Category: Donor Participation Project

Social impact bonds (SIBs) are an innovative way for nonprofits to fund programs and services by attracting private investors. Investors provide upfront capital and get repaid based on the achievement of agreed outcomes. Nonprofits should consider SIBs to scale programs, focus on mission rather than fundraising, and tap a new pool of investors.

Identify a program that drives measurable impact.

Investors want outcomes, not outputs. Select a program, like training refugees as nursing assistants, with concrete results that benefit society. This helps win over investors and governments, who repay investors.

Understand and leverage your investor base.

Consider who wants to see change in your cause area, like healthcare, and may invest for both social and financial returns. Note that many investors value SIBs for the former reason, as they are driven by mission impact. Engage current donors as potential investors, as they already believe in your work.

Negotiate with your local government.

Discuss opportunities to implement an SIB for one of their grant-funded programs. Argue that an SIB lets them fund outcomes rather than activities while also allowing nonprofits to focus on mission. Some governments now prefer SIBs to traditional grants.

Rigorously evaluate your outcomes.

Well-evaluated programs attract more investors by demonstrating effectiveness. Work with third-party evaluators to analyze outcomes, ensure transparency, and prove success to investors and governments who will repay based on agreed metrics.

Address risks like costs, sustainability and evaluation. Applying for SIBs requires time and money!

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For nonprofit advancement teams looking to scale their fundraising operations, making a data-driven case for investment is key. Peter Fardy, a fundraising consultant, shares how he helped triple fundraising at Dalhousie University over 12 years by tracking performance, benchmarking against peers, and forecasting achievable growth.

First, analyze your historical data to understand your fundraising potential.

Look at new commitments secured and funds spent over at least 10-20 years.

Despite yearly variability, Fardy found a clear correlation between increased investment and higher returns at Dalhousie. Over time, they averaged $6 in new commitments for every $1 spent in advancement.

Next, compare your performance to peer institutions.

While imperfect, benchmarking helps determine if you’re above or below average in key metrics like new commitments per staff, expenditures, and return on investment. At Dalhousie, benchmarking confirmed they were competitive but underinvested in fundraising compared to peers.

Then, build a realistic forecast for future performance to make the case for increased investment.

Without additional resources, why expect to outperform your historical average or peer institutions? But with data showing the potential for growth, argue for ramping up investment to scale impact. For Dalhousie, a forecast model showed potential to triple new commitments within 5-10 years with more staff and dollars.

Finally, determine funding sources, whether from the operating budget, endowment assessments, or elsewhere.

At Dalhousie, the university provided additional funding once they saw the strong case for growth. Within a few years of increased advancement investment, the university endowment exceeded what it would otherwise have been due to new commitments.

By analyzing your fundraising performance, benchmarking against peers, and crafting an achievable vision for the future, you can build a persuasive case for advancing your advancement operations.

Like any investment, the return won’t be immediate, but with the right data and resources, nonprofit fundraising teams can drive sustainable long-term growth.

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For years, higher education institutions have focused on alumni participation rates as a key metric of fundraising success and a factor in college rankings. However, with the recent news that U.S. News and World Report has dropped alumni giving rates from its ranking methodology, institutions now have an opportunity to rethink how they approach and measure alumni engagement.

According to Dr. Shalonda Martin, who participated in a recent discussion on alumni engagement, “Metrics should serve a purpose beyond just existing for the sake of existing.”

Rather than chasing participation rates, schools can now focus on using data to benefit their institutions in more strategic ways. For example, understanding donor motivations—like their desire to create impact—and aligning messaging to resonate with these motivations.

Fundraising expert Perry Readford believes the shift away from rankings also allows schools to approach fundraising with an “inclusive” mindset.

“A lot of schools have pressure to get everyone to the table to give at whatever amount is meaningful to them,” Radford said. Creating a culture of philanthropy where all gifts matter is more meaningful than chasing arbitrary rate targets.

To measure success beyond rates, schools may look to tools like CASE’s Alumni Engagement Metrics which consider factors like alumni satisfaction, loyalty, and advocacy. Digital engagement can also provide insight into how to better connect with younger alumni. Rethinking the traditional phone-a-thon model to focus on broader engagement and volunteering may open more opportunities for alumni to contribute in ways most meaningful to them.

The experts agreed alumni participation still matters for demonstrating community support. But rather than “gaming the system,” schools can now authentically build that support through equitable engagement practices, strategic communications about impact, and partnerships across campus.

For advancement teams, this shift means an opportunity to realize greater contributions and community impact. Overall, alumni engagement and fundraising stand to benefit when the focus moves beyond metrics for their own sake.

Success comes from relationships, not just rankings.

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A recent survey of 75 advancement professionals conducted by the Donor Participation Project found several barriers to improving donor participation rates at their institutions. The majority of respondents felt they lacked key resources and support to drive meaningful growth.

The survey found that while 40% of respondents felt they had adequate budget for donor participation efforts, 73% did not believe their campus culture fully understood or supported the work required. Respondents cited a lack of collaboration and buy-in from leadership across their institutions.

“If that is happening from leadership, then the AVP level will be kind of on the same page…we know this is the direction our leader wants to go.”

Cameron Hall of the University of South Carolina

Another key finding was that advancement teams often lack staff with skills in emerging areas like digital marketing and analytics that are crucial for engaging today’s donors. According to Sean Devendorf of Tufts University, “there are new skill sets that need to be developed all the time…I have had to become a ChatGPT prompt engineer to be able to produce some of the things I’ve been able to produce.” Advancement leaders will need to make skills development and hiring for these roles a higher priority.   

