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    Capital Campaign Guide for Nonprofits

    Looking to launch a capital campaign? There are a few basics you’ll need to know before you get started to guarantee you achieve all your nonprofit organization’s goals. From the basics of a capital campaign to how to build the right team, our crew at iWave will take you through everything you need to know about this fundraising strategy.

     

    What is a Capital Campaign?

    A capital campaign is a fundraising strategy that’s particularly useful in achieving long-term goals. This type of campaign is also known as a brick-and-mortar campaign, because it’s traditionally used to erect buildings or add on a new wing to an already existing structure. At times, capital campaigns are also used to buy necessary equipment or to purchase land.

    The overall goal of a capital campaign is to raise money while on a strict timeframe. A capital campaign is divided into two phases

    1. The Quiet (Private) Phase

    This initial phase is when the majority of the fundraising is done. At this time, you and your team will reach out to major donors with large gift asks.

    1. The Public Phase

    This final phase of funding essentially fills in the gaps by asking for donations from a larger public pool of donors to reach your goals.

    Why Launch a Capital Campaign?

    This type of fundraising is typically used to fund a major expansion that will help your nonprofit grow over the years. Capital campaigns have earned the nickname of brick-and-mortar campaigns since they are traditionally used to raise money for concrete projects.

    If your school needs a new science wing or your hospital wants the latest cancer imaging system, then consider funding through a capital campaign.

    Related: Get the Capital Campaign Cheat Sheet

    When Should You Start a Capital Campaign?

    Capital campaigns are a great way to achieve goals that will propel your organization forward and enhance growth. There are three times when utilizing this type of campaign would be most useful to your organization:

    1. When you’re in need of new resources

    Has your university grown its science program requiring new lab equipment? Does your hospital need to purchase the latest tech for surgeries? Either way, a capital campaign may be the best way to accomplish these goals!

    2. When you’ve outgrown your space

    As your after-school program continues to expand to more communities in need, you may realize you can no longer rent your space and need to purchase your own recreational center. With a capital campaign, you’ll be able to set a strict timeframe and jumpstart your fundraising efforts to meet that goal.

    3. You want to expand your legacy

    A physical building is a great way to leave a mark on your community for years to come. A new rehabilitation center at the hospice you work at will continue to assist those in need even if you were to retire from your organization. Capital campaigns can help you build permanent structures that your community will be able to benefit from well into the future.

    Who Uses a Capital Campaign?

    Since capital campaigns are traditionally used to get funding for structures, mainly healthcare organizations and education organizations use this type of funding.

    Any nonprofit with large needs and major projects on their docket can launch this type of campaign though. For example, if you run an afterschool program for children from underprivileged areas, a capital campaign could help you build a new recreational center, so you no longer have to rent your space.

    How to Organize Your Capital Campaign

    capital campaign ebook

    Since you have a strict timeframe in which your building needs to be constructed or your equipment needs to be purchased, nothing is more important than staying organized during your capital campaign. There are some great ways to accomplish your goals, and it all starts with the right team and strong organizational skills.

    Assemble a Team

    Whether you’re a grassroots organization or a thriving university, you know the importance of working together as a team. Before you get started with your capital campaign, make sure you’re taking the time to locate the best team members for your mission.

    Some positions you’ll need to fill include a planning committee and board members. Make sure you’re choosing people whose beliefs strongly align with the cause and who have the right skills to keep your project on track. In addition to paid staff members, you may also bring on volunteers eager to help throughout the capital campaign process.

    The different team members you might want to recruit include:

    • Capital Campaign Consultant: If resources allow, you may want the added support of a nonprofit fundraising consultant. To identify the best person to assist your organization, you can compare proposals from multiple firms.
    • Campaign Chair: This person will be the primary face of your organization’s capital campaign. They will be the point person who keeps other team members on track.
    • Leadership: Those already in leadership positions at your organization will play an important role in decision making, big-picture project ideas, and daily planning throughout your capital campaign.
    • Staff from Various Departments: Unifying your organization around your capital campaign will better ensure its success. By involving people from all levels of your organization, you’ll encourage collaboration and innovation.
    • Active Volunteers: People who have already demonstrated interest in your organization and passion for your mission will bring energy, enthusiasm, and dedication to your project. They can invite other community members to join in and will spread the word.

