University of the Incarnate Word Presentation

NONPROFIT FUNDRAISING: AN EVOLVING FIELD Carolyn M. Appleton Nonprofit Fundraising and Communications University of the Incarnate Word September 2021

UIW | Ideal Mindset for the Nonprofit Sector “UIW is committed to shaping good minds of strong character that will expand our world. At the core of UIW’s Mission is a commitment to social justice and community service. With a curriculum designed to broaden students’ understanding of the needs of the world, men and women learn to become concerned and enlightened citizens, using their skills for a meaningful impact within the local and global community. Through programs offered at the undergraduate, graduate and doctoral levels through 11 schools and colleges, students can positively influence countless industries and fields of study.”

UIW | You Are In the Right Place ◦ UIW hopes to shape your (already) strong character. ◦ It is committed to social justice and community service. ◦ UIW intends to help you understand the needs of the world. ◦ It encourages you to become concerned and enlightened citizens. ◦ UIW invites you to use your skills for meaningful impact locally and globally. ◦ The University wants you to influence countless industries and fields.

ABOUT CAROLYN Thirty years of hands-on nonprofit fundraising experience in higher education and with nonprofits in the arts, the environment and social services across Texas.

More than $33 million raised for professional projects (and more for volunteer projects).

Two degrees from The University of Texas at Austin, elected to The Honor Society of Phi Kappa Phi. Appointed by Governor Rick Perry to a Texas Commission on Environmental Quality project, Texas Environmental Education Partnership Fund Board (two four-year terms, documentation in the Texas State Library and Archives).

Launched Carolyn’s Nonprofit Blog in 2011 and more than 100 nations visit annually (carolynmappleton.com). This year marks its 10th anniversary.

Lead volunteer organizer of Nonprofit Tech Club Austin (2015-2021) in partnership with NTEN, TechSoup, and entrepreneurial hub Capital Factory in Austin (the club is now evolving into a statewide production).

Developed a nonprofit disaster preparation and recovery course with TechSoup Global, funded by the Center for Disaster Philanthropy (2019-2020).

Elected member of Daughters of the American Revolution with three proven ancestors, Chair of the Literacy Committee of the Austin Colony Chapter.

Independent nonprofit fundraising and communications specialist based in Central Texas working statewide and beyond. I follow ethical fundraising practices. I do not engage in percentage-based fundraising.

NATIONAL COUNCIL OF NONPROFITS ECONOMIC IMPACT • Nonprofits employ 12.3 million people, with payrolls exceeding those of most other U.S. industries, including construction, transportation, and finance.

• Nonprofits spend nearly $1 trillion annually for goods and services, ranging from large expenses, like medical equipment for nonprofit hospitals, to everyday purchases such as office supplies, food, utilities, and rent.

• Nonprofits have an even broader impact by creating economic activity and jobs that ripple through the community. In Texas, nonprofits employ 5.1% of total private employment.

• Total charitable giving grew 5.1% in 2020 measured in current dollars over the revised total of $448.66 billion contributed in 2019 (Giving USA 2021). Adjusted for inflation, total giving increased 3.8%. It came in at 2.3% of Gross Domestic Product (GDP).

• Number of nonprofits registered with the IRS in 1998: 1.16 million. Number of nonprofits in 2021: 1.8 million (Statista and Finances Online)

SIZE OF NONPROFITS

BY BUDGET ◦ Most nonprofit organizations have budgets under $500,000 (66%). ◦ Urban Institute (2016)

18th Century “Taxes from local and colonial government supported the established churches in New England, which were Congregational, and in the South, which were Anglican. A much faster rate of growth appeared in entirely voluntary religious denominations, especially the Methodists and Baptists, and among the Presbyterians especially on the frontier.

German and Dutch immigrants supported their Reformed churches in Pennsylvania and New York without tax money.” - Wikipedia 21st Century Today, Corporate Social Responsibility (CSR) is becoming more important. This concept means corporations accept responsibility for helping to solve societal challenges.

Thomas Insights (2019) Pyramid of Corporate Social Responsibility

How Philanthropists Become Wealthy

1

2

3

Many philanthropists have accumulated wealth by creating and by working with corporations. This has been the case since the founding of our nation.

Some have invested wisely in corporations, and that has yielded profits.

Some recent philanthropists have invented cryptocurrencies and have become wealthy.

#WallStreet

4 Some have inherited wealth.

And some distribute that wealth through foundations that award grants according to formal preset guidelines.

5

6

Some own appreciated assets that they may eventually sell. Those sales can provide substantial wealth (works of art, real estate, crypto and more).

Conclusion: while we can criticize corporations and capitalism, philanthropy is to a large degree made possible by successful companies. #Respect

OCCUPY WALL STREET SEPTEMBER 2011 • Corporate Social Responsibility (CSR) got a big boost after the Occupy Wall Street protest and occupation.

• The protest was caused by perceptions of wealth inequality, political corruption, and too much corporate influence on government.

• A key Occupy slogan was, "We are the 99%” (still popular today).

• Photo by David Shankbone (Wikipedia).

Where does nonprofit funding come from?

NONPROFIT FUNDRAISERS

NONPROFIT FUNDRAISING “Fundraising is generally defined as the process of soliciting financial support and is an essential way for most nonprofits to bring in revenue for their organization’s mission. Fundraising is about so much more than just asking for money. It also consists of ways for charitable organizations to build relationships, bring in foundation support, and attract new donors.”

