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Managing Growth: a Cautionary Tale

Managing Growth: a Cautionary Tale

No matter how much money we raise, we could always raise more.

Do you feel that way? Does your boss or board feel that way?

Being a fundraiser is a tough job. It’s different than being a firefighter that saves babies from a burning building, but it’s got the same sense of urgency. If we fall short in our efforts, others will suffer.

Targets are always set high. There’s too much at stake to aim low.

When organizations commit to raising more money, they tend to do two things:

  1. Raise targets. Great! We’ve solved the problem. We’ll raise more money next year. Doesn’t matter what the actual pipeline or infrastructure looks like, we’ll just work harder, be more passionate about the cause. Who knows, we might get a million-dollar gift this year!
  2. Add a fundraising event or campaign. If we need to raise more money, then we need to add a new revenue stream. Something we haven’t tried before, that is a brand-new initiative surely can help us meet our targets. We’ll figure out the plan when we get closer to the date.

Sound familiar?

The problem with growing revenue through raising targets or adding events is that they are not tied to your pipeline, your past track record of events or the activities that you’re already executing well.

Raising targets randomly has nothing to do with your actual pipeline of potential revenue. Your past track record is the best indicator of future success. The size of your last major gift, the net proceeds from your latest event, or your average gift size from your annual appeal are all the best indicators of future success.

Budgeting for revenue growth of more than 10—15%? Plan for infrastructure investments to support that growth. #fundraisingMOJO   ← Tweet this

It’s always easier to do something you’ve done before, better. The first year of an event is harder than the fifth year of an event, planning for an annual campaign the second time is easier than the first time. That’s why staff turnover is such a killer on fundraising return on investment: you’re going to get better at things over time…if you are around to capitalize on it.

The second year of a new fundraising initiative will always be easier than the first year. #fundraisingMOJO   ← Tweet this

The more events/activities you have on your calendar, the more likely it is that you’re spreading yourself to thin. Adding a new revenue generating event to meet budget is a major distraction to the already scheduled fundraising activities.

Beware of new, shiny objects in your fundraising plans disguised as time sucking distractions. #fundraisingMOJO   ← Tweet this



Assess your current pipeline, your current fundraising events/activities and volume BEFORE you add anything new and shiny to your current initiatives.

Remember the 10% growth rule: if you’re expecting more than a 10% increase in net revenues, what inputs/investments are you making to support that growth? Bottom line: it costs money to raise money.