Technology Creates a New Giving Economy

Crowdfunding for NonprofitsTechnology can be very good for the nonprofit world. While technology has fundamentally changed the way we do business, the world outside of the for-profit sector has just recently caught on to its benefits. Some tech phenomena have already successfully infiltrated the nonprofit sphere, including the use of Software-as-a-Service (SaaS) to improve donor relations and other daily business functions, or crowdfunding for fundraising purposes. While existing technologies remain useful for many, the next wave of using technology for good will be in the peer-to-peer giving model.

Becoming prime time in the corporate world in the early 2000s, SaaS took hold in the nonprofit space in the last 8-10 years. The very nature of SaaS made it ideal for the nonprofit sector: It’s easy to use, low cost, and avoids integration challenges that often come with on-premise databases. It was also readily adopted because of its ability to help groups manage donations and track individual donors.

For example, Room to Read, a global organization transforming the lives of millions of children in low-income countries by focusing on literacy and gender equality in education, relies on SaaS application Salesforce for project allocation, reporting and tracking. It helps their global teams track at scale for both the project and donor side, enabling them to make more meaningful connections and retain existing donors.

The next wave of technology modeled perfectly for nonprofit use was crowdfunding. Making its first appearance in the late 2000s, nonprofits quickly turned to Indiegogo and KickStarter to help fund their initiatives and programs. Crowdfunding caught on in the nonprofit world because it was an easy platform for anyone to access and donate to. With online payments becoming standard, it took the hassle out of mailing a check or donating in-person. Also, the collective community aspect allowed hundreds of people to work together to reach a common goal.

In 2014, Code.org launched its ‘Hour of Code’ program, with a goal of raising $5 million on Indiegogo to train 100 million students to code. They also created a viral video starring Mark Zuckerberg and Bill Gates for the campaign. It was the most successful Indiegogo crowdfunding campaign of its time, quickly surpassing its goal and showcasing the power of collective online donations.

While SaaS and crowdfunding have clearly made their mark on the nonprofit sector, the next technology that will be adopted in the nonprofit sector is peer-to-peer sharing. First emerging in the late 2000s and becoming mainstream in the last three years, the for-profit sector has already seen runaway hits in the peer-to-peer economy with startups like Airbnb, Uber and Zaarly. So what if this model was applied towards social good?

Elevating the sharing economy to the giving economy, nonprofits can tap this concept to allow donors to connect directly to those in need. Users are already familiar with peer-to-peer giving technology and it is easy to use and implement at a broad scale. Also, it is appealing to a millennial’s mindset who wants to help or receive help at the touch of a button.

Additionally, this model takes crowdfunding one step further by creating a meaningful one-to-one connection. Instead of being one of many, a donor can foster a direct relationship with someone in need and feel more satisfying for the donor. Donors who give in this way often receive immediate and direct feedback from someone they have helped, bringing a rush of emotions knowing they have impacted someone’s life. This is what turns random acts of kindness into a normal habit.

Out of all the nonprofit sectors, social services can benefit the most from peer-to-peer giving since it fosters a more dignified way for people to seek help. Because peer-to-peer giving is non-conditional and not predicated on paperwork, rules about sobriety, lifestyle, or impersonal prioritizations by well-meaning social agencies, those who need help can simply receive it from another community member. For instance, if a homeless person requesting a tent has to wait six months for social services paperwork to go through, it can mean they have to sleep outdoors, in the rain, in fear for personal safety, for another half a year. Peer-to-peer giving can drastically shorten the time to receive something critically needed for survival from months to days or even just hours.

The tech world isn’t just in a Silicon Valley bubble anymore. Technology has helped nearly every industry around the globe develop new product or services. With an ever-expanding influence, we have the opportunity to capitalize now on these innovations and benefit the greater good. Next time you spend 10 seconds requesting an Uber, imagine spending the same amount of time to help someone in need. Donating money, supplies or services to anyone, anywhere, with a single click.




Dos and Don’ts of Charity Auctions

Dos and Don’ts of Charity AuctionsCharity auctions, run properly, are a tremendous fundraising opportunity with the right items and organization.  We consider auctions part of the evening’s entertainment … So make sure they are engaging and fun!  Auctions can make upwards of $1 million (this involved auctioning a Ferrari), but on average, you can expect to raise $10-20,000, a significant contribution to the cause.

