May 27, 2024


Marsh Gas

When A Donation Goes to Fundraising and Not Programs

Some time ago I spoke to a nonprofit executive who had great news. She had been talking to an influential person in the community who asked her a simple question.

“If you could do one thing to expand the work you’re doing in the community, what would it be?”

Her immediate response was “Invest in fundraising to make our revenue sustainable.”

The way the executive explains it, no sooner had those words left her, that she fretted because she thought a better answer would have been hiring a program officer or some other activity that would have directly impacted the organization’s programmatic work.


A couple of days passed without a further word from the influential person. The following week, the nonprofit executive received a call, and it was again the community leader. He wanted to follow-up on his question by asking how much she would invest in fundraising. The executive was someone that’s always been at the top of her game, and she promptly responded that with a gift of $200,000, she would be able to hire additional staff and develop a broader fundraising program, which would help her charity grow and make a more widespread and sustainable impact.

The community influencer thanked her and then politely chatted with her about the good work her nonprofit was doing. Once the executive hung up the telephone–after scheduling a time to meet with him to speak further about the organization–she set out to do a little research. She knew that the gentleman had not been a donor or supporter of the charity, but she sensed there was something of interest for him in the organization and its mission.

The Gift

One of the great aspects of working with individuals is that you never know when they’re going to surprise you. When the executive got to the meeting, the influential community member cut straight to the chase. He offered her $150,000 to invest in her development team and then asked her to use the gift as a challenge to other donors to raise the additional $50,000 that would get her to the $200,000 she needed.

She was floored by the generosity, especially from someone who had not been a donor to the organization. In their conversation, he explained that his son was an addict and although he wanted to “save” his son, he also understood that if he could help other parents in a similar predicament, that would also be important.

Why Fundraising and Not Programs

The donor explained that when the executive first told him if she had extra funds she would invest it into fundraising, it was a reply that he did not expect. Also, from a business perspective, he said it made sense. He understood, as a businessman and philanthropist in the community, that hospitals, universities and cultural organizations made it a point to invest in their operation, including marketing and fundraising. He was also aware that it was essential for smaller nonprofits to follow that path because it helped create donor revenue streams, which supported the ongoing work of organizations within the community.

As he explained it, there was a direct link between increased spending on marketing and fundraising and eventual funds for programs. So, the way he saw it, although he was not making a gift directly to programs, the “investment” he was making would help the organization obtain and develop other donors, which in turn, would help drive money into the programmatic work.

Lucky Break

While many nonprofits don’t have the luck and good fortune that the organization I’m writing about today did to get a sophisticated donor who wants to direct a gift into fundraising, the reality is that smaller community organizations and donors are, in fact, understanding what the large institutions have known for a long time. There has to be an investment in the institutional capacity of a charity, especially marketing and fundraising.

There are ways you can begin to till the soil for your supporters to give more toward your annual fund or directly to capacity building.

  1. Inform your supporters about how your non-programmatic funds are spent. Be transparent.
  2. Develop a plan and help your champions, especially your board members, understand why your organization needs investment into the infrastructure of the organization, particularly marketing and fundraising.
  3. Do your research and understand industry benchmarks on the topic of capacity building and nonprofit sustainability.

Finally, if you receive push-back from board members or not enough traction, think about recruiting board members and champions for your organization that also understand the connection between funding fundraising and your organization’s sustainability. Make it a point to have this matter as a regular topic of conversation at your board meetings and with influential donors. And, if you find an opportunity to attract money that will go directly to building up your marketing and fundraising efforts, create a strategy to go out and ask for it.