Nonprofit Network Blog

The Dangerous Reality of Outsourcing Fundraising

Friday, April 08, 2016 12:43 PM | Regina Pinney (Administrator)

Last week, Michigan Attorney General Bill Schuette distributed a report indicating that on average, when a paid fundraiser is involved, fewer than 33% of the funds raised go to the nonprofit.

This is scary on many levels:

  • Nonprofits (as a sector and for our individual missions) rely on a trusting relationship with our donors
  • We could have really used that extra 67%
  • The report didn’t qualify how the paid fundraiser was soliciting the donations (we all know the first gift a donor makes is the most expensive to secure as nonprofits – so were these fundraisers just acquiring first gifts?)
  • The report didn’t describe the trap that many nonprofits fall into when using unethical fundraisers who hold the donors information hostage

But – I totally get it. You need money. You don’t have time. You don’t have enough volunteers to help. Your old tactics aren’t working. Calling in a professional seems like a good idea, and receiving some of more money is better than receiving none. That bottom line number (whatever the 33% is) is more than you have today and you might just be able to serve more people. There are many things that nonprofits can outsource to save money, manage time and be more productive – building relationships with donors isn’t one of them.

If you are going to work with a professional fundraiser, make sure you maintain control of your donor list. Make sure the relationship with the donor is with you, the nonprofit – not with the fundraiser. Donors should be leery of high pressure tactics or if the check needs to be made out to someone other than the charity – ask who will show up on the donor's credit card receipt – the nonprofit or another name.  Donors should also use caution if the caller wants to pick up the donation immediately – most organizations are happy to wait for the donation to arrive in the mail. 

On April 20, I am teaching Mission Driven Fundraising: Lead and Advance Your Fund Development Program. If you are struggling to generate the money you need, this full-day class will help. Together, we will problem solve how you recruit the people you need to implement the fund development plan that will advance your mission. You will still need to find time, but I promise that we will work on efficient strategies and practices that makes the time you do have more productive. 

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Jackson, MI 49202
Phone: (517) 796-4750

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