Fundraising relies on building relationships with people who care about the causes we care about.

While we use all types of jargon and big words like "acquisition" and "retention" to discuss fundraising tactics, we are simply looking for opportunities to share our vision for a better world with others - and inviting them to support causes they care about.

This guide reviews the fundamentals of donor cultivation and offers tactics for reaching new donors, building relationships with existing donors, and finding ways to invite donors to invest further in the world they want to create.

Do you know your organization’s donor retention rate? The statistics are startling:

We tend to work to acquire new donors - but may struggle with retaining the ones we have - it is also more expensive and more difficult to replace a donor, than to keep the ones you already have.

This is why carefully cultivating donor relationships is so important—at all levels of giving. We must focus on our relationship with every donor up and down the pipeline.

Look at your donors. The folks who give $25 now fund the future of your organization. One prominent example is that Michael Bloomberg’s first charitable gift was a $25 gift to his alma mater; since then, he’s given the school more than a billion dollars.

Building long-term donor relationships means adding a little "art" to the "science". Thanking donors is critical to keeping them engaged so they become loyal stakeholders in your mission.

What is the science? And what is the art?

Most nonprofit professionals understand that it is important to send a receipt with a thank-you message when someone makes a gift to their organization.

The "science" focuses on the receipt listing the donation date and amount as a transactional thank you. Often these are form letters that feel very business-like and contain the IRS-required language indicating no goods or services were received in exchange for the donation. Ideally, this receipt is sent within 48 hours of a gift being received.

But your gratitude cannot stop there. The "art" is understanding the difference between a transactional and relational thank you.

You'll want to think about how you can incorporate the "relational thank-you" into your fundraising efforts. You'll want to create a pattern of sharing impact reports or updates of how a donor's gift is making a difference to the individuals or causes impacted by your organization. Ideally, a donor will receive three or four thank-yous, impact updates, or tokens of appreciation (a handwritten card, a photo or phone call) before they are asked to give again.

Everyone expects a transactional thank you. You'll want to discover ways to thank and appreciate them when they least expect it. In this way, your donors are more likely to stick around for a while.

Once you’re clear on exactly how you will thank and appreciate every donor to your organization, you can plan different methods to acquire, retain, re-engage, and further engage them.

While building donor relationships is critical to fundraising efforts, it is important to periodically review your digital footprint. This ensures that those who discover or search for your organization online get a good impression, and that your online presence accurately depicts your work, your culture, and your funding needs.

Setting up your website is a very passive method of establishing your online presence, but it is an important step. Be sure that your website is "responsive" to different screen modes so that the visitor has a positive experience on a desktop, tablet, and a mobile phone - regardless of which device they are using.

When developing your website, create opportunities to grow your contact list:

Ask yourself, your board members, volunteers, and staff - where those who would likely support you would spend their time and energy online. How can you best get in front of them? Which social media platforms do they visit?

Choose one or two social media platforms to begin with.

Once you have set up your social media accounts, here are some tips for managing them:

The online world is vast, and many times individuals come across our organization through other websites and platforms.

When you've received your 501c3 status from the IRS, be sure to visit some of the well-known charity watchdog websites to claim your profiles, and begin building strong ratings. By keeping these platforms up to date, you will gain credibility and position yourself for future giving.

Learn more about Charity Watchdog groups overall through our helpful guide here, and specifically about the benefits of using GuideStar here.

Have you done away with direct mail appeals all together? Should you?

Even with the growth of online communications and giving, direct mail is still a critical tool for engaging constituents, whether they are active, lapsed, or potential donors.

Reasons for using direct mail features:

Congratulations! You've defined your mission, received your 501c3 determination letter from the IRS, and filed the required charitable solicitation paperwork for your state. You've done it!

You're an official nonprofit organization. You're ready to do good and change the world. ...You just need the money to do it!

You are working on such an important cause, and you are doing good work - surely if others know, they will happily donate to support your cause, right?

Figuring out who to ask, when to ask, and how to ask can be tricky. But remember, the international and national organizations with thousands of donors who raise millions of dollars each year didn't begin that way. They started small just like you.

Here are some practical, effective tips for finding your first 100 donors with the hope that they will encourage you to be bold and brave as you invite others to support a cause they care about.

For new nonprofit founders, board members, and staff, the idea of asking for money can be scary. Remember, you are simply inviting those you know to support a cause you care about.

You don't need to be business-like and formal. You could visit over coffee, send a text message, or post on social media - with a message like, “I’m really excited about this great new project/ organization I'm involved with" [followed by xplaining why the organization exists.] Then add, "I just made a donation. Would you join me in making a small monthly gift to support the mission?"