To address these issues, the Donor Participation Project recommends:

1. Advancement leaders focus on educating campus partners about the significance and ROI of donor participation using a long-term “pipeline” approach.
2. Evaluate team structures and budgets to ensure they are aligned with current needs.
3. Staff will require ongoing learning opportunities and support to build skills in new technologies and strategies.
4. Finally, leaders must create a culture where teams feel empowered to test innovative ideas, fail quickly, and adapt.  

Overall, the survey highlights the need for advancement leaders to communicate a shared vision, build buy-in across their institutions, and make key investments in staff and resources to strengthen donor participation over the long run. With a more collaborative, forward-looking approach, advancement teams can overcome roadblocks and transform donor participation into meaningful, long-term relationships.

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A group of leading fundraising experts recently shared insights from their collaborative survey on roadblocks preventing higher donor participation rates. Ashley Budd,  Director of Advancement Marketing at Cornell University, and Cameron Hall, Executive Director of Annual Giving and Lead Generation at University of South Carolina, discussed key findings and actionable solutions with Louis Diez.  

• Budget constraints and lack of skilled staff were cited as top roadblocks, though there was surprising agreement that sufficient leadership buy-in exists.

The experts emphasized that budgets are often not optimized, with too much spent on mass direct mail appeals and not enough on targeted digital strategies and stewardship. Hall noted that development shops need more focus on data-driven strategies and segmentation to effectively reach the right donors through preferred channels. 

• The field lacks enough experienced professionals and provides inadequate training.

Budd suggested “sharing what’s working” through knowledge sharing in the community, as higher education tends to avoid risk-taking due to complex organizational systems. Training programs should expand beyond major gifts to cover digital marketing, analytics, and annual giving. Mentoring students in campus calling programs can help build a pipeline of new talent.

A lack of balance between solicitation and engagement was another key finding. Bud shared that her team dedicated two months solely to education and awareness, pausing solicitations. Despite meeting initial resistance, giving day revenue still increased. Bud noted that while direct attribution is difficult, taking “baby steps” through A/B testing different communication strategies can help build the case for more substantive changes. 

• Finally, the experts recommended learning from for-profit companies.

Hall suggested analyzing customer/donor journeys to determine key touchpoints, then developing content and calls-to-action to match their interests. Bud pointed out that major streaming companies primarily communicate through email updates and content, only soliciting subscription upgrades once a year based on renewal dates. Nonprofits would benefit from a similar model with a greater focus on education and stewardship tailored to donors’ demonstrated interests.

Overall, the panel discussion provided actionable insights and recommendations to help nonprofits identify and overcome roadblocks hindering their donor participation rates.

View the full recording of this session in our Resource Library.

Artificial intelligence or AI is transforming many areas of nonprofit fundraising. There are now useful AI tools that can help with donor engagement, content creation, and more. In this article, we explore three AI fundraising tools in depth and provide tips for using them in your organization.

You can find all three tools at joindpp.org/ai-tools

The first tool is an AI fundraising coach or chatbot.

This chatbot acts as a virtual mentor, answering questions about fundraising strategies and challenges. For example, you can ask how to reactivate lapsed major donors or address board concerns about sharing prospects. The chatbot will respond with tailored advice and action steps. To use this tool, think of issues you want to discuss and questions you have for an expert fundraising coach. Be open to follow-up questions from the chatbot to provide more context. Then, review and implement the suggestions that resonate most.

A second tool generates fundraising content like appeal letters, case statements, or social media posts.

You input information about your campaign or project and the content you need. The AI reviews your guidance and nonprofit details you provide to produce a draft. For the best results, offer plenty of background on your organization and campaign. Be ready to edit the draft, but you’ll have a good starting point to build upon. 

The final tool helps you improve an existing fundraising appeal or other content by providing feedback and edits.

Just input or paste your draft content, and the AI will suggest how to strengthen and optimize it based on best practices. Look for comments on how to enhance your content’s structure, flow, and persuasive elements. Not all feedback will apply, so use your judgment to accept or reject specific suggestions.

AI fundraising tools can save time and support your work. But they are not perfect replacements for human fundraising expertise and judgment.

See them as assistants to help generate ideas, get started with a draft, or improve your existing content. With regular use and input, these tools can become even more tailored to your needs. But always trust your experience and knowledge of your donors to determine the best path forward.  

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According to Lambert, the secret to their success was “having Dan Frezza as a friend.” Frezza served as Lambert’s direct report for annual giving, positioning annual giving not as subordinate to major gifts but as an equal partner.

Their goal was to foster lifelong philanthropic engagement, not just raise more money.

They started by building a student philanthropy education program. Beginning with freshmen, they taught students about the impact of philanthropy and the value of long-term donor relationships. The program aimed not just to raise current dollars but to shape future alumni donors. 

Senior leadership support was also key.

Two university presidents backed their vision, giving Lambert and Frezza the freedom to experiment. “Take risks, try new things,” Lambert advises. “If we fail, we learn quickly and move on.”

Their approach was strategic and relationship-focused, not transactional.

The goal was donor engagement and stewardship, not just asking for money. They saw that engaged students became engaged alumni donors. Engaged donors, in turn, gave more and stayed loyal longer.  

Building an enduring culture took time but paid off in double-digit donor and dollar growth. Over a decade, William & Mary went from outside the top 10 in alumni giving participation within their university system to inside the top 4. Their budget barely changed. intentionality and focus made the difference.

For fundraisers seeking to emulate their success, Lambert and Frezza recommend:

• Securing leadership support,
• Focusing on education and engagement over the long run,
• Taking strategic risks, and
• Maintaining an attitude of gratitude and stewardship.

Building a “winning culture” is challenging, but with time and the right principles, fundraising leaders can achieve sustainable success.

View the full recording of this Donor Participation Project session in our Resource Library.