One of the most frequently asked questions about capital campaigns is whether a campaign might cannibalize your annual fundraising.
People ask us:
If we solicit our donors for a big gift to our capital campaign, won’t they stop giving to our annual fundraising?
While on the surface that seems like a reasonable question, if you dig deeper, you’ll find out why capital campaigns usually strengthen your annual fundraising rather than weaken it.
The key is understanding the difference between recurring and special gifts. Knowing how they fuel your different fundraising efforts will help you make sense of the relationship between your annual fundraising and your capital campaign.
How Recurring Gifts Fuel Annual Giving
Many people make multiple gifts to organizations they want to support. Even in the course of one year, they may give several times. They may give an end-of-year gift, a gift to your gala or other special event, and perhaps a gift to your annual spring appeal.
Donors often give to these appeals understanding that they are likely to support you year after year. Much of that annual giving is made out of a donor’s check book or payment method that doesn’t require tapping into their investment accounts.
Many donors calibrate their annual gifts with that in mind. They have a sense of what they are comfortable giving year after year and they apportion their giving accordingly.
Donors Often Give the Same Amount Again and Again
One donor might have a habitual giving level $50 or $100 or $1,000 that they give year after year. It’s a gift amount for recurring contributions that’s comfortable for them in the context of making a gift again and again.
Occasionally, you might ask your donors to increase their recurring gifts to the next higher level in hopes of nudging those recurring gifts up. When you do that, you probably just ask for an incremental increase from, for example, $100 to $250. Or from $1,000 to $1,250.
You are unlikely to ask one of your steady donors to increase their $100 recurring gift to $5,000 or $10,000. Right?
How Special Gifts Fuel Capital Campaigns
But there are times when you’ve got to raise money for something special. Perhaps your organization needs a new van or upgraded equipment that will increase your ability to carry out your mission.
At a higher level, you may want to build or renovate a facility and start-up a new program. Those expenses are the kind of non-recurring expenses that are typical for capital campaigns. Your organization needs a large amount of money — often many times higher than your annual operating budget.
And for projects like that, you will go back to your donors and ask them for special large gifts. When you do that, you won’t just ask for an incremental increase in annual gifts.
Some of the donors who give you relatively small recurring gifts have the capacity to give much larger gifts. But to do so they will be likely to draw those funds from their investment accounts.
Some donors who give you regular $100 “checkbook gifts” have the capacity to make a non-recurring gift of $100,000 or more to your capital campaign. And if asked, most of those donors will make that special gift in addition to their annual contributions.
Building a Stronger Relationship through a Capital Campaign
When you invite a donor to give a special large gift to your organization to help fund something extraordinary, you will invest time and energy making an exciting case to that donor. In doing so, you will strengthen that donor’s relationship to your organization.
And, if you thank those large donors well and let them know the impact their gift have made, chances are excellent that those donors will be happy to continue to give and perhaps even increase their annual gifts too.
How Recurring Gifts and Special Gifts Fuel Each Other
Capital campaigns happen only every once in a while — perhaps every 10, 15 or even 20 years. They occur when an organization is ready to grow and increase their capacity.
Your ability to raise money for a capital campaign will depend in large part on how well you appreciate and steward the donors who give you smaller recurring gifts year after year.
And as you’ve seen, some of those donors can (and will) make very large gifts every once in a while when you need them most. And, as a result, those donors will be more excited and inspired to give recurring gifts, too, knowing that they’ve become part of something bigger.