The pace of change is so rapid today, and new actors pop up regularly and are aggressively competing for and entering the space historically occupied by traditional “legacy” organizations.
by Avrum Lapin
I am often surprised, even after three decades in the fundraising industry, by the often slow and resistant responses from many leading organizations in the Jewish community to the demands of the new circle of lead and major donors. Emanating from an ill-perceived notion of history and position, or from a sense of entitlement, many organizations are slow to recognize that the emerging “class” of major donors – increasingly entrepreneurs and creators of ideas and solutions – is quite different from those who preceded them, and expect different things from the organizations and causes that they support.
Let me enumerate a few areas where things have continued to evolve and, in doing so, are transforming the narrative and many ways in which the nonprofit world functions and communicates.
1. Survival (or even existence) is not a goal … Focus is on results.
Just because an organization exists does not automatically entitle it to support. Just because an organization has been around for a decade or a century no longer compels a donor to give. Donors are more interested in what you do, not so much that you have been doing it for years.
The pace of change is so rapid today, and new actors pop up regularly and are aggressively competing for and entering the space historically occupied by traditional “legacy” organizations. This phenomenon is happening largely because they tend to be more focused, they bring visions to the discussion that are contemporary, appealing and functional in today’s multi-channel world, and are more agile and less encumbered in their operations. Groups that do not see or resist this trend do so at their peril.
2. Loyalty is no longer the sole determinant of support
We live in an increasingly competitive philanthropic marketplace – one that, as noted above, values outcomes, not only history or position. Understanding this should motivate organizations large and small to think about how they allocate resources and how that frames and communicates their “selling propositions.”
And let’s stay with the notion of “selling.” We live increasingly in a transactional world, where value is determined by what you do, not only what you say you have done. And while we try not to be totally cynical, I am always struck by the number of times I see a prospective donor turn down a cause that should, by objective measure – including giving history, be a “slam dunk,” and who resists making the gift because of (lack of) efficiency, mission creep, market share, etc.
3. Bang for the Buck – Investing Charitable Dollars
I was approached recently by a major donor at the close of an event who asked me about my thoughts regarding the consolidation of asks for related organizations that occupy the same or overlapping program space. He complained that they were competing for resources, potentially diminishing the impact of the dollars that were donated to achieve a goal – not just support an organization. My response was the following: what was historically called the charitable arena has become the philanthropic marketplace, and that as a marketplace it is increasingly a venue where ideas compete and organizations were being rewarded at the intersection of relationship and results, not on relationship and history alone.
He went on to ask if I thought that we could create an appeal that would raise funds to achieve a goal and a solution, not necessarily fund a particular organization, and decide as part of the activity where the funds would be directed. He felt that the diminishment of loyalty and the focus on results would make it successful. I am thinking about it as well.
In this vein, I also reiterate something that I have written and spoken about for years … the need for all successful nonprofits to invest energy and purpose in a business plan. This dynamic document concretizes the vision and makes it actionable financially. It demonstrates, with accountability, how it that vision would be realized and implemented over the ensuing months and years, with programmatic and financial milestones, deliverables and projected outcomes.
And it would meet the expectations of many of today’s emerging major donors who seek to use their philanthropy to “invest” rather than just to “give.” While the functional end product for the organization may be the same – at least for the time being, the prompt for the donor is quite different. They want to see something happen rather than just funding an organization to do something.
Today’s emerging major donor is stepping up to leadership at a time where the marketplace is still governed to some degree by uncertainty. This drives the expectation that, while they are prepared to be charitable, they want to see their money work and put to good and productive use. Successful nonprofits today must accommodate this imperative because it is not going away; in fact it is intensifying and becoming ever sharper. We therefore encourage our friends, many of whom lead very important organizations throughout the nonprofit world, to embrace this challenge. To continue to expect support because you believe that you should have it simply won’t work anymore.
Avrum Lapin is the President at The Lapin Group, LLC, a prominent fundraising consulting firm located in suburban Philadelphia. The Lapin Group works with US-based and international nonprofits on fundraising, strategic direction and planning, leadership development, and nonprofit business practices and growth strategies. He is a frequent contributor to eJewishPhilanthropy.com and speaker in the US and in Israel on challenges and solutions in today’s nonprofit marketplace.
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