Written by: Alexa Clay and Jon Camfield

When considering donations, people often make harsh assumptions about nonprofits that spend on marketing and overhead. But maybe those expenses means the organization is doing a good job.

Every year around this time, a batch of articles comes out talking about how to maximize your year-end giving by focusing on nonprofits with super-low overhead, so you can rest assured that every cent you donate goes directly to the cause.

But I’ve spent the better part of my career as a nonprofit tech warrior, from volunteering in the Peace Corps to a variety of domestic and internationally focused NGOs and nonprofits–small and large. I’ve had contract, full-time, pro-bono, and board positions, and have been on both the grant-requesting and grant-reviewing/giving sides of the equation, and I can tell you that this isn’t entirely fair. The problem is this overhead supports the cause, and zeroing it out means that the 99% non-overhead may be spent poorly or non-strategically, especially in smaller organizations. Programmatic costs may pay for the work, but overhead pays for the tools to do the work well.

Most year-end-giving articles point potential donors at sites like Guidestar or CharityNavigator, which track overhead and fundraising effectiveness. These sites are great for digging in to an organization’s financials, as well as providing a first pass to look at any anomalies in their numbers. If you’re simply crunching the numbers and looking for the nonprofit with the lowest overhead, though, things have gone horribly wrong. It’s a bad way to judge an organization.

Management consultant Neil Edgington eviscerates this style of giving-by-the-numbers:

If a nonprofit organization is creating change, then everything they do is in support of that change. How can a program run if there is no financial engine (fundraising) to fund it? If there is no building or space to house it? […] How can you possibly separate “program” from “overhead?” We must move beyond this distinction and encourage nonprofits to raise (and donors to give) more capacity capital.

Obviously, there are great stories of shady contracts and CEO salary scandals, but these are hardly problems unique to the nonprofit world. Organizations that are mission-focused face a dual challenge. Due to the passion around the issue, it’s hard to justify spending money on the organizational infrastructure–everything from computers that work to an HR department to competitive salaries and benefits. Organizations that also carry out donor-directed work must further defend any spending in terms of the grant agreement, which often doesn’t leave much for those same infrastructural items. Bridgespan Group’s Tom Tierney calls this the starvation cycle in his excellent paper on the topic.

The cycle begins with donors (public as well as private) who have unrealistically low assumptions about what it actually costs to run a nonprofit. Nonprofits, dependent on external funding, feel obliged to conform to those unrealistic expectations insofar as humanly possible. To that end, they cut overhead to the bone and underreport administrative expenditures in annual reports, IRS 990s, and fundraising materials to make their operations look as lean as possible. Unfortunately, this only serves to reinforce the unrealistically low assumptions that kicked off the cycle in the first place.

No one would judge a for-profit company for spending on advertising, sourcing the best hires, or using the best equipment. Indeed, these are points that a wise investor looking for long-term stability should seek out in a for-profit. This constant pressure that nonprofits feel from both their mission-driven world and the donor landscape toward minimizing anything that could be counted as “overhead” is destructive and efficiency-killing. Low overhead means burning staff out at an alarming rate, and having trouble sourcing or retaining skilled workers. It pushes organizations toward duplication over cooperation to attract and maintain funding. Worst of all, it forces a short-term view on what should be a long-term mission. This hurts not only the organizations, but the missions they serve.

But how, then, can we really measure return on donations to nonprofits?

This is, of course, the hard part. You can ask: How much time are they devoting to their actual mission versus marketing their successes? But how can you know about their impact unless they take the time to tell you about it? Here is where the marketplace for social change is inefficient, and where the individual consumer-donor either has to make a safe bet with a large, well-respected organization, or enter in to a much more complex world of mitigating their “risk.”

There are multiple ways to mitigate “risk” in giving. The best way for many traditional nonprofits is to be personally involved with the organization, donating not just your money, but also your time and even your professional skillset where helpful. Seek out social enterprises–the new breed of mission-driven organizations which seek sustainability through commercial models or other innovative funding sources. Keep in touch with their social media outlets, newsletters, and other communications. Look for organizations that help mitigate risk by aggregating smaller organizations, and helping them to track and show progress and impact. Finally, do use sites like CharityNavigator and Guidestar, but please, do not be turned off by high overheads. They’re healthy. They mean the organization has a longer-term view on its role in making change.

