Your nonprofit does great work, and the people you serve rely on you to raise as much money as possible to grow your impact and support your mission. Like every nonprofit, you have limited time, resources, and budget to invest in fundraising. For that reason, it is important for your organization to maximize revenue from each and every fundraising strategy to ensure that you optimize your return on investment in your development program.
In this blog series, we’re going to help you maximize your fundraising revenue by providing 11 great tips for raising more money with less stress and hassle for your team… and without the need to hire new staff or dramatically increase your fundraising budget. These 11 tips span the most common strategies used by organizations to raise money to support their work, and apply to nearly every organization, large or small.
#1: When Holding Fundraising Events, Focus on Sponsorships and Leadership Gifts
Fundraising events make money through a number of different strategies. The most critical revenue-producing line items for a nonprofit fundraising event are (in descending order of importance):
Event sponsorships are the most important source of revenue for fundraising events. If you host an event, such as a black-tie gala, that raises more through ticket sales or silent auction revenue than through sponsors, you are leaving money on the table. The only possible exception is events that are in their first year or two of life, where the goal is to throw a large annual event and you started off with a large donor base that attends the event but have not yet built rapport with major sponsors. Even in that case, sponsors should overtake ticket sales in a year or two.
Corporate and personal sponsorships are important because your average sponsor gift will be many times larger than your average ticket price. Successfully raising $100,000 through $100 ticket sales will be unbelievably time-consuming and frustrating. Raising the same amount through $5,000 and $10,000 sponsorships, while not necessarily easy, will at least be achievable for more nonprofits, and with fewer headaches.
Another benefit to raising money through sponsorships is that companies can generally pay for a sponsorship through either their philanthropic or their corporate marketing budgets. Because you will offer public relations and marketing benefits in return for business sponsorships of your event, most of these companies will be able to legitimately use their advertising and marketing dollars to pay to be sponsors. This is good news for your nonprofit because at most companies, the marketing budget exceeds the charitable giving budget by an order of magnitude.
Sponsorships are the most important source of revenue for your nonprofit fundraising events.
For most events, ticket sales should be the second-highest source of revenue. The possible exceptions to this rule include walk-a-thons and other “a-thons,” as well as live or silent auctions where it is free to attend, and the revenue streams are limited to sponsorships and auction revenue.
Raffles and Auctions
If your event will include a raffle or auction (either silent or live) this should generally be the third-highest source of revenue after sponsorships and ticket sales.
Additional Revenue Streams
Other fundraising add-ons such as “sell-a-service” tables, 50/50 drawings, scratch-cards, etc. should, as a rule, be the smallest portion of your fundraising event revenue.
If your fundraising events raise more revenue through your auction than through sponsorships, or if you raise more through a 50/50 drawing than from ticket sales, you very well may be raising less from your event than you otherwise could. You should look closely at your event as you learn more throughout this blog series to see if a reconfiguring of your revenue streams may be in order.
A common thread between each of these is proper coordination- before, during, and after the event- above all, you want to make sure that your sponsors and attendees want to participate in the future. Having a good CRM database to have a correct structure in place to organize each of these factors for the current year and then in order to return to for the next year is imperative.