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37: Donor Retention Strategy Learned from a Capital Campaign Framework

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“I often see that what’s been missing is a long-term plan that keeps folks engaged at all levels.

– Lindsay Simonds
Episode #37

Overview

In this episode of What the Fundraising Podcast…

I talk to Lindsay Simonds, Founder of LSC (Lindsay Simonds Consulting), which she opened in 2017 following a role as Vice President at CCS, a leading global fundraising consulting and management firm providing services including feasibility studies, capital campaigns, prospect research, public relations, and case developments.

Lindsay takes a deep dive into explaining her experience inside various fundraising scenarios while providing pivotal tips that can help you recalibrate your strategy around donor retention. She emphasizes how donors should be treated like partners and investors, being included in important updates and engaged thoughtfully to remind them of the mission they are supporting. 

Helping to reframe your mindset, Lindsay talks about some heavy-hitting mistakes most of us are guilty of, but she also outlines ways to overcome those barriers. 

Join in and listen to this fundraising expert and her insights on donor retention strategies so you can flip the script inside your fundraising efforts today. 

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episode transcript

Mallory: Welcome everyone. I am so excited to be here today with my friend, Lindsay Simonds. You are such an inspiration in all the different ways that you do work around the development sector, but I particularly was excited to invite you to be a part of this donor retention series, because I think you understand donor retention in a number of different intersectional ways as being a capital campaign master and so thanks for being a part of this with me.

Lindsay: Yeah, thanks for inviting me, Mallory. I’m happy to be here and happy to brainstorm and chat with you about what I’ve seen work and what we can do to advance the space.

Mallory: Awesome. So why don’t you just give a little background to your work and what you focus on and what brings you to the conversation today.

Lindsay: Sure. So I’m a capital campaign, major gifts, individual giving executive coach, campaign manager, style type person. So, I’ve been working as a consultant for 13 years now, working on projects that are capital campaigns, anything from half a million to half a billion. And I’ve also done executive coaching with brand new fundraisers, all the way up to the very top senior fundraisers, CEOs, etc.

And I’ve been interim leadership of departments, I’ve seen the gamut. I used to be more specialized in capital campaigns. Now I’m more of a generalist with capital campaigns as my greatest backbone, my strength, or where I’ve cut my teeth and learned the best practices and the models for how I want to approach fundraising and how I want to support my organizations and doing so.

Mallory: I love that. So tell me when you hear me say donor retention, what is the first thing that comes to mind?

Lindsay: So I think about donor retention being, how are we keeping our supporters most engaged? And so when I think of retention, I think about how are we making relationships meaningful enough that your donors continue to want to invest in the organization, in the mission, in the challenge ahead.

Mallory: When you think about some of the biggest sort of challenges that organizations face when it comes to retention or the biggest missed opportunities, what comes to mind first? 

Lindsay: I think a lot about stewardship, flash cultivation, like two ends of the same spectrum. They’re really about keeping the donor engaged beyond the ask and the thank you

I think about missed opportunities when I think about organizations who have had glory days, and then they’ve fallen down into a changing, tumultuous time. And that is often when I’m called, I’m often called in when there’s either a crisis or when there’s a great opportunity. It’s not usually during that midline baseline, usually, that’s business as usual, and they don’t need to hire a consultant or call-in expert like me to come in.

But when I do look, when I do come in and do an analysis of a space, I often see that what’s been missing is a long-term plan that keeps folks engaged at all levels, it’s segmented. All right, so that there is a division of labor and there’s the working smarter, not harder, but everybody is engaged in a way that feels like it’s part of a community and that there’s a network that’s happening rather than all the donors really love that one executive director. And then she left and so they dropped off.

That’s a classic scenario we’ve seen that can be so painful because really looks like all the fundraising is relationship-driven, that it was exclusive to the relationship as opposed to being tied to the mission. So it’s gotta be a really that combination of shared priorities and mission alignment, as well as the relationship that nurtures, that builds trust, keeps them connected.

I think about this idea of the mission being the nuclear source. That should be the biggest magnetic force that the donor feels like they want to put their money to work for this cause. And that the individuals are the conduits to making that work, to making it run smoothly, to bring them back, to realign priorities and making, giving, and investing in being a partner easy.

So then when we talk about donor retention in the field, we talking a lot about. Different types of retention, right? We talk about your baseline annual givers, and we talk about your special events givers. We talk about your major guests, so individuals, corporations, foundations. Then we talk about capital campaigns, which are more of that extraordinary one time investment, above and beyond.