    Another way to break up your team is with committees. One group might focus on the planning stages of your capital campaign, while the other might focus on continuing the momentum and keeping the project on course.

    Establish a Firm Timeline

    Not only do you need to establish a strict end date, you and your teams will also need to set up smaller fundraising goals along the way. Since there is a private and public phase during a capital campaign, it’s important you’re setting goals for what donations you need to reach during that time.

    Your team should all be receiving consistent updates on goals to stay on track. Also, reach out to your community and let them know the progress you’ve made, so they stay engaged and interested in your mission.

    10 Steps to Execute a Successful capital campaign

    No matter what reasons you have for launching a capital campaign, you obviously want to make it successful. A new building or equipment will help your organization grow and accomplish so much good for your community for years to come. For a successful capital campaign, consider some of these factors.

    1. Assemble a Trustworthy Team

    Before you start your capital campaign, it’s crucial you find the ideal team. Having the right people working for your cause is invaluable. Make sure you’re choosing people who not only believe in your mission and want to see your organization succeed, but people with strong organizational skills as well.

    Some team members you’ll need to assign:

    • Campaign Chair: Your campaign chair is one of the most important team members and will oversee all committees. In the community they’re an ambassador for your campaign, so make sure you choose the right person to be the face of your organization.
    • Board Members: The board members are at the forefront of big picture decisions and are in charge of day to day planning and execution. These members provide approval for any spending, so choosing strong leaders is crucial.
    • Planning Committee: Your planning committee should consist of about 10 to 15 members who help to plan and establish a timeline for your campaign, meaning they need to have strong organizational and time management skills.
    • Steering Committee: After your planning committee sets up a timeline for your capital campaign, your steering committee then keeps the campaign on track. This committee can have the same members as the planning committee, but make sure to add in a few more key players as well.
    • Staff: Other staff members you’ll need: major gift officers, prospect researchers, volunteer coordinators, event planners, and marketing coordinators. Choose these positions based on experience and dedication to the cause.
    • Volunteers: Volunteers are the heart and soul of any nonprofit, and no fundraising endeavor would be complete without them.

    Related: Get the Capital Campaign Cheat Sheet

    1. Determine Your Campaign’s Overall Goal

    The most hardworking teams need goals to work towards. Sit down with your builders, contactors, and anyone else who will be working on your campaign to get an accurate estimate of what your plan will cost. Then, set your end goal higher than this amount to account for unexpected costs, so you can feel confident you’ll achieve what you set out to accomplish.

    1. Set a Strict Deadline for your Capital Campaign

    After establishing an overall end goal, the next step is to determine when you need to achieve this goal by. Whether you have a building deadline or you need a new library by next semester, base your due date on environmental factors as well as personal goals.

    Then, work with your team to break this down into smaller goals along the way. Determine how much you need to fundraise in the initial private (quiet) phase as well as how much you hope to receive in the public portion of fundraising.

    1. Review Past Successes and Areas of Improvement

    As a nonprofit you know you’re always growing and learning. Your organization was born from nothing but an idea and grew into an organization that changes people lives. In order to achieve this success, you’ve needed to learn from your past mistakes.

    Sit down with your team to discuss your most recent fundraising efforts. What went wrong? What went right? How can you make this capital campaign even more successful?

    1. Set a Budget for your Campaign

    Obviously, the goal of a capital campaign is to earn money for your new building or equipment. However, there are times where you may need to spend extra money to get there. Therefore, it’s important you and your team lay out a strict budget for spending.

