Nonprofit Boards Too Scared #Nonprofit Boards

[Mike Burns]

Do you remember the 60's bumper sticker: It will be a great day when the schools get all the money they need and the Air Force has to hold a bake sale to buy a new bomber? Well this article suggests that's exactly what the folks in Charlotte are doing - holding bake sales (not literally) to raise money for pretty big-ticket items.

The following Charlotte Observer article not only challenges the methods Charlotte nonprofit boards are using to raise funds, but calls board members "too scared" more willing instead to do "back door" fundraising then ask directly.

Sadly in my opinion, this article starts with the core premise that asking for money is indeed the job of board members. I pose that the answer is maybe it is but certainly not if that's not what members agreed to when they came on board. This must be the conversation in order to have the expectation. Are there consequences for not having board members ask for money? Certainly. But we also know there are a number of ways to finance a nonprofit and we also know there are some equally important roles for board members in addition to asking for money.

I would suggest that boards first must clarify why they are at the table - for what purpose and then they can get to the methods. I'm not sure that telling board members they are just too scared to ask for money is a true enough assumption. But this is certainly a conversation starter.
Charlotte nonprofits too scared to ask for money
Libraries are wonderfully deserving of financial support. But they shouldn’t have to throw a great gala to get it. John D. Simmons [e-mail]

BY CHRIS MCLEOD

Charlotte is the second-largest financial center in the country, so presumably we know something about money. We’re also home to Myers Park Presbyterian, Myers Park United Methodist and Christ Episcopal, among the largest congregations in their denominations, with budgets north of $5 million. And Elevation and Forest Hills Church, two of the fastest growing megachurches and Billy Graham Evangelical Association also call Charlotte home. Shalom Park, a nationally unique campus, is home to 14 nonprofits and two synagogues.

When I moved to Charlotte 12 years ago, this juxtaposition of big banks and big churches intrigued me. I was confident that I’d discover Charlotte was home to some of the nation’s most well-funded nonprofits. What I discovered surprised me.

Rather than a banking community that brought its penchant for capacity building to its nonprofits, I discovered a nonprofit community haunted by a narrative of scarcity and a shallow understanding of fundraising. We love to build shiny new buildings, but our nonprofits are starved for operating capital. Despite the community’s pressing needs, the majority of nonprofit boards would rather cut costs than raise money.

The reality is most of our board members find fundraising, well, somewhat distasteful. Many of our community leaders pretend to know very little about raising money, preferring to let Hugh McColl and Michael Marsicano do all the asking.

In Charlotte, we prefer to host galas to fund our low-income health clinic and homeless shelter and sell raffle tickets to support our public libraries rather than ask a donor face-to-face for a major gift to support the program costs and staff that make it possible. Given our financial institutions’ focus on efficiency and managing costs, one would think our board members would embrace the face to face major gift ask, since it is the most efficient and cost-effective fundraising strategy.

Our lack of fundraising leadership is forcing the hand of our nonprofits to adopt these desperate fundraising strategies. This trend of “lifestyle philanthropy” is not benign. If we are not careful, Charlotte will end up like many communities in Florida, where donors’ loyalty follows nonprofits hosting the most spectacular galas with little regard for the nonprofits’ mission. Today, nonprofits are training our donor community to give this way, with little appreciation that this is a losing game. While nonprofit leaders proudly announce their galas’ gross receipts, few understand that the actual net gain is dramatically less, often less than half of the gross receipts.

If we presume this “preference” is learned, we can hope that by providing opportunities for community leaders to learn the most efficient and cost-effective strategy for raising charitable capital, we can reverse this trend. If Charlotte is to respond to the incredible opportunities and challenges, we need to identify and teach the next generation of leaders how to raise money.

In 2016, Women’s Impact Fund and the Institute for Philanthropic Leadership will host educational programs that focus on fundraising leadership for board members.

The desire to make a difference is universal, regardless of one’s faith tradition. Fundraising is about inviting people to make a difference. What makes me hopeful about Charlotte is that it is a community of passionate people who dream big dreams and want to make a difference. Those who are going to make the greatest difference are those willing to learn how to invite others to make a difference.

Come join us. We can’t let Hugh and Michael have all the fun.

Chris McLeod is president of Giving Matters, Inc. chris@givingmatters