And in each of those scenarios, we might have a different path of retention or with Mallory, you and I were riffing about different organizational structure. Their business models, like we think that the nonprofit space is all the same things, it’s all nonprofit. But once you’re in it, you know, that there’s tremendous diversity in how we raise money and how we engage with our donors and who we’re engaging with.

And so this conversation was spurred from us thinking. What does donor retention really mean? And why are we saying it’s all apples to apples when it’s really apples to oranges, to bananas, etc, because we’re looking at totally different scenarios across the field. 

Mallory: I love that you’re bringing us there because I feel like one of the questions I have about general retention is should all don’t.

Be retained and I don’t necessarily mean should people be excluded from the donor journey or for opportunities to get involved and be more engaged but I feel like sometimes when we talk about donor retention, we treat the lapse donors or donor attrition number as like a big pool where it’s all one to one.

When we’re talking about different business models. And I don’t mean this in terms of a hierarchy of giving, but when we’re talking about different business models, and I think about nonprofits that do a ton of peer to peer fundraising, or things like that. And so they are organizing a walk for example and they’re raising money for their walk through all of their friends and all their family.

Mallory: Not that there shouldn’t be an opportunity to further engage those people. But if one of those people lapses that has really different implications than a donor who came in because they themselves were a beneficiary or their family member or something like that.

And so to me, I’m curious how you think about the relationship between the original donor acquisition activity and the donor retention. And if you segment or think about if a first-time donor is brought in this way, it’s more normal that perhaps the retention rate is going to be around here. But if a donor comes in for the first time, this way, we really want to be seeing that retention number over here.

Lindsay: It’s a lot to think about. And I’m trying to imagine what’s the best way to start. I think that your point about the peer-to-peer event-based, right? So if you’re a national legacy organization, I’ve done work with the March of Dimes and others like them, where they are highly dependent on their center of influence, that CIO. And that person might be responsible for bringing, not only donating, but bringing in other donors, rallying the troops, organizing folks, and really bringing in a large amount of money that’s peer to peer raised that is from many people, but centralized from one person or one company. 

And so if you’ve got different pods of those centers of influence, and maybe it’s one hierarchy of one who’s the top pod, who’s maybe the chair of the walk, the chairperson of the walk, and then you’ve got the next round, people who are committing to raising a certain amount. And they’ve got people at the next round who are committing to raising another amount and others who are just walkers, they are just to show up and give their $10 for the bib. And all of that is an ecosystem of that, maybe one to $5 million walk fundraiser.

Now, if you’re a chair of the walk drops out for some reason, that could be detrimental because it’s responsible for such a large amount of money and people. And probably that person is a person of influence. So it’s perhaps a local corporation head, and that’s a way that we’ve seen work really well with the walkover, like at The City of Hope.

They have an awesome model there where they have a requirement that in order to be the chair, not only do you have to give but you also must replace yourself. So you have to be helpful in training or replacing the next person. So in this case, retention of that first person, not chairperson is not critical. What is important is that there’s retention space or that role. So that person then can help to find somebody else to fill those shoes. And then hopefully some of those mid or higher-level organizers and centers of influence in their own sphere, they’ll continue to be part of your walk. And it might bring in hundreds of thousands of dollars just through their peers or their corporation.

And then the everyday walkers, you’re hoping that some of them come back and they most likely will if it’s a good experience. Most likely people, people do walks for decades at a time, in a row, I should say, not at a time, it’s a little impossible, but I can see that model is like being really important to differentiate who is important to retain.

And if we think about like, you’re talking about how does somebody come in and if you’re working on hospital or anything that’s an experience where you having a life-saving or life-changing experience. That person’s going to be coming in because their motivation is most likely from a deep gratitude for life so they have this indebtedness. So we call that grateful patients. And you don’t want to be losing your grateful patients because they’re the folks who are closest to the centers of the organization. They’re the ones who, if they have that level of gratitude and generosity, then they will be very loyal and spread goodwill and the word to others then again, their the center of influence.  

So as really important is your centers of influence are retained and they don’t necessarily have to be your top donors. They just have to be the people who are giving themselves and galvanizing others to give, that I would say are really important to focus on.

And then you’ve got others who might be supportive for a project or for a case for support. And that’s where capital campaigns might come in. Where they say, yes, I’m going to support the, let me think of what would be the best like right now I’m coming to mind with school, I’m working with schools. So some might say this building is really important because my future grandchildren are going there and I went there or my kids went there cause we can have this alumni legacy. But the day to day they might be like, I’m not involved,  I’ve moved to England, right. Whatever, I don’t live there anymore. It’s not relevant, not my neighborhood. But then when I get called for this big endeavor and my kids still live in that town, sure I’ll support you, that kind of donor is not necessarily critical to retain year in and year out giving. 

