Category: Fundraising

GuideStar and charitable donors

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The success of a charity often depends on more than the number of gowns and black bow ties parading at a fundraising gala.

The success often depends on the data that gets churned up by the savvy analysts at a nonprofit group such as GuideStar. GuideStar combs through charity filings to produce reports on how groups spend their money, and that information is closely followed by donors who are trying to decide where to give their time, talents and treasures.

Donors don’t just want an analysis of IRS filings any more. They want to give to charities that make a palpable social impact, a quality that’s not always easy to measure. And to stay useful, GuideStar needs to develop new yardsticks.

President and chief executive Bob Ottenhoff recently announced that he is stepping down from GuideStar and making way for Jacob Harold, a 35-year-old foundation leader who has served on GuideStar’s board since 2010. After studying literature and ethics in college, Harold worked for environmental organizations including Greenpeace and Rainforest Action Network.

During that time, Harold became familiar with the aggressive ways that often mark community activism. In a protest stunt against Ford Motor Co., some of his colleagues rappelled off of a building in downtown Detroit to hang a 50-foot banner. Harold bailed them out of jail that night. The next day he found himself in a suit speaking at the car manufacturer’s shareholder meeting about the need to build clean cars.

“To have the sort of impact that I think the world needs, I had to figure out how to wear a suit and multiply my impact,” Harold said. So he decided to go to business school. “A business approach is not fully translatable to the nonprofit sector … but there’s no doubt that both sectors have a lot to learn from each other,” he said.

He spent a summer in India working on climate change and in China studied the science of complex systems. Suddenly the world of philanthropy with all of its moving parts — donors, nonprofits, social impact — seemed a bit more understandable.

Harold couldn’t pass up the opportunity to bridge the world of big data to philanthropy.

— From a Washington Post article by Vanessa Small 

The philanthropic force of connected giving

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As governments around the world pull back, the philanthropic sector will be a critical force in meeting global needs. In what is called the “Giving Pledge”, 81 billionaires have committed to give more than half of their wealth to charitable organizations.  This level of philanthropy, over $37 billion by Warren Buffett alone, is historically unprecedented.

Warren Buffett most lasting contribution will not be his money; rather that he has successfully leveraged his social network and the media to inspire other billionaires to give extraordinary wealth for charitable good.  He is reshaping the way the rich think about money and giving.

And in the same way Warren Buffett has used media to get other billionaires to pledge their fortune to charity, people all over the world have used social media to raise money and inspire their network to join them in giving.

Indeed, according to Blackbaud, people are 200 times more likely to donate to a cause if their friends ask them to support a charity, in comparison to receiving an e-mail solicitation from the organization.  This is part of a distinct cultural shift – you no longer have to be a professional to be a fundraiser.

With the rise in connected giving will come the use of social data for fundraising.  Seventy percent of Millennials ages 20-35 report they prefer to give online, making online giving as the #1 preferred method of giving.

The IDC, a technology research firm, estimates that the total amount of data doubles every two years.  Social media data is a major part of this growth.  Marketers are interested in the “social network value” of a customer– how one person’s purchase influences others to buy a product.  Similarly, nonprofits are becoming aware how a donation can have a ripple effect in the donor’s network.

–Matt Bishop, founder and CEO of iGiveMore

 

 

Social Entrepreneurship under the heading Community Wealth Enterprise

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In his book, “Revolution of the Heart”, Bill Shore defines a facet of social entrepreneurship: “Instead of businesses deciding what nonprofit causes to support with some of their excess profit, nonprofits need to decide what line of business they can devise to create profits needed to support their public-interest efforts.”

Nonprofits creating a business to create the cash they need to support their efforts. This hybrid entity has a name: Community Wealth Enterprise (CWE).

Instead of fighting for a slice of the charitable pie, a CWE bakes its own pie.

It’s not a business where profit margins are top priority, and it’s not a non-profit that strives for philanthropy but has no money of its own.

[Excerpts of an article by William Long]

Grants as a source of funding

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Access to capital is one of the greatest challenges for both small business owners and small non-profits and NGOs. Knowing where to look and how to sift through grant information that applies specifically to your business can be laborious. But, it can also be very rewarding.

Grant writing is a very specialized discipline and requires strong compliance, research, and writing skills. The relationship between grant makers and grant seekers is governed by specific grant protocol, which refers to the rules and requirements governing the provision and award of grant funding. Protocols are grant-specific.

Grant makers include foundations, nonprofits, businesses, corporations, clubs, and professional organizations. Grants are also provided by state, local, and federal governmental agencies.

State, local, and federal government grants are driven by legislation. Every year, the U.S. government awards $400 billion in grants. Private grant funding sources include foundations, nonprofits, businesses, corporations, clubs, and professional organizations. Information on private grants can be found on the Grantsmanship Center website (tgci.com). The website provides information on top grant making foundations, community foundations, corporate giving programs, and state government grant opportunities by state.

Information on independent, corporate, and community foundation funding sources are also available on the Foundation Center website (foundationcenter.org) and the Council on Foundations (cof.org). The Foundation Center provides grant seekers with information on philanthropy opportunities, proposal writing, research, and training. The Council on Foundations provides grant makers (foundations, corporations, and philanthropic entities) with foundation management services.

Foundations and corporate giving programs offer two types of grants: general purpose or program development. General purpose grant awards can be used to fund operating expenses and special programs. Program development grant awards are restricted to funding specific projects.

Bottom line, the quality and completeness of your grant proposal has a tremendous impact on whether or not your project is selected for funding. It behooves those seeking grants to build a relationship with the grant maker to validate the grant proposal approach, if possible. If a face-to-face meeting is not feasible, a letter of introduction and a conference call is the next best option.