Is there an annual fund – capital campaign correlation? In one word, yes.
The annual fund does much more than supplement your budget. Your annual fund is a key indicator as to whether:
- Donors support your mission and vision (literally and figuratively)
- Your development program is donor focused (as opposed to organization focused)
- You ask donors for impactful, meaningful gifts (i.e. $100 annual fund donors who have never been asked for $1,000 donations will always be $100 donors)
- You steward donors throughout the year (sending a second annual appeal letter in the spring is not stewardship)
How does an annual fund impact a capital campaign/endowment campaign?
- have a strong annual fund with many donors who have given for multiple years and feel the love from your nonprofit, you have created a list of prospective capital campaign/endowment campaign donors. (Yay!)
- have staff who understand their role in fundraising, are willing to participate in asking for gifts, and/or willing to learn, you have a staffing structure that can incorporate a capital campaign/endowment campaign. (The next step is to determine if they have the time to add a capital campaign onto their list of responsibilities.)
- have volunteer leadership and board that understand their role in the annual fund includes projecting enthusiasm for annual giving, making personal financial commitments (100% participation), personally thanking donors (in person, in writing and over the phone), and stewardship of annual fund donors, you have a team ready to initiate a capital campaign/endowment campaign. (The next step is to determine who will lead the capital campaign committee.)
- have annual fund systems and software in place to track and correspond with donors, can access an accurate snapshot of your nonprofit’s fundraising health, and have accurate goals and results, you have a system that can work with a capital campaign/endowment campaign. (Systems are the least sexy piece of any campaign but make a major impact on whether a campaign feels complicated to organize or part of doing business.)
How does a capital campaign/endowment campaign help an annual fund?
- Getting donors excited about a capital campaign will remind them of their passion for your mission. (Donors who are not excited will not give to either annual or capital campaigns.)
- Joint asks (annual fund and capital campaign/endowment campaign) help fundraise for both. (Once you are asking for a five-year capital campaign gift, you might as well secure a five-year annual fund gift from your loyal donors.)
- It will provide you with the opportunity to you reassess donor list and their potential for annual gifts. (The in-depth prospect research that accompanies a capital campaign/endowment campaign can help find “hidden gems” in your list that you can also steward towards larger annual gifts.)
- Organizing yourself for a capital campaign/endowment campaign will establish new systems that will be used for the annual campaign for years to come. (Systems that work make fundraising less daunting for staff.)
If you are interested in assessing your fundraising and development systems, improving your annual fund or initiating a capital campaign/endowment campaign, email me by clicking here
To learn more about capital campaign/endowment campaigns consider reading:
The Nonprofit Leaders Guide to a Capital Campaign
The Difference Between Annual and Capital Campaign Gifts
Successful capital campaigns help create community
To learn more about annual funds:
The 3 Cs of Fundraising – Capacity, Commitment and Connection