Of course, if you could retain everything dollar, why wouldn’t you. But if you think about how do you prioritize your work, you would think about those who are centers of influence, those who are loyal, those who are most tied to the mission. Do you want to think about those in terms of who is going to really move the needle in terms of your fundraising goals? So what’s proportionate.

Mallory: And so when you think about the prioritization piece because I feel like this is actually one of the hardest things for fundraisers, right? Because everything feels so urgent. There is so much fear built into some of the different components of showing up as a fundraiser and so the prioritization piece, I think, starts to get really sticky.

And I’m curious how you work with your clients on that, around how do they set reasonable and appropriate metrics for retention, based on those types of segments or the organization that they are and how do you support them to perhaps like work through the feelings they might have about that number. Or just some of the stuff, it’s been such an interesting move into the consultant space into the running a for-profit business now in the nonprofit space. We talk a lot about conversion numbers in for-profit and really good conversion numbers being 4%, 6%, 10%. And I think about how in the nonprofit sector, so much of the numbers we talk about are the flip side, who are you losing? And we don’t really, and I think about the impact that might have on our psyche too.

I’m curious what you think about that?

Lindsay: Well, I love how you talk so much Mallory, about addressing what’s real versus what’s a psychological reality to you, right? You might the fear base is it true asking yourself, is that real or is that what is the heart of the matter? What are the facts what’s important to focus on?

You’re very focused on aligning partnerships, obviously that what’s most important. And I think we can really consider that as we think about retention as well, because we know we can get very discouraged when we just look at numbers and we look at what are national stats for retention, right? What our national stats in our industry are of our size.

It’s better when you start adding qualifiers so if you are a new fundraiser and you just did a Google search, tell me about donor retention, you’re going to see stats and they’re going to be shocking and some of them are really bad. But then you have to think about, well, what was that organization going through and with who are there any context clues here, and how many organizations are we talking about?

The majority of America is composed of nonprofits that are raising less than a million a year. That’s a very different reality than the organizations, 10 and a 100 and 500 million operating budgets. So I think it’s really important that we would distill the data that’s coming in, really think about what does it mean and how does it relate to our organization.

But I really like to look at history. So what is your historic retention? What’s worked in the past. What hasn’t and why, and then thinking about where do you want to go? So why would it be important for us to have X number of donors retained and then which category as well. 

And I think that it’s critical to be a realist, so we can’t just say we want a hundred percent retention. No, that’s not realistic. And if somebody’s priorities shift, then that’s great. Let them go and invest in what’s more important to them. Perhaps they need the funds for their family at that time or perhaps there’s another organization that’s captured their heart that’s the way we should be celebrating generosity. 

And when somebody needs to pause with their giving, then I’m sure that it’s for a good reason. And so long as we’re getting people in the habit of giving, that’s what I think is most important is making giving feel good and making it feel like this is something we should all be doing at whatever level for whatever organization.

So that’s what I think is important about retention at large. But if you’re in the office with your team and somebody saying well donor status. I just read this on AFP and this is what they’re saying about retention. And then you’re like, oh gosh, we’re way behind that. What should we do? And somebody is going to get fired here. No, that’s crazy talk. And it’s real too, I’m not saying this hyperbolically, this does happen. I’ve been in those meetings. And I think what you need to do is just pause there and say let’s look at ours. Let’s look at our donor retention. Let’s look at the actions that we’ve put out, what we received back and what are we investing in?

So let’s look at our own behaviors and then let’s look at what we might do to beta test it even. So why don’t we try with one group of people, a strategy, and then with the other group of like people, a different strategy and be a little bit more nimble. If you’re really interested in donor retention, then think about it as a riddle, rather than a flat stat that you need to hit or not hit.

Mallory: Okay. I love the way you’re talking about this. I knew I wanted to have this conversation with you because you’re making me think of a number of things. So we always hear that statistic, like it’s easier to, or it’s cheaper to keep a donor than to acquire a new donor. But I have a little bit of a challenge to that, whereas I think that’s true when we’re talking about the type of retention that you’re talking about, aligned retention.  Prioritizing the right people, doing those stewardship activities that continue to deepen that relationship, build identity, build belonging, all of those things. 