If realtors emphasize “location, location, location,” we’d like to emphasize “merchandising, merchandising, merchandising.”  Here’s what we’ve learned over the years, from personally managing charity auctions ourselves (silent and live) and from shopping at many more.

 

Silent Auctions

#1 – If appropriate for your event, serve alcohol (‘nuf said).

#2 – It takes a village. Enlist the board, staff and members of your organization and event committee to collect donations. Set a goal for board members (at least one event sponsor and two auction items, for example). Encourage supporters to make requests of the proprietors of restaurants, hotels, clubs, spas, hair salons and retail stores they frequent or where they work.  Provide a deadline when donations need to be secured to give you time to create the presentation materials (see item #6).

#3 – Provide materials for volunteers to use. Sometimes people are overwhelmed about where to start … so they don’t.  Provide:

  • A template letter for requests, which briefly talks about your organization and the event, lists the types of donations you’re looking to receive and provides your 501(c)3 information.
  • A donation form, which requests a full description of the item, any limitations, such as blackout or expiration dates, etc.; retail value; who should be credited on the bid sheet for the donation; and contact information for questions (and, later, a thank you letter from the charity).

#4 – Auction items that do particularly well in our experience include experiential opportunities, travel and hotels (exotic locales as well as “staycation” spots), restaurants and consumables (wine and food). Also include items that are a value for activities in which people already engage.  For example, gift certificates to area spas and restaurants, tickets to local sporting events or concerts … even dry cleaning services.  What is a unique experience in your city that people would love to get the chance to do?  A private tour of a sports stadium prior to a game or entry into a private club?  A sunset boat ride, tee time at a local golf course or a river kayaking trip?  Consider lessons for tennis, dancing, painting or horseback riding.  How about a local caterer or restaurateur donating services to give a wine-tasting event or prepare a meal for four at the winning bidder’s home?  And donations from local artists.

Charity Auction Tips#5 – Organize donations into categories, so that people can shop items that interest them in one area. Popular categories include Travel & Entertainment, Restaurants, Lifestyle (spas, clothing, makeup, etc), Wine & Food, Memorabilia, Art and Sports.  Of course, your donations will also dictate your categories.  Provide signage so people can identify the groupings.

#6 – You need to “sell” your items much like retail stores merchandise their products.   Make the displays and descriptions appealing (You will need to re-write most of the copy provided to you … and be prepared to do some research).  Arrange them decoratively.  Bring floor and table-top easels.  Display photographs and other representational artwork in 8 x 10 acrylic frames.  Create gift baskets that combine like items, such as wine and chocolate or spa gift certificates with personal pampering products.

#7 – Make your silent auction akin to a shopping experience.  Invite a handful of local vendors who work charity events. We’ve had vendors with handsomely framed lithographs of the masters; estate jewelry; and more.  They make your auction more interesting, donate 20% of their sales to the organization and many of them will also provide a direct donation to your auction. Additionally, a reputable vendor will give 20% of sales that occur later, but resulted from initial contact at your event.

#8 – No matter how organized you think you are, have extra blank bid sheets that you can fill out by hand.  You may be missing one sheet … or someone will show up with a donation you didn’t expect. Also have additional sheets for popular items, where bidding goes to page 2.  Request their name, phone number (preferably cell so you can text the winner) and e-mail information.  You will need to track down bidders who have already left the event.  Make the barriers to placing a bid as low as possible, with the starting bid at a reasonable minimum and defined bidding increments.  Modest (though not incidental) increments encourage bidding wars.  Bid sheets should be on clipboards (or the budget clipboard of cardboard & paper clip) and pens should be plentiful.  Winners should not need to be present to claim their winnings.

#9 – It’s helpful to color code your item sheets by category with stick-on dots and to number items within the category for quick reference.  This makes check-out run much more expediently. Organize the gift certificates at the check-out (do not display them on the tables).

#10 – The auction should be staffed at all times to answer questions, encourage friendly bidding competitions, engage bidders (Do you have gifts you need to buy in the near future?) and, sometimes, to prevent theft. (Sadly, it happens.)  Throughout the evening, take the mic and create excitement, remind people the auction will be closing at [designated time].  Although you need to be conscious of when people may want to leave the event, schedule your closing as late as possible to maximize bidding opportunity.  Much like a birthday party, once the presents are opened, people leave the party.  Have the emcee announce that items will be distributed one-half hour after the auction’s closing to give you time to organize the check-out.