Many geographic regions have established giving days to promote giving local- so find out what is happening in your area. Check with your local or regional community foundations to see if they have established portals for giving days and/or ongoing local giving- and if they allow nonprofits to keep a profile year-round.

Depending on your cause area, you might also find collaborative opportunities to be profiled on web platforms or in newsletters.

A fundraising strategy involves much more than hosting fundraisers. But for many young organizations, an event can be an effective method to grow your donor base.

Fundraisers are not all created equal. Some raise awareness, while others provide a quick influx of cash. Some are quite large and require extensive resources to pull together. Still others are a simple gathering of friends. Each one can be effective, but you'll want to consider what you hope to get out of it before you begin planning.

To create an influx of cash, you'll want to draw a crowd. Some attendees at your event may participate simply to enjoy the event and will not likely support you beyond that event - and that's okay! The more you raise awareness of your organization, the more donors you will naturally bring in.

Think of events like:

To raise awareness about your organization in your community, you'll want to design an event that allows you to share your vision with the audience. Attendees will leave with a very clear idea of your organization's mission, the problem you are solving, and how they can help.

Think of events like:

To meet individuals who you believe are likely to give a large gift to your organization, you might consider a smaller, more intimate gathering. You don't need to sell tickets or gather sponsorships, and you don't need a full program of entertainment - you simply invite folks to hear a "pitch" about your cause and ask them to support it with a monetary donation.

Think:

Regardless of the type of fundraising event you host, you'll want to consider a few important questions to ensure that you've optimized the monetary benefits:

So much of the magic of fundraising events happens AFTER the event when you ask folks if they enjoyed the event, if they'd like to learn more about your organization, or if they'd like to become more involved.

One of the biggest mistakes many nonprofits make is NOT planning for how you will follow-up with attendees beyond the transactions of the event to cultivate authentic relationships.

Peer-to-Peer fundraising—also known as personal fundraising, social fundraising, or simply P2P—happens when nonprofits empower supporters to raise money on their organization’s behalf.

These types of campaigns allow causes to extend their reach far beyond their core network, raising awareness and attracting new donors. They center around a passionate desire to make an impact on a problem or cause, and then “recruiting” supporters based on a shared interest in the cause, the social momentum of the campaign, or in honor of the friendship with the original project sponsor.

Peer-to-peer fundraising is a powerful opportunity for nonprofit fundraisers because it allows you to tap into a much broader network than you currently have access to, through people’s most trusted sources of information: their friends.

If you have a group of committed stakeholders and supporters, invite them to raise funds on your behalf. You've likely seen birthday fundraisers on social media where someone invites their friends to donate to a cause they care about in lieu of a birthday gift. You've probably seen GoFundMe-style pages where people launch a fundraising campaign to support a friend in need.

You don't need to wait for a birthday or a tragedy. You can proactively invite your board members, volunteers, or your friends and family to fundraise on your behalf. You can provide images, graphics, and the language they will need to share with their circles.

If your mission is related to advocacy or raising awareness about a critical issue that needs a wider audience, consider creating an online petition. Oftentimes, the petition platforms offer an opportunity to raise funds in connection with that advocacy campaign.

Philanthropic giving is often done on impulse - be sure you're making it easy for those who want to donate.

Incorporate as many elements of modern technology as you can. Make use of online giving platforms, text-to-give software, and QR codes that lead to donation pages. Incorporate video and text messaging in your communications plans.

At the same time, don't forget that tried and true methods of fundraising, like direct mail and phone-a-thons, work too. Even a donation jar or envelopes for those who want to give cash on-site is important!

Another example - is your mailing address clearly visible on your website and is your website clearly visible on all your printed materials? Never make it difficult for someone to support your cause!

As we’ve already discussed, donor retention is critical to the long-term success of your mission - studies have found that increasing your donor retention by 10% can result in a 200% increase in dollars.

While focusing on gratitude is fundamental to donor retention, you will also want to think about how you cultivate different types of donors. You most likely don’t have the capacity to build personal relationships with every donor to your organization.

If you are currently employing a “one size fits all” communication strategy, you need to think about "segmentation".

Segmenting donors is the process of sorting your donors into groups based on similarities, and then marking these donors in your database as a member of that specific group.

By segmenting your donors, you can better understand who your donors are, why they give to you, and how you can best communicate with them. There are many ways to create segments.

Segmenting also allows you to approach your donors in a more personalized, meaningful way. Only you can decide which segments are most meaningful for your community.

