Start at the Top: Identifying and Cultivating Your Top Donors

Synopsis: The top 15% of your donor base contributes 80% to 90% of your donated funds. We’ve evaluated many ministries, and this statistic holds up. Starting at the top means knowing who your top donors are, cultivating strong relationships with them and being bold enough to ask for a specific amount when the time comes. The strength of relationships is the number one predictor of generosity. Discover how you can identify and approach lead gift prospects when it’s time to proceed with a capital campaign. 

How comfortable are you?
There are typically three ways people feel about asking others for money. Comfortable, uncomfortable and terrified. If you’re comfortable asking others for money, you’ll find this article confirms what you already know. If you’re uncomfortable, I hope what’s shared here helps you get over the hurdle of hesitation and encourages you to give solicitation a try. If you’re terrified, there’s not enough encouragement in the world to get you asking others for money, and you probably won’t read past this introduction…if you’ve gotten this far. Not everyone is cut out for soliciting money. 

There are three disciplines when it comes to donor relations: cultivation, stewardship and solicitation. Many people are gifted at building and maintaining relationships, which is cultivation and stewardship. Fewer people are gifted or comfortable with solicitation. This is because soliciting—asking for money—is emotionally challenging. Talking about money with others seems impolite or intrusive. And, if you’re asking a stranger for money, it is impolite and intrusive. Asking a stranger for money is akin to holding up a cardboard sign on a street corner hoping someone will roll down their window and drop a couple dollars in your hat.  

Henri Nouwen, in his book A Spirituality of Fundraising, says, “Whether we are asking for money or giving money, we are drawn together by God, who is about to do a new thing through our collaboration.” So, you see, solicitation is not begging. It is a collaboration with people who are as passionate about your ministry as you are and have the financial wherewithal to fund the vision put forward in your capital campaign.  

This article is the second in an ongoing series about capital campaigns. It is statistically true that the top 15% of donors supply 80% to 90% of funding for nonprofit ministry. Your most generous donors are the ones who will provide the majority of funding for your capital campaign, assuming you ask them. For this reason alone, you need to know who, amongst your donors, are in your top 15%. I always encourage ministries (insist is more accurate) to sort their donor list into four tiers: top 5%; next 10%; next 35%; lowest 50%. Your first two tiers are the donors who provide most of your funding and are your top prospects when preparing for the silent phase of your campaign. 

At Lutheran Church Extension Fund (LCEF), we set a standard goal that the silent phase of a capital campaign consisting of your lead gift solicitation visits raises 70% of your campaign total. Through a process we call “donor mining” you consider all those who are capable of making a lead gift.  

(Note: There is no standard across the board for what constitutes a lead gift. For some ministries, a lead gift is $50,000 or more. Others would start at $10,000 or even less as a significant lead gift.) 

There are the traditional gift pyramids that show how many gifts at each level are needed to hit your goal. However, if you don’t have any donors capable of a six-figure gift, the pyramid showing one or two six figure gifts isn’t of much use. We recommend you study your own donor base and the capacity of people interested in your ministry who haven’t yet given a gift. A phrase we use is, “people in your orbit.”  

First, determine what a significant lead gift would be from your donor base and community. Then, set a floor and a ceiling. In other words, how low will you go and still consider it a lead gift? What’s the highest number you could reasonably expect from your largest donor(s) or those in your orbit? Calculating 70% of your total campaign goal ask, are there enough lead gift prospects between our floor and ceiling to reach our goal? Always estimate twice as much money in your prospect pool as you’ll need because you won’t get 100% of the amount solicited. 

This is how you start at the top when looking to raise capital campaign funds. There is much more to the process, and we haven’t touched on actually asking for money. That will come in a later article. For now, remember relationship is the top predictor of generosity. “Never ask strangers for money” is never truer than when soliciting lead gifts for a capital campaign. Your most generous donors will not only be those with capacity to give but those who feel most closely connected to your ministry. What are you doing today to strengthen that relationship to assure success in future campaigns? 

I strongly recommend everyone involved with raising funds for your ministry read A Spirituality of Fundraising by Henri Nouwen. It is a brief, easy read with the power to revolutionize how you think about donor relations. 

Connect with Tim Kurth, LCEF Vice President of Ministry Solutions, to get started identifying and approaching lead prospects at Tim.Kurth@lcef.org.