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How can small nonprofits overcome hurdles to fundraising?

Posted December 19, 2022 by Virginia Davidson

In this post, we’re excited to share some expert tips to help small nonprofits overcome hurdles and fundraise more efficiently and effectively.

When Little Green Light hosted its Meet the Author webinar with author Erik Hanberg, attendees submitted so many great questions for the Q&A portion that we couldn’t answer them all in our allotted time. Thankfully, Erik was able to respond to additional questions on our blog, so we can continue sharing his practical nonprofit expertise with you in our Ask the Expert series.

In this post, Erik will be answering Megan, who asked:

What would you say is the biggest hurdle for small nonprofits to scale up their fundraising, and how can they overcome it to fundraise successfully?

Hi Megan,

There are a lot of hurdles! Enough that I don’t want to limit myself to just one in my answer. So here are three, along with my recommendations for overcoming them.

First, far too many nonprofits don’t have a donor database or know how to use one. So they spend all their fundraising time reinventing the wheel, always trying to find new donors. This is such a common hurdle and it holds back so many small nonprofits. (And no, I’m not just saying that because I’m writing this on the LGL blog. It’s the truth!) But it’s a hurdle you can overcome by using a donor database, or by effectively using an Excel spreadsheet that will set you up for success when you do transition to a donor database like Little Green Light.

The next most common hurdle is that the nonprofit’s leaders are often too scared to straight-up ask their donors for money. (Many people who are anxious about fundraising tend to dance around the actual ask.) Or they are unwilling to ask some donors to increase their fundraising. Imagine a major donor who gives $500 one year, $1,000 the next, and then jumps up to $5,000 the next. That’s usually where the real power of fundraising shows itself over time. But to make it work, someone has to ask the donor to increase the size of the gift. Small nonprofits seldom reach that level of professional fundraising. And that can prevent you from fundraising successfully. Use your data to target your fundraising appeals, and don’t be afraid to ask for a specific amount or an increased gift.

The other big reason small nonprofits can’t scale up their fundraising is turnover. Too many small nonprofits burn out their staff. They often don’t pay them enough and at the same time they expect too much from them. So when a rockstar Executive Director realizes that she could increase her salary by 30% (with far fewer headaches), she leaves for a better gig. This often happens right as the relationships the ED has formed are primed for that big ask. So even if the ED has done the steps to increase giving, she’s gone too soon. The new ED has to start again, with the potential of the relationships (and the organization) getting squandered. To overcome this hurdle, organizations need to invest in retaining staff.

I hope this helps you avoid some pitfalls as you go about the work in your organization.

Good luck!
Erik

Looking for more advice?

If you missed our webinar with Erik, be sure to check it out here. Plus, if you’re looking for more great advice from someone who knows the ins and outs of fundraising, we encourage you to read Erik’s book, The Little Book of Gold. Forbes rated it as a Top 12 Must-Read Book for Nonprofit Employees, and it’s full of practical, actionable fundraising wisdom.

If you’re using Little Green Light, we also want to point you to LGL’s Companion Guide to The Little Book of Gold. Each chapter of Erik’s book covers an essential aspect of fundraising to help you fundraise successfully. And, in our companion guide, we’ve written corresponding chapters to show you how to use LGL to implement Erik’s advice.

How to access The Little Book of Gold and LGL’s Companion Guide

Download a FREE digital copy of The Little Book of Gold here, along with LGL’s Companion Guide (available further down on the same page).

Your free digital copy of The Little Book of Gold is available throughout 2022.

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