The Most Common Analysis

The Most Common Analysis

This year, we have been interviewing (and hiring) new analysts for our growing company. One of the candidates we were talking with recently asked us a great question: What is your most common ad-hoc analysis? Anyone who has worked with nonprofit organizations is likely familiar with this one. And sadly, it’s killing nonprofits: The Stop Acquisition Analysis. A healthy donor database requires a significant investment in acquiring new donors each and every year to replace the inevitable lapsing of current donors. We all have seen the LTV on new donors. An investment in new donors generally breaks even some time in year 2, and then those donors are profitable from year 3 onward. The problem is that nonprofit boards of directors are oftentimes focused solely on the current fiscal year. When budgets are tight (when aren’t they?), the first place they look to cut their budget is new donor acquisition. And thus, begins a descent into nonprofit hell. With your data and our stats tools, we can put together an analysis of what the (bleak) revenue projection looks like when you stop acquisition. The lack of new donors will cause a decline in file size. A decline in file size results in a decline in revenue followed by a decline in the organization’s budget – which of course will lead to a cut in new donor acquisition the next year. And then, the descent into nonprofit hell accelerates. One of my career goals is to see the day when the Stop Acquisition Analysis is not so popular. Until then, if you are fighting for your acquisition budget from a...
Is Your BOD on Hopium?

Is Your BOD on Hopium?

I saw the term “hopium” for the first time in a recent blog by Victoria Christensen and immediately became fond of the term. As Ms. Christensen defines it: hopium is a false sense of positivity in the midst of dire, evidence-based scientific research. Now, while her context for using the term was not related to fundraising, I couldn’t help but think of all our nonprofit friends who are in the midst of finalizing their FY20 budgets. For our context, here’s an example of how to use the term “hopium”: If your BOD has asked you to increase revenue 10% next fiscal year without any increase in your development budget, they are on hopium. I don’t recall much from my Philosophy 100 class as a freshman in college, but I do remember the Latin term Ex Nilo Nil Fit coined by pre-Socratic Greek philosopher Parmenides: From Nothing, Nothing Comes. I believe there is a national hopium epidemic in our nonprofit board rooms today. Boards continue to ask development professionals to achieve lofty goals without adequately equipping them with the resources they need to get the job done. And we wonder why turnover in nonprofit development departments is so high… So, before you take your next development leadership role in a nonprofit organization, do some research to make sure the BOD isn’t on...
Mission Impossible

Mission Impossible

I recently visited with the Executive Director of a small nonprofit whose mission is mostly carried out by volunteers. And boy, was I impressed with all that they accomplish with such a lean staff. But I also wondered how much more they could do if they had just a little more budget to afford a few more paid staff. As any ED of a small nonprofit knows all too well, they end up diverting a lot of time on the important things that need attention today, rather than focusing on the big picture things that could take the organization to the next level. It leaves me conflicted honestly. On the one hand, this nonprofit organization is doing so many things right. It’s engaging its community of supporters, delivering on its mission and having a big impact on a small group of people. But on the other hand, because of its dependence on volunteers, it can’t scale its services to generate an impact on a bigger group of people. And to do that, the organization will have to change. But is bigger always...
Has Digital Disruption Skipped Fundraising?

Has Digital Disruption Skipped Fundraising?

The intent of today’s blog is to start a dialog. So, I hope you choose to offer your 2 cents. Over the past 20-years, the digital economy has disrupted just about each industry. Particularly in the business to consumer arenas. How we check out things we are interested in buying and how we purchase them has fundamentally changed. From buying clothes and plane tickets to watching our favorite movies – the internet is now the primary way we do these things. Yet, there are two notable exceptions: Grocery shoppingDonating money While there are digital components to each of these exceptions, they remain minor components. I have some hypotheses. But I’d really like to know what you all think. Why haven’t these two industries been disrupted? And are there any similarities about grocery shopping and donation money that might help us understand this all better. I’m all...
The Impact of Grace and Encouragement

The Impact of Grace and Encouragement

I spent the first 35-years of my life in Arizona. This past week, I had an opportunity to visit Phoenix and Flagstaff to catch up with many of the people who have made a big impact in my life. It struck me, on the drive back to the airport, that there were two characteristics each of these influential, yet very diverse group of people shared: Grace & Encouragement. By grace, I mean these mentors and friends always accepted me for who I was. They were never judgmental of the poor decisions I may have made. Instead, they have always just patiently listened, never asked anything of me and never quick to give advice. Rather, they just encouraged me to keep trying. To not give up. They shared a vision of what could be. In short, they gave me hope. We need to always keep in mind that we have opportunities to share grace and encouragement in every daily interaction. This goes for our fundraising communications as well. Too often, we are solely focused on the calls-to-action about how the donor can help us fulfill our missions. My hypothesis is that if we have the courage to meet the donors where they are, take the time to listen to their stories and encourage them in their own walks through life, the impact our organizations will have over time will be...