    Some of the items you may want to figure into your budget include:

    • Fundraising events

    From hosting galas for your major donors to online auctions, there’s a variety of fundraising events you may want to host to get more donations to your cause.

    • Education

    Spreading the message of your cause is crucial if you want to gain more funding. You may want to hire someone to take control of your social media or a copywriter to create informational blog posts about your capital campaign.

    • Marketing materials

    Some marketing materials you may want to invest in include brochures, letters, pledge cards, and online advertising. You also have the option to stay in house for advertising or to reach out to a larger agency with tons of experience.

    1. Establish Contingency Plans

    All fundraising runs into bumps in the road, and your capital campaign most likely will, too. Have your board members or planning committee meet before you launch your campaign to discuss how to go about any potential setbacks. Make sure they discuss how to prevent some roadblocks from occurring altogether as well, making everyone more prepared for whatever comes your way during fundraising.

    1. Conduct Wealth Screenings

    Typically, around 70 percent of capital campaign fundraising is done during the private phase. As such, it’s crucial you’re reaching out to the right potential donors with the right gift asks. To ensure you get the donations your cause needs, conduct wealth screenings prior to officially launching your capital campaign.

    You can conduct these wealth screenings in one of two ways. First, you can hire a team to comb through files and personal records to find the ideal donors for your cause. You’ll want to consider not only the propensity to give but how likely they are to contribute to your specific cause as well. If someone has given to likeminded organizations in the past, they’re more likely to donate to you as well.

    You second option is to invest in a software platform that can perform these wealth screenings for you. The proper technology can help you save hundreds of valuable hours by scanning information faster than you can read through them.

    1. Hold Regular Meetings

    After you officially launch your campaign, it’s important you keep everyone on your team updated. Host weekly or monthly meetings with your steering committee and board members to ensure everyone knows what milestones you’re working towards in addition to making sure everyone is staying on target.

    1. Keep Your Public Updated

    Not only should your team stay updated, but so should your audience. Through your website and social media pages, let everyone know what steppingstones you’ve reached along with how your new project will improve the community. This will help keep everyone excited about your mission.

    1. Engage Your Audience

    Fundraising is much more successful when you get people engaged. In the private phase you can offer incentives such as naming rights to pillars and halls. When you open to the public, consider hosting online events like auctions which are fun and can also reach donors all over the world.

    Why Perform a Feasibility Study for a Capital Campaign?

    Before you launch your capital campaign, it’s a good idea to perform a feasibility study. This resource is useful for gauging whether or not you’ll be able to meet the end goal you hope to accomplish. Typically, these studies are conducted by outside consultants through various surveys and are extremely helpful in knowing whether you should launch your campaign.

    Prior to the quiet portion of fundraising, the consultants will interview 20 to 40 board members within your community to see if they would be willing and able to financially support your cause. At the end of the study, the results will let you know how much your existing donor pool can realistically contribute to your cause.

    If your feasibility study results are not what you were hoping for, this doesn’t necessarily mean your campaign is over before it even began. Instead, it means you need to consider conducting a wealth screening to see who you can include in your donor pool.

    How to Set a Capital Campaign Budget?

    As we mentioned before, a targeted plan is essential for a successful campaign. In order to accurately set up goals along the way, you first need to establish a capital campaign budget.

    Obviously, the overarching goal of a capital campaign is to fundraise for a specific cause, but there are a few times when you may need to spend some money to generate awareness for your cause. You can also host an event—online or in-person if you’re able.

    On average, a capital campaign will cost an organization about 10 percent of the end goal. For example, if your team determines it’ll cost $10 million to build a new science center at your university, expect to spend $1 million throughout the campaign.

    From hiring consultants to direct mail materials, have your team meet and decide where you want to allocate your funds to. This will help you stay under or within your budget. Make sure to also account for any unforeseen circumstances. Having extra money built into your budget ensures you won’t overspend if an issue were to arise.