Creating an Individual Giving Program
From Annual Gifts to Major Donors
Presented by
Richard R. Blain, CFRE
Richard R. Blain & Associates, LLC
Dublin
Friday, March 9, 2012
8:45am – 12:00pm
(Check In: 8:30am)
Dublin School Library, Project Room
18 Lehmann Way, Dublin NH 03444

Having a successful Individual Giving Program may be the single most important component in your development plan. Any size organization can develop a strong program with the commitment of the executive director, development staff and board members to appropriate best practices. But where do individual donors come from? How can you make your organization attractive to prospects in today’s competitive marketplace?
This session will discuss:
– Identifying and Attracting Suspects and Prospects
– Effective Annual Giving Programs
– Moving Donors Up the Pyramid – from an Annual Donor to a Major Donor
– When, How, and Why Donors Make Major Gifts
– Building Relationships and Stewardship
– Roles for Board Members and staff
Who Should Attend:
– Executive Directors
– Development Professionals
– Board members
– Fund Development Committees
Registration fees:
$49 for CONFR members
$79 for nonmembers
$39 for board members of CONFR member organizations
Register Today! Go to www.confr.org to register online or download a registration form and mail to: CONFR, PO Box 3514, Concord, NH 03302. For more information, please
call 603-724-6741.

Using Social Media for Fundraising
Building a Community of Online Donors!
Presented by
Diane Wasilisian
President/Founder of Designdotcom, Inc
Conway
Friday, March 16, 2012
9:30am – 12:30pm
(Check In: 9:15am)
Granite State College
Tech Village
53 Technology Lane, Suite 150
Conway, NH 03818

Do you continue to rely on the old methods of emails and snail mail to get donations but experience declining results? Do you already have a presence onvFacebook or Twitter but are not sure how to raise money using social media? Do youvlack a solid, comprehensive, solution for growing giving revenue from these importantvnew channels? Are you looking for someone to help you get started?
Learn how you can use the free platforms available to everyone to engage yourvaudience – whether they are in their 20’s or in the baby boomer generation – and buildvlong-term relationships and loyalty. Find out how to get your fans and/or connections tovbecome the fundraisers for your organization while maintaining the highest standards ofvethics, privacy and security. There are no short cuts to building effective relationships.  But the Internet will enhance your efforts.

Who Should Attend:
– Executive Directors
– Development Professionals
– Website Administrators
– Board Members
– Marketing Directors
Registration Fees:
$49 for CONFR members
$79 for nonmembers
$39 for board members of CONFR member organizations
Partial scholarships are available thanks to a grant from the New Hampshire Charitable Foundation, North Country Region.

Register Today! Go to www.confr.org to register online or download a registration form and
mail to: CONFR, PO Box 3514, Concord, NH 03302. For more information, please call 603-724- 6741.

Moving Your Annual Fund to the Next Level
Presented by
Libby K. Rust
The Rust Communications Group
Portsmouth
Friday, March 23, 2012
8:45am – 12:00pm
(Check In: 8:30am)
Community Campus
100 Campus Drive, Portsmouth, NH

Gain insight into ways to create a concrete plan for asking, stewarding and recognizing that
will increase the dollars you raise. This session will look at creating a strategic plan of
action, asking via mail and in person, tips for stewarding donors to the next level, and
simple ways to begin a planned giving program. We’ll also explore ways to involve and
motivate your Board, your Development Committee and your Executive Director.
This session will discuss:
– Key Elements to Move Your Donors to the Next Level
–Building Relationships and Stewardship
–Roles and Motivation Tips for Staff and Board Members
– Ways to Begin a Planned Giving Program
–A Monday Morning Action Plan
Who Should Attend:
This workshop is essential training for Staff with Development responsibilities

Registration fees:
$49 for CONFR members
$79 for nonmembers
$39 for board members of CONFR member organizations
Register Today! Go to www.confr.org to register online or download a registration
form and mail to: CONFR, PO Box 3514, Concord, NH 03302. For more information, please call 603-724-6741.

The Art of Fearless Fundraising!
Asking for Major Gifts with Confidence
Gorham
Friday, April 13, 2012
8:45am to Noon; Check In: 8:30am
Family Resource Center
123 Main Street, Gorham, NH
Presented by: Porter D. “Pete” Caesar II, CFRE

Any size organization can develop a strong Major Gifts program with the commitment of the Executive Director, Development Director, Board Members, and Fund Development Committee to appropriate best practices. This highly interactive workshop will explore how major donors are identified, involved, cultivated, and finally asked for a gift. Pete will demystify the components of successful personal solicitations, focusing on the bedrock importance of becoming adept at “listening the gift.”
Topics included are:
–Roles for staff and board
– Why board members must be donors and fundraisers
– How to identify and attract donors and prospects
– Building relationships
– Effective case statements
– Telling the story
– When the time is right, how to make the ask
Who Should Attend:
This workshop is essential training for:
– Executive Directors
– Development Professionals
– Board members and other volunteer fund raisers
– Fund Development Committees
Registration Fees:
$49 for CONFR members
$79 for nonmembers
$39 for board members of CONFR member organizations
Scholarships are Available
To Register:
Go to www/confr.org to register online or download a registration form and mail to: CONFR, PO Box 3514, Concord, NH 03302. For more information, please call 603-724.6741.