Introduction

To build a viable advancement program it’s important that you along with your deans and directors understand the ins and outs of fundraising, as every good development officer will tell you.  Private support offers the greatest opportunity for institutional advancement.  The better you are able to navigate these waters, the more success you can expect from your team.  You can improve your fundraising potential, and that of your staff, by ensuring that you and they are well-versed in fundraising fundamentals.  Whether your institution uses a centralized or decentralized model for fundraising, you still need to understand what makes for good implementation of a fundraising plan.

Fundraising is about building relationships and laying a solid foundation for the “Ask”.  Fundraising is as much of an art as it is a science. However, there are some fundamental rules that will help create realistic expectations in a capital campaign and when negotiating gift agreements with donors.  Chief Academic Officers are often called upon to create campaigns and approve gift proposals for colleges and programs.  This checklist will help demystify fundraising and ensure that you have the right information BEFORE accepting a donor’s gift.  The checklist is prepared in two parts. Part One focuses on the fundamentals of fundraising.  Part Two presents more in-depth information about capital campaign planning and success.

Fundraising Fundamentals

Fundraising involves:

• donor identification, 
• carefully planned involvement, 
• special cultivation, and
• a well-orchestrated solicitation.

Are you clear on your institution’s fundraising priorities?  Build your fundraising plans by matching your plans for innovation with a set of energized donors.

Fundraising always has legal, procedural, and ethical considerations for the entire institution.  Understanding your institutional rules and regulations is critical to your fundraising success and reduces the potential of embarrassing errors. 

What are the institutional rules related to donors and their children/spouses?  It can be tricky negotiating a gift with a donor who is expecting an admissions decision for their granddaughter!  The same is true for governing board members – tread carefully!

Don’t forget that a donor may be interested in a project that crosses division or department lines or may be interested in supporting athletics instead of an academic program.  My view, however, is “More for you means more for everyone!!” – so with each potential donor, try to increase the size of the institutional pie – your time will come!!

Many donors start out small to test the waters.  When they feel that your institution is responsive to their interests and needs, they may then be ready for a larger more significant gift, so don’t underestimate the power of smaller donors – they may turn out to be BIG FISH later.

Don’t get sucked into accepting a gift of insurance, since you may not really be able to use it until the insurance is actually paid out (if at all!!)– and not when the gift agreement is signed.

Creating a Fundraising Culture

Have you created an environment for active philanthropy?  Have you made fundraising highly visible and a major priority?  Do your faculty understand the amount of time attention you expect will be devoted to fundraising in each college?  Are you adequately communicating fundraising successes so that faculty understand the importance of development work in the overall scheme of your division’s priorities?

Are your development officers regularly invited to attend Council of Deans meetings and faculty meetings – this will help them better understand your institutional priorities and academic work.

Donor Stewardship and Acknowledgement 

What is your institution’s donor communications plan?  Who is supposed to follow up with the donor and when?  Who keeps the donor informed of developments related to the gift?  Is your donor included in major institutional events and publications?  Who is responsible for keeping donor information up to date – (e.g., children’s names, divorces, and changing home/email addresses can be a nightmare if not kept current in institutional records!!)

Help your development office by keeping them up to date with the activities of major donors – if you see something in the news about a major donor – share it with Development.

Finding Donors

Are there volunteer opportunities where one of your institution’s major donors could contribute time and interest?  You may find that these informal activities cultivate new relationships and friendships.  Get your major donors involved and the cash will follow!

In addition to alumni, consider other individuals and corporations like library friends, grant-makers, and local companies.  Some of the best fund-raising I’ve done came from art enthusiasts and librarians!  An athletics supporter can become a major donor for an academic program…if you get to know them.  And don’t forget about continuing education alumni – your program may have made a major difference in their life.  Also, you may have many community members who use your institution’s services and campus and would be willing to lend their support ---if asked!

And don’t forget about cultivating people you meet in your own community and civic activities.   Share the business cards you collect with the Development Office – they may have software that helps you find connections you never knew existed!

The ABC’s of the Ask

How much do you know about the prospect?  Do you have a clear game plan for the visit? What is the exact amount you are seeking?  What is the scope of the project being funded?

