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Joanne Fritz

Study Reveals Vicious Cycle of Fundraising Failure

By January 14, 2013

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Vicious Cycle of Fundraising Failure

Nonprofit fundraising is in a vicious cycle, according to a new national study from CompassPoint and the Evelyn and Walter Haas, Jr Fund.

The problems this study pinpoints have to do with the churn among development staff; the deficit of qualified candidates for development positions; and the lack of fundraising infrastructure in many nonprofit organizations.

The study, Underdeveloped: A National Study of Challenges Facing Nonprofit Fundraising, details three primary challenges for nonprofits:

The Revolving Door. Nonprofits, says the study, "pin their hopes and dreams for fundraising on one person - the development director." But there is high turnover in these positions, and vacancies persist for a long time.

  • EDs of nonprofits with open development director positions say that the posts tend to be open for six months on average, sometimes much longer.
  • Among current development directors in this study, half said that they plan to leave their jobs within two years or less.

Help Wanted. Qualified candidates for development director slots are scarce, plus EDs report that key development staff often under perform and lack basic fundraising skills.

  • Half of the EDs surveyed said their development director searches did not come up with enough candidates who have the right mix of skills and experience.
  • One in four of these EDs reported that they had fired the previous development director.
  • One in four EDs revealed that their current development director lacks experience or the necessary skills in donor research and in securing gifts.

It's About More Than One Person. Beyond the human deficits among development staff, the survey found that nonprofits lack the capacity, the systems, and the culture to be successful in fundraising.

  • Nearly 25% of nonprofits have no fundraising plan; one in five does not have a fundraising database.
  • Three out of four EDs report that board members are not doing enough to support the organization's fundraising.
  • More than one in four EDs said that they have no competency or are novices in fundraising.
  • A majority of development directors said they have little or only moderate influence on key tasks at their organizations such as involving other staff in fundraising or helping to develop organizational budgets.

The study suggests that all of these factors lead to a vicious cycle of fundraising failure. The researchers suggest "calls to action" that might break that cycle, including:

  • Embracing fund development across the nonprofit sector.
  • Elevating the field of fundraising, turning it into a respected and rewarding career.
  • Strengthening and diversifying the talent pool
  • Leveraging technological innovation
  • Sharing accountability for fundraising results across the organization.

The full study is available here.

Image: Detail from Underdeveloped: A National Study of Challenges Facing Nonprofit Fundraising, by CompassPoint.

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January 17, 2013 at 10:33 am
(1) Krystina says:

I am trying really hard to get into nonprofits and development. I have a background in communications, but a lack of experience in fundraising that is making it difficult for me to get a job.

Can you do a post, or maybe you already have one, on what qualities these EDs would like their development directors to have? And what kind of experience they would like to see them come into the job with?

I think that would be helpful. Thank you!

January 18, 2013 at 10:06 am
(2) nonprofit says:

Good idea, Krystina!

January 17, 2013 at 5:59 pm
(3) Cheri says:

I just had to let my fundraising person go today. After trying to get him to meet deadlines for eight months, money was barely trickling in.

I’m lucky that I have another staff person who can step into the position. She is willing to ask for help when needed, works as a team player, and has a proven background in special events and sponsorships.

Krystina, I would have to say that I’m looking for someone willing to learn. My suggestion to you would be to volunteer on a fundraising committee with an organization you’d like to work for. You will learn a lot and get the experience you need to actually get a position with a nonprofit.

January 18, 2013 at 10:05 am
(4) nonprofit says:

Thanks so much for sharing, Cheri!

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