The Art & Science of Fundraising

Presented byJay Ornellas & Lisa Feldman

October 15, 2011

MISSION STATEMENT

The UCLA Fund builds enduring relationships with alumni, parents, students and friends and secures annual discretionary funds for UCLA’s Chancellor and academic leaders to

maintain and enrich UCLA’s tradition of world-class excellence.

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Fundraising Fundamentals

Some Basic Truths Giving & Volunteering In The USA Key Concepts In Fundraising Understanding Donors And Prospects Effective Volunteers

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Some Basic Truths People don’t give to causes. People

give to people with causes

People don’t want to give to an organization that has needs, but rather to one that meets needs

Knowing why you care about a cause is important to keeping you motivated

The best thing you can do for your prospect/donor is believe in the mission you are representing

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Giving & Volunteering in the USA

Women Men

30.1% 23.3%

White

Black

Asian

Hispanic

20.2%

28.3%

16-24 22.0%

25-34 23.5%

35-44 31.5%

45-54 30.8%

55-64 28.3%

65+ 23.9%

Generation Y (born 1981-91) $341

Generation X (born 1965-80) $796

Baby Boomers (born 1946-64) $901

Matures (born before 1946) $1,066

Sources: Conivo, The Chronicle of Philanthropy, Bureau of Labor Statistics --- for 2009

By Age

How much the average member of four generations gave to charity in the past year

By Race/Ethnicity

By Sex

Generational Giving14.7%

19%

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USA 2010 Contributions: $290.89 B by Type of Recipient Organization

Religion , $100.63

Education, $41.67

Human Services, $26.49

Health, $22.83

Public - Society Benefit, $24.24

Arts, Culture & Humanities, $13.28

International Affairs, $15.77

Environment/Animals, $6.66

Foundations, $33.00

To Individuals, $4.20

Unallocated, $2.12 Religion 35%

Education 14%

Human Services 9%

Health 8%

Public - Society Benefit 8%Arts, Culture & Humanities 5%

International Affairs 5%

Environment/Animals 2%

Foundations 11%

To Individuals 2%

Unallocated 1%6

USA 2010 Contributions: $290.89 B by Source

Individuals; $211.77

Foundations; $41.00

Bequests; $22.83

Corporations; $15.29

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Individuals 73%

Foundations 14%

Bequests 8%

Corporations 5%

FY11 UCLA Development Year-End Results

FY11 Actual

FY11 Actual % of Total

YTD Private Support by Gift Level $10M+ $159,500,540 33%

$5 - $9.9M $35,000,000 7%

$1 - $4.9M $65,789,099 14%

$100K - $999K $119,929,594 25%

$10K - $99K $66,482,238 14%

$1K - $9K $23,493,643 5%

$1 - $999 $9,303,433 2%

$479,498,548 100%

# of Gifts

4

6

39

544

2,451

9,238

67,515

79,797

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FY11 UCLA FundYear-End Results

FY11 Actual

FY11 Actual % of Total

YTD Private Support by Gift Level

$2,500 - $100,000 $9,055,163 62%

$1000 – $2,499 $1,505,716 10%

$1 - $999 $4,072,179 28%

$14,633,058 100%

# of Gifts

2,428

2,145

36,059

40,632

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$201M42%

$80M17%

$10M2%

$17M4%

$71M15%

$36M8%

$40M8%

$23M5%

Alumni

Alumni Estates

Non-Alumni

Non-Alumni Estates

Independent Foundations

Corporations

Other Organizations

Campus Organizations

FY 2011 Total: $479,498,548

UCLA FY11 Giving By Source

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Key Concepts in Fundraising

Ethical Fundraisers Fundraising Terms The Heart of an Organization The Prospect Cultivation and Solicitation Cycle The Pyramid of Giving The Gifts Chart

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Ethical Fundraisers

Match donor’s passion/interests with University’s needs

Determine and support donor’s ability to give (capacity + affinity + willingness)

Invest in long-term relationships and not just a single gift—especially in an annual fund environment

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Fundraising Terms

Case – The combination of reasons advanced by an institution or organization in justification of its appeals for support, with emphasis on its services — past, present and potential. The case is one of the three basic pedestals on which fundraising success must rest, the others being volunteer leadership and sources of support.

