HNSA Crest with photos of visitors at the ships.

Finding the Money: Strategies and tactics
Fundraising in the real world

Lisa Dunlop, Senior Associate
325 Chestnut Street, Suite 700
Philadelphia, PA 19106
www.schultzwilliams.com

Schultz and Williams logo

When your work life is filled with operational responsibilities, educational programs, publications, and preservation activities, it can feel nearly impossible to execute philanthropy along with everything else. In this session, learn ways to:

  • Identify your most promising opportunities
  • Create a lean and effective fundraising function
  • Create your unique "prospect treasure map" to look deeper at your members, visitors, and even vendors and find your core group of donors who want to invest their philanthropic power in your mission

Challenges:

  • Revenue not growing, expenses rising; revenue shrinking
  • No development department - the buck stops with the Executive Director who is focused on program and preservation
  • Not knowing where to begin
  • Not knowing how to manage and evaluate to make sure the investment pays off

By examining a case study of Tin Can Sailors, Inc.'s current campaign to raise money for Navy destroyer museum ships, you can see a sample start-up process illustrated, from vision through design to deployment of an integrated campaign that is posting record results in its first year. This presentation will identify the decision points in the process and help you to look at the resources in your organization in new ways. Combining the disciplines of management and leadership, marketing and communication, development planning and fundraising tactics into one coordinated and comprehensive plan of action, nonprofits can successfully raise institutional awareness, positively affect public opinion, and raise revenue significantly and efficiently.

Finding the Money: Strategies and Tactics for the Real World

Outline:

Introduction
History
Case Study
Sources of Charitable Giving Today
Identifying Resources
Finding Prospects on the Relationship Map
Why Partnerships Are Important
Conclusion

Introduction

Through use of a case study, we will examine ways to succeed in fundraising by identifying and making the most of the resources within and connected to an organization. The case study is from Tin Can Sailors, Inc., which set out to establish perpetual funding for destroyer museum ships. We will see how they gathered information and revised their plan to be successful.

Overarching Messages

  • Make the most of your organization's relationships, because connection and conversation lead to giving.
  • Extend your vision outward from the end of the next fiscal year the long-term pursuit of sustainability.
  • Be open to shifting your focus or perspective, in order to place your organization in the most advantageous position to receive resources.

History: Tin Can Sailors, Inc.

The mission of Tin Can Sailors includes serving veterans, helping today's active sailors, and supporting the historic fleet financially, through volunteer labor, and by promoting the ships.

In 1992, Tin Can Sailors established a Destroyer Museum Grant Program. It was funded from membership revenue and made an average of $100,000 in annual grants. As they lost more and more of their World War II vets to the ages, their operating costs rose at the same time, particularly for their excellent quarterly newspaper, and the net revenue over expenses slipped away. They decided to undertake fundraising to restore this funding.

Since there was no fundraising infrastructure, the first idea was to raise a lump sum of $2-million as quickly as possible, and invest it so that it would generate income that could be granted, and the fundraising effort and expense could end.

The Directors wanted to resume giving $100,000 a year as soon as possible. They didn't know people with deep pockets, so they thought about approaching shipbuilders, foundations and flag officers who had served on destroyers.

Case Study

Setting the Goal

The goal was based on achieving a lump sum of two million dollars because that would mean sustainability for the Destroyer Museum Grant Program. One important step to success is to have a clear goal, so everyone knows when you reach it.

Creating the Case Statement

Following the goal Tin Can Sailors created a case statement, a short document that illustrates both the need and the plan to meet that need. Schultz & Williams completed a pre-campaign study to test the goal and the effectiveness of the case, as well as to gauge the engagement of people identified as the most likely prospects.

Pre-Campaign Study

To reach the study prospects, Tin Can Sailors mailed the case statement and a cover letter to about 25 people, and Schultz & Williams staff followed up with telephone calls to set phone interviews, expecting to complete this with about half the group. This is done more effectively face to face but in the real world, people are scattered, travel is expensive, and most of the interviews were by telephone.

