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Nonprofit Q&A Email-Forum
A service of Jeane Vogel and Fund Raising Innovations January 3, 2005
Nonprofit Q&A
A service of Jeane Vogel and Fund Raising Innovations January 3, 2005 Happy New Year! Here's to a year of volunteers who follow through on their projects, executive directors who appreciate the work of their development directors, and development directors who don't get blamed for every little thing that goes wrong. Here's to a year of mission fulfillment, generous donors and organizations that are grateful for every dollar that comes in. The Nonprofit Q&A 2005 is almost ready to ship! This compendium of last years Nonprofit Q&A columns addresses 27 topics in five areas: Working with Your Board, Budgets and Planning, Mailings, Solicitations and Annual Reports, Grants and Major Gifts, and Care and Feeding of Donors and Volunteers. Even if you read every column in 2004, you'll want this spiral-bound, 126-page book organized for easy reference. Order extras for your board members and key development staff.
$15 per copy. E-mail me at jeanevogel@earthlink.net
to reserve your copy. Shipping date: January 7, 2005. Payment by PayPal,
MasterCard/Visa, check or money order. Shipping costs $1.95 - $5.95,
depending on the quantity ordered. Order for your whole board (12 copies
or more) and shipping is free!
Here's this week's question: What's the best way to use a gift pyramid? A gift pyramid is a wonderful tool to help everyone get their heads around what it takes to raise a lot of money. It operates on the principle that it's easier to reach a goal by focusing on the largest gifts first, or those at the top of the pyramid, and working your way down. You need fewer large gift and more smaller gifts to reach your goal. And if you start by raising the larger gifts first, the goal will seem within reach, thus motivating your volunteers to continue with the campaign. Let's say you want to raise $100,000. Without the concept of a gift pyramid, most people start by raising money within their comfort level, generally $1000 or less. At a $1000 per gift, you need 200 gifts to reach your $200,000. That seems so daunting! And since you won't get that amount from everybody, so you might have to ask 350 -600 people before you got 100 to say "yes!" If your comfort level is only $100, the goal will seem impossible, and you might be right
This is the spot where boards
start to fail in their fund raising resolve. The job is just too hard.
We'll never make it!
The gift pyramid shifts the focus away from the board's "comfort level" and puts it on realistic goals. The pyramid divides the goals into manageable chunks. For every gift needed, it shows how many prospects are needed at that level and how much money toward the goal will be raised. For that $200,000 campaign, in chart form it might look like this:
Obviously, you notice a couple of things: You need more prospects per gift for the larger gifts and the smaller gifts don't add up as fast. If you start at the top of the pyramid, though, you will reach your goal faster and the smaller donors will realize that are helping to meet a realistic goal. Once you've set your goal, set up your pyramid. At the top is the largest gift, or lead gift. It should be 25 - 50 percent of the total. You'll generally need three to four qualified prospects to get that gift. Remember, just because you qualified the prospect, doesn't mean that donor has qualified you! Base your gift sizes on your current donor list and reasonable list of prospects. For example, if your current largest donor gives $5,000, it's not likely you will get a $100,000 lead gift from your base. Keep your gift sizes aggressive, but within reach. Consider a three-year pledge for some of the largest gifts, if that fits within your fund raising needs. The next level is 10-25 percent of goal, then 5-10 percent, and so on. At each level your prospect to donor ratio will be lower until you get to the smallest gifts. Spend the most time and effort on the largest gifts and the goal is within reach. Use this method to help board members understand how many donors are needed to reach your goal. They pyramid also is useful to set recognition levels and naming opportunities. © 2005 by Jeane Vogel and Fund Raising Innovations Was this article helpful? Make a donation of
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