Volunteers or event attendees could be first-time donor prospects. They’ve probably engaged with you but haven’t given a gift. The thing is, these prospects are very likely to give on the first ask—but they need personalized attention to get there.

Once someone gives you a gift, begin by sending a welcome series to introduce them to your organization, to offer a bit of history, ways to get further involved, and more personal outreach at the beginning.

If you can call them individually, do that. Have a conversation. As you thank them for joining your community, learn more about them—ask them what inspired their giving.

Communicate with them regularly. Share what impact their gift is having. Tell stories of those impacted. Ask board members, volunteers, donors, and program participants or beneficiaries to offer testimonials about why your organization is important to them.

Be sure to thank the donor again – when they least expect it. Everyone expects a transactional thank you after sending a gift. Don’t forget to share your appreciation for their support several times over the year. If you know their birthday or any holidays that are important to them, be sure to send a celebratory card.

Practice the “ask – thank – report impact – repeat” pattern of communication so that before you ask for a second gift, the donor already knows they are appreciated and the difference their gift has made.

Mid-level donors are sort of like the forgotten middle child—the "Jan Brady" of donors. They even might look like low-level givers that give in small, consistent amounts.

Mid-level donors tend to give a higher percentage of their income to charity and generally have a higher retention rate than lower-level donors. While they may not have the means to become major donors, their commitment and support make them a fundamental building block for the future of your nonprofit.

Remember, most major donors begin with small gifts. Annual fund donors are strong prospects for moving up to mid-level giving. These are your future major donors, so it’s worth investing your time and resources in moving them up.

We actually have prospects for every level hiding in our general fund, but most nonprofits don’t have an intentional mid-level strategy. These folks need to be identified and given more love and attention to encourage them to move up to mid-level and eventually major gifts.

Monthly donors are usually an organization’s most loyal and most engaged donors.

A small, monthly recurring gift can be an easy entry point for donors. A gift of $10 or $15 a month is easier to work into a budget than a one-time gift of $100. And many of these donations are processed automatically—no extra effort for you or your donors.

Plus, these donors are likely to make additional one-time gifts throughout the year, attend events, and encourage their networks to support and donate if you launch a peer-to-peer campaign. In short, these monthly donors are the most active and generous supporters over time.

By making a habit of doing something small every day to improve either the number or loyalty of your monthly recurring donors, you’ll create a habit that allows you to be more effective and successful over time.

And, very importantly, 80% of monthly donors give again!

Major giving and major donors need your attention for two major reasons:

First - because of the huge impact one major donor can have on your total fundraising goal, it’s essential that you give major donors the right amount of attention to ensure their continued interest in your work.

Second - a huge intergenerational wealth transfer will be underway during the next 40 years. Baby Boomers will soon be passing on their wealth to the Gen X and Millennial generations. These younger generations will be looking for a cause to support and it’s your job to make sure the pieces are in place now to cultivate these up-and-coming major donors.

Most nonprofits set a minimum amount they define as a major gift to help them identify who among their constituents deserves attention based on some assessment of gift capacity.

If your organization hasn’t selected a threshold amount, consider taking these steps to identify your potential major donors:

Now that you’ve identified your major donors, the next step is deciding how much time you are willing to commit to building and strengthening these important connections.

You’ll want to create personal cultivation plans for your major donors. This might include chats over coffee, site visits, or special tokens of appreciation. You want to learn more about them, their passions and desires. And don’t be afraid to ask their advice or seek their opinion on potential projects.

Here’s a brief outline of what it takes to complete a single visit with a major donor or prospect. And remember, almost no significant gifts are secured in a single visit:

Securing the appointment

Plan for 30 minutes of making phone calls to secure one appointment. That includes leaving voicemails, speaking with gatekeepers, and scheduling the meeting. Set aside blocks of time each week for these calls. Prioritize and protect this time because it’s important!

Preparing for the meeting

You’ll usually want up to 30 minutes prior to the visit to conduct research, prepare pertinent materials, and plan for the visit.

Ensuring enough time for a productive meeting

Budget two hours for the visit and don’t forget to leave yourself adequate time to travel to each appointment. And when you’re scheduling back-to-back meetings, it’s better to have extra time between appointments than to have to rush to the end of a valuable conversation.

During the meeting

"Warm them up" with a conversation on common interests or top-of-mind news or events (keep it uncontroversial!). Then, probe their philanthropic passions and habits via a series of open-ended questions:

Conducting follow up

Plan for up to an hour post-visit for follow-up correspondence, internal coordination, planning next steps, etc.

