Fundraising is more than just a financing strategy: it is a way to achieve goals together. From supporting non-profit organizations and political campaigns to financing entrepreneurial innovations, it permeates almost all areas of social life. It draws on a variety of strategies to promote people’s commitment and solidarity.

In this article, we take a comprehensive look at the topic of fundraising and highlight various methods you can use to get people excited about your ideas and encourage donations. To help you consistently pursue your fundraising goal, collect donations and issue a donation receipt, you will finally have the chance to try out free donation management software.

The word fundraising is written in a booklet with stick figures

Well-planned fundraising can help an organization achieve its goals.

Fundraising is an English term made up of the words fund (means) and raising (procurement). It stands for the organized and systematic procurement of resources for specific purposes or projects. As a method of raising capital, it can be used for both charitable and entrepreneurial purposes.

In the corporate context, investors raise money to finance entrepreneurial activities and enable growth. On the other hand, fundraising is also used for charitable purposes, where donations are collected for social projects, whether by large organizations or smaller associations. The focus here is not on the expectation of a direct return service from the donor, but rather the aim of having a positive impact on society or a specific target group.

In order to fundraise successfully and convince people of your project, a direct and personal approach is crucial. It should be clear to potential donors who you are and what project you are looking for donations for.

It is important that you provide detailed information, including the specific amount you need for your defined purpose. Use emotional and descriptive language to get as many interested parties as possible excited about your idea.

Jar with coins, out of which a small plant grows

Fundraising requires creativity to attract people’s attention.

With fundraising, organizations have the flexibility to collect donations without adhering to a specific time frame. This allows you to plan and execute your campaigns over a longer period of time, which can be particularly beneficial when it comes to raising larger amounts or implementing complex projects.

In contrast, crowdfunding often sets a specific time period, typically between 30 and 60 days, in which the donation target must be reached. If the target is not reached within this period, the donations are usually not paid out and the campaign is deemed to have failed.

The following diagram provides a brief overview of the main differences.

Differences between fundraising and crowdfunding

The difference between fundraising and crowdfunding

In fundraising, there are many different concepts and ideas that you can implement both offline and online. Perhaps you have already come across traditional face-to-face fundraising in pedestrian zones? Although many people walk past the stands unimpressed, this method is still one of the most successful. Alternatively, offline fundraising events such as charity events, auctions and charity runs can be an effective way to collect donations and involve the community.

In the digital world, you have numerous options for collecting donations. Online campaigns allow you to reach a wide range of target groups and age groups, giving you the chance to reach a larger number of potential donors.

Offline

  • Fundraising events such as auctions or runs
  • Donation letters, flyers and posters
  • Telephone calls
  • personal visits
  • Speech in the pedestrian zone

Online

  • Personal e-mails and newsletters
  • Donation forms
  • Fundraising platforms
  • Current offers
  • Search engines and social media marketing

Appeal for donations on a computer

Social media is playing an increasingly important role in fundraising.

The donor pyramid, developed by Joan Flanagan in 1991, is considered one of the basic models in fundraising. It structures donors according to the amount of their donations and shows how commitment increases with each level, while the number of donors decreases. In addition, the donor pyramid provides insights into the time required to acquire donations and the expected income per donor category.

Nowadays, the donor pyramid is viewed critically for various reasons, as its hierarchical structure is outdated and no longer reflects modern donation behavior. The variety of new donation opportunities, from online crowdfunding to peer-to-peer fundraising, leads to a more complex dynamic that challenges the traditional pyramid.

Nevertheless, the donor categories can still be helpful to better segment donors. Typically, the following donor groups are distinguished:

  • Interested parties
  • First-time donors
  • Multiple and permanent donors
  • Major donors
  • Testator

Using the right fundraising methods, you can build a network of donors who will be available to your project or organization in the long term. The donor pyramid is a useful tool here to illustrate how a donor goes from being a prospective donor to an initial donor and later possibly to a permanent or major donor.

As a donor’s involvement in your project increases, a personal and individual approach becomes all the more important. It is worth investing time and resources to build and maintain long-term relationships with your donors.

This contrasts with cold calling, where you approach potential donors who have had no previous contact with your project. The focus here is on mass communication, as the aim is to reach a broad public. This method requires less time, but the expected return per contact is rather low.

Many non-profit organizations lose a large proportion of their donors between the first and second donation. According to an analysis by Beat Hunziker, only around half of all donors make a second donation. The donor loyalty cycle is a model that shows how people interested in donating can become committed supporters.

Donor loyalty cycle in fundraising

Donor loyalty cycle

This cycle comprises various phases, including the acquisition of new donors, the conversion of first-time donors into recurring donors, the maintenance and strengthening of loyalty and the reactivation of inactive donors.

During acquisition, you identify potential donors and draw their attention to your cause with suitable measures, be it targeted campaigns, PR activities or online marketing. You can use a suitable approach to persuade interested parties to make an initial donation.

It is then important to strengthen the bond and develop the donor into a regular supporter. This can be achieved through personalized communication, thank-you gestures and involvement in the organization. Relationship management is an ongoing process that aims to consolidate the donor’s commitment and loyalty in the long term. This includes regular reports on the organization’s work, the creation of emotional bonds and the opportunity to participate in events or programs.

Finally, the reactivation of inactive donors is important in order to reuse the potential of past supporters. Through targeted outreach and offers, you can encourage inactive donors to donate again and re-engage with your organization.

With SeaTable’s free template , you can make fundraising and donation management as easy as possible in the future. Organize several projects in one place and stay on top of things.

In your online database , you can not only collect and manage donations, but also automatically calculate the difference between donations already made and the target amount. Create donation receipts with one click and keep track of your donors’ contact details. You can see all the important facts and the progress of your projects at a glance on a clear Kanban board.

For smaller organizations, the features and storage limits of SeaTable Free (free version) should be sufficient. If you have larger plans, your non-profit organization will receive standard discounts on the cost of SeaTable Plus or Enterprise.

First register for the free subscription and then submit a corresponding request via the team administration. We look forward to supporting your non-profit organization with our software!

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