    In some instances, creating a budget requires you to go outside of your organization and hire a finance expert. Make sure you’re considering all your options to ensure you have the most successful capital campaign possible.

    Create a Gift Range Chart

    Another great resource to help you stay on track throughout your campaign is to create a gift range chart. A gift range chart is your organization’s way of mapping out future gifts. It works by breaking down your fundraising goal into more manageable chunks, so you can set smaller milestones throughout the campaign.

    In this chart, you’ll list out how many gifts of a certain size you’re hoping to receive. The larger the gifts you receive, the less donors you’ll need to reach your goal.

    In your chart, you’ll want to list not only the gift amount, but also the number of prospective donors you can reach out to in order to reach your gift goal. Then provide a total gift amount, so you can easily add up to the total you need to meet your fundraising goal.

    Gift Chart Break Down

    • Gift Amount: What is the value of your target gift?
    • Number of Gifts: How many of these gifts do you wish to receive?
    • Number of Prospects: How many potential donors can you reach out to?
    • Cumulative Total: How much money have you raised in gifts thus far, adding your current donations to all preceding gift donations?

    Gift Amount

    Number of Gifts

    Number of Prospects

    Cumulative Total

    $125,00

    1

    4

    $125,000

    $60,000

    2

    8

    $245,000

    $40,000

    4

    16

    $405,000

    $15,000

    8

    24

    $525,000

    $10,000

    16

    32

    $685,000

    $5,000

    24

    48

    $805,000

    $2,000

    40

    80

    $885,000

     

    Be conservative when you put together your gift range chart. You may ask 24 potential donors to make a $15,000 donation but only have eight people interested in your cause, so by underestimating you’ll be better prepared for setbacks.

    On the other hand, in the same situation, 10 donors may offer their support instead and you’ll receive more donations than initially expected, which leads to a more successful campaign overall! You never know how your donations may pan out, so it’s best to be prepared.

    How to Get a Campaign Grant?

    When launching a capital campaign, you have the option to apply for a grant. A grant is a large contribution to your campaign to help propel fundraising forward and enhance your mission. Grants are a great way to help set you up for more major gift donations for the rest of your campaign since they bring awareness to your cause.

    These differ from challenge grants in that you don’t need to complete a challenge to receive the money. However, in certain instances a capital campaign may also be a challenge grant, so it’s a good idea to consider all the options available to you.

    How Do You Find Grants?

    In order to secure a grant for your campaign, you first need to seek out organizations that provide grants to nonprofits like yours. Each grant has specific qualifications, so you’ll want to make sure you’re applying to the right ones. One of the best ways to do so is to use fundraising platforms that screen for grants that suit your organization.

    Then, you want to craft a proposal stating why you deserve the grant and what you plan on achieving with the grant money. The person who writes this proposal needs to be a strong writer who can embody the passion and heart of your nonprofit. If your budget allows, you may want to consider hiring a grant writer who has experience obtaining grants for organizations similar to yours.

    How to Kick Off Your Capital Campaign?

    Now that you know the best steps to take when it comes to your capital campaign, you’re ready to get started. Some of the final steps you need to take to kick it off successfully include:

    • Invest in software for donor information: As we mentioned before, there are many platforms you can invest in to do the hard work for you when it comes to finding the right donors for your mission.
    • Conduct a wealth screening: Once you find the best software to assist in finding donors, use it to perform a wealth screening that examines propensity and inclination to give.
    • Set goals and a timeline: Work with your planning committee to craft a timeline and strict, immovable dates for fundraising goals to be achieved.
    • Craft a campaign slogan: A slogan is a crucial way to let everyone know what your organization and capital campaign are all about. Also, at this time, you’ll want to set up a website, craft brochures, write letters, and come up with pledge cards.

    What Capital Campaign Marketing Materials Do You Need?

    Once you’ve crafted your mission statement and campaign slogan, you’re ready to start preparing your marketing materials. These materials will help to spread awareness for your mission and are a crucial part to support both the private and public fundraising phases.