After each meeting, phone call, or conversation, record a summary of that conversation in the person’s record in your fundraising software

You should also train your staff to look up donor information and record conversation topics. If a colleague happens to reach out to any of your prospects or donors, asking them to log the communication in your fundraising software gives you an accurate account on who said what to when and why.

On average, you should budget about four hours per major gift appointment. Understand this isn’t time spent all at once, but it will impact your overall work week. This means approximately 10% of your working hours should be committed to major gift fundraising.

If you’re just starting out, try doubling that to 20%.

Try to schedule at least two face-to-face visits each week. These can be discovery visits, or stewardship visits – it doesn’t matter where you start or with whom you meet. All that matters is that you start and that you commit to your goal.

The first step to creating a strong stewardship and re-engagement plan for lapsed donors is to understand the reasons donors might have for not continuing their support.

It's important to remember that these reasons, more likely than not, have nothing to do with you or your organization.

Other donors stop giving because they aren’t certain their donations are having a real impact, they feel under- or unappreciated, they were asked for support too often, or the organization did something to offend them.

While you can’t do anything to avoid many of the factors influencing a donor’s decision, you can take steps to better understand your donors and keep them engaged.

Instead of trying to avoid things you can’t control, focus on what you can. Do your best to prevent a donor from lapsing.

If a donor does lapse, create a communications plan directed to these lapsed donors. Decide the best way to engage the donor: individual phone call or video message, a personal email or handwritten note, an email blast or direct mail letter? This might depend on their gift size or hoe long ag their most recent gift was.

In the new year, if you haven’t received a gift of support from someone who gave at a high level or someone who gave consistently, personal outreach is appropriate.

If someone on the leadership team has a personal connection, ask them to reach out to the donor.

If you have a large group of lapsed donors who you cannot reach out to individually, use mass communication tools like a group video, email blast, or personalized form letter.

In the one-to-one situations, prepare first to ask after their well-being. Be open to hearing them share something that might explain why they have stopped giving. Don’t be too intent on asking for their support that you miss an important message about their lives that may have impacted their support.

For one-time donors, small gift donors, or those you may not know well, communications should emphasize that their support was missed and that their donation would be appreciated and have an important impact. Help them understand how and why their gift will make a difference. Share one or two tangible and intangible results of a gift. For example, “your $20 gift will provide a week of afterschool literacy class – and hours of encouragement and hope for a child struggling to read.”

If you have experienced an increase in need or an expansion in programming, let them know. If you’ve lost a significant funding source due to program changes, from the loss of a grant, or a canceled fundraising event, don’t be afraid to let them know.

Remember, a lapsed donor had a reason they donated to your organization, and they have a reason they stopped giving. Help them understand the important impact they can have with another gift.

The more you can do to build a relationship with your donors to help them truly understand your mission, your monetary need, and the impact of their gift the more likely you are to have a higher donor retention rate. Try to better understand them and show appreciation for their previous support.

There are opportunity costs associated with cultivating donors in terms of time and money, and we have an obligation to be good stewards of our nonprofit’s resources. This means learning the "ABCs of Prospecting":

Effective prospecting begins with "access"—prospects we already know. Many of us are inclined to skip to reviewing "capacity" and start with who has money - and that’s where we get into trouble. "Capacity" does not equal "interest" or "belief", nor does it equal "generosity."

If you don’t have access to a major donor, or if the major donor doesn’t already have interest or a "belief" in your mission, then despite their "capacity", pursuing them may come at the expense of missing the “millionaires next door” already in your files.

When identifying and cultivating general fund donors to move up to the next level of giving, consider these factors:

How long has the donor been on your files? Long-term giving could mean moving a donor into planned, recurring, or major gifts. How does your nonprofit identify a long-term donor?

Be sure to look at cumulative giving, not just the amount they give each year. A donor who gives $2,500 four times per year tends to be more receptive than one who gives an annual lump sum of $10,000. What amount of cumulative giving does your average middle donor give?

This is huge. Are they volunteering? Are they reading your emails and newsletters? How involved are they in your organization? People who are investing time in your nonprofit are great candidates for moving up the pyramid. What types of engagement could you easily search for in your database?

People who were referred to your organization by another donor, especially major donors, meet the Access requirement right off the mark. How have you been following up on referrals? Is it effective? How can you improve?

Fundraising is a marathon, not a sprint. Finding new donors can feel like a daunting, overwhelming task. You'll hear "no" sometimes. Don't worry. "No" doesn’t mean you've failed. You can't take it personally.

Continue to amplify your message, share your vision, and offer everyone within your circles an opportunity to support your worthy cause.

Remember - donors give for their reasons, not ours. For greater success, start with the folks you already know. Then, stay steady – and always be grateful.