Major gifts are significant monetary donations made by donors or sponsors to a charitable organization. Though major gifts are relatively rare, they are a very important aspect of any development plan, due to their large size. Major gifts don’t just happen – a major gifts strategic plan is needed if your organization plans to receive major gifts with any regularity. The stewardship, outreach and cultivation processes are all crucial parts of a major gifts program. If your University or organization is interested in implementing or revising your major gifts program, start with these five key steps.
Step 1: Determine the Threshold for a Major Gift
Major gifts are defined as significant monetary donations received from donors or sponsors. But what exactly is major? The amount can vary widely, from organization to organization. The range can begin as low as $1,000 for small or new organizations and exceed $10,000 or even $100,000 for Universities or large established organizations. Determining your major gift minimum threshold depends on several things:
- Past Donors: A good place to begin is to review your organization’s past donors and highest donation amounts received. If you have a recurring donation campaign or membership program, review these donors especially. This information can serve as a good starting threshold and help determine your major gift fundraising goal.
- Annual Fundraising Goal: Using your organization’s annual fundraising budget or goal is another point of analysis that can help determine how many major donors are needed and the amount needed for each major gift to accomplish a significant portion of the goal. Remember these donations are rare, so fundraising events, grants and smaller donations will still likely make up the majority of your fundraising.
- Connections and Time Commitment of the Committee: After discussing the prior two points, it’s also important to evaluate your committee or Development Department’s realistic capacity to perform the outreach required for major gift donors. We’ll cover this more in detail in the section Finding New Prospects.
Step 2: Prepare Marketing Collateral and Documents
While most major gift donations will come through warm connections and building relationships, having the proper marketing collateral reinforces the reputation of your organization. Be sure to focus on the programs and options that donors can allocate major gifts to here. While some donors may be happy to simply write a $20,000 check, most major gifts donors will want to know exactly how their funds will be used and what impact can be expected as an outcome.
Proper marketing collateral can include any of the following:
- Professional Website: The organization website should be easy to navigate, simple but beautifully designed and able to receive donations securely. Here is a great article to understand essential elements that create an impressive non-profit website design.
- Educational Brochures: Brochures should be available that educate supporters and donors about your organization and charitable cause, as well as your organization’s achievements to date and how their financial support helps.
- Letterhead: Any handwritten or typed letters should be completed on the organization’s professional letterhead.
- Sponsorship Collateral: Major donors like to be recognized for their generosity. Preparing a chart which illustrates your donation tiers and incentives donors receive for donating at these incremental tiers is vital to your program’s success.
Step 3: Set Up Incentives for Major Gift Donors
The relationship with your organization and charitable cause will be a large part of the reason why a sponsor considers giving a major gift, but incentives will help seal the support. The more a sponsor donates, the more incentives they should receive. Here are examples of incentives that are appropriate for donors of major gifts:
- Brand Recognition Opportunities: Many sponsors are enticed by the amount of brand recognition received from a major cause. If there will be advertising campaigns for a special event (such as a race or walk fundraiser), major gift incentives can include a business logo, organization name or individual name on the advertisement or poster (higher donation amounts can be shown in larger font/logo sizes). If there is a step-and-repeat banner for photo opportunities for guests and news outlets, their logo can be included on the backdrop for media exposure. Alternatively, for a non-event affiliated branding opportunity, a certain program, room or building can be named after the donor. This works especially well for alumni fundraising campaigns.
- Speaking Sessions: If your organization has an upcoming event, such as a gala or speaking panel, major donors can be offered the opportunity to present an award or introduce a keynote speaker. This serves to recognize their contributions and tie them more closely to your organization’s platform.
- Special Major Gift Events: A great way to thank the donors of major gifts is to host a special event just for them or give them VIP passes to your fundraising events. Special major donor events could be a brunch, lunch or dinner with tickets to an event (such as a Broadway show or sports show) or a special tour of the work your organization is doing. If your organization hosts an annual charity golf outing, offer them a foursome and VIP dinner table at no charge.
