← Nonprofit Mastermind Podcast
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Brooke Richie Babbage
This week I want to make a case for why it's really important if you want to sustain a seven figure level of impact for you to have an individual giving program. I've been having a lot of fascinating conversations about this during giving season and I thought I would record some of my own thoughts about this and why it is such a central part of the three prong sustainability approach that I teach inside of Next Level Nonprofit welcome to the Nonprofit Mastermind podcast. I'm Brooke Richie Babbage. I've been in the social impact game for 25 years as a social justice lawyer turned two time nonprofit founder and leader turned growth strategist and coach for leaders around the country. I grew my nonprofit from me and an intern in a tiny closet to a high impact seven figure organization. And along the way I learned so so much about how to build an organization that has real impact and how to do it without burning out. In this podcast I share the nuts and bolts of all of it so you can do that too. We dive into the mindset, strategies and tactics of how to scale a high impact organization and how to do it in a way that's truly sustainable. So warning. I'm really passionate about this. The short explanation for why everyone says it's important to have an individual giving program as part of your revenue model and why, like I said, it is so central to what I teach inside my program. The short explanation is that it works. Organizations that have at least 10% of their revenue from individuals, at least have consistently been found to be healthier, to grow more smoothly, and to be able to weather economic storms far more easily than those that rely on foundations, corporations and government alone. Having individuals as part of individual donors as part of your donor what I call a revenue engine, but as part of your diversified sort of revenue plan makes you less vulnerable. Individuals give because of personal affinity beliefs, values, alignment with your work, and during times of upheaval, political upheaval, economic uncertainty, those things have been shown to deepen, not waiver. That means that individual giving is one of the most stable forms of revenue that you can find. I personally experienced this. I had started my organization fairly recently during when the recession of 2008 hit and it was a doozy. And almost every foundation that I had been working with shifted its priorities to focus on direct service work because of the recession and my organization didn't do direct service work. So we went from being 65% funded for the year to having a $200,000 funding cliff, which given the size of our budget was huge like close our doors. Huge. And the thing that saved me was, or one of the things that saved me was my community of supporters, which is always how I think about an individual donor program. It's a community of raving fans. They were the teachers and the social workers and the law students and the pro bono lawyers and the parents of the kids that we worked with. They were people who, like me, loved the work that we were doing and believed in it enough to invest in my vision. That community of donors and supporters saved our organization because their belief in what we were doing together. Right. My role was doing the work. Their role was helping to support the work. Their belief in this mission and in our work wasn't dependent on political or economic trends. They were committed to the work, to the end goal, the same way I was. So I share that. To say that the reason that folks say organizations should have an individual donor program and the reason I say it is that when you build a community of raving fans, a community of people who love what you do, they won't leave you. They make the organization stronger. Especially times when external stuff is crazy. So that leads to my second thought that I wanted to share. And that's why so many people think that it doesn't work. Right. I think the reason that so many nonprofits. So let me pause for a moment. This is actually at the root of most of the conversations that I have. I work with organizations that are nearing and in seven figures and that want to sustain that level of impact. Right. Not that level of budget necessarily. The budget is tied to the impact they want to be. See an organization having expansive impact in the world and it can be really hard to raise that money consistently. Can feel hard. And we talk a lot about the idea of feast or famine. Right? Money's in the bank and then you spend it down. And that cyclical feeling of worry is really, really present in the experiences, leadership experiences of the organizations that I work with because of where they are in terms of their growth and their. And so we talk a lot about why they haven't leaned into individual giving as a source of revenue. And it really comes down to it doesn't. It hasn't worked for them. Right. The return on their investment has been very low. They run email campaigns, they do peer to peer campaigns, they have events, they've put in the time, they've done the work, and they get, you know, four figures in return. And I understand that that return on investment feels crappy and I wouldn't do it either. But here's what I believe, and here's what I share as we sort of talk through it in our coaching spaces. It's usually because these organizations are not doing it right. A few times a year they gear up for an email campaign, they prep their board for their annual event, they spend time, maybe money, hiring someone to help write emails, the prep talking points for their board, and