#11 – When the auction ends, have plenty of volunteers ready to collect bid sheets quickly (no cheating!), to help process payments and deliver items to the winners promptly. Organize the winning bid sheets by the same category in which they were displayed to make it easier to find.  Additionally, you can make a “winners” board with a chalk or dry-erase board.  Create a check-out line with at least two representatives to process credit card payments and one to handle cash/checks and hand out gift certificates.  If possible, set up a Square payment system for your charity. If that’s not possible, make sure you have a phone line available to your check-out station to process credit card payments.  If you are utilizing an old-fashioned, carbon copy imprinter, your credit card processing company may offer a slightly lower rate if you write their phone/address on the receipt (and it gives you recourse for any problems that come up later).  Stamp the bid sheet PAID and hand it off to designated “runners” who will track down the item and hand it off to the winner.

 

Live Auctions

If you have one or two extraordinary items (private jet travel, full vacation experience at a high-end destination, dinner with a local celebrity, etc.), you may want to consider holding a live auction.  Announce that the silent auction is closing soon, then have someone from your organization (who isn’t shy) take the mic and oversee the bidding.  Have volunteers help you identify who is bidding in the audience and escort them to the payment table.

We have also been at a few events where a professional auctioneer oversees a larger effort.  Project Angel Food in Los Angeles does this really well.  The auctioneer sells “opportunities,” such as “$2,500 will buy special Thanksgiving meals for X number of clients” … and so on. Frequently, they sell more than one across a variety of categories and donation levels.

Opportunity Drawings

Formerly known as a raffle (until the IRS regulated the age-old tradition), it’s another fun way to enliven the evening and we consider it icing on the auction cake.  But make sure you follow state and federal guidelines. If you’re willing to negotiate the red tape, here are a few ideas …

Have the item(s) merchandised at the check-in table.  Ask people to “make a donation” for tickets (rolls of dividable carnival tickets will do) as they check-in, then have volunteers walking around to offer them throughout the evening.

One gimmick that works extremely well is to suggestion a donation of $1 per ticket or “your height in tickets” for $20.  Have them put one foot on the end of the ticket roll and literally break off the length of tickets at the top of their head. (We always give shorter guests a few bonus inches).  It’s a great ice breaker.

While regulations chance drawings vary by state, you can review the federal guidelines regarding tax-exempt organizations and gaming at:  https://www.irs.gov/pub/irs-pdf/p3079.pdf

With the above tips, your silent auction should be a huge success and make a significant contribution to your organization’s mission.  Good luck!

3 Ways in Which Donor Data Helps Nonprofits Raise More Funds

Nonprofit AdviceHow many times have you had the thought of whether the donations you make are being used efficiently? Nonprofits across the globe are now turning to data to make the processes much efficient and bring about transparency. They store and analyze data to not just improve their own logistics but also to be able to target potential donors the right way.

The data is available in the form of data stored in donor databases, blog posts, and social media posts and so on. All this data offers a gold mine of insights for the nonprofits.

NONPROFITS’s today are talking about when and how to tap into this data and what to do with it. They want to know how to sort, analyze and manipulate the data and put it to use. By leveraging analytics tools and solutions to analyze the wealth of donor information, Nonprofits can gain powerful insights into their donors’ behaviors and needs.

Especially small nonprofits are really struggling, and data analytics and social media strategy can go a long way in strengthening local nonprofits thrive in the competitive environment. If NONPROFITS’S figure out ways to merge the data across different channels and create a single view of the donors, they will have a competitive advantage in the following three areas

  1. Better retention/reactivation strategies: Nonprofits can develop better retention/ reactivation strategies if they have access to donor data, intelligent data mining can help in generating more donations through reactivation and retention than trying to generate new accounts. For Example. CRY foundation which is focused on child empowerment has donor data across continents. Understanding the mode of communication to which the donor responds best, they have been able to increase their donor retention rate every year. This in turn have only aided them in ensuring a deeper impact every year on wards.
  2. Better marketing decisions: Leverage history and response behavior to make better targeted marketing offers to donors increasing the chances of success. Nonprofits can connect their donor base and put up creative appeals intelligently better offers and increase the donation in response for their appeals.
  3. Better donor experience: If we know a certain nonprofit donors talks better to a certain agent – try and route calls to that agent. If they are online – display information relevant to them based on their web traversal history. Monitor social postings, and identify the opinion leader in a pack of friends to determine where to make an appeal. This will increase the awareness as well as increase donation. Another method to better donor experience is learning from what Akshaya Patra an India based nonprofit organization that focuses on providing mid-day meals for about 2 million Children in ten states of India. They collect data on feedback from Children in order to ensure high quality of meals every day. This data can be passed on to potential or current donors to ensure that their donation is making a difference to the lives of the children.

