Two Essential Words: Thank You

Have you thanked anyone this week? If not, it's about time you did. Expressing your appreciation for your staff, board members, volunteers, and donors is an essential element in building organizational capacity and sustaining relationships with the folks who support your work. Here are some basic guidelines:

• Thank everyone: Yep - I mean everyone, including the donor who contributes a mere $10 and the volunteer who puts in an hour of time and the board member you can't stand and the staff person who is slacking. Do it not only because it's prudent practice - donors who receive prompt thank you letters give more, volunteers who are thanked are more likely to return for more hours, board members and staffers who are appreciated work harder. Do it because it's the right thing to do.
• Thank promptly: When someone donates, your acknowledgement should be sent out immediately - no more than a week after receipt of the donation. If a donor has to call to check and see if you received a contribution, you have really blown it - and you run the risk of losing future donations.
• Make it personal: It might sound downright old-fashioned, but an actual handwritten letter or postcard or a personal phone call beats a form letter (or even worse, a form email) any day. At the very least, be sure to add a handwritten note (it can be as simple as "thanks for your continuing support; it really makes a difference!"), especially to important longtime donors and volunteers.
• Do it right: This may sound stupid, but make sure you send the appropriate letter with the correct salutation to the right address. Just last week I received a thank you letter for someone named Jane. I returned the letter to the nonprofit with a note, but not everyone is going to be so helpful. And make sure you have the correct language in your letters to donors. Here's what to include for cash donations: "This letter acknowledges receipt of a gift in cash, for which there were no goods or services provided in consideration, in whole or in part, or for which the goods and services provided were of insubstantial value." Note that if you did provide goods/services of value, you need to indicate how much they are worth and deduct that amount from the acknowledged charitable donation. For gifts of stock you need to include the number of shares, name of the stock, date the gift was received, and the value of the gift on that date.
• Stay in touch: Don't make that thank you letter the last thing your donors or volunteers hear from you until they get your next year's solicitation letter. Be sure to put them on your email list for newsletters, send them invites to special events, call significant donors and volunteers to share important news, and plan fun annual volunteer and donor appreciation events.

By the way - thanks to all of you who continue reading these blog posts, sending me emails with feedback, and letting me know that my posts have helped you in your nonprofit work!

Five Questions to Ask Before You Write That Grant

So you have a budget shortfall. Your board looks at the financials, panics, points to the Executive Director, and says, "Why don't you just write a grant?" I'm guessing this scenario sounds pretty familiar. But before you write that grant, it's important to stop and evaluate whether it's worth your valuable time to do so:

1) Are the foundation priorities a fit with your organizational mission?

• You don't want to waste your time writing a proposal that has little prospect of being funded. Take the time to determine if the funders' goals and objectives are a match for your organization.
• Look at the website for funding priorities as well as lists of previous grants to get a sense of what they are looking for and what kinds of organizations they like to support.
• That said, never create a project for a grant proposal simply because it fits into the parameters of a particular foundation unless it represents a clearly defined and authentic effort to meet new needs for your constituency within your stated charitable purpose.

2) What are the odds of actually getting funded?

• Be sure the foundation gives grants in your geographic area, accepts unsolicited proposals, makes grants of a size that is within an appropriate scale for your organization, and actually gives the kind of funding (operating support, capital campaigns, scholarships, ongoing programs, etc.) you need.

3) What's your game plan for the day after the grant period is completed?

• I know you are all looking for ongoing operating support, but don't kid yourself - those kinds of grants are pie in the sky in our current climate. Know that most grants will be for time-limited project support, although you can usually budget a small percentage (typically no more than 10%) for administrative costs in project grants.
• So - assume that any grant will be for one year only and plan accordingly, particularly if your project involves any significant increase in staff and programming.

4) Will this grant contribute to an income stream that is diverse?

• Always seek for a diversity of funding sources, both overall and within income categories (grants, earned income, contributed income).
• Avoid the trap of becoming dependent on one donor for key support, whether it be an individual or a foundation. Some of the worst financial messes I've seen nonprofits get into were precipitated when a long-time donor or foundation stopped providing funding due to a change in priorities or an economic downturn such as we just experienced.

5) Is writing this grant application the best use of your time?

• Don't forge to weigh the benefit of receiving a project grant against the extra work required, including not only time spent writing the grant but also written narrative and financial reports.
• Finally - remember that 75% of charitable dollars in the U.S. comes from individuals (83% if you include bequests and family foundations). A paltry 12.5% comes from foundations. Given your staffing level and/or board engagement, you might be better served strengthening your major donor fundraising efforts.

Five Tips for Building Donor Relationships

So you have a base of donors for your organization. Now the question is how you plan to sustain and build relationships over time with your donors that will continue to support your good work. Here are five tips about how to do just that:

1. Get to know them: Do this through data - and on a personal basis. First gather as much information about them as possible and put it into your database - name, address, phone, cell phone, email, salutation, giving history, direct participation in your organization, special interests, etc. But you also need to take the time through direct personal contact to know them as people - their family, what they care about deeply, why they are interested in your cause.
2. Stay in touch: According to Rockefeller Foundation research, 9% of donors stop giving because they had no memory of supporting that nonprofit. You need to stay in touch about their membership status and gently remind them if their membership has lapsed. You need to stay in touch with reports on your progress and successes through handwritten notes, enewsletters, personal phone calls, and one-on-one meetings. You need to stay in touch sometimes even when you don't want money, simply to maintain your connection, update them on your programs, and solicit their feedback.
3. Communicate effectively: Here's more telling information from the Rockefeller Foundation about donors who stop giving - 5% thought the charity did not need their support, 8% felt they didn't get enough information about how their charitable dollars were being used, and 18% felt communication was poor. Donors want to know where their donations go and what impact your work is having. Be sure to emphasize impact in all of your communications, with a focus on using stories, videos, and photographs to highlight your achievements.
4. Invite participation: Offer them tickets to upcoming events. Invite them for a tour of your facility. Ask them to visit when an exciting program is scheduled. Include them in conference calls. And consider inviting them to volunteer. According to a Fidelity Charitable Gift Fund report, 67% of volunteers make charitable gifts to the organization they volunteer with, and they give 10% more than non-volunteers.
5. Thank them promptly: I cannot emphasize this enough - 13% of lapsed donors were never thanked for their donations. And statistics consistently show that donors who are thanked in a timely fashion give more generously over time. So get those handwritten thank-you letters out. Always express appreciation for their support when you talk to them personally. And be sure to plan an annual appreciation event that is fun, has great food, and is appropriate for your organizational culture.

Think of your relationships with donors as if they are friendships. Treat them respectfully, stay in touch regularly, and communicate honestly and authentically. In doing so, you will strengthen their loyalty to your nonprofit - and you may just find (as I did) that you have also forged true friendships.