What is Prospect Research?
Donations are one of the most essential parts of running and operating a nonprofit organization. Major gifts can help you achieve new goals and propel your organization forward. To secure major gifts, however, you’ll need to find the right donors.
Prospect research is one of the best ways of uncovering the right potential donors for you. Your friends at iWave are here to guide you through exactly what prospect research and wealth screenings are and how they can help your fundraising efforts.
What is Prospect Research?
Prospect research is a tactic utilized by nonprofit organizations of all sizes to learn more about the personal backgrounds, history of giving, wealth indicators, and philanthropic motivations of potential or already existing donors. This research is then used to evaluate a donor’s ability to give as well as their personal affinity towards the organization.
In simple terms, prospect research helps you find the best potential donors for your nonprofit’s mission.
Prospect Research Terminology
Before we jump into how prospect research can assist with fundraising, it’s important to go over some key terms. The following items are crucial to completely understanding how this type of background research can make fundraising simpler.
An individual or philanthropic entity, like a foundation, with the ability to provide your organization with a major gift. They can be new to your specific cause or could have donated to you in the past.
A role within your organization that is responsible for compiling data on fundraising prospects. The prospect researcher may also be responsible for the implementation of data into the fundraising activities.
Prospect Screening Software
A resource like iWave which will provide the prospect research tools and perform screening services for your nonprofit to support and empower its mission.
Prospect screening information that paints a picture of whether a prospect is likely to give to your cause. Some of the top philanthropic markers include
- History of giving to your nonprofit: Are they an established donor? Could they become a major gift donor in the future?
- History of giving to other like-minded organizations: Do they routinely support a similar nonprofit? Do they have a vested interest in your cause?
- Involvement as a board member or trustee for a nonprofit: What is their charitable giving history? Do they routinely work with other nonprofits?
In addition to philanthropic markers, wealth indicators show if a fundraising prospect is able to support your cause. Some common wealth markers include:
- Real estate ownership: How many homes do they own? Are they a real estate investor?
- Stock holdings: What stocks have they invested in? How much of their finances are tied up in the stock market?
- Business affiliations: Who does their company associate with? What perks come from their business’s status? Does their employer offer a matching program?
A financial analysis that screens for philanthropic and wealth indicators. It takes into account various factors to determine if a fundraising prospect has the capacity to donate to your cause. Wealth screenings can be performed by a prospect researcher or a prospect screening company.
Who Uses Prospect Research?
Prospect research is a tool that can be used by any nonprofit organization. Some of the most common organizations who may use this type of research include:
- Sororities and fraternities
- Religious organizations
- Environmental groups
- Wildlife conservation groups
While the above organizations commonly use prospect research, any team can do it! It’s important to keep in mind that no two organizations are the same and therefore no two prospects will be identical. Ideal major gift donors will vary nonprofit to nonprofit, so it’s essential you customize your prospect research and wealth screenings to match your specific needs as well as your individual cause.
How to Perform a Prospect Screen?
Anyone within your organization can conduct this research. That being said, many organizations have compiled or used the following researchers and resources to aid in their efforts:
Internal development team
A team within your organization that performs all the data compilation and wealth screenings needed to uncover the best donors for your cause. This team will be detail-oriented and highly organized to ensure nothing is overlooked.
- Specialized prospect research consultant
Special prospect researchers can be hired on a consultative basis or even as a permanent part of your development team.
Prospect screening software
As noted before in our common terminology, prospect screening software will essentially do the work for you. This software will scan through billions of datapoints to then provide you with a clear picture of the best potential donors. This is often the fastest and most accurate option.
How to start Prospect Research?
To start prospect research, your team or researcher will compile data on a specific potential or existing donor’s giving history, involvement with other charitable organizations, political giving, business affiliations, etc. to provide a full picture of their ability and propensity to give.
If you choose to invest in a fundraising platform, its technology will scan through these factors for you and provide you with a list of potential donors and the reasons why they may be right for your cause.
Whether you compile this data by hand or with fundraising software, your team will then synthesize the data and identify which prospects you may want to consider asking for a major donation. This information is used to inform your fundraising activities such as day-to-day fundraising or annual campaigns and can also be utilized to create more accurate budget and end goals.