But I think when I see, I feel like sometimes I see organizations, a little bit in this, like either or category like they either hyper prioritize acquisition strategies and completely lose sight of all their stewardship or they’re so freaked out about their stewardship that they won’t let anyone go. And I think what I hear you saying and correct me if I’m wrong or is that actually it’s like the middle, it’s you constantly want to be acquiring new donors that you are aligned with.

And part of that consistent messaging around alignment is going to allow you to do that. And actually like cultivation and stewardship. They’re the same action in many ways on different sides of the engagement ladder, but they’re not so disconnected. And so how do we find that happy middle, where it’s like, yes, we’re constantly looking for new people who are aligned with the work that we’re doing. We’re constantly investing in retaining the people who share that alignment. And we’re letting go of the people who are no longer aligned with us. And we’re not letting that freak us out or suck our energy out in a way that takes us away from the fact that there are plenty of people out there who are aligned with us.

Lindsay: Yeah, that’s right. And I’ve done a lot of phone-a-thons if you will, if you’re really just sitting down smiling and there may not be for like a solicitation on the call or on not conversation, but not as a phone solicitation, but where you’re calling to do a gratitude campaign or you’re trying to get people to attend an event or whatever it might be.

But I always talk about trying three times, leaving a voicemail on the second and third time, sending one an email, and then moving on and that’s it. So four touchpoints and that I think that you really want to think about fishing where there is fish, go fishing where they’re actually fish and don’t just go for any pond.

Yeah. Go through the door that’s open. I say that one a lot to think about where there’s alignment, where there’s flow and energy, in our California mode, most of where there’s movement and energy and momentum where people want to be, and then where there’s not, move along because it’s not useful. And I also think about lapse donors. So I think about if somebody hasn’t been engaged for four years, that’s really a lapsed donor. 

And if you’ve got a new hire, actually I was talking to somebody on my podcast, Creating Community For Good, where we were talking about the retention and data. Ashley Dittmar. She talked about a being a new employee and being relatively new to fundraising. And she was just given the task of going through all the old donors and reaching out to them. I think that’s a great exercise at some point, but not every quarter and probably not every day. There could be a benefit to going back and calling through old donors and seeing if you can rekindle the spark or at least understand why they left and what they might be driven by to come back.

But I don’t think it’s worth going in and looking at old donors and people who are not returning your phone calls, and not coming back every quarter or part of your portfolio, just clean them out. If they’re not interested, find somebody who is, cause this is really the universe. And we have a lot of people who are interested in doing good and you really do want your work to be joyful.

And so if you’re just running your head against the wall, beat your head against the wall because you’re going to doors that are closed or halfway closed, you’re not going to enjoy your job. And you’re not going to bring the light to it. The donor really needs to experience in order to feel like it’s a worthy use of their time and their money.

Mallory: There are a few things about what you just said that I just want to highlight. One is that inside Power Partners, we use those lapse donor lists to do something called The Seven Day No Challenge, where their goal is to make cold calls and get as many no’s as possible in the, in the week.

And the goal is to be building their resilience around hearing No, and to do it in a really low-stakes way. I think if you’re going to do it in any way, do it that way. Just so you’re flipping that script.  Because I agree with setting that as a to-do every however many months and building in your self-worth on your success rate with that list, it’s just not good for you. It’s not emotionally, mentally, it’s just not good for you. And I think the other piece of that is, is that there are these sort of components. I think that’s an interesting thing to think about how you deal with that lapsed donor list. 

And then the other piece of what you said that I do think is interesting, I just interviewed this woman, Vanessa Bonds on the podcast, and she talks about influence, that we have more influence than we think. And she demonstrated some really interesting numbers around what happens when somebody says no and then they’re asked again, and actually, the data demonstrates that people who said no, who turned down a request are more likely to say yes the next time. 

So I think you’re right, if somebody has lapsed for multiple years, and they’ve been asked. It is really important to let them go. My one caveat would be, make sure that they’ve been invited to be engaged at all and give them that a few entry points. If you’re coming in as a new development director, for example, and there’s this cold list and you don’t know what’s happened with them. Did anyone ever follow up after that event? Those types of things. I think it’s fine to create some invitations to test that engagement. And then exactly, as you said, let them go and don’t get too attached to those numbers. That’s a test. That’s an awesome opportunity. I love what you said about AB testing and seeing what works, what doesn’t, that is such an awesome opportunity to do a little bit of testing around some of your engagement methods. So I love that idea. 

