How do you ask for a really, really, really big donation?

Sarah Durham: Hey, welcome to the Smart Communications Podcast. I’m Sarah Durham and I’m joined today by Eric Javier from CCS Fundraising. Hi, Eric.

Eric Javier: Hi Sarah.

Sarah Durham: So for those of you who don’t know Eric, he’s a Principal and Managing Director with CCS. And for more than 20 years, Eric has been a trusted advisor to leading nonprofit executives, trustees, and development leaders. He’s helped design and implement campaigns and initiatives that have raised more than $2 billion to make a positive difference in communities around the world. His primary areas of expertise include feasibility and planning studies, capital and endowment campaigns, major donor programs, principal gift solicitation strategies. That’s what we’re going to talk about today. Strategic development planning, case messaging, board development, coaching and training. Welcome Eric. Thank you for having me, Sarah. So tell us a little bit about CCS before we dig in.

Eric Javier: Sure. So CCS is a fundraising, consulting, and management firm that partners with nonprofits for transformational change. So we partner with nonprofits usually when they want to do something extraordinary, something big, they want to launch a major campaign. They want to revamp their development office, they want to go from raising X to 3X or 4X. And we provide both the advice and the hands on execution to help our nonprofit partners do that.

Sarah Durham: So Eric said something really interesting to me recently that I thought it would be great to talk about on the podcast. We were talking about what used to be known as the 80/20 rule and how that’s changed and the implications of that for making a big ask. So Eric, what was the 80/20 rule? How has it changed? Just give us the backdrop there.

Eric Javier: Yeah, sure. So there’s a principle in business and certainly in fundraising where 80% of your revenue or 80% of your funds raised will come oftentimes from about 20% of your donor audience coming up in this business, doing this for well over 20 years. That’s something that very much felt like lore and I think we would experience it, but the game has completely shifted. And as you said, when you look at these donor pyramids and the gift distributions and how organizations are raising money, that 80/20 rule is turned into 90/10 and maybe even 95/5, so the bottom line idea here is that more and more money is being given by a smaller fraction of what are really elite mega donors. And we can debate how that’s good or bad, but if an organization wants to do something extraordinary, the attention that needs to be paid to that top of the pyramid is only being magnified.

Sarah Durham: Yeah, and I think for people who solicit major gifts, people who actually have to sit down and ask a donor to make $1 million, multimillion dollar, maybe hundreds of million dollars, and that is quite an ask to make. There’s so much that hangs on that and I can think of in Big Duck’s history, one example of a project where a lot of time and money went into creating one ask for one donor, but tell us a little bit in your experience, how do you go about doing that? How do you prime somebody to make a mega gift? And how do you make that ask and steward that kind of relationship?

Eric Javier: The good news, I think for all the listeners, for nonprofits out there is that philanthropists are becoming more sophisticated and they are more often open to big ideas and considering different asks and initiatives for organizations that maybe they’re not necessarily close to. Now, that’s still the exception to the rule. So I think for the purpose of this conversation, I think we should assume that, listen, if you’re gonna get a mega gift, if you’re going to get an eight or nine figure gift or an extraordinary seven figure gift, you know, mega gifts can be different for different organizations. More often than not, it’s going to come from someone within the family who, of course, has the capacity to consider a gift like that. May or may not have a track record of giving gifts like that, but they’re known to you. You have a relationship as such where you can move a conversation to a place where you are asking them to invest in a vision and it’s going to require something extraordinary. You can’t do that with someone off the street. It’s very hard to do that with someone if you’re a direct mail organization, just sort of plucking a name with high capacity and saying, okay, we’re going to prepare proposal for $10 million. There needs to be a lot more sort of process and evolution to make that happen.

Sarah Durham: And these are sometimes called transformational gifts because they have the power to transform the whole organization. Is that correct?

