Talking Fundraising to Finance

guest blog by Samantha Woolven

OK, I’m not sure how closely the fundraising and finance teams work where you are…but in my experience if finance are asking why you need the information then some education is needed. This post will focus on finance teams, but can be equally applied to other: technical specialists who have information you think would be useful, service delivery teams who know what it is really like for the people who use your service, those holding the keys to corporate management information, and even those members of your Exec or Trustee teams who have had little hands-on connection to Fundraising.

What do I get if I read on?

So this will be a long blog post, it’s designed to guide a conversation…a conversation I’ve directed countless times from CEO to the person who opens the mail. This conversation is just the start and will take, if done well, a good hour of your investment. For an organisation to become a truly ‘fundraising organisation’, then everyone from cleaner to President needs to understand what that means to them.

Why don’t they just give me the information:

My general approach to these sorts of conversations is that they probably have as much real knowledge about fundraising as I have about corporate finance…which, just in case you’re wondering, is not a lot.

If this is true, then they are probably unaware of their lack of understanding, they won’t know what they don’t know, or they may feel like they should know more and feel embarrassed that they don’t. This lack of understanding can make people feel super uncomfortable as they want to get it right, they want to help you, but don’t know how.

1.      Remember that they are trying and really do want to help

Most non-fundraisers only experience fundraising in terms of: street fundraisers, school fetes, and appeals through their door or on their TV. This means that they’ve only been exposed to the two extreme ends of fundraising numbers – the £5 and the £500,000,000, and they never see or understand that there is real maths behind these numbers.

It’s easy to forget how much prior knowledge and practical understanding I assume of others….I then get annoyed when they seem “difficult” or “challenge why” I want the information I’ve asked for. In my head, I clearly need this information to do my job or I wouldn’t have asked.

2.      What is Fundraising?

It’s then my job as the fundraiser to help them understand. This is where the unofficial training comes in. I’ve often offered (and it’s always accepted) a short ‘shall we start with an overview of how fundraising works here so we’ll all on the same page’ approach.

They need to understand the differences, the fact that there are differences, to all the different fundraising things they’ve heard about. I take them briefly through the basic differences in mass-fundraising vs high value fundraising vs legacies:

  • Mass-fundraising: lots of people donating a higher number of lower value sums to “core” work, meaning non-specific or non-restricted
  • High-value fundraising: fewer people donating a lower number of higher value sums, sometimes this is for core work and lots of the time this is for “restricted” or specified areas of work

3.      What is Fundraising at your place?

It can help to give a broad overview of fundraising in general and then link it directly to the numbers they are used to in your fundraising teams. For example:

  • Individual Giving [insert your team names as appropriate]:
    • Raises XX% of our total voluntary income,
    • They talk to around XXXX of people a year,
    • Receiving an average donation of £X.
    • These are the donors that respond to written appeals, street fundraisers, online, [plus anything you do too],
    • It takes around XX months to return a profit on the initial investment.
    • It is always much cheaper to re-engage with someone who already knows us, than to start from scratch.

Repeat this type of short outline for all the top line fundraising teams:

  • Major Donor Fundraising: mention that there is often a long-lead period with these sorts of donors – its takes time to gain their attention/ interest/ and then we will work with the donor to find something interesting to donate to.
  • Trust and Statutory Fundraising: mention that these funders work to their own application and reporting timelines, they ask for lots of specific information and will require expert financial and impact monitoring.
  • Legacy Fundraising: some people choose to leave an exact amount, some people choose to leave a percentage, we always encourage a gift after they have already taken care of their loved ones (it’s good to set this out early so they don’t worry about it).
  • Community Fundraising: relies a lot on volunteers and ambassadors in the community, this is built up of many many small donations and can require very local information.
  • Corporate Partnerships: these funders are often demanding more from their charity partnerships now. They ask for due diligence and expect opportunities to invest and be more heavily involved.

Now they have a broad understanding of what fundraising is and how the different teams and donors differ from each other. Hopefully they will have questions.

