Stratagems, July 2022

Kissing $500 Billion

When it counts the most, Americans from all different socio-economic backgrounds step up and share and care commensurate with their ability and capacity. Charitable giving reached a record high of $485 billion in 2021, according to Giving USA: The Annual Report on Philanthropy. This overall total is extraordinary, kissing half $1 trillion or well over $1 billion a day. Another way to picture this total: It’s 5,000 pallets, each stacked with $100 million in $100 bills Overall, giving increased by an estimated 4% (-.7% when adjusted for inflation) over 2020, that was markedly up from the prior year. It’s evident that American individuals, corporations and foundations consistently respond to urgent priorities of which there is no shortage. Eight of the nine recipients’ sectors experienced increases or stayed flat (education being the lone exception). Total giving has remained at about 2.1% of the total Gross National Product. To be sure, challenges, including inflation/recession, loom in the future and will test American generosity even more. Giving USA is the longest-running and most comprehensive report of its kind in America published by Giving USA Foundation, a public service initiative of The Giving Institute. It is researched and written by the Indiana University Lilly Family School of Philanthropy at IUPUI.

Gifts From Individuals Rule

A lot of things have changed in the Giving USA reports begun in 1956. One thing that hasn’t changed is giving sources. The name of the game remains giving from individuals, which comprises 67.5% of total giving, with foundations 18.7%, bequests 9.5% and corporations 4.3%. When individuals are combined with bequests and family foundations, the share is about 86%. Now don’t get me wrong, I love gifts from foundations and corporations, but individuals consistently account for more than two-thirds of America’s private philanthropy. That’s why I emphasize to our learning community members that any prospect list should concentrate on gifts from individuals. It is my experience that also individuals make decisions much more quickly than corporations and foundations.

Donor Connections

There is no single approach to fundraising that accounts for each non-profit’s unique challenges, goals, and ideas. Classy’s research elevates three decision-making stages that can help diversify your campaign portfolio and inform your campaigns, channels, and timing to position your organization for long-term success. The following are the key focus areas that continuously surfaced throughout the stages of the Path to Lasting Donor Connections:
  • Events are back and driving renewed revenue potential. Not only did we see tremendous year-over-year donation volume growth for events, but events with peer-to-peer fundraising converted at 47%, the highest rate of all campaign types. Hybrid and online fundraising event platforms will further enable non-profits to enhance experiences and connect with attendees this year.
  • Donors give more when they have choices. Organizations leave money on the table when they fail to give donors modern payment options. The average one-time donation was nearly 1.5X more when non-profits offered ACH, PayPal, and digital wallet payments. Adding in options like Venmo and cryptocurrency will enhance this personal touch shown to increase conversions, gift sizes, and volume of recurring donations.
  • Fundraising among peers thrives on social media. Time-based campaigns that include peer-to-peer raise on average 3.8X more than all other time-based campaign types. We also saw that 32% of the mobile traffic to peer-to-peer campaigns is from social media, a key channel that existing supporters can use to bring in new networks of donors.

Defining Philanthropy

There are many versions to articulate from the voluntary sharing of time and money to love of humankind. Our thanks to Deakin University in Australia (ranked in the top 1% of universities in the world) for putting together this brief video based on interviews with a wide range of donors and recipients. If you’re like me, you will be impressed by what our friends from Down Under have to say. Please e-mail me a short statement on what philanthropy means to you along with your photograph so I can share it with our learning community in a future newsletter.

Motivation

Tax breaks aren’t the primary incentive for philanthropy among the ultra-wealthy, according to BNY Mellon Wealth Management’s inaugural Charitable Giving Study. The report, polling 200 individuals with wealth ranging from $5 million to more than $25 million, found the top three motivators were personal satisfaction, connection to a cause or organization, and a sense of duty regarding giving back. By contrast, tax benefits ranked among the bottom. “Taxes are a nice side benefit, and sometimes taxes can be the catalyst for a larger discussion of charitable goals, but taxes are not a primary reason why people give,” researchers concluded. There’s a stronger interest in philanthropy among millennials and Gen X, according to the report, which polled cross-generational investors throughout the country.