Lindsay: You’ve got me thinking about no’s. And so no’s don’t always mean, No go away, I don’t like you, you’re a bad person. And the fundraiser sometimes feels so defeated and I know you do a lot of work like you talk about what you just said, but also I know from the podcast you were on with me and some of your work that you talk a lot about figuring out the courage and differentiating your identity from somebody’s responses to you and your job and fundraising.

So I think it’s important to consider when somebody says no, is it a not now? Or is it not that much? Or is it not that project? And to ask a follow-up question. So I think that that’s a big part of retention is to understand when is a good time for me to follow up. What is a motivation to you? What are your philanthropic priorities? How would you like to see your money move the needle in society or in with our mission? 

So I think it’s talking about having a follow-up conversation and further conversations really understand what does that person’s decline mean? And then if they say I’ve moved, I have other priorities, I’m giving to another organization, I’m on another board. That’s pretty clear sight, you are no longer going to be harassed by us. And you can put that in your notes and your REU or whatever CRM is. 

And that next person who comes in really benefit from knowing why that person has moved on. As opposed to just saying, oh, that person said, no, let’s move on. And then a new person comes in a year and a half later and calls that person then the donors are even more annoyed because they’ve already explained that, they don’t appreciate that the organization, that they shifted their priorities and now they don’t feel like they’ve been heard. And so you’re hurting the relationship twice, as opposed to that person, if you’re a new person or you’re coming back to somebody who’s left and you say something along the lines of, I realized that you left for X, Y, and Z reasons. I want to tell you about something else that we’re working on, or I want to explore your current philanthropic endeavors. And is there any openness to continuing or coming back to our organizations? There are a lot of ways that you can have a conversation that are, if you’re very dogged and you want to get back to that donor, you can do that.

But when you have a respect for where they’re coming from, and you can actually reference it and treat them like a human and acknowledge what’s happened in the past so that you can actually consider going forward. And if they then again, say no, no, there’s actually no openness right now. And then you close the door. Or would it be appropriate for me to call you in another year or in six months, what would be appropriate? And if the donor just says, no, no, no, no, no. Then you really need to put that in bold in your database. 

And if they just say not right now, but call me back in six months, which oftentimes they do. There’s a whole new gateway of relationship that you can engage in and you can retain your donors in a different way than what you’ve traditionally think of, which is donor retention is year over year. Some of those donors might be coming back every couple of years then if you’re actually nurturing the relationship and staying with the organization, which is another topic for another time, right?

The importance of having some continuity in relationships. But I think those are things to consider, really though I think you want to focus your energy and prioritize those donors who are raising their hands. And they say, I want to be a part of this organization. I want to help you. Let’s think about how you can be that center of influence or how you can move the needle rather than begging to try to retain some of those folks that are, that we’ve just worked through it. We just talked about that at the very tail end. 

Mallory: I think you’re saying is so important. And one thing I’ll just say really quickly, and then I have another question related to that is, I just did this interview with Francesco Ambrogetti who wrote the book, Hooked On A Feeling, and I love what he talks about in that book around peak and endpoints.

And I think what you’re talking about here is this endpoint piece, this serotonin memory-based, identity-based relationship to an organization is so important. And that’s really built over time based on peak and endpoints with the organization. And an endpoint is how do they pause their monthly giving. How do they transition off of giving for a year?

That really does cement, when we think about rituals in particular to Vic Harrison just said this on the podcast recently, also that when somebody leaves Charity Water’s Monthly Giving Program, there’s a ritual for that, a beautiful one. And I think those are things we often don’t take the time to think about how like it, and maybe it is because we think, Okay, they’re out. So they’re off my mind until I’m going to make those lapse donor calls or until I want something else from that, but we don’t really honor the time that they spent with us. And so I really, really appreciate you and saying all of that.

Lindsay: I appreciate you saying that because I sit on a board where somebody is just rolling off and the exit interview was super positive and it was again like we talked about very passionate about another project that has a, I don’t want to give the details, but there’s a great reason and it has nothing to do disliking the board that she’s been on. It has to do with feeling satisfied and complete with her service and interested in a new challenge, which is beautiful. And what it would be like for us to then send her a care package that say “So great that you were of service for these years, and this is the these are the things that you’ve done” and maybe a photo and a logo, something, and just well-wishes, anything like that.

And maybe you don’t have the bandwidth or resources to do that for all of your donors, but certainly for your board members. You absolutely must build that in because there’s tight relationship. And how wonderful to think about that exit strategy. I’m glad you said that.

Mallory: Yeah. And I think even if you just get a little alert that somebody is leaving and you give them a nice phone call, really quick.

