Major gifts are not only for a capital campaign. They’re also critical for your annual fund. If you’re not working with individual donors on a one-on-one basis to raise major gifts, it’s time to start!
What is a Major Gift?
Before you can start enjoying the success that comes with major gift fundraising, it’s important to define what a major gift is for you. The term “major gift” means something different at every organization.
For example, when I started my career in fundraising at the Battered Women’s Shelter, we rarely received gifts (excluding grants) over $1,000. When we received our first $10,000 gift, there was cause for major celebration around the office — for us, that was a MAJOR gift. We considered any gift from an individual over $5,000 a major gift.
On the other hand, I worked at Rutgers University many moons ago. There, we considered a major gift any gift over $25,000. And, during the same period of time, just down the road from Rutgers was Princeton University, where Major Gifts didn’t start until $100,000 or more.
If you’re at a small organization and just getting started with individual giving and major gifts, it would be ridiculous to hold you to the standards of Princeton University.
Major Gift Fundraising at Your Organization
Remember, major gifts don’t have to be over six figures to be considered major, and they aren’t only for capital campaigns. There’s no better way to skyrocket your annual fund than to infuse it with some major gift power.
So, what is considered a major gift at your organization?
Option 1 for determining a major gift
Check your database (donor records) to identify your top five individual donors (not foundation funders). If you have donors who give from their family foundations, but you don’t need to submit grant applications, it’s fine to include them on the list (they are really individuals who are giving through a foundation).
What is the range of your top five donors’ gifts? Is one of the gifts significantly more than the other four?
If you ran a list of 25 donors, would they all be at a similar top level? Or, do the top few gifts really stand out (is there a significant difference between the top givers and the rest of your donors)?
Option 2 for determining a major gift
Pick an amount that you think would be a good major gift level — let’s say $10,000. Then, run a report to determine how many people have given at that level or above (cumulatively) in the last twelve months to your organization.
Depending on the number of donors you have, if there are a lot of people who have given over that amount, then it’s too low. If you don’t have any donors at that amount, then it could be too high.
An appropriate amount for a major gift is one that you have received a few gifts of that size or just above the top level.
Discuss your findings with your executive director
After you have identified your top level of giving, have a discussion with your executive director, development staff, and key board members to determine what will be considered a major gift at your organization.
Be realistic and yet optimistic when picking an amount.
Now let’s look at the different steps involved in the process of major gift fundraising.
The 4 Steps of Major Gift Fundraising
There are four steps in the major gift fundraising cycle: (1) Identification; (2) Cultivation; (3) Solicitation; (4) Stewardship.
You’ll learn the ins and outs of each of these steps through the remainder of this guide.
Step 1 — IDENTIFICATION
If you want to be successful with any fundraising (and particularly major gifts fundraising), one of the first steps is identifying who you will ask. Your goal should be to assemble a list of your top 20 prospective donors with whom you will work this year.
There are several ways to identify prospects (prospective donors).
As mentioned before, the first and best way to identify prospects is to check your database. A database is a list of your supporters, which includes contact information and records for each time they’ve donated. Hopefully you have a database with donor history going back at least two or three years. (And if you don’t have a donor database, never fear — keep reading.)
You’re looking for two things…
When checking your database to determine your best prospects, you’re looking for two things:
- Your Largest Donors
Run a report to identify those who have given the most, cumulatively, over the last two years. It is important to use cumulative giving as criteria, because if you simply look for anyone who has given over $1,000 (as a one-time gift) you may miss donors who come to every event and donate smaller amounts throughout the year.
- Your Most Loyal Donors
Run a report to identify anyone who has given at least seven times during the last ten years. This group is significantly different from your largest donors group, because there’s no minimum gift amount required to make it onto this list. In other words, this list can include individuals who give $10 per year, but do so consistently, year-after-year.
The reason your loyal donors are important is that they are your best planned giving prospects. Furthermore, loyalty is uncommon these days in fundraising. It’s more important to have a low-level committed donor, than one who gives once and never gives again.
PRO TIP: These donors (those who’ve given the most and are your most loyal) are going to be your BEST individual giving prospects. They already have an affinity for the organization and are showing it by donating money.
With this criteria (largest gifts + most loyal supporters), create a list of your top 20 major gifts prospects. These are the people with whom you’re going to want to foster strong relationships.
Step 2 — CULTIVATION
The next step is to build relationships with the individuals on your list. This stage of the fundraising process is called cultivation.
Fundraising is about relationships
I’m sure you’ve heard the expression, “people give to people.” Well, it’s absolutely true. Donors want to trust and like the individuals at the organizations they support. Cultivation is about building relationships before asking for money.
It’s your job to build relationships with the individuals on your list. I realize that it’s likely that you already know many of the people on your list — they may be board members or other volunteers. Regardless of whether you know them or not, you need to start thinking strategically about how to move them to consider supporting your organization in a bigger way… a major gift.
You want to create a plan for each of the individuals on your list. All of the plans can be similar, but you’ll need to tweak them depending on your existing relationship with each person.
