Fundraising is an investment - the exchange of money for impact

Fundraising game changer: Treat donors as investors rather than benefactors 

One of my key interventions as a Fundraising Strategist is to support my clients during fundraising to see it as a transaction: the exchange of money for impact. Therefore, to access more funding, the donor requires a clear impact model. This should be defined ahead of contacting a potential donor. 

This transactional thinking helps to address the unequal power dynamic between donor and beneficiary. They are not doing you a favour:  you are solving the problem of how to achieve their desired impact without them having to implement the work themselves. You are providing the donor with a reliable pathway to their desired impact and need to be properly enabled to undertake this programme of work.

Slow down your storytelling: This may seem obvious to some, but many non-profits don’t describe the basic thinking underlying their impact model, assuming that it will be obvious to the funder. Or they leave the emotion out of fundraising proposals and instead focus only on technical details. By slowing down and describing your pathway to impact more effectively, you can create a compelling proposal that connects with the potential donor. 

Use your five-year strategy as a proposal: Donors, particularly high-net-worth individuals, are often sophisticated business thinkers. Many have run complex companies and have a nose for good strategy. The best way to get the attention of this kind of donor is to present them with a three-,  five- or ten-year strategy for your organisation and ask them to invest in it.

A good strategy hinges on a solid impact model, described in a vision, mission and theory of change (see our resources for more information). The other layers of a strategy - namely a programme framework and a five-year costing - are more detailed descriptions of that core impact model. This impact-centred approach makes it easy for a funder to understand the link between impact, activities and costs and makes it easier for them to invest with confidence. 

Set ‘problem-solving’ targets: By defining the impact that a research group or non-profit intends to make over the next five years, we can package that investment as a project and attach a 'problem-solving' fundraising target. 

This high-level target can further be broken down into 'enabling' targets which allow us to achieve milestones along the way to our intended impact. Enabling targets opens the door for multiple donors to collaborate to help you reach your larger fundraising target - a group of donors with a common impact goal. 

Key take-home point: It can be as time-consuming and challenging to get USD 10 000 as it is to get USD 100 000 out of a funder. By describing the funder’s involvement as an investment, and clearly showing the impact you will provide in exchange for their involvement, you open the door to catalytic, problem-solving donations.