top of page
  • Writer's pictureRandall Fisher

Being involved can be good for business.

Working with and being involved with charitable work not only feels good, it actually can be good for business. To understand how charities work, let’s take a look at how they are put together. Let’s start with the basics.

Fundraising Overview

Fundraising, or the process of soliciting and gathering contributions, such as money or other assets and resources by requesting donations from individuals, businesses, charitable foundations or governmental agencies, is multi-faceted. Its major divisions are annual giving, capital campaigns, major gifts, and deferred (or “planned”) giving.

Annual Giving

Annual giving focuses on donor acquisition, repeating the gift and upgrading the gift. Most first gifts are small, but annual giving creates the habit of regular giving and, typically, increasing gift size over time. Direct mail solicitations, telemarketing, e-solicitations and special events are most often the methods used to increase annual giving. The ultimate goal of annual giving is lead generation for the other categories of fundraising.

Capital Campaigns

Capital campaigns are the most common way charities raise the funds needed for special large projects, such as a new building or a permanent endowment. A capital campaign is an intensive, time-limited effort seeking a larger than usual sum of money from the charity’s perspective. Most charities consider hiring an outside consulting firm for a capital campaign rather than hiring or using internal staff. Frequently the outside consultant will guide the existing staff.

Major Gifts

Unlike annual gifts, which are typically made with cash, major gifts are often made in the form of publicly traded stock, bonds or other negotiable financial assets and, in some cases, real estate and valuable personal property, like art. Each charity establishes its own threshold for what is considered a “major” gift. For a religious denomination, it might be $25,000 or more, whereas a small local charity might set threshold at $1,000. Typically, making a “major” gift entitles the donor to special benefits, such as membership in a giving society (i.e., “Circle of Friends”), recognition in the charity’s publications, or ticket priority for charity events.

Deferred (“Planned Giving”) Gifts

Deferred gifts are gifts that a donor establishes now for the charity to receive at a future date. Most attorneys, CPAs and financial advisors are familiar with these. In some cases, the donor will receive income and tax benefits during his or her lifetime. Most are complicated and require planning; hence, the term “planned giving.” Typical deferred gifts include Will bequests, post-death revocable living trust distributions, charitable remainder trusts, gift annuities, charity-owned life insurance, and pooled income funds. Although not completely “deferred” (the charity receives a benefit starting in the first year), most planners include charitable lead trusts in the category of deferred gifts.


Charities today also sometimes raise money by obtaining grants from individual or corporate private foundations or government agencies. Applying for such grants may be the assigned responsibility of a staff member or outside consultant.

What Charities Do with the Money They Raise

Charities are just like everybody else. They do two things with the money they get – spend it or save it for future use. Some contributions will be unrestricted and thus available to be used immediately for day-to-day expenses and charitable functions. Many charities also have an endowment fund in which gifts are set aside and held in a special fund to earn income that is used by the charity for general or special charitable purposes. Major gifts and deferred gifts other than for an identified purpose, e.g., a new building, typically go into the charity’s endowment fund. The size of a charity’s endowment fund is often used as a measure of its fundraising and overall success. Endowment funds are often divided into sub-funds to accommodate major contributors who wish to have their gift earmarked for a special purpose, such as scholarships.

How Charities Organize Their Fundraising Efforts

Many charities have at least one employee whose primary responsibility is fundraising. In smaller charities, a development officer may handle all of the facets of fundraising. Larger charities may have multiple fundraising staff members who are assigned to different fund raising functions within the charity’s office. For example, one may be assigned specifically to developing deferred gifts.

How Development Officers Are Compensated

Development officers are paid a salary; it is unethical for them to receive a commission. Most are evaluated by their success in closing charitable gifts on an annual basis. Deferred giving officers are evaluated not on actual gifts received, but on expectancies, as they have no control over when a donor will die and thus when the gift will “mature.”

How You Can Work Together

Development officers, business donors and other professionals can work together in the different types of giving. Depending on the type and need of the gift, a level of positive goodwill is generated through both the beneficiaries of the charity and the board of directors of that organization. In all cases everyone should be involved in the process as needed to make sure the gift makes sense for and provides the greatest benefit to the donor and the charity.

A Source of New Business for You

The publicity surrounding a gift can be small or large, depending on the opportunity and the charity you choose to work with. The outreach from that gift can be like a stone hitting a pond – the ripple effect can go for miles.

The best way to find the right charities to work with is to meet development officers and have them explain their charities in some old-fashioned networking. Here are some suggestions to help you get started.

Networking Tip #1: Get to know the nonprofits in your area and learn about the resources and services they offer to the community.

Networking Tip #2: Local and regional planned giving councils have regular meetings with guest speakers. You can join, attend, and even offer to speak at these. Regular attendance will yield the best results.

Networking Tip #3: Ask other professionals with whom you already work if they know any development officers in your area. Ask for an introduction and/or a lunch meeting.

Networking Tip #4: Cold calling. Look up nonprofits in your area, then call the planned giving or fundraising office and explain that you would like to meet the development officer. It’s not as good as a personal introduction, but it will get you noticed.

Networking Tip #5: Some nonprofits host their own “Get to Know Us” educational seminars as a way to attract potential volunteers and donors. Attending one is a great way to show your interest, learn about the nonprofit first-hand and meet the development officers.


Developing alliances with charities and their development officers for non-profit organizations is an excellent way to expand your networking opportunities, become more aware of the services and resources available in your community, and generate new business. But most importantly, it will feel good to help your clients and charities in a way that is beneficial to both.

As always, good luck and good hunting.

0 views0 comments

Recent Posts

See All

It's time to get back to work......

December 20 is measured by some as the longest night of the year. Four years and four months before that, I went through one of those life changing events with the death of my wife. After that, a year


As part of life’s journey, there are many speed bumps that we have all encountered. Almost all of them center around the phrase  “♂, ♀, ✳, †, ∞”(man, woman, birth, death, infinity.) Some of you may be


bottom of page