Even though just two examples have been mentioned in this article many other organizations that are also turning towards data to utilize resources effectively, save time & costs, and thereby increase efficiency of operation tremendously. Even though many organizations are not too optimistic about depending on data for driving their decisions, organizations that have done so has seen great improvements.

Co-Authored by Dheeraj Pandey & Danesa Thandassery

 

 

How to Avoid Managing to the Numbers Ruining a Holiday

Nonprofit AdviceAs the new economy forces nonprofits to act more like the for profit world, you should ask yourself this question: is your organization fooling itself by managing to a number?

Are you devoting this year’s donor initiative to prospects that should be given a longer nurturing period in order for your organization to gain a larger gift? Where else might short term actions detract from the best decisions for long term social missions?

To better apply this to the nonprofit world, let’s start with the more easily visible version of this issue in the for-profit world. By applying the following points to your organization, you may be able to improve its sustainability. Leaders of both public and private companies sometimes publicly single out specific numerical targets for net income. Once stated, those targets often become obligations.

So why is this an issue for them and you? Well, in those leaders’ zeal to consistently reach numerical goals, for-profit organizations begin to fall for the temptation to stretch some quarters to reach targets. Sometimes, they even slow down, lest they bring in too much income above the target number in another quarter. The result: in their ever-increasing attention to reaching short-term numbers, leaders can lose focus on making the best long-term decisions to build values.

Month end, quarter end, and fiscal year end personal activities can be taken hostage in this teeter-totter process of getting just enough income (but not too much) in the current period. This phenomenon can be likened to Goldilocks tasting the three bears’ porridge! (Having been part of year-end deal-closing crunches, I can assure you that inordinate amounts of time, money, and focus are required to to get deals closed in the desired period. Often those crunch times occur during holidays or when special family events had already been scheduled, inconveniencing and annoying the employees involved.)

When they have gone too far in covering shortfalls to reach arbitrary numbers, companies often hold “fire sales” to ensure they get the last few sales needed for target revenues. This practice can backfire and result in customers quickly learning to hold off on purchases until the regular desperate overture is made at period end. All of these complications result from a focus on hitting the sacred numerical targets. This ends up reducing margins as well as creating a spiraling impact as the company continues to try to make upcoming period results.

What does this this obsession with exactly hitting stated numerical results do to the sustainability of employee or volunteer commitment throughout the organization? Consider this corrosive environment with stress and pressure from the non-economic energies required to reach those targets. How much does that pressure detract from corporate responsibility to shareholders to consistently build economic value for the enterprise within risk tolerances and resources available? (Some of you should be starting to see parallels in your nonprofit world.)

At what point does this create a situation where the for-profit or nonprofit organization gets too caught up in the process and loses track of real balance sheet and operating information needed to make the best decisions? The closer to customer facing activities this incorrect data reaches, the more likely it creates operational inefficiencies.

As a result, the company owner, leadership team, or staff will likely devote holiday time to managing wasted energy needed to hit those numbers, when instead they should be looking at building equity and long-term wealth.

But fear not good fellows! For good news is at hand: Santa’s got 3 stocking gift ideas to help you reduce emotional cost and financial fallout. These three actions can help bring back the spirit of good cheer, and happier spouses, families and significant others in the form of restored holiday time:

  • Consider targeting a numerical range, not an exact amount. Why not set a number goal of, plus or minus 2 to 5 percent? Think of this concept sort of like a flex budget.
  • To encourage employees or volunteers to emphasize consistently reaching longer-term goals and objectives, change or adapt incentive programs. A balanced scorecard approach fits very well with tailored incentive plans. Plans that can be measured produce
  • Change the tone from the top to emphasize doing things right, instead of focusing on managing income. A number of experts suggest that an emphasis on doing things right does a better job of building long term equity or fund balance. This tone fits better with the mission and vision for most nonprofits, anyway.