Benefits of Prospect Research
As you can see, prospect research is mainly useful in saving time and resources for both large and small organizations (and all nonprofits in between). If you can launch a fundraising effort already knowing the best donors to speak to, you’re more likely to achieve success.
Some of the other top perks of performing prospect research include:
Simplified and streamlined fundraising
Prospect research helps to improve major gift fundraising. Wealth screening results will direct your team to the proper potential donors, so you can ask for the funds needed to propel your organization forward. This saves time and resources, so you can spend more time in the field enacting change and less time trying to find support.
Uncover a major gift donor within your pre-existing donor pool
It’s important to screen within your already established donors to learn if any of them could become major donors in the future. You already know these donors have the inclination to support your cause, so a wealth screening will let you know if they have the capability to give more. For large organizations with a vast donor pool, this is a huge time-saver.
Find prospects for planned giving
There are times when you may launch major fundraising events such as a capital campaign to build a new structure or to acquire top-of-the-line medical equipment. By using prospect research to identify potential top donors, you’ll help launch a more successful planned giving program.
Identify new prospects
Over the years, your nonprofit has grown and changed in order to affect more change within your community. It’s likely you’ve accrued a solid following of donors who continually support your cause.
As your organization grows, you’ll need more funds and therefore more donors. By performing regular prospect research and wealth screenings, you’ll be able to uncover more donors to continue propelling your mission forward.
- Study donor giving patterns
Use prospect research to study up on your current donors to better learn about the future of their charitable behavior. By studying their patterns, you may be able to determine what time of year they are more charitable and can ask for a major gift donation during that time.
There are even more benefits of prospect research that you will discover as you fundraise. The best part is that due to the customizability of wealth screenings and donor research, you’ll be able to launch your organization’s fundraising efforts farther than ever.
How to Fit Prospect Research into Your Fundraising Strategy
The following are some of the top ways you can use prospect research to meet your fundraising needs:
Major gifts can be given at any time to help empower your organization. These are typically used for day-to-day operations and other expenses your nonprofit may need.
Planned giving is used for specific events within your nonprofit. With this type of fundraising, you have a specific target in mind and a clear strategy on how to achieve it. Some examples of planned giving may be an event, online auction, or raffle.
Capital campaigns are broken down into two stages of fundraising: Private (quiet) and public. During the private phase your team will reach out to potential major donors to raise the majority of total funds needed. Since capital campaigns are usually used for building funds, it’s crucial you’re starting off on the right foot. Prospect research can ensure you’re contacting the right people.
Over time you will create a following a people who were positively affected by your charitable contributions. For example, healthcare organizations can turn former patients whose lives they helped save into major gift donors through prospect research.
There are even more ways for you to utilize prospect research in your fundraising strategy. The best way to kick off any fundraiser is with a clear plan and strongly defined end goal. Heading into a fundraiser with defined donors can assist with this.
How Can iWave Assist with Prospect Research?
You’ve learned a lot about prospect screening companies and how they can assist with prospect research. So, if you’re interested in learning more about how these platforms can help your specific fundraising goals, contact us at iWave.
We feature next-generation fundraising software designed to scan billions of datapoints faster then you could analyze them by hand. In addition to saving you time and energy by performing these wealth screenings, our technology is designed to be used anytime, anywhere. Access our software through your smartphone device to brush up before a meeting with a potential donor and ensure you’re prepared.
We will not only show you who to ask for major gifts, but how much to ask for as well, so you can feel confident no money is left on the table. Then, as your organization grows, we’ll grow along with you and provide you with a team to help you propel your fundraising further.
See iWave in Action
Don’t just take our word for it though, reach out to us today to see our advanced platform for yourself. A member of our team is happy to set up a free demo to show you our tools in person or to schedule a fundraising assessment to show you how are platform can be customized to your needs.
Major gift donors are out there waiting for you to find them. What will you do and who can you help with extra donations? Find out today! Contact us today at iWave.
Stay Up-to-date on Fundraising News and Resources
What You Should Do Now
- Request a Demo and see how iWave can help your nonprofit organization target the best potential donors.
- Looking for creative ideas to raise money? Read our in-depth resource on fundraising ideas.
- If you know someone who’d enjoy this page, share it with them via email, LinkedIn, Twitter, or Facebook.