Often when we work with non-profit organizations to help them create a plan to raise more money for their cause, they discuss implementing the plan next year or the ever-elusive “later.” Many people are feeling the financial squeeze right now, but the top 10% are not. Things have never been better for them. It may not always be this way, so you must strike while the proverbial iron is hot. The time to raise more money is right now.
What is the Difference between Taking a Risk and Being Risky?
There is a difference between doing something risky and taking a risk - it is not always a black-and-white situation. Depending on the circumstances, what might be risky for one non-profit might be just taking a risk for another. Here are some examples of things that straddle the line between risky and taking a risk so you can see what we mean.
“We raised our top donor spot to $50k.”
A non-profit we once worked with had never raised $25,000 from a single donor. We challenged them to ask their top donors for $50,000. The non-profit was skeptical, but they did, and they called us back almost in tears to tell us that they got a donation of $50,000 and 2 donations of $25,000. This wouldn’t have happened if they didn’t take a risk and asked for it.
In this case, asking for $50,000 might have felt risky because it was so far above what they had done before, but it wasn’t risky. As we often say, making a big ask means that your donor will tell you how much they are willing to give. They had at least two donors turn around and say, “we can’t give $50,000, but we can give you $25,000.”
“We did away with our live auction and decided to focus on a fund-a-need instead.”
We recently spoke to someone from a non-profit that decided to focus on its fund-a-need to the extent of cutting its live auction and silent auction. In our opinion, this is risky, and we wouldn’t recommend it in most cases. However, this non-profit went about it strategically. They prepared for it long before the fundraising event.
It worked so well because this non-profit organization had a large donor base that had been involved with the non-profit for a while. Each donor was bought into the mission and really dedicated to the cause. We have also seen non-profits do this and fall flat, so you’ve got to think carefully about if it is risky for your non-profit or if it would be taking a risk.
“We are selling our Golden Ticket Raffle tickets for $250 each.”
This can depend on the circumstances. For a fundraising event that attracts high-capacity donors, this may just be taking a risk.
There are many circumstances where this may be risky, such as if you have never run a raffle before or if your fundraising event is a $25 spaghetti dinner. In that situation, it might be best to try a never-ending raffle instead.
Step 1 is planning to raise more money. Don’t let fear of failure hold you back from naming your goal. We spoke to someone recently and asked him how much he wanted to raise for his non-profit this year. He hemmed and hawed a bit and admitted he would really like to raise $100,000. That was quickly followed by saying he was aiming for $45,000.
Let’s say you’re a non-profit that usually raises approximately $25,000 per year for your non-profit. If you have a goal of $100,000 and fall short and only raise $50,000 – is that really a failure? We see it as a win because you have doubled the amount you raised for your non-profit. As the W. Clement Stone quote says, “Aim for the moon. If you miss, you may hit a star.”
If you don’t plan to succeed, then you are planning to fail. Allow yourself to dream big and create a plan for your big dream. That way, if you do fall short of your goal, you’re still not failing.
Understand What Your Donors Want to Bid On
Donors are consumers. While bidding on things and donating to support your cause, they don’t want to bid on things they don’t want. One of the biggest mistakes we see non-profits make is using their live and silent auction as a dumping ground for donated items. Doing this negatively impacts your live auction’s ability to be a significant revenue generator for your organization.
Instead, we recommend strategically choosing your live auction and silent auction items and maximizing the potential to raise money with those auction items.
For example, we saw a non-profit that always received donations of free dental checks and vouchers from local businesses pool a lot of them and create a “feed a college kid for a year” package. This package was very popular with donors, many of whom had family or friends that were going off to college. It raised $1,200 yearly, which was much more than each item would’ve raised by itself. Knowing that they were creating this package, the non-profit was able to secure donated items that fit the package too.
Another situation we often see is that a donor donates an item and is insistent that it be in the live auction or that the item is worth a certain amount of money. It can be challenging to navigate these situations as you want to preserve the donor relationship and not appear ungrateful for the donation.
We saw this once with a rather eclectic piece of jewelry. It may have been worth the $8,000 that the donor insisted it was worth, but due to its uniqueness, it would never have fetched that in an auction. Instead, the non-profit used the piece of jewelry as a Golden Ticket Raffle prize. The organization sold 42 tickets at $200 apiece, maximizing the opportunity. The donor was happy, the non-profit was happy, and the raffle winner was happy.
The question to ask yourself is, do you have multiple donors who would pay $10,000 for it? (Or however much money you are trying to raise.) If the answer is no, the best place for it is to be used as a raffle prize. Alternatively, you can combine it with related items to make a more valuable auction item.
Listen to Episode 120 of the HGAFundraising webinar to learn more about how your non-profit can start raising more money NOW.
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