  • Enthusiasm is contagious.
  • Relate a gift to a specific need or project.
  • Be enthusiastic and persistent.
  • Don’t be apologetic.

The primary objective of your capital campaign is to ensure that every viable prospect is asked to support the fund raising campaign in a significant way. Our experience has shown that three (3) factors affect the level of a person’s gift to a campaign:

  • Financial ability
  • Interest in and awareness of the fund raising campaign.
  • The manner in which the gift is requested.

THE KEY PRINCIPLES OF THE CAMPAIGN PLAN INCLUDE:

PERSONAL SOLICITATION
To meet personally in the homes or business of each prospect is critical to the success of your capital campaign. A personal visit is the most effective way to:

  • Personally thank donors for their on-going support of the organization.
  • Explain the reasons for the capital project and how it will enhance the future of your organization.
  • Answer questions about the work of your organization and the proposed fund raising campaign.
  • Request a specific pledged gift over time to the fund raising campaign.
  • Explain the pledge system.

Personal Visits Always Result in Larger Gifts.

PLEDGE GIFTS - THE KEY TO SUCCESS
To offer prospects the opportunity to pledge their gifts over time through a multi-year pledge payment plan, enables a $1,000 donation to become a $3,000 pledge gift or more . Studies have shown that donors who pledge their gifts contribute 2 to 3 times as much as others.

REQUEST FOR SPECIFIC GIFTS
To provide guidance to those who will support your campaign and to stimulate a meaningful contribution. A number of gift plans should be developed reflecting the level of giving necessary to meet the goals and objectives of the campaign.

EMPHASIS ON MAJOR GIFTS
To set the pace for giving, inspire confidence, build leadership, give credibility, provide significant money, create momentum, attract other major gifts and ensure success. The major gift phase is conducted prior to the public announcement of the campaign.

In many fund raising campaigns, the 80%-20% rule applies: wherein 80% of the funds raised are contributed by 20% of the actual donors. Some campaigns are experiencing a 90%-10% ratio.

A PHASE-BY-PHASE APPROACH
To generate momentum and establish a high level of giving. A capital campaign will seek large gifts from a select few to set the pace then seek broader participation from the general community at a lower gift level.

A CAMPAIGN ATMOSPHERE
To build excitement, momentum and a sense of urgency in order to achieve the best results. Campaign meetings, reports, brochures, posters, and events are designed to support a campaign atmosphere.

AN INTENSIVE TIMETABLE
To minimize the time while maximizing the productivity required from volunteers. The campaign timetable will be designed to create deadlines and focal points of activity.

DONOR RECOGNITION
All potential donors should be presented a specific gift plan with related memorial and commemorative giving opportunities. Commemorative opportunities serve as a form of gratitude to donors.

The amount indicated for a specific memorial or dedication does not necessarily reflect the actual cost of the item.

The above points are some of the key essentials in conducting a capital campaign. During the course of the fund class I will offer examples where organizations met or ignored these points in conducting their capital campaigns.

I welcome any comments on the above points to get the class started.

Your Fund Class Facilitator,

    Greg Jakubowicz
President, Funding Solutions www.fundingsol.com

This opening message was originally posted by Michel Hudson, April 15, 1998

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