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August 10, 2020
 
A New Normal in Nonprofit Fundraising Is Starting to Emerge
With spring fundraising events and capital campaigns on hold—as many nonprofits scramble to keep operating in the face of increased demands stemming from the coronavirus crisis, while others reduce operations—a sudden drop in revenue is causing many organizations to rethink the way they raise funds.

Two fundraising consultants, David Sharken, principal at Rainmaker Consulting, and Robin Cabral, principal of Development Consulting Solutions, offer views of what a 'new normal' in nonprofit fundraising may look like.

"Whether we want to or not, we are all required to pivot and re-create our work at this time. As we navigate the new normal, we and our client agencies are consciously feeding a culture of philanthropy to help grow the healthiest possible newer version of our organizations," Sharken said.

In the short term, as program fees largely disappear, governments and foundations will help stabilize nonprofits, particularly those providing aid to people with existential needs.

Cabral and Sharken both said individual giving will initially be erratic. There may be a bump in giving as people respond to emergency appeals, as they typically do following a natural disaster. After a few weeks, those donations are likely to drop for perhaps up to six months, before rising again as major donors respond to a continuing need for funding from nonprofits providing life-supporting services. A call by many nonprofits for foundations to loosen restrictions on grants—many foundations have already—will also boost income for nonprofits.

A number of new realities are helping to set the stage for a rebound in giving to nonprofits, according to Sharken. Among them:
  • Communities are responding generously in the face of crisis and agencies are playing a part to connect people to the needs of society.

  • Nonprofit leaders are refining talking points of how their organization is pivoting to a new world.

  • The pandemic and societal upheaval is forcing agencies to ensure programs remain mission-centric.

  • Many organizations have increased personal outreach, particularly to major donors, via emails, personal notes, calls, and texts.

  • Many nonprofits are ramping up social media and electronic communications with compelling mission stories.

  • Many are starting to shift from event-based fundraising to other creative solutions, including online events, gift certificate sales, and by articulating future investment opportunities.
"The nonprofit community has the chance to laser focus on its commitment to mission, its clear communication to stakeholders, and its ability to be responsive during the pandemic," said Sharken.

The "Great Upheaval" now underway will change the way nonprofits operate, according to Cabral. Far-sighted nonprofit organizations, and the ones more likely to survive and ultimately prosper in its aftermath, will institute many of the following practices:
  • Boards will engage to a greater extent than before on systemically assessing risks—even those previously seen to be far removed geographically—that could affect their organization.

  • Those boards will also take steps to build reserves and build endowment funds, if they haven't already.

  • Organizations, particularly those previously highly dependent on grants, foundations, and special events, will make concerted efforts to diversify their revenue streams.

  • They will rethink their special event strategy. While there has been a pivot to ensure that special events continue in a virtual format, for many organizations virtual formats are falling flat and appear somewhat out of tune with this unprecedented time.

  • Technology will play a growing role in fundraising, whether it video for mass e-appeals, text messaging to donors, or even digital lead acquisition.

  • Nonprofits will recognize they need to deepen fundraising skills across their staff, and therefore will engage fundraising coaches to teach them, in place of relying principally on fundraising consultants who often do much of the work.
Whatever the new normal eventually looks like, Cabral said, how nonprofits respond now, how they communicate with major donors, including via special reports, personal notes, and meaningful photos, will shape the relationships that will support them for the medium and long term.
April 2020
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