We learned something from everyone we talked to, and we also learned from the people who didn't participate, which helped us to keep looking in the right places and not chase in directions that weren't going to yield real prospects.

Another discovery was that a number of the longtime Tin Can Sailors members were quite frail, very old and not well, and beyond the point of talking on the telephone. Trying to connect with an aging membership base made us confront the fact that the WWII generation - people who might have become involved in this initiative 10 or 20 years ago - were slipping away by the day. It is not just the ships that are disappearing, but also the people who know them intimately. It added to the sense of urgency with this campaign.

The interviews yield information that tells you which development activities and groups of prospects may be most effective. Use an outside professional for this process to gather responses confidentially, and aggregate them so they are helpful. Using an inside person instead can mean your participants won't tell you the hard truth you need, and also your relationships could sustain damage when someone tells you something you didn't want to hear.

Typical Study Questions

We want to know from the candidate how he would describe his relationship with the organization and its Board and/or staff; whether he is aware of the purpose for the proposed fundraising. We ask about reaction to the case, and whether he thinks the organization can be successful getting the amount of money that is the goal. We want to know if the interviewees see themselves giving, and at what level; whether they'd volunteer for the campaign, who else we should be talking to for gifts and leadership, and where this person sees opportunity as well as threats from competing efforts by organizations that tap the same sources. Comments will reflect your brand as it is perceived.

Study Outcome

The original plan, a straw man going into the study, was to discover some major prospects, secure a few very large gifts from them, establish a restricted fund to generate income for annual grants, and end the fundraising effort.

Some participants responded emotionally to the cause, but could not make large gifts. The shipyards and related manufacturers were not searching for ways to spend money. Active duty flag officers were focused on human services for today's sailors, like the USO, and felt they couldn't play favorites publicly since most career officers who served on destroyers also served on other types of ships. The pass-through structure took Tin Can Sailors out of the running with a number of foundations, who want direct contact with their beneficiaries. By process of elimination, the study identified the primary population of passionate people: the members.

Sources of Charitable Giving

It's important to understand whether a campaign approaching primarily individuals can be successful. Giving USA publishes comprehensive figures each year, and this information is helpful for the proposed campaign at this juncture.

In 2009, more than $300 BILLION in charitable gifts flowed to nonprofit organizations. The falloff from 2008 to 2009 was 3.6%, which is a lot less than the drop in most people's savings. Consider that a $300 billion pie has enough resources for all the worthy nonprofits today; consider basing your plans on that belief. When you make your plans from a position that the money is not out there, your success will come in spite of your beliefs, which makes it an uphill climb attitudinally.

Three quarters of the charitable dollars -- $227 billion - come from people giving money and other assets directly to charities. See Appendix A for two illustrations.

Shift your perspective to add estate gifts and family foundations into the individual giving portion. When you view the charitable dollars coming from individuals in the three ways they can give, the portion of total giving is really 88%.

So wouldn't you want to put 88% of your fundraising resources, including your attention, into individuals?

Finding Resources

The Importance of Individuals

At this point in the Tin Can Sailors case, they had just discovered that people - destroyer veterans mostly - loved the museum ship cause but didn't see themselves or anyone they knew giving big gifts. Wealth screening did not identify anyone known to the Board except one - at age 93, he said he had given away all his money, but that he would help another way.

Tin Can Sailors' celebrity member, Ernest Borgnine, said "I'll be in a video if you want!" This is an example of being open to the resources that people have - by the end of the conversation, Ernie had signed on to be the Honorary Chairman who signs the appeal letter, and is now the star of the first-ever Tin Can Sailors fundraising video.