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The Case for Chancellor’s Greatest Needs (CGN)

Touching Lives Worldwide Gifts that transform lives are the most powerful, and the Chancellor’s Greatest Needs Fund (CGN) offers that potential. Allocated not just where support is needed, but where it will reverberate most, CGN generates campus-wide change. The Chancellor’s Greatest Needs fund is closely aligned with UCLA’s mission of enhancing education, advancing research, and promoting community service for lifelong civic engagement. The University endeavors to integrate these three hallmarks of a great university so that each enriches and extends the others. This integration promotes academic excellence as well as nurturing innovation and scholarly development.

Much like venture capital, CGN enables UCLA to maintain its entrepreneurial culture and approach in teaching and research. The Chancellor’s Greatest Needs fund provides the unique flexibility to support unforeseen opportunities as they arise. Above all, CGN empowers students to enhance their social mobility by enhancing academic programs and student services, recruiting the best faculty, and out-of-the-classroom learning opportunities. A professor can help guide an undergraduate’s life’s path; a fellowship for a talented graduate student may hold the key to a groundbreaking discovery that will benefit millions. With gifts to the Chancellor’s Greatest Needs fund, the sky’s the limit.

Fundraising Terms

Charitable Institution – Any private institution or organization that operates on a nonprofit basis for the public good and which is therefore exempt from taxation, with the exception of commercial operations in which it may be involved. Most are classified in Section 1954 of the Internal Revenue Code as a 501(c)(3) organization.

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Fundraising Terms Development- The process of aligning fund-

raising goals with institutional planning and objectives in order to move a university forward utilizing professional staff and volunteers—alumni, parents, students and friends–who become advocates and ambassadors for the university and whose efforts ultimately aid in the financial health of the institution.

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Fundraising Terms Restricted vs. Unrestricted Gifts-Restricted

gifts are designated to a specific project or purpose whereas, while an unrestricted gift can still be targeted to a designated fund, its use is not restricted to a specific purpose.

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Fundraising Terms

Prospect – A potential donor who has been identified as having the capacity to give at the target level, an affinity with the organization and/or its work, and as one to whom the organization has access through his or her relationship with one or more volunteers and/or staff persons.

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Fundraising Terms

Cultivation – The process of developing the interest of a prospect through exposure to institutional activities, people, needs and plans to the point where he or she may consider a leadership annual or major gift. Focused cultivation activities can extend over a period of a few weeks to many months or even years in the case of a major or principal gift strategy.

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Fundraising Terms

Personal Solicitation – The preferred method of fundraising, involving one or more individuals meeting face-to-face with a prospect to invite that alum, parent or friend to make a charitable gift to the University.

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Fundraising Terms

Stewardship – The development process by which an organization shows gratitude to a donor through timely and meaningful acknowledgement, recognition and involvement and through annual reporting demonstrating the impact of the gift on the mission of the organization.

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The Heart of an Organization: Work from inside out and top down

Level 1: People closest to the heart – board and council members, major and principal donors, leadership-level annual donorsLevel 2: Volunteers, Alumni Association members, staff, below-leadership-level annual donors

Level 3: People who are not current donors but have given in the past (lapsed donors)

Level 4: Non-engaged alumni, students, parents and friends you haven’t reached yet (non-donors)

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Prospect Cultivation & Solicitation Cycle

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Cultivation

Solicitation

Stewardship

Identification

Re-solicitation

Pyramid of Giving

Principal gifts

Major and planned gifts

Individual annual gifts

Potential gifts from non-engaged alumni, students, parents and friends

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Pyramid of Giving

Principal gifts

Major and planned gifts

Individual annual gifts

Potential gifts from non-engaged alumni, students,

parents and friends

$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$

$$$$$$$$$$$$$$$

$$$$$$$$

$

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Understanding the Pyramid of Giving Simply stated, development can be

considered a game of numbers and methods used.

