Questions to Ask in Planning a Campaign
As part of any feasibility study for a major campaign, or even for annual fundraising planning, it is timely to verify that the multi-year financial plan for your organization remains valid and relevant.  Start by asking these questions to be sure of the financial context which your fundraising plan must complement.

• Is service demand likely to grow in future years? If so, does your budget start planning for that growth?
• Will current grant and philanthropic efforts adequately support such growth? What does the proposed budget do to back those efforts? Will the level of service delivery and/or the financial condition resulting from this budget encourage or discourage donors and grantors in their providing the level of gifts anticipated in the budget and plan?
• Will any of your facilities need significant repair or modification in the next few years? If so, do you expect to perform those repairs? How will you pay for them if you do and what are the consequences if you don't?

Click here for a full menu of questions to help you to be sure of the financial context which your fundraising plan must complement. Email us with your suggestions for how a board can better assess how well its financial strategy is positioned to benefit the most from its advancement efforts!

Need more?  Read how we can work with you or present a workshop to hone these ideas.

Unfamiliar terms?  See our glossary.

Excerpts from Linking Mission to Money
This link from Chapter Fifteen Capitalize on Good Financial Times provides a cautionary note for organizations that are considering focusing their advancement efforts on raising endowment monies. Click here for an excerpt from Linking Mission to Money

Articles of Interest Before You Begin a Fundraising Campaign
Reductions in corporate giving are more than a math problem  urges corporate donors to carefully design changes that respond to current financial circumstances with the least impact on nonprofits' ability to sustain themselves and their mission.  Five principles to guide reduction decisions are explained. 

Nonprofits in Recessions, Where the Buck Stops  is a March 2009 speech I gave which argues that governmental and philanthropic policies of the last 20 years have weakened nonprofits financially yet at the same time made them our public goods providers of last resort.  Five suggestions are made to improve their ability to weather this recession.

Supply chain management lessons may help nonprofits in hard times  argues that nonprofits increasingly serve a role as suppliers to philanthropies' service programs.  In difficult times, supply chain management dictates that philanthropies must be responsive to the financial stress on their nonrprofit suppliers if they are to maintain their supply chain of services.

Challenge made to tax write-offs for some forms of charitable giving   documents the community benefit that higher education and cultural institutions provide and rebuts challenges to the tax deductibility of donors' gifts to those institutions. 

Sustaining nonprofit groups moves front, center with sector's backers   discusses an emerging sense among donors that some changes in how philanthropy works in the U.S. are necessary to relieve the stress on nonprofits from the pressure to address critical social issues so rapidly that the volume of service overwhelms many nonprofits' capacity. 

Donor's choicest gift to a nonprofit is trust in the group's management  argues that a lack of trust is often the reason donors impose restrictions on their gifts and it is important that the nonprofit address the cause of the distrust rather than passively accept the restriction. 

Raising money only the beginning of managing nonprofit endowment  explains that endowment is not a goal but a tool that can be misused and be a cause of volatility rather than sustainability in a nonprofit's mission.

An endowment may be something your nonprofit cannot yet afford  explains how modern endowment management shifts resources to the future and away from the present, potentially starving current operations of needed cash.

Nonprofits face danger in blurring line between donors, its managers  discusses how the well-intentioned movement of philanthropy toward seed grants, matching or challenge grants, and performance measurement requirements can lead to unintended adverse consequences for nonprofits. See the resources on gift acceptance policies below for tips on how to minimize adverse consequences.

Nonprofits must ensure there's cash in reserves for unexpected bills  discusses why it is important for boards and donors to understand the critical role of unrestricted cash reserves to the stable provision of a nonprofit's services.

Does cost of added disclosure by nonprofit groups create real benefits?  questions the value of multiple, uncoordinated disclosure reports and argues that it may be more effective to create a single disclosure report and devote more effort to educating donors on how to evaluate the effectiveness of their gifits. 

5 lessons finance officers want to teach execs, board  reminds CEOs and boards of some budget lessons that are repeatedly forgotten, often with unfortunate results.

Nonprofits poorly treated by restrictions on funding discusses the unforeseen burdens of donor restrictions and how they may actually weaken the financial sustainability of a nonprofit.

Donors want more than a party from nonprofits  explains the critical importance of regular, open, and frank communication with donors.

Other Resources
On March 15, 2007 more than 50 fundraisers and foundations came together for Capital Ideas: Moving from Short-Term Engagement to Long-Term Sustainability   to voice their support for a fundamental shift in the way funders support the non-profit sectors.  Click here for the 73-page proceedings of this conference. A short six page executive summary is available at this link.

Gift acceptance policies are an excellent tool to use to minimize the unintentional adverse consequences of restricted gifts discussed in my article above, Nonprofits Face Danger.  See this1999 article by Kathryn Miree in Planned Giving magazine for advice that is still revelvant on how to structure a gift acceptance policy that helps your nonprofit without creating counterproductive restrictions. See also Creating Gift Acceptance Policies   for an extensive how-to guide written from a legal perspective by Beth Engel. 

Arts and cultural nonprofits can be at a disadvantage to social services nonprofits in convincing donors of their value to the community.  Click here to read a convincing white paper on the public value and community advantage that can be provided by keeping our arts and cultural nonprofits healthy and vibrant. 

IRS Form 990 is rapidly becoming the first place a donor looks to get information about a nonprofit. Ideally, the nonprofit audit committee should review and approve its Form 990 before it is filed with the IRS.   Unfortunately, it is becoming apparent that nonprofit boards pay too little attention to the accuracy and consistency of their 990 filings.  Read this January 2007 article in CFO magazine to understand this emerging source of criticism of nonprofit board oversight, particularly of fundraising costs. Click on this link to see what a Form 990 looks like. Guidestar is a free web site that allows users to quickly search for and access the Form 990 filings for any nonprofit in the United States. Click here for instructions on how to access Guidestar. For significant changes for TY2006 filings,  click here.

Organized philanthropy is encountering a Catch-22 in its desire to be effective.  The Center for Effective Philanthropy released a report in December 2006 that finds that, while foundation executives acknowledge that unrestricted grants have greater impact on nonprofits, they favor restricted grant-making because it easier for them to measure the effectiveness of restricted grants.  Click here to download their report. 

A theme in many of our  Focused Discussion workshops  and articles under the Institutional Advancement tab is the relative weakness of nonprofit balance sheets compared with similar-looking for-profit balance sheets.  One source of this weakness is the inattention of many nonprofits to their capital structure and acceptance of restricted gifts and how the two practices together can result in capital-strapped organizations focused on short-term fundraising at the expense of long-term sustainability and innovation.  Click here   to read a seminal article by Clara Miller on the importance of capital structure with a special box on "Capital-Savvy Principles for Grantmakers."