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Fundraising Best Practices for Nonprofit CEOs
How any busy nonprofit CEO can take steps toward being a more effective fundraiser.
The CEO or Executive Director of your nonprofit organization may not be its best fundraiser, but fundraising must be a part of their job description. While front-line fundraisers may maintain the majority of donor relationships, no voice rings louder in their ears than that of the organization’s most senior leader. The CEO not only sets the goals of the mission, but leads the charge toward the achievement of them. The CEO carries the mission’s vision and values forward or holds them back. For better or worse, an organization’s reputation and perception in the eyes of the community is largely determined by the leadership and voice – or lack thereof - of its CEO. Because of these reasons and more, fundraising is a crucial responsibility for nonprofit CEOs. Here are some best practices:
1. Lead by Example: CEOs should be actively involved in fundraising efforts, demonstrating their commitment to the cause. They may not, and probably shouldn’t, carry a large portfolio. But they should be willing to participate in solicitations alongside major gift officers and board members, be willing to be quoted often in the organization’s marketing, and be present at functions where donors are present to meet and thank them for their investment.
2. Build Relationships: Nonprofit CEOs should cultivate relationships with donors, both individual and institutional. The most key stakeholders of the organization should be the responsibility of the most senior leader. Personal connections are often key to successful fundraising.
3. Craft a Compelling Story: A CEO inspired by and impassioned for the mission they lead can light a fire of passion in potential donors like no other staff in the organization can. The CEO’s connection to the mission should be personal and how that connection comes out in their written and verbal communication should be authentic and heartfelt. Develop a compelling narrative about your organization's mission and impact.
4. Diversify Fundraising Revenue Streams: Not only does a CEO drive fundraising forward, but a tactful and shrewd CEO understands the value of fundraising channel diversification to advance mission sustainability. An effective fundraising CEO will invest in the resources necessary to develop multiple revenue opportunities.
5. Set Clear Goals: Nonprofit CEOs play a role in establishing fundraising goals and metrics to track progress. A CEO who tells their head of fundraising to increase revenue 5% year over year isn’t setting goals. Instead, the Chief Executive should be attuned to the challenges and opportunities present in their fundraising enterprise and be ambitious when possible and conservative when necessary. This provides a clear path for the fundraising team and donors.
6. Stewardship: A CEO’s voice can often be the most influential in an ask. But it’s almost always the most influential in a thank you. If the CEO is wondering where to start growing as a fundraiser, look no further than donor stewardship. A minimum gift size threshold could automatically trigger a personal thank you call from the CEO. The CEO signature on personal stationery goes a long way in the eyes of a donor. For the most impactful gifts, the CEO can make it a point to get face to face with donors to express gratitude.
7. Transparency: Transparency about how funds are used is important to donors – especially for major donors. The organization’s Guidestar profile is important. Understand the current cost to raise a dollar. A CEO should be able to answer how much of your organization’s raised funds go toward Administration and Fundraising and is mindful of how volunteers and in-kind giving influence that. CEOs make sure the restrictions that have been placed on gifts can be honored. Donors want to know their money is making a difference and that their dollars are being used as intended.
8. Engage the Board: CEO’s encourage and involve the board in fundraising efforts. They ask board members to open doors to potential donors and encourage board members to be some of the most effective advocates and influencers for the mission.
9. Invest in Fundraising Streams: It costs money to raise money. Once the CEO has a good sense of how revenue streams can be diversified, they invest sufficiently in fundraising. CEOs understand that spending on fundraising is a literal investment. It’s some of the only spending in the CEO’s budget that will yield a direct financial ROI. The CEO recruits quality fundraisers and support staff to manage and grow donated revenue. The CEO bolsters the marketing efforts and provides sufficient budget to keep the donor pipeline full.
10. Maintain Compliance: The CEO ensures fundraising activities adhere to all legal and ethical standards. A Nonprofit CEO holds their head of fundraising to a high ethical standard. Nobody’s standard should be higher than the CEO’s though.
11. Educate and Train: The CEO provides the fundraising team with opportunities to attend trainings, seminars, conferences, and whatever else they need within reason to keep them apprised of fundraising best practices to ensure that donors are being stewarded by continuously growing and improving fundraisers.
If you’ve found something within this white paper that you would like to explore further with our team, please contact us.
Claudia A. Looney, FAHP, CFRE
Principal and Managing Partner
Kyle Houlton
President and CEO
