Three Challenges for Finances and Fundraising
Jul 21, 2015
Finances are a topic that frequently show up in my “Challenge” surveys (where I ask people what are the biggest challenges they face).
I’ve gone through my own struggles with fundraising, and this post is a synopsis of what I’ve learned so far.To accomplish any kind of mission is going to require energy.
It’s just a basic fact of life. Energy is the word we use to describe the capacity for action.
dictionaries define it as ‘the vigorous exertion of power, or the ability to do work, or the resources to produce the work.’ Energy requires some kind of resource or fuel.
If you’re building a fire, you need wood and a spark (and occasionally a liberal amount of gasoline).
If you’re running a marathon, you’re going to need special foods to eat while running.
When you’re trying to start a company, you have to buy things (raw materials, for example) before you have the money that comes from selling them.
Put simply, these are “startup expenses.” You often don’t have the money to pay for them because you haven’t sold anything yet.
Some people can use credit cards to purchase the needed supplies; others raise the money from investors; others invest their own money from earlier businesses.
In a non-profit enterprise, like a mission agency, we are typically providing something to people who are not paying for it.
Yet the resources required to provide the ‘thing,’ be it a hot meal or an evangelistic message, must be acquired in some way.
However the paper for the Bibles is gotten, you have to have it if you’re going to print Bibles.
All of this is elementary. Usually, for simplicity’s sake, this process is reduced to donors who provide money used for the expenses of the ministry: Donor > Cash > Resources > Ministry > Unreached Reached.
The viability and scale of a ministry is therefore limited by two factors: (1) the number of donors available and (2) the average size of the donor’s gift.
(Let’s for the moment set aside theological pronouncements about faith.
This is a “rubber meets the road” sort of limitation.
We could equally come from the other side and say that God’s validation of a calling is (1) the provision of donors who (2) provide enough money.) To sustain a ministry, we must therefore (1) find enough people who (2) are motivated enough to (3) provide enough money (we’ll use money as a catchall for whatever resource) to sustain the ministry. **Challenge no.
1, finding enough people**, is a search problem: you need a method or algorithm to be able to search through your relational network for people who are willing to give.
For some, this is easy.
For others, it is not.
It can actually be broken into two “sub-challenges”: finding and enough.
For some, “finding” is less of an issue than “finding enough” is.
Finding people is where relational references, social media, and regular communications come into play. If you need ‘more’ people to sustain the work, you’ll need to find a system for constantly encountering more people.
There are so many ways to meet people out there that I won’t bother trying to list them all.
You can judge each one simply by asking: will this help me meet people? who probably share my concerns? **Challenge no.
2, motivated enough**, is somewhat more difficult.
People will give either to (a) a sufficiently persuasive appeal (which has been taken advantage of in the past by unethical fundraisers); (b) because they know youand care about you, but not necessarily the cause; (c) because they care about the cause.
In my experience, people who know you and care about the cause are the people most likely to help you the most–not just with finances, but with prayer, concern, encouragement, critiques, resources, connections, references, etc.
If none of the people closest to me, who know me the best, are interested in this cause of mine, it should give me pause.
People who care about the cause–even if they don’t know me–are often likely to help, especially with individual projects.
That financial transaction may open the door for us to get to know one another better.
Finances are important, but they aren’t the end-all of everything; connections, wisdom, resource pointers and references can be far more important.
I never bother with a particularly persuasive appeal.
I focus on finding people who share my heart and passion, and who know people who know me, and then I just try to speak truth from my heart.
I’m not saying you shouldn’t communicate as well as you can, and you obviously should try to get better at communicating, but if you focus more on persuasiveness and less on passion and truth, the appeal may work for one gift but hardly for repeats and certainly not for relationship building.
Being able to clearly and professionally communicate your vision is an important task. We use Kingdom Come Training at ActBeyond, which is especially good for teaching people how to share their story.
There are plenty of other resources out there that are likewise quite good.
But it’s useless to communicate your passion to someone who doesn’t share it.
So ‘motivated enough’ becomes the chief concern. **Challenge No.
3 giving enough**.
A thousand people who give $1 a year are probably not going to get you very far.
You have to set a realistic budget, and then get a realistic sense of how many people would be needed to help sustain the ministry, and whether you can find them all in the time you have.
One resource that helped me a lot in this area is Kevin Kelly’s “1,000 True Fans.” His point: if you were an artist and had 1,000 people who bought $100 worth of your music in a year, you’d have a sustainable business.
Not every missionary on the field would need 1,000 at that rate.
Not every missionary at home would, either.
But it gives you an idea of how to identify your goal.
The number of donors is a function of the typical gift and the total budget.
This has been particularly helpful to me from a diversification standpoint. I have found I don’t like the idea of having one or two donors responsible for 50 to 75% of my budget.
If they drop off, my work is in jeopardy.
I prefer a lot of people who give a bit to a few people who give a lot, and who have an inordinate amount of power (whether they realize it or not). When I’ve had trouble with finances, I’ve been able to track it down to one of these three challenges.
First, I found I wasn’t communicating regularly or clearly to my existing partners, so they weren’t especially motivated, because they didn’t have any real understanding of what we were doing.
Second, I found I didn’t have enough partners (and this is what I’m working on right now).
If God has called me to this, he will provide the partners - but I have to be looking for his provision.
If you’re having trouble with finances, you might start by looking at these three categories, and see where you are facing an issue that needs to be addressed.
If you want to talk further about any of these three areas, drop me an email and I’ll be happy to chat about it.
I can’t promise that I’ve got all the answers - we haven’t hit 100% of our budget - but I know how to experiment, measure, iterate, improve, and I have some resources I’ve found useful.
So you won’t get platitudes! (Neither will you get connections to people who will just shower you with money, either.) See also