For nonprofits, fundraising is the fuel that powers their mission. But fundraising requires investment to build relationships, set strategy, and solicit donations. Some organizations question if the return on investment (ROI) is worth the cost, especially for resource-constrained groups. However, research shows that fundraising has one of the highest ROIs of any nonprofit activity.
According to research from DAHP University in Canada, fundraising can return up to $15 for every $1 invested. For major gifts, the return is even higher.
Professor Russell James explained, “If you want the resources to actually make the impact, that’s not going to come from a hundred or a thousand small donations. Fundamentally, there is nothing that has a better ROI than spending more time with donors of capacity.”
Investing in advancement means hiring staff, training them well, and trusting them to build long-term relationships with donors. It means giving them the time and resources to discover what motivates individuals to give meaningfully.
According to fundraising expert Jim Langley, “We’ve got to recognize empirical reality, and that empirical reality is that if you want the resources to actually make the impact, that’s not going to come from a hundred or a thousand pat on the head gifts.”
For organizations hesitant to make fundraising investments, start with what you have. Tap volunteers, board members, and existing staff to help with donor discovery and outreach. Provide the rationale and training they need to have genuine conversations. Share stories of donors who have funded transformational work to build urgency.
Fundraisers must focus on finding opportunities for “major life investment gifts” that accomplish donors’ philanthropic victories. This level of customized partnership requires investment but is well worth the reward. As James said, “There’s lots of great reasons to try to expand the volume of donors…[but] the number one is because we want that to help us identify those who have the willingness, the interest, and the capacity to make these major transformational gifts.”
For nonprofits that want to make a real impact, fundraising investment is not optional. The question is not whether organizations can afford to invest in advancement, but whether they can afford not to. With the right strategy and staffing, fundraising has the power to change what is possible for organizations and the lives they serve.
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