I just feel like there’s so many ways to honor that because I do think that commitment to the overall giving community and really inspiring generosity, that takes us all stewarding well, to continue to invite people and involve people in these causes. And so I think it’s such an important thing. I just saw this statistic about first-time donors have an average of a 20% retention rate. I was shocked when I saw that number and I’m just so curious why that is happening. And I’d love to know what is that number signal to you?

Lindsay: When I think of about the 20% donor retention from first-time donors, I am really wondering, where do those donors come from? Oftentimes I think people are activated to give when there’s an emergency.

So if you think about nonprofits, they tend to be funded at a large scale by the masses in response to a crisis, right. So if we look at the last two years, I wonder where that stat came from. Do you know how long that stat was? Is that a recent stat or is it?

Mallory: I think it was pretty recent. 

Lindsay: Okay. So what we’re talking about is very current stats rather than exact date. I think that’s a hundred percent related to crisis. I really do. I think that’s a food shortage, the masks, the hospitals, the blood shortages, the social injustice and crisis moment that our country has come to care about more than they ever have in the past and that’s what is going on.

This is very crisis reactionary giving and that’s what’s going on. I do think it’s an awesome opportunity to retain donors and to bring donors back right now is a time to say who was that one-time donor who has a response to the climate at large? And how might we engage them. I think a survey is something we haven’t talked about much in this conversation, but I do think it’s a highly valuable tool. Especially if you’re talking about massive numbers of people, rather than a high level, major guests, individual giving, you can easily do a survey that asks people about their philanthropic priorities or about their knowledge of your organization. You can drop in information about the impact of your organization while you’re asking questions about what’s important to them. So it’s both an informational messaging piece, but it’s also a tool to collect data and then you can segment and you can respond to their data, specifically.

You can hear what they’ve said and say, you said X, Y, and Z, put it right back in their words or rephrasing it or putting it buckets of like sentiments and think about your data. Of course, I don’t want to get into that tangent there, but you can really have an awesome feel for your first-time donors, second-time donors. 

You can create automated systems in Salesforce. So somebody gets to the first time and you have an automatic reply something like That’s wonderful, you gave, thank you. Can you give us any information as to why you gave and how would you like to be worked with, would you like emails? Would you like a phone call? Would you like newsletters, social media? You can talk about, you know, what’s their preference for communication and what’s their giving priorities and you can do it in a 3 to 10 point survey that takes 3 to 10 minutes, very low costs and ask of your donor that can really set you on a totally different trajectory to build relations.

Mallory: I love that. And I do talk about surveys quite a bit with Francesca as well. But I love that reminder, I think it’s so important. And I think the data around surveys in particular was pretty mind-blowing to me. I didn’t really realize just how impactful the strategy it was. And I think it’s also a great reminder about how bad we are at designing strategies around what we personally want and how that is just so not evidence-based in so many ways.

I think so often in our fundraising too, where I would be uncomfortable with that, or I wouldn’t want that phone call, or I would want it in a text message. We do a lot of non-data-based decisions based on like our personal preference. And I think it’s such a good reminder to look at the data, there is so much evidence around what people want and what helps them feel included and a part of it and it’s just so important that we are spending some time being familiar with those things as we design our followup activities. I really appreciate that. 

I want to focus because I have you here and we’ve never on this podcast actually focused on capital campaigns. And I’m really curious about the intersection in some of what we’re talking about around donor retention and how that relates to capital campaign work. In terms of how does, an organization know perhaps that they have enough of a secure donor base to launch a capital campaign? Because I think what’s interesting, you said this at the very beginning, you said, I worked on capital campaigns that are a half-million dollars to half-billion dollars.

And I think that’s really important because I think sometimes when people think about capital campaigns, they just think about the really big ones. And oftentimes I’ve seen organizations not even call something a capital campaign when in fact they do a fundraising campaign for a capital investment.

And so I’m really curious if you could just walk us through, maybe even at the very beginning, what is a capital campaign as you define it and how does it plug into major gift fundraising?

Lindsay:  So I think of capital campaigns as an extraordinary fundraising endeavor. It’s extraordinary, right? It’s not part of your baseline. It’s not your operations. It’s a one-time big lift. It is to do something that would have an incredible impact over time with one sprint and with one major inflection of funding. I would think of a capital campaign for buildings, for endowing, for debt reduction, for program expansion, for an expansion, for services or geography, a new vision for the organization.

