Major Gifts

Major gifts are a large component in your budgeting and fundraising strategy. Major gifts mean different things to different people, but there is a common understanding that without major gifts and donors, most nonprofits would be struggling more significantly and they may not maintain financial sustainability. It is important that your organization identify what you consider a major gift and for you to know how many donors contribute at that level or above.

To understand where your current major gifts are coming from and at what level, take a look at your top 10 percent of your donors. This means those who are contributing the most to your organization’s efforts. How much are they contributing? This should be your current baseline as to what establishes a Major Gift.

What Does “Major” Mean?

There is no common baseline between nonprofits that determines what a major gift is defined as. Every budget has different challenges and levels. What is major for one organization may be among the smallest donations in another. Yet, that smaller organization would have no need for the level of donation that the larger organization deems as their major donor. Gift levels vary and are respective of your organization’s needs and community engagement.

Small organizations may consider a major gift as $500, $1,000, or $2,500 and such donations can have a significant impact for the work that they do. Larger organizations may not be able to do what they do without donors who contribute at least $10,000 or far more. Some have projects that cannot move forward without six figure gifts from their major donors. Often, they will supplement these programs with grant funding. They know that large needs require multiple sources of financial support. Foundations (grants) expect you to know this as well. Never expect a grant to fund an entire project. They expect you to hold fundraisers, have additional major donors contributing, and other grant funding sources.

The Significance of Major Gifts

The following is a breakdown of how most donations cover nonprofit expenses.

  • 10% of your donors give 60% of your total donations
  • 20% of your donors give 20% of your total donations
  • 70% of your donors give 20% of your total donations

Ratios can vary, but this level of measurement is fairly accurate in most cases. With this in mind, you can set your fundraising goals accordingly and chart how many donations you will need to procure at each level. You can also use this Building a Gift Chart exercise to assist you in your planning efforts. It is quite evident from the percentages above how important your major donors really are.

How Major Donors are Different

Major donors are from every walk of life. They are no different from anyone else. The difference is in how you treat them. They will require more communication, deeper involvement or engagement, and more appreciation.

All donors will require attention, but those who provide 60% of your overall donations require an equal amount of attention and focus. This will help continue to keep your bottom line stable and the future growth of your organization promising. Do not ignore any donor as your small donor today could end up being your largest major donor tomorrow. Get to know your donors.

How to Find and Engage Major Donors

Some are fortunate enough to have high status friends who can start their efforts off with large contributions. However, most nonprofits do not start with such a coffer. This means that procurement and engagement of your current donors and prospective donors has to be done thoughtfully and proactively. The following is a list of steps you can take to accomplish this major goal:

1. Create and promote a monthly giving program

If you’re just starting out, start small. When numbers at $500 or $1,000 sound like a big ask, then break them down into monthly installments. As your donors to contribute $42 or $84 per month, and you will achieve your $500 and $1,000 annually from each donor who commits to this level of monthly contribution. This makes the ask much less intimidating to donors on budgets.

2. Involve your board

You can involve your board in procuring a larger major gifts pool by asking them to individually make a list of people they know who could afford the above monthly examples (or more). Do not hold their hands on this. Let them figure it out and let them take initiative. They are there to also engage in fundraising, so let them. Let them surprise you with what they come up with.

3. Study your peers

Whatever niche your nonprofit fulfills, there will be others doing the same or something similar either in your community or within your region. Learn about their efforts, study their methods, visit their websites, ask for their annual reports, and review their published lists of donors based upon gift size (if available).

You don’t need to invent the wheel. It’s been invented. So customize it for your particular organization and get the instruction manual by studying another organization’s structure. Assemble this collected information for your board, make copies and create booklets. Ask all board members to review the materials and to identify any personal connections they may have on these lists. This is an additional method for building your prospect list.

4. Face to Face Ask

This can be intimidating for some, as not everyone likes to ask for money while looking at the donor directly. This is required if you are ever to succeed in the nonprofit realm. This is also the most successful method for obtaining larger gifts. As mentioned previously, more attention should be given to your major donors. They don’t become major donors if you don’t pay attention to them. When you do this in person, you will find that your contributions will be almost ten times greater than mailed in contributions. The emotional engagement and involvement feels more real when it is face to face.

Do not do this without preparation. Have your speech prepared by creating your case and practicing your presentation. Remember that this will be a dialogue, so expect questions and be prepared to answer them. The next step is to schedule your appointment and make the ask.

Your major donors are your lifeblood, so treat them with respect, acknowledge their interests and need to be involved, and make personal connections. Treat them meaningfully and they will meaningfully contribute and do so consistently.