With the start of a new fiscal year on July 1, it’s budget season at Prepare + Prosper (one of the many things we do when it’s not tax season!). During this time of planning and ideating, it’s common for the fundraising team to field questions from fellow staff and Board members like “Have we considered a gala to raise money?” or “How much of our budget comes from individual donors?” As I was preparing to present on fundraising at our recent staff retreat, I thought it might be fun to share–and debunk–some common fundraising and nonprofit myths as well.

Myth 1. (Of nonprofits in general) If you’re a nonprofit, does that mean you don’t get paid?

Haha! No, luckily we get paid. The way we get paid is to secure revenue through fundraising – through grants, donations, and events.

Myth 2. Your job must be terrible. It sounds like sales.

My job is actually quite enjoyable. I get to witness people’s generosity every day, and that is awe-inspiring. I like to think about fundraising as matchmaking – pairing community needs with people and organizations who want to give.

There is no arm-twisting. If someone chooses not to give, I understand that a lot goes into that decision, and I honor that choice because I’ve been there. My job is to ask and invite people to give and share the impact of their gifts on our work.

Myth 3. Why can’t you just have a gala?

The short answer is I’ve planned a gala, and they’re too much work for the return they yield. Galas are not everyone’s thing, and the Twin Cities market is flooded with them, so I think our team’s time is better spent building donor and funder relationships in other ways.

Myth 4. You should just start charging for your services. Then you wouldn’t have to fundraise.

While P+P earns a very modest amount of revenue from selling its volunteer manual to other organizations, charging for our services is not allowed by the IRS, in order to be a part of the VITA (Volunteer Income Tax Assistance) program.

Myth 5. You’ve grown as an organization, so you must not need my money.

The truth is, it takes all of us, myself included, to keep the lights on. Your volunteer time, sharing about our work on social media, donations, and connecting us to opportunities like matching funds and grants make this work happen.

Increasingly, institutional funders such as foundations, corporations, and government agencies are putting greater restrictions on their grants, making them more complicated to track and harder to piece together. (You can learn more about the changes in grantmaking in a recent Minnesota Public Radio story we weighed in on.) For example, they’ll give P+P money, but it has to be spent on buying computers and no salaries. Of course, it takes people to buy, update, and upload software on to those computers, so we have to find another source of revenue to fill that gap.

This is where the generosity of our donors and flexible funders smooths things out. This general operating support gives us the flexibility to focus on our programs and services (instead of tracking grants down to the dollar). So we very much do need donors’ gifts to do what we do.

Myth 6. I don’t want my money going to overhead.

There are eloquent and funny takes on this already, including my personal favorite from Nonprofit AF that imagines a world in which Apple has to run like a nonprofit. But here are all the things overhead ensures:

  • It ensures that you’re not the sole donor to an organization. Someone is charged with sustainability and solvency of the organization. (Fundraising)
  • It means that we have space to provide customers professionalism, privacy, and confidentiality. (Rent)
  • It allows us to treat our employees well, providing part of their health insurance premiums and matching their retirement contributions. (Benefits)
  • It ensures that we have sound fiscal management and oversight. (Accounting)
  • It allows P+P some flexibility to address unexpected needs.
Myth 7. Maybe you should ask Bill Gates/Warren Buffet/Oprah for money and then they could fund your whole budget and you’d never fundraise a day in your life again.

There’s a reason I have a job. If it were that easy, organizations would do it. Those folks are so generous, but they also have very specific goals for their philanthropic giving that our org does not do (e.g. malaria prevention, nuclear safety, youth education).

Myth 8. You must get a lot of government funding.

Not as much as people usually assume. It takes $2.2 million to accomplish all that we do in a year. Here’s where our revenue comes from:

  • $831,000 from foundations
  • $308,000 from Greater Twin Cities United Way
  • $651,000 from government sources
  • $93,000 from corporations and CPA firms
  • $15,000 from the Board
  • $221,000 from individuals
  • $46,000 from events (golf tournament + Give to the Max Day happy hour)
  • $35,000 from interest, earned revenue, and other misc. revenue
I’ll leave you with some fun facts about fundraising at P+P:
  • I recently calculated how much our department needs to bring in each working day to make sure we make our revenue goals. $9,000 is the magic number. Obviously, on some days, we land a big grant or meet our Give to the Max Day goal and breathe a sigh of relief. But there are other days that we wonder, how will we do this? That is why your support and partnership mean so much to us.
  • P+P has 690 donors. Of these donors, 45 people are major donors, which P+P defines as donating $1,000 or more per year.
  • P+P’s donor retention rate is 52%, while the national average is 46%, according to Donor Trends.

Have more questions about our fundraising? I welcome the chance to share more over coffee, phone (651-262-2156), or email! I couldn’t call myself a fundraiser if I also didn’t say, I welcome your donation.

Thank you!

Above illustration was done by an artist commissioned by Pollen. It was given to us by a donor who received it as a part of donating on Give to the Max Day.