Step 4: Find Your Major Gifts Prospects
Achieving your fundraising goal requires a strong team with a realistic plan, but you also need the right tools to succeed. Nonprofit CRM and donor management software is essential to identifying and working with major gift prospects.
Major donors can be broken down into two groups:
- Already Existing Prospects: As mentioned before, a good start is to review your past donors and to see who has either consistently donated to your organization or who has donated large amounts. Approaching pre-existing donors should be warm, consistent and informal, since they already know about your cause. If a new campaign is coming up or a major gift program has been launched, assign it to a committee member or board member that has a close connection to the person or organization. Have them initiate a conversation to discuss the benefits of participating as a major gift donor.
- Finding New Prospects: New prospects will take a lot more effort because there is a process of gaining trust and building brand recognition for your organization. Designate certain committee members or board members certain prospects to outreach based on their connections, time capacity and reputation. There are different places to find new prospects:
- Networking Groups: Whether it is a Meetup geared towards non-profits, a technology event, a referral networking group, a networking event or otherwise, these are great places to find volunteers and donors.
- Vetting the Network of the Network: Since your supporters and donors already appreciate your cause, they may be able to introduce you to other well-connected individuals and organizations that can also donate major gifts or help with in-kind donations. You’ll have to ask them to introduce you.
- Research Donors of Similar Causes: Annual reports, past event information, social media channels and other helpful sources can provide details about past donors that have given major gifts to causes that relate to your organization.
Read more on why your organization needs non-profit CRM software.
Step 5: Define Protocol to Ask for and Receive Major Gifts
All committees and Development personnel should be in sync to understand what is needed to ask for and receive a major gift. Determine the deadlines for first outreach, follow-ups and finalizing donation amounts to achieve the goal during a given period (quarterly, annually). The organization’s Treasurer or Office Manager should communicate any tax information that is necessary to properly give letters or tax forms to the donors to recognize their donations.
Also, having fundraising software that is able to track all of the information about the major gift and the donor would be helpful for long-term planning and the growth of your major gift program. If logging the donation information or using a donation software is not already part of the procedure, research a sophisticated donation software that comes with helpful features to build your donor list.
Once all of the prior steps have been done, discuss the plan and establish a protocol to receive major gifts. First and foremost, you will need to meet with your prospects in person to make an ask. You can’t ask for major gifts in a group setting or by email.
The Fundraising Ask
Once you have determined a prospect in step 4, someone will need to call them and setup a meeting. The call as well as the in-person meeting should come from the Executive Director of the organization, a Board Member or senior Development staff (Development Director or Major Gifts Officer). When meeting with the prospect, be sure that they already know who you are and have a relationship with you. Don’t send someone who has never met a prospect or only briefly met a prospect to do a major gift ask.
If you are just getting started with a major gift campaign, be sure to practice the ask before you show up for a meeting. You can practice and role play with others in the organization. Be sure to know who is making the ask (if you go as a team), once you are in the situation. Don’t’ leave it to just happen – it’s not easy to ask for a major gift for the first time. What happens when the donor requests more information or says they will think about it…And what happens if the prospect says no? Be prepared for this.
Here are more tips on mastering the fundraising ask.
What Happens When a Donor Says Yes?
When meeting with potential donors, being prepared to receive a donation is just as important. It’s understood that major gift donations are frequently done with a handshake and a check. However, having a major gift sponsorship form on hand can b useful. Here are some helpful fields that should be on the major gift sponsorship form:
- Basic Individual/Company Information
- Contact Information
- Amount Donated
- Tax Information (to take advantage of tax write-offs for donations)
- Instructions and/or Information for executing incentives (instructions on providing their logo for a banner for a major race, information about the speaker for a speaking slot during your gala)
With these helpful steps, careful planning and a communicative committee, giving an extra push to achieve new fundraising goals from major gifts is quite possible to achieve. For some extra tips and advice on the strategy of major gift outreach, building relationships and donor retention, stay tuned for part two of Building a Major Gift Program.