As a charity or not-for-profit organisation, there is no shortage of funding opportunities available to you. Whether it’s campaign fundraising and private donations, social enterprise or commercial partnerships, charities can raise the money they need to deliver their goals in many different ways.
This is both an opportunity and a challenge. The opportunity comes from having flexibility and choice. The challenge is knowing how to leverage the right funding options in the right way to maximise overall revenue.
This is why having a sound funding strategy in place is so important for non-profit organisations. Strategy boils down to setting out your goals, recognising what the barriers to achieving them are, and working out a methodology for getting where you want to be.
A strong strategy provides a blueprint for finding new supporters, growing revenues and exercising appropriate governance over your finances. Here are our five top tips for creating a funding strategy that will deliver your goals.
Start with the basics
It sounds obvious, but as a not-for-profit organisation, you have a reason for raising funds. You will also have an idea of how much you need, and what sort of timescales you have to work to. These are the starting points for any funding strategy. The what, why and when of fundraising help you to define your ambition as clearly as you can. Comparing that to your present situation gives you an outline roadmap for where you want to get to.
Consider the pros and cons of all funding options thoroughly
With so many options on the table, a ‘pick and mix’ approach to funding sounds great. But different funding routes have different pros and cons. Not all options will be suitable for every organisation, project or goal. For example, setting up a social enterprise can be a great way of securing sustainable funding in the long term. But it can take a while for income to start to flow through, plus set up can be time-consuming and require considerable investment. Event fundraising, on the other hand, can provide a high return within a fixed timeline. But again, there are costs associated with organising, running and promoting such an event.
In most cases, it’s better to consider a blend of funding options so the strengths of some can compensate for the drawbacks of others. Deciding on what that blend should look like rests on weighing up the various pros and cons in light of your goals.
Build a strategy from your donors’ and supporters’ perspective
It’s important to clarify as an organisation what your goals are and how you intend to achieve them. But when it comes to fundraising, there are other critical stakeholders whose opinions you need to consider – the people you’re trying to secure funding from. Whether it is donors or commercial partners, your strategy should reflect their preferences and needs. For example, when it comes to donations, what’s the preferred option of your target audience – in-person donations at events, subscriptions, crowdfunding etc? Does your messaging align with what they are interested in? Are you using the right channels to communicate with them? All of these factors make a huge difference to your chances of success.
Understand the regulatory position
This is another obvious one – every charitable organisation knows there are tight regulations about fundraising and financial governance. However, knowing there are strict rules and being compliant with them in your fundraising are two different things. No non-profit can afford to take any risks. Whatever your approach to fundraising, you must do everything by the book or face heavy penalties. And the way to ensure that is to plan compliance in from the very beginning.
Make full use of data
Finally, strategy is all about decision making. Not that you are tied to the plans you lay out in a strategic plan without flexibility – being able to adjust and adapt operationally is an important capability in its own right. But the fundraising roadmap you put in place with an initial strategy is built around decisions you make about the best way to achieve your funding goals.
Non-profit organisations these days can take a lot of the educated guesswork out of those decisions. They can use data to guide them. For example, looking back to the questions about what funding routes and communication pathways work best for your target audiences – you can draw on data to tell you what works best, either from previous campaign analytics or from industry benchmarks.
Speak to an expert
At Xeinadin, we recognise that each not-for-profit organisation is unique, with its own set of objectives, challenges, and aspirations. That’s why we offer a diverse range of specialised services meticulously crafted to address the distinct needs of NFPs. Get in touch with our team today to find out more.
