It’s a busy time to be a nonprofit. There’s escalating need everywhere, grant availability fluctuates with politics, and everything from paperclips to plane tickets seems to just get more expensive. On top of all that, you’ve got to find a way to get and keep donors and raise much-needed funds.
While I can’t guarantee my advice will skyrocket your nonprofit to the top of the fundraising charts, I can look at the past few decades we’ve spent helping nonprofits and point out some errors I see pretty often. Avoiding these common pitfalls will surely put you on a straighter path to success.
This article will cover the top five mistakes we see our nonprofit clients make. We will also offer advice on avoiding them and pivoting quickly if you realize you’re already entering the red zone.
Without further adieu, here we go….
The fundraising life is often a whirlwind of activity, and executive directors can find themselves building the plane as they’re flying it. We cannot stress this step too much: Slow down, sit down, and invest time and resources in creating a plan.
This strategic plan should be the north star of your nonprofit. While it must remain a living, breathing, evolving document to stay relevant, the core mission won’t change, and your plan will be a great way to ensure your efforts are always aligned with reaching your goals.
A strategic plan offers the opportunity to lay out what you want to do and how you will do it. Your audience is broad: it’s your donors, your staff, your board of directors, your supporters. It’s a critical document if you plan to apply for grants. It lends validity and heft to your organization and clearly defines your reason for being.
What should you include? At its most basic, these are the elements of a nonprofit strategic plan:
If you’re stretched thin, some consultants can help you formulate your strategic plan. If you spend the time creating a solid document, you can rest assured that your time and resources are well and efficiently spent and that you are staying on track to meet your goals.
A nonprofit board of directors is a beautiful thing. They are invested in your mission and provide strategic guidance and support. But if there aren’t clear lines of responsibility and influence between the board and the CEO/Executive Director (ED), you can find yourself in a difficult situation.
Board members might not be board veterans, so it’s an error to assume they’re all-knowing and all-powerful and don’t need your input.
The Board is responsible for:
We like how the National Council of Nonprofits says that the board should be considered “up in the crow’s nest, scanning the horizon for signs of storms or rainbows to explore (perhaps with a pot of gold at the end!)." Scan, but don't take a flying leap into the water!
You, as CEO or Executive Director, are responsible for:
These lists aren’t exhaustive, but they give you an idea of where the lines can be drawn. If the board makes decisions about your staff or whether you should launch an email campaign, they are in the weeds and might become an impediment.
It’s worth your time to sit down with your board and detail the responsibilities of each. This documentation should be shared internally, so all staff members understand the relationship between the nonprofit and its board. Transparency will help keep those lines in place.
If you don’t make mistake #1 and have a solid strategic plan, this won’t happen. If you have a plan and a vision, you’ll be less likely to fall into a pattern of following money and grants and reshaping your mission to qualify for funding.
For example, it’s easy to see an appealing grant that you’d qualify for if only you included a particular group of beneficiaries. That’s a dangerous place to be because, over time, you can quickly erode your original mission (which is the one you have data and research to validate). You weaken your nonprofit when your mission wobbles.
How to avoid this downfall?
As I often say, if you’re a nonprofit focused on gardening, even the most lucrative grant isn’t worth it if it means you’ll be running a youth basketball camp!
Hold on, we know. Sometimes tough times call for tough measures, and you have to trim the fat. But nonprofits don’t usually have much fat, and sometimes it seems impossible to recession-proof your nonprofit without cutting everything down to the bare minimum.
But in our experience, it makes sense to have a financial plan (again, avoid mistake #1) and follow it. But what, you ask, if my sustainers fall short of my expectations and I know I won’t have the revenue I expected?
Our advice is to double down on growing your programs and supporters before considering cutting costs. This is where good technology comes into play: if you can easily launch no-cost campaigns from your CRM, do it. A/B test your messages with small groups and find what compels donors or prospective donors to action, then try email or a peer-to-peer campaign.
Sit down with your board and brainstorm ways to get more donors and more money from the donors you already have.
The bottom line is that cutting costs is, of course, sometimes necessary. But don’t start there. Focus on outgrowing the problem first; raising more money, engaging more new donors, getting more support from existing donors. This strategy can save you in the short term and set you up for long-term success.
Before you say, “Oh, we would never do that!” ask yourself the last time you conscientiously thanked your donors. Picked up the phone and called a donor to tell them how their donation impacts your mission. Sent a handwritten note of appreciation.
Take a good look at your casual supporters. You know, that one $25 end-of-year donation, or the plus-one of a donor that comes to a few events and sits on the sidelines. Those casual supporters are gold ready to be mined. They know about your nonprofit, and they’ve shown they will support you. How can you incentivize them to become regular donors?
Angel Aloma, who spent decades in charge of Food For The Poor, boils donor care down in this captivating interview.
We recommend a few tips to make sure your donors are feeling the love:
Internally, we talk about how appeals must contain ethos, logos, and pathos, or Aristotle’s modes of persuasion. They can serve as a guide when we talk about donor care:
Remember that your donors fuel your nonprofit. Donor care must be on the to-do list of your staff every day.
Avoiding these five common mistakes doesn’t mean the path will always be easy. But like the proverbial note on the fridge, keeping these top of mind will keep you safe from the pitfalls that catch many nonprofits by surprise.
And when all else fails, revert to common sense. Be organized and have a plan. Know your internal roles. Stay close to your mission and raise money rather than cutting funds. And always, always thank and love your donors.
We talked about how technology can help you avoid all of these mistakes. Evaluate your CRM to see if it’s a good match for your efforts and goals. If it’s not, give us a shout, and we’ll show you ours.