I think of them as being very strategic and to have a greater impact on the organization and the folks who the beneficiaries. I think of them as different because you’re not necessarily, how do I want to say this, if you have major gift donors, you’re continuing to engage them on your operations, but you might also ask them to increase their giving for this capital campaign. But you’re being very clear that it’s not a robbing Peter to pay Paul. You’re not just moving the funds over, but you’re asking people to go above and beyond what they’ve ever done before, in addition to what they’re currently doing. To maintain the health and the operation of the organization, but to do a one-time, extra-large investment.

Mallory: Okay, so I love that we’re talking about this within the framework of donor retention because I feel like one of the things I hear the most about how to have conversations like this with donors is, if we ask them to increase their giving, or if we ask them to give for two different things, they might not give that all.

How likely is that?

Lindsay: Oh, not likely, not likely. 

Mallory: Do you hear that fear a lot? 

Lindsay: They might not give all if you ask them for two things, no, I don’t hear that fear in particular. But I do hear a lot, How are we going to prevent that we’re depleting our operational fund. That is really, really common and what we’ve actually studied over time as professional consultants and capital campaign managers, is that you see an increase in all giving when done right.

So you’re going to see your operational funds increase as well as your capital campaign funds get delivered. If you’re doing this with the appropriate outreach. And something I talk about a lot is the critical element of doing a phase approach and being very careful about how you’re segmenting your work and making sure that it is personalized and proportional and pledged. So we talk about peace, right? The phase approach, which is doing one group at a time, the proportion of giving. You’re not asking everybody for the same thing. I worked with an awesome organization, The Scandinavian School and Cultural Center. I want to celebrate them and their culture is so different from the American culture.

We had a really fun time thinking about the way that the Scandinavian altruism, everybody having a same input and same benefits and that they really wanted to focus on if everybody in this group could give a thousand dollars, so everybody in this group gives $10,000. And so that is one way of approaching fundraising.

The way that I like to think about it is so long as if we can do that approach, so long as we have them in steps, and in stairs. That we’re asking people to give at different amounts in those groups. Rather than just if everybody, if we do the math real quick, but I sat down with a church nine or 10 years ago. I’ll never forget where the head of the development just said, all right, we have, what was it like 1,500 parishioners, so if everybody gave just $200, we would raise X dollars. So let’s go out and just get $200 from everybody, I thought, okay. That is like a, good math, it’s good math you’re right. But that’s just not how giving works. And it’s really not the best way for capital campaigns. And I think that was a bit of a tangent, but what I really want to focus on is the importance of asking people to give what is meaningful and specific to them.

Rather than just asking everybody for the blanket, same amount, because you’re going to get people feeling like it’s transactional. Our culture in America, it does not feed our community that way. In Scandinavia, it works better because they have that mindset that we all need to pitch in. 

Here we don’t, we think of what’s in it for me, what’s the value, what’s the ROI and I want to study this. And what support is appropriate and who else has been giving and how much. Oh, maybe I should give that much then because I want to be in that echelon. So our thinking is very different in different cultures around the world. 

And so thinking about my area, America. So as I think about that, I think about the importance of asking individuals to give at higher levels than before, without taking away funds from their operating budget. And I love the idea of a combined solicitation, where you might say to somebody let’s go with that school scenario because it’s a really easy one where schools are going to have the funded, need the bridge, the gap. They’re going to have the end-of-year giving. They’re going to have back to school giving, they’re going to have all sorts of, the dance. They’re going to have cookies. And there are a lot of times when they’re asking their community to give, which is great. 

But if you’re going to make a capital campaign, you might talk to those individuals who are asking to give at the significant levels that are really going to be your big rocks in the project to consider a gift now that would then be, it would be for the campaign, but also to support the operations at the same time. So you might ask them for a hundred thousand dollars today over to be paid over the next five years at $20,000 a year. And that 10,000 is going to go to the capital campaign, or maybe it’s 15 is going to have the capital campaign and five is going to be to fund all of those asks that we do this year. So we do this year, but we’re going to give you credit. 

We’re going to give you tickets to the event and we’re going to put your name on the roster of donors. And we’re going to do all the things that demonstrate to the community, that you’re part of this community and you’re supporting the operations. But you’re not expecting to, you’re not going to be surprised right, when then there’s another big asset comes six months later and you think, gosh, didn’t we just sit down and talk about this six months ago, and you asked me for a huge amount for the campaign and you couldn’t have told me that there was going to be pressure and peer pressure and all the pressure that sometimes happens, in fundraising to give again, that’s when it doesn’t feel good.

If you can treat your donors like investors, then they respond much better. And if you’re saying something along the lines of, we’re going to ask you for, these are the things that are going to come down the pike and it’s up to you whether you want to fund them or not. We’d love for you to consider this campaign.

