ABOUT TO GO OVER THE FUNDRAISING EDGE? OR… WHAT TO DO WHEN THE ECONOMY IS DOWN?
ABOUT TO GO OVER THE FUNDRAISING EDGE? OR… WHAT TO DO WHEN THE ECONOMY IS DOWN?
Andrea McManus, ViTreo Group Inc
February 12th 2019
For many years, in my part of the world particularly, the energy industry was one of the heavy hitters for supporting nonprofits and their causes. At the current low price for oil in Alberta, corporate funding is down. Down a lot. Some say 25 - 35%. Others report even more. Regardless, everything from sponsorship to grants to event attendance has taken a hit.
I don’t claim to be able to foresee the future, but I’m pretty confident oil prices are not going to rebound anytime soon…
NOW WHAT DO WE DO?
In October, I blogged about reviewing long-held fundraising methods that may no longer serve us. The Provocateur – Ready For Some Cow Tipping?
Could reliance on any single sector be another sacred cow that should be tipped, along with galas, grant-writing and other long-held fundraising efforts that no longer function well in today’s philanthropic world?
What about your organization or your fundraising efforts — have you put any methods out to pasture? What efforts are proving more successful now? In what areas are you struggling?
We need to don new lenses and cast our glances further afield to find new opportunities. On behalf of the vulnerable and others whose well-being relies upon our sector, now is the time for exploration and innovation, for operating with a clear vision and a positive outlook.
One of the great lessons from this economic downturn (or at any time for that matter) is that dependence on one supplier for anything — customers, funders, employment and so on — makes for poor strategy. I think it’s common sense — but it’s inviting to take that route when times are good. Solid strategic planning takes a more long-term view and the eventuality of a market downturn into consideration.
WHAT TO DO WHEN THE BOTTOM FALLS OUT OF YOUR BASKET OF EGGS?
Here lies an opportunity. Let’s not ignore it. Now more than ever, we must be nimble, we must be forward thinking and we must be in a position to pivot.
Reduce Risk
Nonprofits need to operate with the same business model as successful companies or wealth managers. No CEO or other leader running a well-established business relies on one customer for revenue. Not everyone is going to be its ideal customer, but it’s critical to have a solid base of different demographics which form that client base. Well-performing investment funds or portfolios are typically diversified to lower risk (Business Insider -- Don't put all your eggs in one basket Martin Aitken 08/21/16).
Execution Is Everything
How we execute our fundraising efforts matters more than ever. Expanding our base, whether in a healthy economy or during a downturn, is imperative. Conduct an environmental scan — what other businesses or sectors in your locale are growing? Do your research on this new market and tailor your approach to this potential funding pool. Understanding your audience is key to influencing and persuading them.
So Is Innovation
Here’s a great story about a small arts organization that “faced with a shrinking donor base and changing economy, knew a fundamental strategic shift was in order”. The fundraisers decided upon a new approach — “a three-legged stool composed of major donors, corporations, and crowd funding” — which created a windfall for the museum (Inside Philanthropy A look at the fundraising model behind this small town museum 03/17/16).
FOR US, I HAVE TO WONDER IF COMMERCIAL REAL ESTATE DEVELOPERS ARE THE NEW OIL AND GAS?
As we must shift from dependence on oil and gas companies in Canada and the U.S. as funders, a void will be left. It must be filled or some among us may not survive. Commercial real estate firms could fill that gap.
In Vancouver, BC - this recent Business in Vancouver headline and article :
“Move over, housing; commercial is the new real estate boom.”
More headlines:
Toronto, Ontario — a September 2018 article “Toronto’s Tech Boom Will Keep Real Estate Frenzy Going: Forecast“
In the U.S., Deloitte Center for Financial 2019 Commercial Real Estate Outlook begins its report with this title — The ecosystem influencers— Investors ride on tech-enabled commercial real estate firms.
I also see the phrase ‘expanding tech sector’ every time I read the news — although many of these companies are still in their infancy, that shouldn’t stop us from developing relationships with them. Some of them may be the next Facebook or Amazon.
Other sectors and companies are also flourishing. Have you begun to research and approach them? Where do you see promise?
The philanthropy business is experiencing tectonic shifts, as are most other sectors. Although the ground seems to be moving rapidly, standing still and hoping for the best is not an option.
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ABOUT THE AUTHOR
Andrea McManus, Chair, Board of Directors, Partner
ViTreo Group Inc
Andrea McManus is a Partner with ViTreo with over 30 years’ experience in fund development, marketing, sponsorship and nonprofit management. A highly strategic thinker and change maker, Andrea has worked with organizations that span the nonprofit sector with particular focus on building long-term and sustainable capacity.