Trust

Morning Consult’s Most Trusted Brands 2022 is the definitive measure of brand trust across industries, showcasing the companies and products that have earned or maintained consumer trust in 2022. In this report, they unpack why trust is important, how trust is built and how it’s broken in the non-profit industry. They then zero in on the top 10 most trusted brands in the non-profit industry, diving into three different case studies of brands that have stood out in their trust metrics. Americans instinctively trust non-profits. Roughly 3 in 5 Americans (57%) reported that they tend to trust non-profits, and a non-profit would have to do something bad to lose their trust. An open-end analysis reveals that putting donations to good use is a top reason adults trust non-profits. At the same time, perceived misuse of funds is the most cited reason for not trusting non-profits. Non-profits are still susceptible to scandal. Forty-three percent of Americans said they have experienced a loss of trust with a non-profit, and those who report a loss in trust are generally unforgiving. Non-profits must do what they say and say what they do. An advanced analysis reveals that the best thing nonprofits can do to build trust is to consistently deliver on what they promise. St. Jude Children’s Research Hospital® has been named the No. 1 Most Trusted Non-profit. 

Your Money Back

A glossy book is arriving at the homes and offices of America’s wealthiest individuals. Inside is a charity pitch that aims to raise as much as $6 billion for non-profits fighting global poverty. The proposition? Donate and get results — or your money back. The advocacy group Global Citizen and the finance firm NPX are engineering this campaign. It targets Forbes 400 billionaires, Giving Pledge members, and the wealthy generally — a group increasingly criticized for what is seen as having tight purse strings. The drive launched recently with dinners, meetings, and a Wall Street Journal ad that asked: “Will you donate … if we achieve results?” Initially, the effort aims to raise at least $150 million through six $25 million funds. Each of the programs could absorb as much as $1 billion, according to campaign officials. The drive is an unusually large effort to tap two big sources of capital — the wealth of individual philanthropists and the funds amassed for impact investments that seek both social and financial returns. It also is a test of whether a “pay for results” model can get millions of dollars that are earmarked for social good but sitting on the sidelines — including more than $1.3 trillion in foundation assets, $160 billion in donor-advised funds, and an estimated $700 billion managed by impact-investment firms. Donors would commit to gifts, but the money would be released only as measurable outcomes are achieved. 

Putting Listening in Perspective

As a general rule, I don’t enjoy entering controversial space. But like most people, there are occasions when I feel like I need to get something off my chest. This is such an occasion. Like other fundraising trainer/consultants I have emphasized the importance of listening skills. You’re not going to make it in fundraising without superior listening abilities. But pardon the pun, I think too much lip service is paid to the power of listening. I consider it a given, not a game-changer. It’s how you use what you hear to persuade and inspire donor prospects to make gifts, especially major gifts, which opens the door to touching, improving and saving more lives to fulfill the noble missions of America’s non-profits. Eskin Fundraising Training thanks Jimmy LaRose and Major Gifts Ramp-Up for featuring our guest blog, “Listening to Major Donors Is Over Rated,” to explore this topic. I expect this piece to stimulate feedback and I welcome hearing it.