Assessment of Internal Resources

People:

  • Loyal, mail-responsive members
  • Committed Directors that come from the membership ranks
  • Strong staff that supports members and reunion group

Things:

  • Brand
  • Newspaper
  • Database

Regarding the concept of "brand," it is critical to this process to know who you are in the eyes of others, and make it work to your advantage. In the study, people consistently described Tin Can Sailors as "trustworthy," "helpful to members," "a source of reliable information." Tin Can Sailors has invested 34 years in the relationships it has with its members, ship associations and the destroyer museum community. This is the well-earned result of decades of devotion to members and the cause - not just broadcasting outward, generating newsletters and dues mailings, but listening and responding fully to members.

The newspaper cultivates members by staying connected with them, and provides "free rider" opportunities to include campaign messages at virtually no cost. The database provides an accurate mailing list, plus in most cases rank or rating and ships on which members served, making the bio records more personal and thus a tool in cultivation.

Adjusting the Plan

After this evaluation, Tin Can Sailors decided to leverage their database, staff, and brand, to reach out to the membership by mail, and beyond that, through the ship associations, which have varying numbers of Tin Can Sailors members in their ranks. If the reunion coordinators would welcome an appeal for the ships along with the Ernest Borgnine video, Tin Can Sailors could solicit many more active destroyer veterans.

With a database just over 20,000, an average annual dues payment around $28, and no known major prospects, Tin Can Sailors inverted the original structure and pursued as many gifts as possible via direct mail.

Schultz & Williams Direct wrote and designed a package, Ernest Borgnine signed the letter, and Tin Can Sailors used its database to make the letters as personal as possible. The gift ladder steps all had premiums and were $15, $100 and $1,000 respectively. As an aside, I do recommend offering one level higher than you think anyone will choose, because it's human nature to not go for the very top level.

Response

The response was tremendous and sustained for about six weeks. About one of every 10 donors opted for the $100 level, and in addition to Board members, 16 members gave $1,000. At the end of the response period, Tin Can Sailors had resounding confirmation that they were asking the right people, people who cared about this mission, and doing so in a way that made them feel comfortable about supporting it. Tin Can Sailors now has a database of charitable donors and can build on that to deepen relationships with those people, and invite them to look at their own resources and consider how they might help the museum ships. Once the organization is positioned as a philanthropic choice for a critical mass of people, staff can open conversations about planned giving, which is particularly suited to this population of loyal, conservative donors.

Finding Prospects on the Relationship Map

As an example, here are some of the groups of people that connect to Tin Can Sailors:

  • Members
  • Board
  • Staff
  • Ship/Reunion Associations
  • Museum Ships
  • HNSA

Every one of these groups has a stake in the preservation of destroyer museum ships. For members, that includes their personal support of the mission; pride of association; and the idea that they can take part in leaving a legacy to their grandchildren and generations to come, because these ships can live on to provide an exciting and emotional visitor experience that tells the stories of the sailors who lived and worked on board. The Board is dedicated to the mission. The staff wants the organization to do well, both for pride and job security. The veterans active in their ship associations don't want to see the last destroyer go the way of the Towers. HNSA works for a rising tide for all its members, and of course the museum ships receive grants.

What makes this situation distinctive is that it is a hub-and-spoke partnership structure that began with a membership group, Tin Can Sailors, at the center, and connected outward to several destroyer museum ships that are independent of one another, treating them as a group.

Shift Perspective: Put Ships at the Center

See Appendix B

Because the destroyers were turned into a group via Tin Can Sailors's different perspective on them, they benefited not only from the dedication of an inspired group of veterans, but also by the economy of scale created by grouping the historic fleet together.

Look at the groups around your organization and consider how you can create a union, a partnership, an alliance, whatever you want to call it - but look for similarities rather than differences, join to form a group in some way, and seek ways to make one approach together, sharing in the result.

Consider the ships and organizations that share the most with your cause, and imagine what life would be like if you weren't competing against them for charitable dollars from the prospects that you share. You could develop economies of scale for more expensive undertakings like direct mail, and by coordinating your efforts, increase your visibility by leveraging all your communications outlets, and cut your expenses. Share the work, share the results.