4 Steps to building strong major gifts relationships
You can do these steps in any order that makes sense to you and your nonprofit.
- Have a private face-to-face meeting.
This is a must. You cannot discuss a major gift in a group setting. This can be at the beginning of your cultivation or toward the end, but you cannot get around it.
More than one person can go on a face-to-face meeting — usually a board member and the executive director or development director. The meeting can take place at the prospect’s home or office and can last anywhere from 15 minutes to an hour.
- Invite them to see your program in action.
Persuade each of your prospects to take a tour, visit a program, or attend an event. Choose something you think will have the greatest impact on that individual.
- Engage your prospects to volunteer.
Invite your prospects to volunteer. On a committee, in the office, in direct service, one-time or ongoing. Volunteering brings people closer to your organization and makes them more inclined to give.
- Provide regular updates.
Updates about your programs and services can be delivered by phone, email, in-person, or hand written note. Updates should be delivered twice annually to all prospects on your list.
Get to know your major gifts prospects better
One goal of cultivation is to get to know your prospects better. To do this, you should ask them a variety of open ended questions, including:
- How did you originally get involved with your organization?
- Why did you decide to start giving? Why do you continue to give?
- Why do you feel our mission is important to support?
- What do you love about our organization? What would you like to see improved?
- If you could fix or improve one thing about our organization, community, or the world, what would it be?
These questions encourage them to think about your organization on a deeper level and consider how they can get involved in making the world a better place.
Step 3 — SOLICITATION (The Ask)
When you’re ready to begin asking your prospects for major gifts, begin with your top three prospective donors. Call them up and schedule “ask meetings” with each of them. After you conduct your meetings, you’ll set up meetings with your next three top prospects (and so on).
Scheduling your “ask meetings”
When you call each prospective donor, explain that you’d like to follow-up on your previous discussions, and talk specifically about how they might be able to help your organization, project, or program. It should be no secret why you’re coming.
PRO TIP: If they ask you if you’re coming to ask them for money, say YES! This is a relationship, and relationships are built on trust and honesty. The donor should not be surprised when you ask them for money.
Let me explain a little more about the phone call, and what to say if they ask you if you are coming to ask for money. You’ll want to say something like:
Yes, I’d like to come discuss how you might invest in our organization in a bigger and more meaningful way.
Once you’ve secured a meeting date, time, and place, you’re halfway there.
Who should attend the ask meeting?
It’s ideal to go to the ask meeting with two people from your organization — preferably the executive director and a board member. However, it’s most important that the prospective donor has already met anyone who comes to this meeting (preferably more than once).
Remember, this is about relationships, so the person who asks should have the strongest relationship with the prospect. At times, this is the development director.
In the best case scenario, a board member will ask. This is called peer-to-peer fundraising. That’s because the board member or volunteer has no financial stake in the organization, except what they have donated. They’ve already invested their time and money and are simply asking the donor to do the same.
Where should the ask meeting take place?
The meeting should be held someplace that’s quiet. This is not a good time to have a meeting at a restaurant. Hold the meeting at the donor’s home or office, or wherever is most convenient for them.
Some prospects will come to your office. Make sure the meeting is conducted someplace where you can have a quiet, confidential conversation.
Preparing for your ask meeting
Since major gifts fundraising (i.e., face-to-face fundraising) may be new to you and/or the asker, it is extremely important to prepare, practice, and role play. Don’t assume that the asker knows what they’re doing.
Make sure you know in advance:
- Who will open the meeting?
- Who will ask?
- Who will close the meeting?
The asker should take some time to practice and do some role playing with a partner.
Lastly, never leave your meeting without a follow-up plan (more on this in step 4).
What exactly should you say when you ask?
The one question I get asked about major gift fundraising more than any other is, “How do you actually ask?”
So here’s some “ask” language for you to try. Practice it in the mirror, until it feels more comfortable. And adjust it for you and your donor.
Mary, you’ve been such a great supporter of this organization, and we want to thank you again for that. As you know, the organization needs more funding to accomplish X-Y-Z goals that we’ve been discussing.
If a board member is asking, they should state at this point that they’ve given what they can, and then continue…
I’m here today to ask you to consider a gift in the range of $5,000 to support the After School Program.
Notice the language in the above example:
- Consider a gift
- Range of $5,000 — a specific amount
- After School Program — a specific program or service
PRO TIP: Be sure to include a specific amount to support a specific program or service (even if that specific thing is unrestricted operating – say “overall support of the organization”).
Lastly, make sure you know how to respond to “no” or “maybe”. That’s key!
Step 4 — STEWARDSHIP
Even before you ask your prospects for a major gift, you need to think about gratitude. Don’t think of your donors as ATM machines. Instead, really focus on them as people and what they do for your organization.
Your major gifts prospects don’t simply give money — they save lives; they feed the hungry and house the homeless; they educate children; they help cure diseases — they make the important work of your organization possible.