You are not begging; you are asking someone to invest in the life’s work of your faculty and administrators.  Make your ask with confidence.  The donor is investing in your institution’s success! 

Don’t beat around the bush – most rich people expect you to ask them for something!  Make sure you’re asking for something that is appealing to them (not you) …Do Your Homework!  Remember – if you don’t ask you definitely won’t get… and even if the donor says “not now” or “not that much”... revise your proposal or remember to follow up in the future – not now doesn’t mean never.

Donor wills and trusts may not benefit you directly in the moment but can build a lasting legacy commemorating your hard work and dedication.

You don’t have to do it alone, enlist the help of the president, alumni trustees, deans and director of the program, faculty leaders, student ambassadors and even your own administrative staff may have a flair for fundraising.  

Have you made your own gift?  Now, you have skin in the game too!

Crucial Gift Policies and Procedures

• Does the board have a policy specifying various levels of gifts?
• What level of gift requires prior board approval?
• What level of gift requires mere reporting of the gift to the Board before or after execution?
• Who is authorized by the Board to sign the gift agreement?
• Should the CFO and legal counsel sign the agreement to support institutional implementation and legal sufficiency?
• Has the institution developed varying levels for specific types of gifts?

Examples:  Endowed chairs, Distinguished Professorships, Endowed Faculty Fellowships, Distinguished Visiting Professorships, Artists/Executives in Residence, Visiting Lectureships, Scholarships, Graduate Fellowships /Assistantships, Library/Special Collections Funds, Library/Art Preservations Funds, Library/Art Acquisition Funds

Due Diligence and Important Gift Policies

• What is the source and purpose of the gift?
• Who must approve the gift proposal prior to solicitation?
• Is the institutional preference for endowed or restricted gifts?
• Are the terms of the gift consistent with institutional policies and procedures including nondiscrimination laws and policies?
• What is the fair market value of the gift – what is the basis for this valuation?  Was the valuation done by a neutral third party?
• Does the institution or Board have the flexibility to apply the funds “nearest to the intent of the donor” if the proposed use is prohibited or impracticable?  Do you need authorization from the State or the Courts?
• Should a newly created endowed fund balance be restricted for some period (usually 5 years, or until 50% of the total has been received) before it can be used for the intended purpose?

Elements of Standard Gift Agreements and Forms

• Donor’s full legal name, legal address with zip code
• Name of the scholarship, endowment/fund
• Description of the gift and value/total sum of the gift and how it will be paid? (i.e., cash, securities, personal property or real estate).
• Description of how the gift will be used. Who will decide who receives the scholarships? (the financial aid office or a detached disinterested grantor or a faculty panel)
• Scholarship eligibility criteria  (Is it too restrictive or unlawfully discriminatory?)
• Is there a restriction on use of the funds for the first 12 months to permit the fund to accrue interest/income?
• How many scholarships is the fund intended to support annually?
• If the endowed fund is for a non-scholarship activity, what type of activities are intended?
• Can the funds be used for operational expenses?
• Who decides how the money will be spent each year and when will they decide? – faculty panel/President/administrators/You?
• Outright gifts – if cash or securities, how will you value the initial gift?  Can the institution use the entire gift of principal and interest?  Is the property (real or personal)? Can the institution sell the asset? If artwork, does the gift include all the intellectual property rights in the work?
• What recognition does the donor want for the gift?
• For endowed funds – will the funds be pooled with other endowed funds? What percentage will be annually available for institutional use?

Here’s wishing you happy fundraising…I hope you reel in a big one!!!

Part Two of this Checklist for Fundraising and Donor Stewardship presents more in-depth information about capital campaign planning and success.

¹Although the checklist is general and intended as a reminder, I wanted to provide you with information to help ensure institutional compliance and reduce risk. I hope you find the checklist helpful. And I welcome your feedback, so please let me know what I can do to strengthen this document.  Please be sure to consult with your legal counsel on matters requiring legal advice.

You can reach me at [email protected]

Written by

Mary E. Kennard, Senior Consultant, AcademicSearch.org