The historic fleet of destroyers became a group because Tin Can Sailors saw them that way, and you can make it happen by forming your own team.

Why Partnerships Are Important

From the museum ship world's recent headlines, it is clear that public sources of funds will not always take care of the ships' needs. You want to be efficient and effective when you reach out to individuals - when you orient your fundraising to that 88% slice of the charitable dollars pie - you are giving people an opportunity to connect with a cause they really care about supporting. Banding together can also pre-empt donor fatigue from multiple solicitations coming from similar organizations.

What groups connect with destroyer museum ships? With multiple ships at the center, the bubbles indicate multiple Boards, multiple sets of museum visitors and members, etc. The model is the same, just with subsets for each ship under most of these headings.

Who Are Your Prospects?

Anyone connecting with your organization could be a prospect - for a gift of something. If you want people to give generously, consider what they have in abundance, and ask for that. Maybe it's money, or maybe it's personal influence; it could be time, the ability to illustrate your case for giving, or opportunities to give your messages a "free ride" in a publication or on a website.

When you identify the most productive connections or relationships you have, you know where to invest YOUR resources - time, effort, organization, charm, passion, knowledge ... you have identified plenty of internal resources by now, and what you want to do is to exchange them for resources that benefit your cause.

Expand your view to include all kinds of helpful resources, not just cash. Look at the following groups and identify two critical things about them: what resources do people in this group have in abundance? And, what is their stake in your success?

Here are some examples:

Board Members:
Resources Stake in Your Success
Passion for the mission Pride of association
Knowledge of programs and history Deeper relationship
Money Energy, inspiration
Expertise, time and energy Enhanced profile in community
Networks of communication
Community visibility

Staff:

Resources Stake in Your Success
Operational expertise Pride of association
Passion for maritime history Reinforces good choice of employer
Knowledge of organization's history Energy, inspiration
Money, a little Job security
Networks of communication Enhanced ability to recruit quality staff
Success stories to share

Volunteers

Resources Stake in Your Success
Time to dedicate to your cause Pride of association
Professional expertise Reinforces that the time they give is worthwhile
Money, a little/some Inspiration, energy
Interest in maritime history Make friends with common interests
Knowledge of your organization Deepens relationship
Networks of communication

Donors, Members
Resources Stake in Your Success
Money, maybe more Fulfills their personal mission
Influence Reinforces their choice to give/belong
Professional expertise Deepens relationship/satisfying connection
Community visibility
Networks of communication
Time and energy, a little or a lot

Veterans and Vet Groups (VFWs, Legion Posts, Ship Associations, etc.)

Resources Stake in Your Success
Passion for the cause Pride of association
Personal naval history, sea stories Opportunity to create a legacy
Networks of communication Raise their profile by allying with your brand
Money, some

Continue this exercise for your Vendors, Elected Officials, Local Media, Mission-relevant publications and websites, college and university programs in museum studies and Naval history, and Associations like NHMS, HNSA and ICMM.

For small museum organizations, consider the value of partnership once more. When there is a group of similar ships inviting support together, and you embrace being part of something bigger, you open the door for veterans to see their ships as part of something bigger as well, and suddenly the individual vessel is not as critical as the well-being of the fleet. You can lead the way in a shift of focus that will lead to a coordinated development effort designed to move you toward sustainability.

Questions in Closing:

  • What are my organization's resources that we can use to reach people and ultimately gather in significant gifts?
  • What groups connect with us, what are their resources, and why do they want us to succeed?
  • How are we going to tell them about our success?
  • Who is talking to whom? If your STAFF is talking to VISITORS, how can you put your messages into that flow?
  • Who can be part of a bigger group, the way the destroyer museum ships are a group, that would make sense to approach donors together?

Appendix A: Sources of Charitable Giving

Gift Sources Graph

Aggregated Individual Giving Graph

Appendix B: Relationships - Tin Can Sailors

Tin Can Sailors Relationships

Relationships - Historic Fleet of Destroyers

Tin Can Sailors Relationships

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