Donors are so much more than simply “donors.” Until you start treating them that way, they have no real incentive to give more.
Why is stewardship important?
Stewardship is often talked about as the last step in fundraising. It’s the “thank you” after a gift is made. However, you should think about stewardship long before you ask for a gift.
How will you thank your donors so that they understand the impact they’ve made on your organization? How can you thank your donors so they want to give again and again and again?
Sadly, I’ve come across too many organizations where donors aren’t thanked at all. Staff and board members feel it’s not necessary, and then wonder why they struggle with fundraising! Do you think you would give again to an organization that didn’t appreciate you?
How to create a simple stewardship plan
A simple stewardship plan that complements your major gift fundraising can be created by answering a few questions:
- Who will follow up with your donors?
- When will they follow up?
- How (specifically) will they follow up?
Consider… will all donors be treated equally or will you have a different plan for different major gift amounts?
PRO TIP: A good rule of thumb is that a donor should be thanked in multiple ways by multiple people. In addition, they should always be told how their donation was used (follow up), before they’re asked for another gift.
Who will follow up?
Who will thank your donors? Staff? Board Members?
When will they follow up?
How soon after the major gift is made will they receive their first thank you? Their second? When will they receive an update on how the gift was used and the impact it made?
How will they follow up?
You should have an in-person follow-up meeting for all major donors. In addition, will they get a handwritten card or note? Will they be listed in your next newsletter or annual report? What about on your website?
The final follow-up meeting
Ultimately, you will want to have at least three meetings per year with your major gift prospects.
- The initial cultivation meeting.
- The ask meeting.
- The follow-up meeting.
The follow-up meeting comes last, after the donation has been made.
Remember, you’re not simply thanking them for a wad of cash, but for helping to fulfill your mission. Will more children be vaccinated thanks to them? What difference did their donation really make?
If you’ll be having board members make thank you calls, draft talking points for them. Should they leave messages? (Yes!) Should they leave a return number? What number? Theirs or the number of the organization? Do what works best for your organization.
If you expect the executive director to write personal notes, write a sample draft note. Provide the stationery with details about the donor.
Once you’re ready to steward, you’re ready to start asking for major gifts!
Maintaining Your Major Gift Fundraising Program
Once you’ve established a major gift fundraising program, you need to maintain it! Your organization should invest time each and every week toward raising major gifts. In fact, I’ve prepared an entire weekly series called the Major Gifts Challenge to walk you through exactly how to spend your time — just a few hours each week.
That said, here are two of my best tips to keep your nonprofit on track with major gift fundraising.
Have weekly major gifts meetings
The nonprofits with whom I’ve worked that have had the most success with major gift fundraising have one thing in common — they hold a weekly development team meeting.
Include anyone on your major gifts team — the executive director, development staff, administrative assistant (if they help with scheduling meetings or sending thank you notes or any related tasks) and key board members.
Plan time to discuss:
- Who among your 20 major gifts prospects are ready to be asked? Who will schedule the ask meeting? How much will you ask for?
- Who (on your list) needs more cultivation? Review the cultivation plans for each prospect at the meeting. Who (on your major gifts team) will be responsible for cultivation activities?
- Who was asked within the last month (since your last meeting)? What did they say? What follow-up needs to take place? Who is responsible for that follow up?
Make assignments to be completed during the next week or month.
Eat your Monday morning frog
Have you heard of the book, Eat That Frog by Brian Tracy? (Transcript available here.) It’s an anti-procrastination book. It turns out that Mark Twain came up with the concept of eating a frog, as doing your worst task first, so you can move on with your day, knowing the worst is out of the way.
If you’re dreading asking for a major gift, go ahead and get it over with. I’m sure you’ve heard the expression, “What doesn’t kill you, makes you stronger”. Well, asking for a major gift won’t kill you.
This “worst-first” approach can help you avoid the procrastination that often derails major gift fundraising.
Getting Started with Raising Major Gifts
Now you’ve learned the essentials of major gift fundraising. But where should you start?
Start with the Major Gifts Challenge!
Be rich: In less than a year, you can increase your organization’s annual fund by 10%, 20%, 100% or more.
Be famous: In 12 months’ time, you can be revered by your boss, board members and colleagues.
If becoming a rich and famous all-star at your organization sounds intriguing, then you’re in luck.
Participating in the Major Gifts Challenge is easy. Here’s what you’ll do:
- Read each of my Major Gifts Challenge blog posts.
- Dedicate two hours per week to taking action on the information in each post. This step is critical — if you don’t take action, you won’t get results. Remember, it’s only two hours per week — you can do that!
- Let me know how it’s going in the comments so I know what’s working for you and when you need more help.
And, I promise, you’ll raise more money this year and successfully solicit major gifts. But to get there, you need to follow my advice and take action.
I know you can do it!
Questions About Major Gift Fundraising?
I’ve spent the better part of my career helping people like you create a highly successful major gift fundraising program for their organizations. If you have questions about anything in this guide, contact me — I’m happy to help.