Don’t make decisions for your donors. Give them the menu of options. Let them know what’s going to come down the pipe, let them know what’s important to the organization at the time. 

Mallory: Okay. There’s so many things you said that I think are really valuable. And I think you took us actually into an area of retention that I just think is really important.

I think what you talked about seeing your organizational giving over time and your capital campaign really speaks to this piece, that deeper engagement is deeper engagement. And so I really, I’m curious, are you familiar with any statistics that sort of demonstrate folks who do participate in a capital campaign from a financial giving perspective?

Do they tend to have a longer donor life span with the organization overall?

Lindsay: Absolutely. Yes. I don’t have a stat off the top of my head. But that is something that we have absolutely seen anecdotally and by the data too. I’ve been in capital campaign fundraising since 2008 – 2009, since the crisis, the economic crisis, which was the interesting parallels between then and 2020.

We have seen that when people are giving to capital campaigns, that they want to continue to see the benefits, the fruits of their labor essentially.  They want to see the organization continue to thrive because they have made such a significant investment in it. And so they continue to support it, time and time again. Either through big events or the annual funds and usually, a great fundraiser and organization would say when that donor has completed their pledge, it would be a sit-down where they’re thanking them, talking about the impact of their giving over time, and then talking to them about how they would like to engage with the organization.

And oftentimes it’s asking them, would you like to continue giving at that same level? Is that something that you’re interested in doing to fund our operations? And if the donor says no way, that was a big stretch for me, after the three years, five years, whatever it is, I’m ready to take a break. Then you just celebrate that and say, great, well, thank you so much.

What can we, how can we move forward together? We’d like to see you supporting the operations so that you can enjoy the benefits of the project completion. And would you consider X, Y, and Z? So then you just find the level that’s right for them. And that’s really how you keep a donor. And that’s how all boats rise.

Because somebody who’s been giving at a very high level, even if they come down, they’re most likely not going to come down to where they started. 

Mallory: Yeah. Okay. I love that. And I wanted to just click on one piece of it in particular, related to what we know about behavior, especially because we really have learned a lot here about BJ Fogg’s behavior model around motivation the relationship between motivation ability and a prompt. And so he talked about fundraising in particular, the ability for fundraising is how much someone can give, is really the ability indicator. And of course, how easy for online campaign donations, how easy it is to give, that’s the other side of it.

When we think about ability from an amount perspective. I think that just really relates to what you were saying before around the customization and that you’re inviting people to invest at a number that makes sense to them. That reflects that you really understand them the way they invest in organizations, the type of impact they’re trying to have. 

And so I feel like what I hear you saying and correct me if I’m wrong, but that part of tailoring that number, part of zeroing in on the right ability level for a donor is not just to make sure that you aren’t asking for too much. In fact, it’s also really making sure you’re not asking for too little because that also feels very to the way they like to participate in organizations.

Lindsay: Absolutely. Yeah, I love that. A great point.

Mallory: Cool. I could have this conversation for a very long time, but can you tell everyone all the different ways to connect with you and learn from you. 

Thank you so much for spending this time and digging into this with me. 

Lindsay: Oh, thanks for having me. This has been a great chat.

I love our conversations, Mallory, and you’ve been such a great friend and peer to me in this space. So thank you for inviting me to talk a little bit and share some thoughts. The best way for the audience to find me is on the website. LindsaySimonsconsulting.com 

And on there, I’ve got a signup to click on podcasts. You can sign up for my podcast, that’s the best way to get my newsletter. And then you’re going to hear from me monthly. And I’ll give some personal anecdotes and tips and then share my podcasts, or you can sign up for a meeting that way using Calendly. Or if you just get into the groove of communicating with me that way.

Otherwise, I’m very active on LinkedIn. I’d say that that’s another great way if somebody wants to get in touch. They can find me at LindsaySimondsConsulting.com, and we can have a chat about what’s going on. Happy to talk there. I have Instagram and Twitter under Creating Community for Good and that’s my podcast’s name. 

Lindsay Simonds Consulting is my consulting business. And then the Creative Community for Good is the podcast where I have a little bit more of a wider audience connection. Those are the best things to do to get in touch with me.  

Thank you, Mallory. This is a great conversation. Thanks for all the great work that you’re doing and all of the information that you’re sharing with the community at large, and really advancing our industry for good for all of us to have a better life.

Mallory: Oh, my gosh. Thank you. 

Lindsay: I know you work hard. You’re doing a good service. 

Mallory: Thank you.

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