We recently reviewed a non-profit that had an events superstructure. That is, the culture of their development department was essentially “all events, all the time.” They boast how the events team brings in about $6 million dollars a year in revenue.
We started digging a little more. “Of that $6 million in revenue, how much comes from donors that are on a caseload? This is revenue you are going to get regardless of putting on an event or not. And when you deduct that revenue from caseload donors, how much NET revenue do you actually end up with?” The answer was embarrassingly little.
And when we spoke with a few of the MGOs, they were complaining that some of their donors whom they were cultivating for large six-figure gifts actually gave LESS because they happened to sponsor a $20,000 table at an event instead. They were really frustrated.
Yet upper management continues to believe that “if we didn’t have all of these events, we wouldn’t be able to raise so much money.”