A Different Perspective on Mega Donors
By Michael Oberlander
What adjectives do you usually think about when you think about mega donors? Wealthy, sure. Generous, of course. Passionate, yeah.
Recently, I was with a group of colleagues from around the country and we were discussing strategies for securing mega gifts. Depending upon where we lived and worked, we had slightly different definitions of what mega gifts are. For some, a mega gift is in the 9 figures. For others, multi-million dollar gifts are celebrated as mega gifts. We discussed some recent literature that indicates that the top 10% of donors account for 94% of the charitable dollars raised by American nonprofits. An earlier report showed that the top 1% of donors accounted for over 70% of donations.
According to the Council for Aid to Education, for the year ended June 2016 overall giving to higher education increased again to a record high of $41 billion. In order to raise those types of dollars, universities seem to be increasingly using multi-year campaigns with multi-billion dollar goals. And, the universities are securing mega donations of $100 million or more at a time in order to achieve these amazing results.
We discussed how the cultivation and solicitation of a mega gift differs from the “run-of-the-mill” gifts to annual campaigns. Mega gifts are typically structured as multi-year gifts. They often include some component of cash and some component of a bequest or other testamentary gift. We also discussed how mega gift cultivation and solicitation is the exact same as every other: build a relationship of trust, understand the motivations of the donor and how they fit into the mission and vision of the charity, communicate clearly and make the ask.
Of course, get any group of fundraisers in a room and the stories will soon start to flow. After all, one of the most important tricks in our bag is the ability to tell compelling stories. Truth is good, but compelling is essential. We connect with each other through stories, so we connect with our donors through stories. Statistics are great, but tell a story that makes an emotional connection and donors will want to respond.
These stories were about our relationships and interactions with uber wealthy donors (those donors with the capacity, if so inspired, to make mega gifts). You can imagine some of the stories, but suffice it to say that some of the adjectives used were “quirky,” “eccentric,” “unconventional” and even “disruptive.” We didn’t talk about homes, cars, boats, planes or things. We talked about access to information, input into decision making, expectations for quality of communication and service. The conversation turned to the question of what makes the uber wealthy “like that”? Was it the money going to their heads? Did they feel entitled? Did they feel accustomed to getting what they want, when they want it?
I look at the question differently. What was it about those people that made them uber wealthy with the potential to give mega gifts. I believe they, by and large, became uber wealthy because of their quirks, eccentricities, unconventional and even disruptive perspectives.
Earlier this year, The Chronicle of Philanthropy put out its annual ranking of 50 Americans who gave the most to charity in 2016. (Universities and colleges received nearly half of the money donated by these philanthropists.) Who made the list? Tech giants captured 4 of the top 9 spots, and 9 of the top 50. Number 1 was Phil Knight, founder of Nike. 16 of the top 50 made their fortunes in finance. These are people like Michael Bloomberg and Roxanne Quimby, co-founder of Burt’s Bees. They are private equity and hedge fund investors. Most appear to me to be creators of wealth, and not inheritors of wealth.
These are people who looked at the same world as you and I, and identified that there are different ways to make and sell running shoes, share news, connect with each other and be entertained. These people saw opportunities to exploit inefficiencies in markets with lots of really smart people in them. And, then they had the perseverance, grit and talent to succeed.
I contend that it was their unconventionality that enabled them to look at the same landscape as millions of others and dream of a different way to first sell books, and then to sell everything else and get it to you in less than a day. And, I also believe that it is that same disruptiveness that can shatter the way we communicate with each other that can help us deliver on our missions. So, as we look to secure gifts from mega donors let us embrace the qualities that set these people apart. They want access to information – give it to them. The good, the bad and the ugly. We need to build trusting relationships. They want input into decision making – of course they do. Before asking for the mega gift, ask the donor for advice. They have high expectations for quality of communication and service – and they should, as should all of our donors. It is up to us to step up our game to engage meaningfully with donors and secure mega gifts.
Michael Oberlander is the Chief Philanthropy Officer of the Jewish Federation of St. Louis. Prior to becoming a communal professional in the summer of 2016, he was an active volunteer leader and corporate lawyer.