Eric Javier: It is correct and I think it’s an important point to answer the question, well how do you go about this? For all our listeners, I think we have to start with the question, what are we trying to accomplish? What do we need the money for? One of my partners had a great saying that in our experience, the magnitude of the gift is often related to the length of the timeline for the vision for the future of this organization. In other words, it’s time for the annual fund. It’s year in, year out. I’m ready to give my thousand dollar gift or my $100 gift, or maybe even my $10,000 gift if I’m a major donor, but it’s for what we have to do year in, year out,

Sarah Durham: And I better be prepared to do it again next year

Eric Javier: That’s right. If we’re building a new cancer wing or if we’re building a new gymnasium for the school. Okay. That’s a bigger vision. That’s multi-year and it may justify a million dollar ask of this major donor, but if we’re going to ask someone for $25 million or $100 million, we need to be prepared to paint a picture that says over the next decade, this is what it could accomplish or beyond.

Sarah Durham: We’re not just going to build a gymnasium, we’re going to change the world.

Eric Javier: Yeah, whatever iteration for your organization. Absolutely. Yeah. What justifies a big ask? Well, big need, big vision, big ideas, right? And it’s hard to have a big vision if you’re confining yourself to just what you’re trying to do this year or even over the next few years.

Sarah Durham: So these are asks that I imagine have a ton of prep, research, probably preliminary conversations with the donor about what compels them. You’ve already done a lot of feasibility work. You and I have recorded another podcast about feasibility that listeners can look for and we’ll link to in the show notes here. But going into that conversation with the donor, who’s having this conversation? Is it the executive director or is it the board chair? How do you tee up this kind of conversation?

Eric Javier: There’s no question that institutional organizational leadership will play a key role. Executive directors, CEO, president of the university, et cetera. We have to think organization, we also have to think carefully about program leadership, right? So the head of neuroscience, if you’re an academic medical center, again, depending on what that potential transformational donor is interested in what we’re trying to get them to fund, yes, the CEO’s going to be important, but people want to invest in programs and ideas that are led by people with whom they have great respect and confidence. And so bringing in a faculty member, bringing in a dean, bringing in a chair of a department, bringing in a program leader, is going to be important. And then oftentimes, maybe not always, the role of a peer. I think major philanthropists want to invest in organizations again where they have trust and confidence. So who is leading this board? Who can reassure me that in addition to the staff, who I love who’s awesome from a governance standpoint and a leadership standpoint, these are people that I trust and I like and I believe in them. Right? And there’s credibility there. So yeah, you have executive leadership, you might have program leadership and then you might have lay leadership that can be part of the conversation in different ways.

Sarah Durham: I would imagine it’s a series of conversations with multiple people over a long period of time.

Eric Javier: Absolutely. We’re often told that, listen, we have one shot to do this, and my reaction to that is that’s not promising because I think major philanthropists, it has to be a multilayered multipoint conversation when you’re asking for that type of investment. Think about when anyone makes a major investment, right? If you’re going to buy an apartment or buy a new home or think about how many conversations and how many people are involved in that decision making, and it’s not dissimilar when you’re thinking about something that’s extraordinary like this.

Sarah Durham: In the communications and marketing world there’s this piece of theory called the ladder of engagement, which says that before people have heard of your organization, they’re unaware and our job is to communicate with them in a way that makes them aware so they’ve heard of you or something. The example of that is if you get intercepted on the street and asked for a gift from an organization you’ve never heard of, you’re not going to make that gift because you’re unaware and there’s no credibility there. But if you get intercepted by Greenpeace or the ACLU or an organization you’ve heard of and that holds some heft in your brain, you’re not unaware, you’ve maybe contemplated giving a gift. You’ve moved up the ladder of engagement. And as we move up the ladder of engagement, we go from being unaware to becoming aware, to contemplating, to maybe lurking, checking them out to maybe a low level of support or engagement. Maybe I’ve shared something on social or signed a pledge or made a small gift. And then we move up and up and up towards a level of advocacy where we become champions for the organization. And those are, I imagine, the types of donors you’re talking about. These are not people who just came in off the street cold yesterday, never heard about you. These are people who’ve been around, they’ve been supporting you, they’re connected to the board, they know the staff, and this is an opportunity to kind of further embrace them in the warm hug of your organization.