And, in return, Santa only asks that you truthfully reflect on the possibility that this short-term income-oriented behavior runs deeply in your socially-concerned, mission-driven nonprofit. The fact is, you may need a fresh set of eyes to see where you are. Then, as you begin to eliminate non-economic activities, maybe the majority of your employees can enjoy their holiday time.

This concept can apply beyond the traditional holiday season to other holidays throughout the year like Valentine’s Day, Independence Day, Labor Day, Thanksgiving etc.

His Boardsource presentation and Roadmap to Sustainable Mission is available at http://www.boardsourceleadershipforum.org/session/boardroom-black-holes-and-taboos-2/


How to Get Started With K-12 Fundraising

The children need erasers! And air conditioning! And teachers! The children can’t just sit there and be expected to discover how multiplication and division work.

School Fundraising IdeasFundraising for K-12 schools isn’t calculus. While fundraising, in general, may require some serious thinking, raising money for schools is simple math, and something that your school can and should do in order to have the funds to offer the best opportunities.

What is K-12 fundraising?

Educational institutions need to raise money for various expenses, such as student clubs, community projects, facility updates, and more.

K-12 schools receive local, state, and federal funds, but they tend to need more money in order to operate at full capacity. As nonprofits, raising money through charitable donations from parents, alumni, and community members is a great way for schools to accrue more revenue.

Why do schools fundraise?

For the same reason you go to work. They need money to pay the bills. Schools have to cover the cost of teacher salaries, field trips, educational resources, and more.

There are plenty of other common initiatives that schools fundraise for, such as:

  • Sports teams
  • Transportation costs
  • Extracurricular activities
  • Core classes
  • Educational programs
  • Facility renovations

K-12 schools can even emulate colleges and fundraise on behalf of charities. Many K-12 schools have clubs that support local or national causes. These clubs run fundraisers on behalf of their respective nonprofits.

Causes that student clubs and schools might support include:

  • Natural disaster aid
  • Military veterans
  • Homeless shelters

Using a school to fundraise is a great way for nonprofits to make their needs known to entire communities at a time.

How do K-12 schools fundraise?

Fundraising begins and ends with your people, who fall into two groups:

  • Fundraisers – Teachers, administrators, and students are your go-to people for organizing and executing fundraisers. Parents and community members can also help.
  • Donors – Parents are the most common donors, but school staff and members of the community can also give. Just don’t ask your students to fork over their lunch money.

Crafting fundraising events requires knowing your people. What fundraisers do the students want to run? Would parents be more giving if you ran events geared towards them, such as wine tastings? How much time and energy does your school’s staff want to dedicate to fundraising?

Asking for donations is the usual nonprofit method of raising money. If your school is going to request gifts, then it helps to use prospect research to learn important facts about parents that can help to make fundraising appeals more personal and more effective.

However, schools have the luxury of being able to get creative with fundraising. There is a plethora of events that schools can run in order to raise funds for big events like prom, homecoming, and student trips.

Test out one of these three fun, creative fundraising ideas to help your K-12 school get started:

  1. Penny war – Kids might not get naturally excited about fundraising. To encourage more enthusiasm, you can try an interesting, competitive fundraiser. Penny wars challenge students to bring in loose change. You can get tricky with the rules, but the goal is to make it a fun competition that helps your school raise money from spare change that might have otherwise been left lying around.
  2. Bake sale – While parents can obviously get involved by donating, you can build some goodwill by encouraging parents to help out and feel like they’re doing more for the cause. Bake sales are a chance for parents to work with their kids to cook delicious treats. Parents can also help to organize and promote bake sales, as well as oversee the sales. A big perk of getting parents involved as participants, rather than just donors, is that they might tell their friends that they’re part of a bake sale, which could mean that new people come and support your school.
  3. School sleepover – Parents love their kids, but they could always use a night off. Many parents will gladly pay for their kids to sleep at the school. This benefits the kids, too, as they receive a night full of games and snacks with their buddies. Make sure that your school has teachers and administrators willing to help out, as the burden of playing ‘babysitter’ often falls upon them.

The secret weapon of K-12 fundraising is the ability to host events that involve students, parents, and larger communities. Schools can have plenty of fun while raising funds, and there is an endless variety of fundraising events from which they can choose.

Once you’ve selected and hosted some fundraisers, learn how to make the grade with your events by testing their performance using success metrics!

Students in grades K-12 need great resources in order to learn. Don’t wait for the future. Kids are the future, and they need great schools now.

 

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