How are fundraising goals set at your nonprofit? Where did these numbers come from?
How are you progressing towards your fundraising goals? Can you take a moment to review and – if needed – reset them? Could your goals be too aggressive? Were they set too low? Do people want to fund your programs, or do they feel you should have other priorities?
Whether your fiscal year ends June 30th, December 31st, or another date it is always a good idea to check your progress towards your fundraising goals. We suggest starting with a simple question: how were your goals determined? Knowing this can help you assess what you need to do reach your goals prior to your fiscal year end. The following are examples of how some nonprofits set their fundraising goals.
Some organizations set their fundraising goals by calculating anticipated revenue from fees, services, multi-year grants or contracts, and then subtracting expenses. The difference is the fundraising goal. Others add a pre-determined percentage to last year’s goal, regardless of the circumstances. Still others look to what their “competitors” are raising and use that as their goal. Some just use last year’s goal, regardless of whether they met it. A variation on this is to operate with no goal: the organization raises what it can.
During the goal setting process some nonprofits place an emphasis on ensuring they replace donors that were “lost” in the prior year. They keep an eye on their donor attrition numbers, the amount of money that represents, and focus on replacing those funds. Others focus on emerging or urgent community needs and make a commitment to raising funds required to be part of the solution.
Sometimes goals are set by including “windfall” gifts from the prior year. Most major estate gifts, or other unexpected large gifts or grants will not be repeated. If you include this in your current year planning, you can set yourself up for disappointment. Finally, gut feelings drive some goal setting. This is where a leader “feels” the organization has the ability to raise a certain amount regardless of prior year fundraising, number of prospective donors identified, or findings from a feasibility study.
When you assess your ability to reach your fundraising goals we suggest looking to see if any of the methods above were used to set your goals. If they were, look at your data and revise your goals (up or down) based on market information. After that, look to increase your pool of prospective donors and those who can assist you with fundraising. Look at your capacity and infrastructure: were your goals too modest for what your staff and board can achieve? Too ambitious? Finally, start pulling reports on donors from this year and last: who needs to be asked for a gift? The number one reason people don’t give is because they weren’t asked!
Most importantly, engage in goal setting that is based on realistic information, including market research gained from a feasibility study or conversations with current and potential donors. Don’t pull numbers from a hat: set realistic goals. Your staff, board, and donors will thank you.