Approximately 30% - 35% of first-renewal donors will make a gift their 2nd year

60% of 3-year donors will make a gift their 4th year

86% of 5-year donors will make a gift their 6th year

97% of leadership-level donors renew at their 5-year mark

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Understanding the Pyramid of Giving There is a direct correlation between the size of

one’s gift and the method used to solicit it Most first-time contributions are secured through

telemarketing and e-solicitation methods. Second and third gifts are often also solicited through this type of appeal or through direct mail.

Once a gift reaches a certain level — leadership- level gifts ($1,000+) are secured through personal solicitations (also referred to as “face-to-face” solicitations), ideally by someone who knows the donor on a personal basis.

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Understanding the Pyramid of Giving The top 10% to 20% of the gifts received will

account for 75% to 90% of the dollars produced 75% to 85% or more of the total number of gifts

received will typically be in the smallest giving ranges and equal about 10% to 20% of the total dollars given.

Usually less than 100 gifts will account for 75% to 90% or more of the total dollar production.

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# of Gifts Gift Size # of Prospects Total

# of Gifts Gift Size # of Prospects Total

5 $100,000 20 $500,000

4 $75,000 16 $300,000

10 $50,000 40 $500,000

75 $25,000 300 $1,875,000

100 $10,000 400 $1,000,000

325 $5,000 1,000 $1,625,000

1,500 $2,500 4,000 $3,750,000

1,000 $1,000 4,000 $1,000,000

Many Under $999.00 Many $5,250,000Grand Total $15,800,000

UCLA Fund Projected Gifts FY12

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Understanding Donors and Prospects

Qualifying prospects Why people give Why people don’t give It’s all about relationship building

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Are we on the same page?

Qualifying Prospects

Capacity Do they have a level of income sufficient to support a

leadership gift? Affinity

Do they have an interest in and/or an emotional tie to one or more parts of the University?

Willingness Are their circumstances such that they are amenable to

making a gift if asked?

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Why People Give

A desire to make an impact and do something with lasting meaning

A responsibility to share good fortune To be a part of the solution, make a difference Emotional response, belief in the mission, empathy, sense

of belonging, giving back Recognition, personal gain, networking, peer influence, to

set an example, image Tax benefits

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Why People Give

What are the three primary reasons why people say “yes” when asked to give? Because the are expecting to be asked Because they are asked Because the right person asked

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Why People Don’t Give

What are the primary reasons why people don’t give? It’s not a good match; they are not emotionally

compelled Weak case for giving and/or insufficient

stewardship The wrong person did the asking, for the wrong

amount, at the wrong time They weren’t asked

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It’s All About Relationship Building Create opportunities for involvement and

interaction Personal contact is critical Attentiveness is key Phone calls are more effective than snail mail

or email Face-to-face interaction is more effective than

phone calls Let the donor/prospect know that they are

important and that their contributions matter

Effective Volunteers Believe in the mission of the organization and

understand the case for giving Are donors themselves Have one or more of the following characteristics

Personable, good at telling their story Attentive, good listener Dedicated, good follow-through, dependable Sincere, genuinely interested Don’t take “no” personally

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From Sales to Fundraising

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Sales Skills… …Applied to Fundraising

Communicating product/service value to your customer

Communicating the case for UCLA and your passion to the donor

Listening to your customer’s needs and requirements

Listening to your donor’s concerns and interests

Helping the customer find the right product/service

Helping your donor find the right giving level and program

Closing the dealMaking an effective ask and receiving the donation so it can start doing good right away

“The Tiny Essentials of Fundraising” Neil Sloggie

One thing has remained constant in fundraising for two thousand years, that is that the more personalized approach works the best. For the future of fundraising, no matter what happens, it will come back to the levels of personalization that can be provided.

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Thank You.

Any Questions?

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