FROM A FUNDRAISING PALLET, TO A FUNDRAISING PALACE

Different definitions of donor centricity highlight the two polar opposite worlds of fundraising — whether you aspire to find a Fundraising Pallet or inhabit a Fundraising Palace.

Your definition is also probably aligned with how much power you have in relation to donors and within your organisation (and yes, this is about privilege too).

From the Fundraising Pallet: Donor centricity as donor power

I began this week with a dozen important conversations with fundraisers living in Afghanistan, Myanmar, Vietnam, Sri Lanka, Guatemala, Zimbabwe, Zambia, Pakistan, Nepal, Kyrgyzstan, Senegal and the Philippines.

Together, we are navigating fundraising in difficult situations: in a war zone, during a military coup, under a communist government, where fundraising is banned, where there is no charity law, rampant corruption, threats of violence, internet and electricity blackouts, no table for a donated laptop to rest on… all on top of a global pandemic.

We discussed their decades of fundraising experience, their past successes with governments and global trusts, and that 90–95% of their proposals are now rejected. We explored effective fundraising strategies and tactics to diversify income within the context of local funder disinterest, limited access to donors, and the near-impossibility of raising core funding; and how for some, fundraising results are directly linked to their salary, and therefore providing for their family.

As I said, this is difficult stuff.

Many of these conversations kept returning to the fundraising sujet du jour; donor centricity. These fundraisers consistently defined donor centricity (without prompting) as problematic, for them it’s about a lack of power, relative to the power of donors.

Fundraising for me is like swimming in the middle of an ocean… I am searching for something … a wooden pallet, that might keep me floating for a while … until then I have nothing to build on, no real power over our mission, I have no choice but to deliver exactly the projects that donors want, with near-zero funding for core costs, otherwise they will find another who will, and I will have to swim on, looking for something else to hold onto.

A wooden pallet floating in the sea.

 

These conversations highlighted the importance (and near-impossibility) of raising unrestricted/core funding as a strategy, to not only try to fund salaries, rent (and tables), but as a strategy to gain power, relative to donors and inside bigger organisations.

But this is not just about geography, and it’s not just about global fundraising in challenging places.

For the past decade, I have been guiding nonprofits of all shapes and sizes from the UK and Japan (where I live). I have been working closely with London’s Royal Geographical Society to help hundreds of small expeditions and environmental projects get funded. I have been an active trustee of six (most small nonprofits, based in the UK) and I am about to take on another.

These small organisations and community projects in an established fundraising market are also swimming in this same ocean, searching for their own pallets, clinging on to whatever funding they can find to stay afloat for a while.

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From the Fundraising Palace: donor centricity as donor love

More than a decade ago, a good friend of mine described the pressure she felt when working to raise and manage multiple major gifts:

So, yes, let’s talk about me more and my first-world problems … how hard I’m finding all the travel and the dinners, the massive donations from super-wealthy people … I’m trying hard to not sound like a princess living in some sort of fundraising palace … but I’m heading to Nairobi tomorrow, then Addis, so that will keep it real.

The Royal Thai Palace in Bangkok, Thailand.

 

Whiplash! In the middle of this week I’m suddenly in a very different fundraising world that is definitely more Palace than Pallet.

I Zoomed into a conversation with a major corporate foundation that has started receiving unsolicited six-figure donations. They are seeking guidance to create their own major gifts programme.

A LinkedIn post popped into my feed, advertising eight well-paid fundraising positions at a university in London. They will join a team of more than one hundred people that is raising hundreds of millions of pounds every year.

I opened an email from a US fundraising consultancy, celebrating their involvement in a $50 million donation to a cancer project in Orange County, in California.

My newsfeed highlighted a wildly successful multi-million dollar digital Giving Day at a university in a southern US state.

The Fundraising Palace is home to global nonprofit brands, international universities, ancient institutions; long histories and well-established causes that appeal to wealthy people; natural audiences of grateful alumni, patients and visitors; big ideas and world-changing impact; high profiles that attract the best leaders and trustees; access to wealthy people and funding organisations; big offices and budgets for big fundraising teams; big fundraising campaigns that deliver big donations.

There is an entire industry set up in the grounds of the Fundraising Palace dedicated to its support and protection. Those living in the Palace grounds are resourced by its continued fundraising success: fundraising consultants (yes, me), training organisations (me again), specialist conferences, companies selling databases, crowdfunding platforms, fundraising think tanks, legal advisers, data management specialists, digital marketing agencies, magazines, academic departments, philanthropy advisers … and so on.

In the Fundraising Palace, donor centricity is a badge of honour. It is defined as donor love, as an aspiration towards excellence in donor engagement.

The donor love perspective is well-described and contextualised by the UK-based fundraising academic Adrian Sargeant of the Institute of Sustainable Philanthropy. His recent article on Donor Centricity helpfully sets out the origin of donor centricity and ends with seven questions to determine how donor-centric your organisation is.

These seven questions are to help us build:

…more loving and fulfilling relationships [with donors] … Donor centricity demands this level of understanding. And as a sector we’re not there yet.

So what?

