I’ve partnered with a number of high net-worth individuals during my years in the nonprofit sector. At some point I have asked each of them 2 questions:
- Has a nonprofit made you feel like a cash cow at some point?
- If yes, how did that make you feel?
Every woman and man answered “yes” to question one. To question two, the answers were very similar: “Awful. Horrible. Really bad.”
This Is NOT How You Build Relationships
I understand your mandate is to raise money. As much of it as possible.
Actually, that’s NOT your job: Your job is to create social change in the world, better your community by serving and helping local residents. Raising a little money is what’s needed to do that.
Yet so much of nonprofit life revolves around the unholy dollar. There’s never enough. Retention rate is abysmal. We have to underpay staff because we don’t have enough money. And on and on and on…
As experts will tell you, fundraising is all about the relationships we have with our donors and supporters. They are the heroes creating change and we are the ones connecting them with causes they champion. Relationships are built over time and require patience, understanding and open conversations. Sometimes there are disagreements but if the relationship is solid, those can be overcome.
When it comes to wealthy people unfortunately, oftentimes the relationship takes a backseat to their bank account. Many in the sector view them with a huge dollar sign imprinted on their forehead. Relationship? Forget that. They have money and they should be donating to your charity.
You’re doing it wrong.
When I speak to the high net-worth people I know, the stories have a similar feel. They didn’t feel like they were valued. They didn’t feel like the nonprofit wanted to partner with them to change the world. They felt like everyone wanted a piece of their wallet and then would take the money and not be in touch again…until they needed more money.
There might have been a time when it was enough to visit a donor once a year, pick up a check and everyone walked away happy. Not anymore.
Yet each donor I spoke to had horror stories of meetings with fundraisers where they were treated with a lack of respect. Where the connection took a backseat to budgetary needs. Which led me to ask a third question:
Did these interactions cause you to stop donating to one or more nonprofits?
The answer is always the same: Yes.
Imagine that: When you treat people like a bank, they stop giving.
Rich People Are People Too
High net-worth individuals have feelings and wants. Their money doesn’t define them. Their values do and if we can connect with those values, then the relationship will be built on solid ground.
We’ll see them as equal partners in building a better society. We’ll want to report back to them about how their donation is helping people in the community. We’ll take the time to reach out, meet for lunch and talk about everything BUT fundraising.
I first learned the term “cash cow” while studying for my MBA back in 1997. In business terms, according to Wikipedia, it’s a venture that generates a steady return of profits that far exceed the outlay of cash required to acquire or start it. Basically, it offers a steady stream of income with little maintenance.
Many fundraisers want that: A steady stream of donations with little maintenance, i.e. relationship building. But think about this: Acquisition costs more than retention. Want to receive a yearly check from your high net-worth donors?
Then the relationship should never be about the money.
P.S. As a rule, I HATE when people criticize high net-worth individuals for the amount they give (“it’s not enough”). Just because someone has money doesn’t mean they have to give. Maybe it’s time we change our attitudes towards the giving of the 1% and worked on building better relationships with them. You might be surprised at the results.
Need someone to do an audit of your email marketing, website content, social media or fundraising/marketing collateral? I’m happy to work with you! If you’re a subscriber to my newsletter, then be in touch before the end of July to take advantage of my special promotion!