Harder to find? Yes.
More difficult to close? Darn right.
Creativity required? Absolutely.I will be participating with the Chronicle of Philanthropy in a live discussion on getting million dollar gifts in this economy next Tuesday, February 9 at noon EST. It should be interesting, so plan to join us: http://philanthropy.com/article/Seeking-Big-Gifts-in-Tough/63880/
Readers of my blog will know that my company and I place much of the responsibility for fundraising success on the fundraiser’s back.
I have written before about the research on million dollar gift lists; several organizations try to manage them. My mentor, Art Franzreb and I gave his Million Dollar Gift List to Indiana University.
While they serve a purpose, obviously there is difficulty with all of these lists on two fronts: 1) they can only represent reported million dollar gifts, and 2) the reported date is frequently distanced from the date of the gift.
I honor and respect the effort to understand giving, and I realize we can’t report what we don’t know. But making casual deductions about giving based on these lists can be misleading.In my 40 years in fundraising, I have observed that most reported gifts are made to higher education, health care and an individual’s own foundation. You see very few reported gifts to the Salvation Army, food banks, or children’s causes. Does that mean they don’t exist? No, but for a myriad of reasons donors and/or organizations do not publicize them immediately, if at all.
I often use my own $1.5 million gift to Indiana University as an example. The gift was made in March 2006, but it was reported on October 12, 2006—almost eight months after the decision was delivered to the institution. My most recent $1.2 million gift was shared with the University in May, 2009, but announced December 5, 2009. Again, eight months after the decision was made. And I have made a third million dollar gift that won’t be announced for the time being. It was made in early 2008!
Anomalies? Hardly. In each case the institutions decided the appropriate time to announce the gift, not me. So much for using those lists to tell us who is raising million dollar gifts and when.
So let’s assume—because I’m telling you it is—that million dollar gifts are being given away all the time.
What does it take to find a million dollar gift today?
Persistence and tenacity, as always. But now more than ever, there must be an intense interest in getting on the side of the donor. Here are five tips for you to take or leave. If I were you, I would take them.
1. Listen for success. Fundraisers are like everyone else in that they can get sucked into a media-driven “everyone lost money and no one is giving away” mentality. “Nobody” and “everybody” don’t do anything. But if we aren’t listening, success will pass us by!
2. Be aware. There is a sensitivity to making large gifts during a struggling economy. One million dollar donor didn’t want his gift announced because he had laid off 10% of his work force. Even though this gift came from him personally, he was afraid of what his employees would think. So there was no announcement, at least not yet.
3. Work with the donor. For a social service group, a campaign leader wanted to make a million dollar gift based on the sale of land. He was going to wait until it was sold. Instead, we created a contract pledge in which he gave the organization $1 million or 10% of the sale, whichever was greater. Five professional fundraisers had walked away from this donor because their organization wanted all the money at one time. This deal was signed December 21, 2009 and guess what? A buyer is closing on the sale on May 1, 2010. The social service institution who got on the donor’s side made a million dollars, at least for now. They made a friend for life. It’s the donor’s asset, not yours.
4. Find out where it is. Somebody’s making money all the time. I know a residential apartment owner whose banker is telling him to raise his rents because his occupancy is too high. There is a medical building contractor who’s never trusted the stock market and has invested exclusively in CD’s. And a petroleum transporter whose family has been doing in the business for 80 years who’s recession-proof. How about the banker whose privately held bank had a temporary loss in stock value? He pledged $18 million last October—a gift that is yet to be announced—to his favorite public service nonprofit through his own foundation, along with $80 million in gifts (unannounced) that benefit five charities.
5. Make bequest giving a priority. Almost 96% of all planned gifts are bequests. Now is the time to tie them down. Earlier research clearly illustrated that 85% of all endowments were created when someone died. IRA’s are horrible devices to transfer wealth to family. Twenty years ago the IRA business was rampant to professionals. Now we have millions of over funded IRA’s. Another banker I know had a $1.5 million IRA that was to go to his family—all cash. He changed it to a gift to a hospital and at 62 years old bought a second-to-die single premium life insurance policy for $200k with a $1.5 million death benefit. So now the family gets the money and so does the medical center. Make sure you’re the one that’s there when those decisions are made.
Okay, now I have given you the ways to get million dollar gifts. Certainly, a nonprofit and a philanthropist must exist in order for these gifts to occur, but I will also share the three secrets of million dollar gifts that no one else will tell you:
1. It is the fundraiser.
2. It is the fundraiser.
3. It is the fundraiser.
Fundraisers, the brokers of philanthropy, carry the responsibility for million dollars gifts on their backs. Which fundraisers among us will boldly carry that weight? And who will say it’s too heavy and hand it back to the nonprofit, the philanthropist, or the economy?
I am looking forward to being with Holly Hall, Bob Carter, vice chairman of Changing Our World and Lisa Thomson, associate director of gift planning at the Nature Conservancy on Tuesday, February 9, at noon Eastern time Center of Philanthropy’s webinar.
Stories? Frustrations? Share them with me.