then they bring in very little money. So they feel like that return on investment is low. But, and I'll just take a moment to sort of pick apart some of the things that have come up in recent calls about why, why they're not actually doing things right. And that's why there's a low return on investment. So, first, email campaigns, really creative peer to peer campaigns, awesome events. Those are all various forms of asking people for money, which you have to do as part of fundraising. But those things by themselves don't work. And those are the things we've all been taught to focus on. There's this sort of unspoken belief that if we have a really compelling campaign with a powerful theme and the right language, the right emails with really inspirational videos or pictures, if we have the right impact report, right, if we put the right combination of marketing materials and fundraising materials in front of people, then people will see how great we are and they will give. Right? I call that the billboard approach to fundraising. Conversely, if you put sort of a please donate button on the bottom of your homepage or your donation page or at the bottom of an occasional email, or in an email, you say it would be great if you would consider supporting us. And then people don't give. That feels deflating. So just as an ask by itself, the events, the campaigns by themselves don't work without nurturing. Nurturing. And having people on your email list and having people in your community won't work if you don't ask. And I see both of those a lot, they'll do a lot of asking, but they're not sort of building relationships with people that make that ask effective. Or they'll do a lot of relationship building, they'll stay in touch, they'll email their folks. You know, they'll have cultivation events. And then the ask is sort of hidden behind this, you know, soft language of wouldn't it be awesome if perhaps you would hopefully consider maybe giving us something? Right? And we've, most of us, I was about to say, we've all been there. I've definitely been there. Most of us have been there. And there are lots of reasons for it. But I will say here is neither of Those things are gonna work, right? And so you can do all of that work, the nurturing without the ask, or the ask without the nurturing, and you will get a low return on your investment and that will feel crappy. Another myth that does people in expecting the people you went to college or graduate school with, the people your board members work with, the friends of your parents and siblings, expecting them to give isn't an individual donor program. The sort of who you know approach to fundraising doesn't drive growth because at some point you run out of people you know, and they run out of people they know. And actually, even if you knew a thousand people, only some small percentage of those people is going to care at all about what you do, right? So we get discouraged when we have people in our world and we expect them to give. And maybe they give a little amount or maybe they give inconsistently and far more frequently. They don't give. Our board members, friends don't give, and we don't know why or whether they even care about our mission. So when they don't give, we feel bad, right? But it could actually be and is usually the case that that nexus of affinity isn't there, right? The attachment is there. They know us, they know somebody in our world, but maybe the issue that you work on isn't their issue, right? So we ask the people we know and try to get them to ask the people they know, and that still brings in very little. So that's another sort of workflow that is very frequently deflating for people, and it doesn't work because attachment based fundraising is essentially transactional, right? If people give just because they know you or know someone you know, that's fine, but that's not actually relationship based fundraising, and those aren't the donors that stay. So this, this idea that I shared at the beginning of donors being stable, a lot of the leaders that I worked have not had that experience, right? They do all this work, maybe they bring in donors, and then the next year they feel like I have to do just as much work for, you know, a $10,000 campaign or an $8,000 return for new donors. And again, if that is your experience. That's right. That is very low roi. But the reason that that often happens is those donors didn't give because they feel enough. And they aren't actually that community of raving fans. It was inherently or basically transactional. And those people don't stay. The third myth that can be demoralizing and what can undermine our belief in the importance or our understanding of the importance of having an individual donor program is about sort of finding the right person and putting our work in front of them. So just because you find somebody who you believe ought to love your mission, and maybe they do care very deeply about your issue and you describe your incredible work, doesn't mean they're going to give right away. New donors, people who are new to your organization have never given, have to move through a cycle of being nurtured or cultivated. That's the relationship building piece. That's where they get to know what you do. They come to understand what you do. They recognize the shared affinity, right? You might see that this is someone who ought to love what you do and if they knew what you did, would just be the best owner. You see that. But the cultivation period is where they start to understand that, right? You put them through or give them access to experiences, let's say that help them see the nexus of affinity and they