Strengthening Your Portfolio Over Time

Building a portfolio.

#5 in the series How to Manage Your Portfolio Effectively

I think one of the toughest things for us at Veritus Group, when we work with non-profit managers or leaders, is their expectation that major gift income will just magically grow overnight. The idea that non-profit leaders get in their heads is that wealthy donors will somehow appear out of nowhere, and they will shell out a bunch of cash because the non-profit is worthy of it.

That’s roughly the overall attitude. Here is the truth, though:

  1. Creating and building a major gift program is the best way, in the long-term, to create net revenue for your programs.
  2. In building a major gift program (or taking it out of hibernation), you will see immediate “wins” from the low-hanging fruit that is in your donor file. But you cannot expect those early wins to continue at the same pace without a pause.
  3. Only a managed portfolio of donors will be able to yield higher donor and value retention rates that far outperform any other fundraising program you currently have in place… or will ever have in place.
  4. It will take 18 months to start seeing growth, but it will take two to three years of solid, hard work to get your major gift program to the point where it is creating that solid net revenue and high returns on investment.

With that truth in mind, the key is to manage your major gift portfolio in a very disciplined, focused way; so that over time, you will 1) reduce donor and value attrition, 2) increase the revenue per donor, 3) mine more mega-donors who can give transformational gifts, and thus 4) increase revenue, year over year, without increasing the number of donors you are cultivating and stewarding in your caseload.

Ultimately, a caseload is strengthened over time by:

  1. Working with qualified donors.
  2. Tiering your donors to help you manage your time.
  3. Creating a strategic plan and revenue goal for every donor.
  4. Developing meaningful relationships so you understand a donor’s interests and passions and know the donor’s story as to why they give to your organization – so you can match them with your organization’s projects and programs for funding.
  5. Biannually (in January and in July), review your caseload to move donors out and other donors in.
  6. Working with a few select donors in your caseload to solicit transformational gifts.

Back in September, Richard wrote what I think is one of the best series he’s ever written that is totally devoted to this. I strongly recommend that you re-read his series “How a Caseload Grows Over Time” to understand how this process works. Once you have that foundation, then you need to start “getting dirty” and implement the disciplined approach we have been advocating week after week in our blog.

After you read that series, read our white paper, “Qualifying Donors for Major Gift Caseloads” then re-read this series on “How to Manage Your Portfolio” and lastly request the white paper on “Creating Strategic Plans and Goals For Every Donor.”

Those resources right there will give you the information you need to help you learn the skills to create the disciplined approach to major gifts that are required for your success. And remember, we’re here to help you along the way in your journey.

Jeff

PS – If you want or need to learn even more, be sure to sign up for our Major Gift Academy course at the end of February. You’ll come out knowing “The Veritus Way” by heart!

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