Setting your right fundraising goal at the start of a campaign is very important. Why? Consider these two top reasons:
First, large fundraising drives are not done frequently. Because of their infrequency, it’s important to make sure you’re asking for all you need. Once you ask, asking again at a large level usually can’t be done until five or ten years pass.
Second, people decide on the amount of their gift in proportion to the goal. A $100,000 goal, for example, is unlikely to attract a gift larger than $10,000, whereas a $1 million goal will attract a $100,000 gift. The principle of proportionality is significant in fundraising. People with the capacity to give usually give in proportion to the goal. (As an aside, they also give in proportion to the other gifts already secured, which is why privately securing “lead gifts” is so important.)
Therefore, consider the following steps when you set about setting your goal:
1. Make a forecast of the project expenses, and be rigorous about the details. Often construction cannot anticipate what they will find when removing a roof, or working on an historic property. These unexpected costs must be explored before a goal is set. Consulting with multiple professionals, and getting various expert views, is often best.
2. Always include a reserve fund as part of the goal to cover construction overages, usually estimated at 20% of the construction or rehab budget.
3. Always include the costs of fundraising, costs related to the communication materials, the direct expenses that will be incurred (wealth vetting research, travel, data base management increases, donor acknowledgement program, videography, etc.)
4. Always include building maintenance reserves that will be required. The amount of reserves varies so an architect should be consulted. Generally a ten year view must be had, and these funds are usually restricted.
Using an excel spreadsheet to track the cost centers is the norm. This exercise should not be rushed, and usually takes about 60-90 days from start to finish.
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