Why can’t we just each have a slightly different definition of what it means to be donor centric?

Well, I am privileged to have a foot in each of the Pallet and Palace fundraising worlds. Here are some of my reflections as to why we can all carefully reflect on the roots and consequences of how we define donor centricity (and how it’s perfectly possible to build a palace out of wooden pallets!)

Note: Before I go on, it’s important to recognise that many of those living in the Fundraising Palace and occupying it grounds are working really hard to support those swimming to Fundraising Pallets, they recognise the inequality in nonprofit fundraising, the need for change and are committed to making it happen: as donors; as trustees for small nonprofits; taking pay cuts to work in smaller organisations; delivering free or reduced-price content, knowledge, resources and products; offering free and accessible mentorship and training; providing pro bono support, and much, much, much more.

You people are awesome and you are making a massive difference.

1. Donor centricity (as the need to shift donors)

Those looking at the donor world from the Fundraising Pallet are pointing to systemic issues in the relationships between donors and nonprofits and how many nonprofits are reinforcing the paradigm of donors as heroes, not as allies.

This was highlighted this week from within the Fundraising Palace by Darren Walker, the norm-shattering head of the Ford Foundation (though not the Ford Foundation’s first Black president). During his recent 60 Minutes interview on CBS he called for a shift in the focus of the relationships between nonprofits and their donors.

Darren Walker, President of the Ford Foundation

 

Generosity actually is more about the donor, right? So when you give money to help a homeless person, you feel good. Justice is a deeper engagement where you are actually asking, “What are the systemic reasons that put people out onto the streets?” Generosity makes the donor feel good. Justice implicates the donor.

All of us who have a foot (or two) within the Fundraising Palace (and its grounds) can reflect on the role we can play to shift our own donor relationships from Generosity to Justice — at every stage of the donor journey, from initial contact, to how we communicate about donations.

Walker then moved onto the responsibility of donors to fund the core costs of the nonprofits that make their projects possible:

All of the unexciting parts of a nonprofit has to be paid for — technology and infrastructure, paying the rent. It is both arrogant and ignorant to believe that you can give money to an organization for your project, and not be concerned about the infrastructure that makes your project possible.

Nonprofits who have power in their donor relationships (we’ll talk more about this in a moment) can push for systemic change in expectations of donors and core funding in a way that most others cannot.

Those of us in the Palace can ask harder questions of donors, about whether this donation is truly delivering equal value for the nonprofit recipient (beyond the cash), and if the context of this donation is helping to raise the tide for the wider nonprofit sector.

And we need many more powerful voices from within the Palace speaking truth to donors. I hope every other donor, company and government follows the Ford Foundation’s lead (but I’ll not be holding my breath).

 

2. Donor centricity as competitive advantage (for small causes)

The view from the Fundraising Pallet is often necessarily narrow. Fundraising options can be squashed by overwhelming need starkly set against limited capacity to address it. This is often compounded by a triple crisis in fundraising capacity, clarity and confidence.

When these three are rebuilt (not easy, but that’s what we’re working on from Afghanistan to Zimbabwe) fundraisers can begin to look up and redirect existing capacity — divesting time from inefficient approaches and reinvesting it in training and focusing on better, more efficient, realistic funding opportunities.

We can also reframe our smallness as agility and flexibility, so donor centricity becomes one of most powerful competitive advantages, as one fundraiser in Uganda illustrated with a tree metaphor:

Our small organisations are like young Acacia trees, we can and must bend with the elements to survive and grow. In this way we can more easily work to truly incorporate the views and experiences of donors within our mission. This does not make us donor centric in the traditional sense — we still decide what work we present to donors.

Larger organisations are like Baobabs, they are tall, obvious … strong, fat roots that anchor them. They have big donations and resources so they don’t need to flex with the elements. Their size means they have established norms, cultures, politics and histories, that can make them less flexible. There are more barriers for them to genuinely involve donors in their core mission.

The challenge here is about creating the space for (and empowering) small nonprofits to make this shift, to explore and prove the impact of an alternative approach that balances donor centricity and uses this to inform strategies and tactics that build their advantage.

 

3. Donor love is blind (and can make us vulnerable)

I’ve lived in the Palace and I’ve felt the donor love. Man, it felt GOOD at the time!

I loved the Kuwaiti Nouhoudh Foundation when they confirmed a £12+ million pledge; I loved the five individuals who each donated six-figures during one evening in Amman; I especially loved my childhood hero Mark Knopfler (I’m from the North East of the UK) when he called me to make a £25,000 donation to AMREF Health Africa; I loved touring health projects in Tanzania and Kenya with an England football player; I loved taking a donor to visit a hospital project in southern Somalia; I loved the billionaire Japanese monk who poured Cristal Champagne while we discussed his donation.

Looking back on these times, it feels like the day after I ate too much cake at the party.

It’s much easier to love people who are throwing money (and champagne) in our direction. Some donors are wonderful and aligned, they are worthy of our respect and deserve to be brought as partners towards the centre of our mission.