4.      Things non-fundraisers might not know

Here are some general assumptions we make and rules we work to:

  • There is a big difference between the words could and will. Tell them that our preference is for as much as possible to be ‘could’, which is the donor saying that they trust us to spend their money wisely, but sometimes donors want to have a greater level of control and recognition.
  • £7.3 million is a big number for anyone to get their head around – we need to break down into meaningful packages to make it easy for potential donors to digest and get excited about doing something
  • Detailed information helps us build credibility and says that we are a trustworthy and safe place to invest your money.
  • Higher value donors treat their donation as an investment. This means that they will want more details on what will actually happen with their money, how quickly it will be spent, how many people it will help, etc. They also like to tell their friends about which charities they support – we need to help them talk about our work easily and knowledgeably.
  • Mention that grants/ lotteries/ and often big funders want regular reporting – we will need finance’s help with this.
  • When we are working with major donors each donation is seen as a personal investment we need to appeal to the personal preferences of each donor. We need to find something that makes us stand out from the crowd of other charities asking them for their money. By training fundraisers in how we spend money, we can help them to talk about it easily.
  • Explain that conversations with major donors can move fast. The fundraiser needs to have thought about several options that may interest them – this is why we often ask about several items at once. We need to be able to quickly and easily see opportunities for things that would catch their interest.

5.      Confirm that they can trust their fundraisers

This may sound ridiculous, but memories are often long in charity teams, and previous fundraisers and personal preconceptions may still be having an impact on your current inter-team relationships. Things to reassure them of:

  • Fundraisers are always saying the truth about the charity as they understand it. Problems arise when they don’t understand it well enough – they need your help to get this right.
  • Fundraisers can be trusted to not share information that have been asked not to.
  • Fundraisers need to know why a decision has been made. No matter how topline this explanation, they need a reason and ideally a reason they can share with the donor.
  • It is always better for the fundraiser to be better informed, even if they’re not allowed to share certain stuff, so they can help steer a conversation to an appropriate option.
  • If they don’t know what they don’t know then they can end up offering something that they then can’t fulfil – much better to avert this in the first place.

6.      Explain your approach but be willing to work with theirs

Finance people are precise and detail orientated, fundraisers to need to be more responsive and creative in presentation, but rooted in fact. This difference in approach often causes confusion and then annoyance all round.

  • If you ask a finance person for a specific item then they will try their utmost to give you exactly what you have asked for – this can take time. The challenge is when you are just giving an example of what you want, you’re considering many options at the same time, or you have a gut feeling of something you think you’d like. They may tie themselves up in knots creating bespoke reports, they may talk to all sorts of people to get the right answer, they may worry about exact cost codes, all for you to turn around and say it’s not right anyway, you’ve thought of something better.
  • The trick is to explain your end goal and ask them how best to get you there – they are the experts in all things money here. If you help them to understand your problem or your donor’s interests, then they are much more likely to be able to provide a solution more quickly. If you work out a rhythm together, then hopefully this will become easily repeatable for the next ask.
  • As much as possible work to a timescale and regularity that suits their existing workload and reporting schedule. Don’t make it more work for them if you don’t absolutely need it to these exact dates or in this precise time – many donors accept quarterly figures and understand financial processes if you explain why you will be giving slightly different details. For the ones that need to be exact, explain why to the person you’re asking to do the work.
  • Finance is all about ways to split the “pie”. They have probably already split the whole pie in several ways already: by service and by type of thing it paid for. You now need them to either:
    • split the whole pie in other sensible ways (they probably know better what is sensible)
    • or split the individual slices of pie into what pays for what, specifically
    • Other useful items the finance team has access to are average salary bands for staff members, which means that we can maintain confidentiality whilst also providing an exact “thing” someone can pay for

7.      Share the love

Be open and transparent and kind.

  • Share the finished document so they can see what sort of thing they helped create – they will continue to grow their understanding
  • Share the money – make them one of the first people to know when your fundraising is successful, show them the positive results of their work and make them as excited as you are
  • Share the feedback – positive or negative, why did it work, what would’ve made it better?
  • Remember, you’re a team.

8.      Round up your intro to fundraising

  • Explain to them that retroactive fundraising is really difficult – it’s much easier to get someone excited, and therefore willing to invest, in something in the future.
  • High value donations relationships take months to build, fundraisers need as much notice as possible to fundraise for specific items/ projects – the more notice the more likely they are to secure some money.
  • Remember that they also don’t know what they don’t know. Give them as much information and insight into what you’re trying to achieve and what the specific donor wants – they may surprise you with a great insight into what’s coming up or something you didn’t know about that would be the exact thing your donor would jump at.
  • Most of fundraising doesn’t need to be “urgent” it can work with annual, quarterly reporting and normal planning processes. Don’t pass your stress onto someone else. If you work with this approach for 90% of your fundraising then the 10% that needs to be urgent is much easier and happier for the finance team to respond to. Especially if you acknowledge the rush and disruption to the work plans (remember you working with very planned people and asking them to drop everything to help – it can be uncomfortable for them).

Fundraising in one simple visual sentence:

The credit card analogy – charities work like you spend on a credit card. All the money is spent (allocated) at the beginning of the year and fundraisers spend the rest of the year trying to pay it off. In April next year, they start all over again.