In this interview with Kim Klein, an internationally known nonprofit trainer, speaker and author, we discuss how to build the best relationships with donors and learn from nonprofit Bright Spots.
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Watch the full interview above or read the highlights below.
Fundraising Bright Spots
AE: I saw your session the other day, and you were talking about fundraising “Bright Spots”. What is that?
KK: Fundraising Bright Spots is a report that my firm (Klein and Roth) and another firm called Compass Point just put out last year. The short of it is, we’re all consultants, right? And so we get called in to all these groups and they have problems and we help them with their problems, and we write a lot of books about problems and they are very prescriptive … how you should solve your problems. But somebody had read this article about positive deviants, so they had this bright idea that we should look for groups that never call us. And we should say to them, what is your secret?
At Compass Point and Klein and Roth, we work almost entirely with social justice groups, and groups that have very small budgets — under $2 or $2.5 Million. So we had a very specific niche. We decided to try to figure out if there is a cross section of organizations who had been able to grow their individual donor program, significantly.
We put out the word. We got about 200 nominations and we picked 16, and really drilled down to see what they had in common. That’s our report.
AE: What are one or two of the key takeaways?
KK: Some aren’t that surprising. One was that your fundraising has to be grounded in a philosophy. You have to think, if I could raise money in any way I wanted, what would be the most mission-fulfilling way for our organization to raise money?
The second is, fundraising has to be highly distributed. Every single person — janitors, receptionists, social workers — has to understand it, and know what they can do to help.
Then of course, the things you talk about, being systematic, disciplined, and using data.
AE: Great! Everyone should read it.
Using a Fundraising Form to Cultivate Ideas
AE: One of my favorite points that you made was this fundraising form. Would you share what that is, and why we should use it?
KK: I’m glad you caught that. One the things that people object to, if you’re going to be a fundraising bright spot and you distribute fundraising everywhere, is that your board members and your volunteers will come in with their really “bright” ideas, that really are not. And so what are you going to do about it? But, every so often someone does have a bright idea.
This group called Student Action for Farmworkers, they have this form called the fundraising experiment form. [People who fill out the form] write up things like: this is my idea, this is how much I think it will raise or do for us, this is how much it will cost, etc. And then the staff and board members read through it, and then they decide yes or no.
It either succeeds or it doesn’t, but it doesn’t matter, because it all adds to knowledge. I think that was an important point of the Bright Spots — they were totally willing to take risks. And if they fell down, they were like, now we know. So their development directors weren’t defensive, or hiding things.
AE: It’s such an important point, because I think so many nonprofits are risk-averse. They are very afraid of losing money, of experimenting, of disappointing donors. So they are really not willing or able to think outside the box or try new things. This fundraising experiment form … I love it! Somebody submits the form and a committee decides, so it’s not just one person’s “stupid idea.”
The True Meaning of Relationship Building
AE: Okay, let’s turn to relationship building. What does relationship building have to do with fundraising?
KK: It’s one of the first things I ever learned. It’s one of the first things that everybody learns, right? I thought it was such a great idea, and then I thought, I don’t really know what that means.
Now, 40 years later, I’ve kind of figured it out. I see that organizations are so focused on their bottom line, but a very important thing is this:
We don’t want a donation, we want a donor.
We want someone who likes us and keeps giving year after year, who tells their friends.
To build that relationship requires looking at — how does the person make their first gift? What would make you say “yes” the first time? What would make you say “yes” the second time? The third, fourth, or fifth time? What would make you say “yes” to a bigger request? Ultimately, what would make you say, I’ll include you in my will?
We don’t pay nearly enough attention to that. We’re overly focused on major gifts … finding the rich person who hopefully doesn’t give you too much advice. It’s very transactional.
AE: If major gifts are done right, it shouldn’t be transactional.
KK: One of the things that Roger Craver looks at, is we have this enormous churn, with very low retention rates. It’s very expensive.
Look at the Donor as a Whole
AE: What would you like those in the fundraising profession to emphasize more? What should we be focused on?
KK: I think the idea that a donor is a whole person. A donor has whatever money they can give you, they have a network that they can bring in if they want to, they do have advice — it’s not always good advice, but sometimes it is. They have ideas. They can take your message and educate other people.
What is the power of the donor besides their money? Donors are also the voters, the recruiters of other voters.
AE: That’s what you want all donors to be doing — to be advocates and fans of your nonprofit.
Donor-Nonprofit Relationship Building Tools
AE: Let’s bring it home. What are some tools and tips that people should take to build relationships?
KK: None of this is going to be earth shattering or original.
Number one, thank before you bank. No one ever feels appreciated enough, right? And be genuine about it. The only thing you know for sure your donors are going to read is your thank you note. You should change the content of it every couple of months.
AE: I say, it doesn’t matter if you thank you donors, it only matters if they feel thanked.
KK: [Try] engaging donors in conversations other than about money. Not just always sharing what you’ve done, but more like, “What do you think? What else are you seeing out there?”
Watch the full interview for more words of wisdom from Kim.
What are your thoughts about the Bright Spots and about donor relationships? Let me and Kim know in the comments.