Eric Javier: Yeah, that is perfect framing. And I think that’s exactly right. And I would say that at the very top of that ladder for organizations that really do this well, organizations that have formal principal gift programs, we’re at a stage in philanthropy where having a major gifts department for a lot of these larger institutions, it’s not enough. Having a leadership gifts department is no longer enough. We’re now talking about organizations, and it’s usually the university world and the academic medical center world, but not only them who are creating literally principal gift or maybe even transformational gift teams. Who are focusing on not the masses and not even the top 5% of the pyramid, but the top one, top 0.5% and the ladder of engagement, and I know this is so much of your work, when you think about the great brands on the corporate side, American Express, you name it, where you could be gold, you could be platinum, or you could be diamond, and when you’re diamond there’s a set of experiences that you begin to expect. And so universities and these bigger institutions are being sort of hyper intentional and mindful that what are the experiences for that top 0.5, 0.25% in terms of how we communicate with them in terms of the experiences they get when they come to campus and it’s endless. Right? And we can have a whole other podcast about that, but when you’re talking about transformational gifts and is this audience organization that do this well and come in more and more of them, they add some rungs to the top of that letter of engagement.

Sarah Durham: Yeah. I want to name as I’m listening to you talk about this too, that these are issues that are also fraught with tensions around power and privilege. One of the strategists on the Big Duck team, Hannah wrote a great blog about that, about diversity, equity and inclusion and capital campaigns and so that’s a whole other whole other topic.

Eric Javier: That’s another podcast.

Sarah Durham: Yeah, that’s another podcast. But for an organization that is just thinking about these kinds of major donor asks. Before we wrap up, do you have any advice, anything that you’d like them to think about as they assess their ability to make an ask or get ready to make their first major ask?

Eric Javier: Yeah, absolutely. So let’s assume as we’ve walked through in this conversation that there is a potential donor who’s been connected to the organization. They are super engaged, they’ve made substantial gifts before and now they’re ready for this next level type of conversation and request and so there are a number of questions that I would encourage listeners and nonprofits who who have the opportunity to do this to think about and to guide how you would approach it. One is what is that 10 year vision and beyond that you are articulating and that picture that you’re painting for this organization, right? In other words, if you make this investment of $50 million for the sake of argument, what will happen, and I know we always grapple with answering that question for any donor, but it becomes especially important for the mega donor. Secondly, why this person and not the next person? What is unique and special about them in this moment that makes this the right time for them to do this? Just to drill down a little bit on that. We should be able to talk to them about, yes, the impact they can make on this 10 year vision and the programs and the impact that people that we’ll serve. But if they do this, they’re participating as a linchpin for so much more. It’s going to influence the next 10 people. It’s going to elevate. If they do this 25 million I get this will be by far the largest philanthropic gift this organization has ever commanded and the press and the publicity and the notoriety and how it elevates our game and our brand. There’s so much more impact if a mega donor invests in an organization. So we have to answer that question. Third, how will I be recognized for this? And yeah, it could be a name on the building, it could be a name on a program, but what else? What recognition is multifaceted? The fourth and final question, I would encourage everyone to answer is, how can we reassure this mega donor that what they’re investing in will be carried out? What are the reassurances? And so who are the leaders that are going to be involved? What are the checkpoints? What’s our plan for stewardship? How do we involve them in the unfolding of whatever program or building that were involved? So again, a lot to unpack, but hopefully those guiding questions are helpful for your listeners.

Sarah Durham: Great, and where can our listeners find you or CCS Fundraising?

Eric Javier: CCSFundraising.com you can get a whole set of resources and publications and research. We put out a whole bunch of blogs and we’re happy to be helpful to the nonprofit community and we’re so grateful, Sarah, that we’ve overlapped on so many occasions.

Sarah Durham: Well thanks for joining me, Eric. We’ll link to all of that in the show notes and I look forward to seeing you out there at AFP conferences and other places soon.

Eric Javier: Great. Thanks Sarah.