DEI Impact

A study from the Better Business Bureau’s Give.org finds that two in five people would not donate to a charity that tolerates discrimination. Based on a survey of more than 2,100 adults in the U.S. and more than 1,000 adults in Canada, the report explores whether donors value diversity, equity, and inclusion (DEI) in charities, and whether DEI is a meaningful consideration in the giving process among the general public and different demographic groups. While nearly 41% said they would no longer donate to a charity they supported in the past upon learning that the charity’s culture tolerates discrimination against people served, 34% would no longer donate to charities using culturally insensitive images and language, and 17% would no longer donate upon learning the charity’s board is not diverse.
In addition, more than half (54%) of U.S. respondents said they assumed that having a diverse, equitable, and inclusive board and staff has a positive effect on how trustworthy the organization is. And nearly 20% of respondents said that representation of race and ethnicity, disability status, gender identity, sexual orientation, and religious identity in a community served by a nonprofit was “highly important” in their giving decision, but between 25% and 30% attributed low importance to the same question. The report concludes that, while each charity’s DEI journey is complex and unique, the pursuit of a diverse, equitable, and inclusive charity is part of an organization’s strategy to be ethical, effective, and trustworthy.

On Bookshelf: Philanthropy Revolution

In the first book on philanthropy written from a donor’s perspective, businesswoman and philanthropist Lisa Greer lifts the lid on our charitable sector, with an authentic account that describes exactly how outdated the sector has become and why it’s at risk of collapse. Weaving in her story of instant wealth and philanthropy, Greer showcases the latest research, as well as dozens of interviews with donors, non-profit professionals and leading academics in the field. In Philanthropy Revolution, she also provides much-needed ethical solutions that apply to any business, including:
  • Upfront ways to ask for money
  • Effective communications strategies
  • Ways to be transparent from the outset
  • How to curate meaningful events
Philanthropy Revolution is the handbook all fundraisers, non-profits and donors can be using to create trusting, authentic partnerships that can be sustained long-term. Philanthropy is changing dramatically, and it needs nothing short of an intervention to succeed. In this book, Greer shows us how to “save giving” by providing a clear path to success. With her help, the non-profit world can see its donors energized, its charities better supported and its impact increased, all while building a more honest philanthropic culture.

Warren's Last Lunch

An anonymous bidder has bid a record $19 million to have the opportunity to eat lunch with Warren Buffett. The individual, who made the winning bid in a charitable auction on eBay, will meet the Berkshire Hathaway Inc. chief executive at New York City steakhouse Smith & Wollensky sometime in the coming months. This year marks the final time Mr. Buffett, 91 years old, will participate in the lunch. Since kicking off the annual event in 2000, Mr. Buffett has helped raise more than $53 million for Glide, a San Francisco charity that provides meals, healthcare and legal aid to homeless and other vulnerable individuals in the city. Glide was a favorite cause of Mr. Buffett’s first wife, Susie Buffett, who died in 2004. According to Fortune, Buffett’s fortune has dropped below $100 billion. He ranks as the 5th richest person on the Bloomberg Billionaires Index. One of the three organizers of the Giving Pledge, Buffett has pledged 99% of his estate to charity.

Quiz: Declaration Signers

The Declaration of Independence was approved by the Second Continental Congress on July 4, 1776, but it was not signed until almost a month later. The signers of the Declaration of Independence included future Presidents, Vice Presidents, and members of the United States Congress. Match the following signers with their respective ages. Answers are shown at the bottom of the page.
 
1. Sam Adams-Mass.           a. 26
2. Josiah Bartlett-N.H.           b. 33
3. Ben Franklin-Penn.           c. 46
4. Thomas Jefferson-Va.        d. 53
5. Edward Rutledge-S.C.        e. 70

Stratagems is published monthly by Jim Eskin, Founder of Eskin Fundraising Training, LLC. We offer workshops and customized training sessions for board members, staff and volunteers of non-profit organizations of all kinds and sizes. For details about our services and information, or to find out how to schedule a training session for your organization, visit our website. Follow our events on Facebook, and read more articles about philanthropy on our LinkedIn page.

Jim Eskin

Jim Eskin, Founder

Eskin Fundraising Training

Email: [email protected]
Cell: 210.415.3748
www.eskinfundraisingtraining.com

ANSWERS TO THIS MONTH’S QUIZ:  1=d, 2=c, 3=e, 4=b, 5=a

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