    Some of the most popular materials you’ll want to build into your budget include:

    1. Website

    Your website is one of the best ways to convey your mission, interact with the public, and keep everyone updated on the progress of your campaign. Make sure you’re posting weekly or monthly updates to your site and set up a way for the public to make online donations if they’d like.

    Also, on your site, make sure to have plenty of engagement materials such as videos and photos. You should link to your social media accounts where you can more directly interact with your audience.

    1. Brochures

    Brochures are a great way to provide in depth material on the mission of your capital campaign. Your brochure can be a quick way to engage private donors and should include donor incentive levels.

    Have you set up naming rights for various aspects of your building depending on donation level? Include this information in your brochure so a potential donor can quickly view it.

    1. Letters

    Letters are another way to reach out to private donors. Direct mail should be personal and appeal to the specific donor.

    Make sure to be genuine in explaining your mission and why a major gift could really propel your cause forward. End the letter by thanking the potential donor for their gift in advance.

    1. Pledge Cards

    Pledge cards can also be sent via mail or given out at events and meetings. On this card there should be space for the donor’s name, contact information, donation amount, and payment schedule. This is a quick way to raise funds over the course of your capital campaign.

    Best Practices for Capital Campaigns

    Before you officially launch your campaign, during fundraising, and after your mission has been achieved, there are certain practices you want to employ. Some of these best practices include:

    Before the Campaign

    • Conduct a Feasibility Study: Determine if you have the support to launch your capital campaign or if you need to uncover other major gift donors.
    • Invest in Fundraising Software: Fundraising software is a great way to figure out grants available to your organization as well as what potential donors have the biggest inclination and ability to support your mission.
    • Assemble a Team: Build a team surrounding your specific mission and hire any outside consultants that may be needed.
    • Establish a Timeline: Work with your team to determine an end goal and then construct smaller milestones with a clear timeline of when these goals should be achieved.
    • Craft a Campaign Slogan: Work with your marketing team to develop a campaign slogan and then implement this on all your marketing materials.

    During the Campaign

    • Offer Incentives to Major Donors: Determine what incentives you want to offer your major donors and provide a list for them to view on a brochure or in a letter.
    • Get Full Board Participation: Always lead by example. Make sure everyone on your board is committed to making a donation to your campaign.
    • Maintain a Consistent Brand: Consistency is a major key to success. Stay on brand throughout your campaign and tie all your efforts together.
    • Keep Supporters Updated: Make sure your audience is aware of all your successes along the way.
    • Vary Fundraising Efforts: Capital campaigns can last months and even years, so it’s important you’re spreading out your various fundraising events. Diversifying your efforts not only maintains engagement with your cause but provides consistent fundraising throughout your campaign as well.

    After the Campaign

    • Host a Wrap Up Event: After the close of your capital campaign, it’s important to thank your supporters. Host an event to wrap up your goals and publicly thank major supporters. Such an event can be held virtually!

    Additionally, send out personal letters of gratitude. Grateful donors will continue to support your cause and any future fundraising efforts your nonprofit engages in, so this is a crucial final step.

    How our Fundraising Software can help Your Capital Campaign?

    The quiet phase is crucial to the success of your capital campaign and the proper fundraising platform can help you make more successful donation asks. Our next-generation platform is built on billions of datapoints and can help you quickly scan potential donors to uncover the right match for your mission.

    Not only will iWave show you who is most likely to make a contribution to your cause, but we’ll also depict how much to ask for as well, helping you walk away from a gift ask with no money left on the table.

    Our fundraising software can also be accessed on your smartphone device, allowing you to view vital information before entering a meeting. We’re committed to building our fundraising platform around  your nonprofit’s specific needs, so a member of our team will work one-on-one with you show you how you can best utilize our software for a successful capital campaign.

    See iWave in action today. Contact us to request a demo!

     

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