learn to trust you. Right? Can you do what you say you're going to do? Right. Those are those elements of relationship. Nonprofit donor relationships are really important and sometimes they take a short amount of time and sometimes they take a long amount of time, but they take time and it is the biggest part of the new donor cycle, right? The cultivation part. You have to put time into building relationships. Now, don't panic. That doesn't mean one on one relationships with every single donor, major donor fundraising, that really has as its root one on one relationships, that is its own thing. And there are people who are really expert in sort of helping you understand the nature of major donor fundraising. I'm talking now about a diverse, diversified individual donor program with major mid and minor donors. And so not all of those donors require one on one or should be rooted in one on one conversations. You can cultivate through a really compelling email newsletter that tells stories, educational webinars, live experiences with your programs, intimate convenings that bring potential donors into community with influencers in your space. The how of the cultivation depends on the organization and the specific type of donor. The key for all of these myths, all three, is that you have to do all of the steps in building an individual donor program. You have to identify the right people that have some kind of nexus of affinity, right? That would that do love your work. That would be raving fans if they knew and understood and trusted your organization. You have to find the right people, then you have to build a relationship with them. You have to cultivate them and nurture them so that they feel like they are in community with you and you have a shared vision for change. And then you have to ask them, right? You have to do all three for an individual donor program to work. Now, finally, and I think this is a big one and this is more amorphous than the other three, but I think, I think the energy of this one sort of permeates everything else I'm talking about. The way we so often talk about individual donors in our sector is in a way that makes it all about the exchange of money. How much money can you get from donors? Even that phrasing can feel and is extractive. What I teach inside my program is how to see an individual donor program, we'll call it, as a vibrant community of people who are passionate about your work and who want to see it succeed. You find the people who love your vision of change or impact or justice as much as you, as much as your staff. You give them ways to feel connected to that vision, to feel connected to the work, to ask you questions, to be inspired to see what the world looks like as you are working towards making it better. Then you give them a way to partner with you and your organization in making that vision a reality. Your role in the partnership is execution on the mission, and their role is supporting the mission and the vision and the work by donating. I think about the organizations that I donate to. They are the groups that are doing work that I passionately believe is critical to our society. But I can't support it by volunteering. I can't be an employee, right? What I can do is uplift the vision that we share by sending a donation to help them do their work really, really well. Because I know that money matters. You cannot execute on your mission without money. I know that and your donors know that. Right? And so when I believe that my money is being put to use towards in service of a vision that I really, really believe in, I want to give. And what you're doing by creating an individual donor program is giving other people in the world the opportunity to feel that way about your work. That's how I encourage you to think about an individual donor program. Now, the last thing that I want to say, just because of when this episode is coming out, is that I really think that individual donor communities are going to be the lifeblood of, of particularly justice focused organizations in the coming 12 months. As we continue to navigate the fallout from the last election and nonprofits come under attack, governments, corporations, foundations, these sources of sort of bigger checks are going to be shifting how they fund work, especially in the grassroots and justice focused spaces. The source of revenue that is unwavering and that you can lean on is the community of raving fans who have raised their hand to say, we believe in what you're doing. You want to be able to turn to a community like that in the coming years to make yourself more stable. So that's it for my soapbox today on why individual giving programs are so important. And I hope that it has at least gotten you thinking if you don't have an individual donor program about how you might want to Build one in 2025. If you want to talk with someone about that, I like I said, it's one of the main focuses in my next level nonprofit program. You can reach out@richie babbage.com nextlevel nonprofit and we can chat about whether it might make sense for you to join the program and have me and my team you. I will see you back here next week for more Mastermind. Thanks so much for joining me this week. If you enjoy this podcast, I would love for you to leave a rating and a review. I read every single one and they really do matter. I also share extra tidbits and resources building on what we talk about here in my newsletter, Leadership for 321. You can sign up by texting the word impact to 66866 and finally, definitely check out the links and resources that I mentioned this episode at brooke richie babbage.com podcast see you next week.