But this love can be blinding. Not all donors are worthy of love and a blanket approach to donor centricity can leave nonprofits and enthusiastic fundraisers (with income targets) vulnerable.

Vulnerable, to perennial non-donors who are happy to waste the precious fundraising time of fundraisers and nonprofit leaders by dangling pledges that never quite appear in order to have their egos stroked (we all know who they are).

Vulnerable, also to donors who use nonprofit donations to achieve other ends that might be unseen and be ultimately damaging to the wider mission of the recipient. This is something I have experienced in all of my fundraising leadership roles (mainly with the benefit of hindsight) and frequently as a fundraising consultant and mentor.

If donor love is our thing, we can all be more careful which donors we show the love to. We can all try harder to remain objective at every stage of the donor relationship so our eyes are open to the true motivations of every donor and all the consequences of a donation (which a pure donor-centric approach aims to do from the outset!)

 

4. Donor love is blind (to power and privilege)

The Palace definition of donor centricity points to a fundamental problem: fundraising’s role in reinforcing inequality, power and privilege, the very thing our nonprofits are aiming to be a solution to.

Towards the end of his article Adrian Sargeant asserts (generously applying corporate-based stakeholder theory to the nonprofit sector) that:

… orienting to donors does not preclude orienting to other groups or communities. Stronger organisations focus on multiple stakeholders and as a growing literature has demonstrated (e.g. Donaldson and Preston 1995), it is perfectly possible to accommodate strategically the needs of more than one stakeholder group.

The donor love definition of donor centric, assumes that we have power to manage donors, to push back when they overstep, to assert ourselves when they threaten to walk away.

In theory, it is possible to be donor centric (by this definition) and also orient to other communities, but in real-life this is much more difficult when one stakeholder group is so clearly financially downstream from another.

One of my programme participants in Asia reflected this:

If you can think about donor centricity and consider it a good thing, you have power that I do not. If you can think about refusing a donation, you live in a different world to mine. If you can get core funding to pay for your rent, electricity or salary … you are a fortunate fundraiser.

I have been a fortunate fundraiser. I’ve written and enforced gift acceptance policies and acted as a gatekeeper to (and for) donors.

Whilst leading the fundraising at SOAS, I made the decision to reject a £2+ million donation due to serious ethical concerns. It took all of my white man privilege to get heard on this. If someone else within the organisation had raised concerns, and if we hadn’t raised more than £10 million that year, the conversation might have been very different.

Having the power to create our own gift acceptance policy and the power to enforce it to reject a donation means we are have a huge amount of power, relative to many seeking funding for their causes and projects.

Another fundraising consultant recently shared his experience in Latin America:

More and more, I am being asked by fundraisers at the edge of big nonprofits about how to develop strategies to engage the core fundraising team. The members of the central fundraising team are viewed and being treated like donors because they are the gatekeepers and sometimes their best or only chance of getting funded.

Restrictive gift acceptance policies can severely limit fundraisers at the edge of bigger nonprofits ability to engage with donors directly, even those who have access to networks are being blocked from accessing them by internal policies and demands for coordinated approaches to donors.

These policies make complete sense from a central fundraising perspective (within the Fundraising Palace), but not for those within the same organisations seeking a Fundraising Pallet to rest on.

As fundraising gatekeepers we can recognise our power and check our own privilege and that of our position.

We can better involve those affected by central decisions around who can be approached for funding and by whom. We can be more flexible and find a better balance between flexibility and the need to coordinate approaches.

And we can be aware of how our conscious and unconscious biases are determining whose voices are being heard, who has access to us, and therefore the donors.

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As an educated white British man, I’m literally the least qualified person to talk about privilege. That I’m even talking about privilege here, that I expect to be heard, that I feel able to weather the consequences, is probably the clearest illustration of my privilege. Yet on my privilege allows me to plough…

For the last two decades I’ve witnessed a deepening divide between the fundraising have-nots (those aspiring to Pallets) and the fundraising haves (those living in and aspiring to Palaces).

But the difference between fundraising options isn’t because one set of causes is more worthy, or that they have better ideas, nor are they better fundraisers. The difference is systemic, one group has power in fundraising (the Palace) and the other does not (the Pallet). This power is reinforced by privilege.

Privilege in fundraising is very real, it determines who has access to donors, who even can be a fundraiser, who can push back at donors, and much, much more.

We can all reflect on our own position, our power and our privilege (and those of our organisations and of our positions within our organisations), and create space for less privileged voices.

Back to Darren Walker on the importance of reflecting, recognising and acting on our privilege within our nonprofits:

It’s not human nature to give up privilege, particularly if you feel it’s hard-earned. But at the end of the day, we elites need to understand that, while we may be benefiting from this inequality, ultimately, we are undoing the very fabric of A̶m̶e̶r̶i̶c̶a̶ [our nonprofits’ missions].

[my amendment]

Build a Palace from Pallets

By the way, it’s perfectly possible to build a Palace from Pallets.

It demands creativity, support, space, time, capacity, clarity, confidence (and allies).

It demands reflection and action from those of us in the Palace and those of us searching for Pallets and it demands that donors shift, from Generosity to Justice.