NPQ: Nonprofit Quarterly (2017)

CHANGING LANDSCAPE Misunderstood profession: development officer.

Nonprofit fundraisers have gone from an average of 3.5 years on the job in the 1990s and 2000s, to only 16 months today.

Professional development officers should be focused on bringing donors through a meaningful life cycle, from a modest annual donation to a deeply meaningful planned gift (through a Will or estate gift), for example.

Development professionals are not just chasing “money.” They should be focused on “developing” long term relationships. You cannot develop meaningful long-term relationships in only 16 months.

EMOTIONAL CONNECTION Fundraisers are #EssentialWorkers.

They should not be hired only to “get the money” as quickly as possible.

Nonprofit directors and founders sometimes view fundraising as a purely objective business where emotional connection and long-term involvement are inconsequential.

My opinion: an emotional connection is what sets nonprofits apart and what ensures their long-term success.

• Individual and family donations; • Grant research and writing (traditional private foundations and corporations);

METHODS TO SECURE NONPROFIT REVENUE

• Sponsorships (corporations, often involving a branding or advertising match); • Annual giving programs (memberships, annual giving days, monthly donor programs, and more); • Special events; • Major gift fundraising; • Crowdfunding; • Planned giving (Will and estate plan gifts);

• Wise investments (endowment income); • Gift shops and production/sale of products; • Services nonprofits provide for a fee.

PROFESSIONAL DEVELOPMENT PATHWAYS 1. Life experience and being an “accidental” development professional with hands-on experience.

2. Formal academic training.

Carolyn’s Nonprofit Blog, “Professional Development Resources” (carolynmappleton.com/nonprofitprofessional-development)

MENTORING ◦ Theory vs. practice? ◦ Combine both! ◦ Gain hands-on experience through volunteering and internships. ◦ Find a mentor willing to take the time to teach you.

A FEW CREDENTIALING OPTIONS ◦ Association of Healthcare Philanthropy Certification (AHP) ◦ Certified Fund Raising Executive (CFRE) ◦ Grant Professionals Certification (GPC) ◦ Certified Specialist in Planned Giving (CSPG) ◦ Lilly Family School of Philanthropy Certificate Program ◦ NTEN Certificate Program Continuing education matters and will keep you on top of your game throughout your career.

◦ The past decade, technology and online communications have advanced. They have changed the field of nonprofit fundraising dramatically. ◦ COVID-19 has pushed nonprofits online even further. This trend shows no sign of reversing.

TREND SPOTTING AND ADVICE

◦ Nonprofit fundraisers need to be skilled at communicating in person and in writing (e.g., grant proposals, correspondence, case statements, publications and on social media). ◦ Stewardship of gifts, once they are given, is notoriously poor across the nonprofit sector, making donor retention a challenge, and increasing the need to identify new donors. #NeedToChange ◦ Professional advisors have become a major force in philanthropy.

Professional advisors watch to be sure nonprofits are well run and that guidelines for donations are followed. ◦ Large fundraising consulting firms have dominated the industry (especially major gift campaigns). But as new data collection and review methods are developed and as they become readily available, their services are less necessary. #DIY

◦ Nonprofits can (and should) establish greater credibility by doing such things as claiming and completing their GuideStar profile (free). They should also invest in professional accounting services for the sake of objectivity. ◦ Word-of-mouth endorsement is as important to “sales” as it is to successful nonprofit fundraising. #Testimonials

TREND SPOTTING AND ADVICE

◦ Nonprofits should develop formal statements discussing their views on equity, diversity, ethical fundraising practices, and they should share those and their non-discrimination policies with the public. ◦ Recently, federal agencies are asking nonprofits to have a disaster plan in place. #TechSoup ◦ Nonprofits need to initiate electronic transfer options for donors and to rely less on regular mail. ◦ Nonprofit fundraisers need to invest more time in reading the business press to ensure they are on top of current financial trends. We need to look at philanthropy from the donor perspective. ◦ Planned giving needs to become more of a focus. ◦ More “rainy day funds,” please.

◦ It is estimated that nearly 45 million U.S. households will transfer $68 trillion over the next 25 years, according to Cerulli Associates.

GET READY: WEALTH TRANSFER

◦ With tax laws in flux, estate planning is more critical than ever, financial experts say.

◦ To lessen the tax bite, families may consider Roth IRA conversions, life insurance, gifting and other strategies.

CNBC, “Are you prepared for tax impact of the $68 trillion great wealth transfer? Here are some options to reduce the bite” (July 2021)

Investors' purpose now: putting capital behind experiences, relationships, and helping others.

UBS: THE NEW VALUABLES

◦ 79% | “COVID-19 made me reassess what’s most important.” ◦ 68% | “I want to make more of a difference.” ◦ 93% | “I am more appreciative of what I have.” ◦ 77% | “I believe life experiences are more important than material things.” ◦ 90% | “I want to align my investments with my values.”

THANK YOU Carolyn M. Appleton Nonprofit Fundraising and Communications Website: carolynmappleton.com

Email: carolyn@carolynmappleton.com

FOLLOW-UP Carolyn’s Nonprofit Blog carolynmappleton.com Nonprofits and Startups | Birds of a Feather Carolyn’s List of Professional Development Resources Wall Street | Our Love Hate Relationship Building Relationships With Professional Advisors During Good Times, Don’t Forget to Prepare for Rainy Days Are We Listening Only to Ourselves?

Economy and Philanthropy And more!