Successful Fund Raising

By Noshir H. Dadrawala
Centre for Advancement of Philanthropy

A Good Fund Raiser:

·         Must Believe in the cause

·         Should be Innovative 

·         Should be an Effective Communicator 

·         Should be Persistent and Determined

Income Of Voluntary Organizations:

·         Donations:

-Individuals,
-Companies,
-Trusts/foundations,
-Government,
-Foreign agencies,
-Charity cash box, etc.;
-Internet

·         Other Forms of Income

-Interest/Dividends: On short/long-term investments;

- Sale of products: usually prepared by beneficiaries of the organization

-Rent: If the organization leases out its property like office space, hall, etc.

-Membership fees/subscriptions
(Entrance fee being in the nature of capital receipt, is not to be treated as “income”.)

Types of Donations/Grants

·         Corpus

·         General

·         Earmarked

·         Matching

·         Returnable

Corpus/Endowment
It is a “capital receipt” and therefore not treated as income.
Donor must express the intent in writing that the donation is towards corpus.
Corpus donation should preferably be invested in long-term deposit and only the interest used.

General Purpose
For general activities of the organization, including
establishment expenses, programming, etc.

Earmarked
For specific programs/projects only.
It could be earmarked by the donor as corpus or otherwise

Matching or Challenge Grant
Donor agrees to give 50% of the amount required for a programme/project provided the organization raises the balance
Mr. Carnegie’s challenge?

Returnable Grant
It is like a loan for two or three years to be returned after the  program becomes self-sustaining.

Sources of Funding

1.       Individuals

2.       Foundations, Trusts and Donor Agencies

3.       Corporations

4.       Government

5.       Religious institutions

1. Individuals

According to ‘Giving USA 2005’ (The Annual Report on Philanthropy              for the year 2004),

-Americans contributed  $ 248.52 billion to charity,  

-Individuals donated an estimated $ 187.92 billion (75.6%).
-Bequest giving was estimated at 19.80 billion (8%)
-Foundations contributed $ 28.80 billion (11.6%) and
-Corporations $ 12 billion (4.8%).

Indian Survey:
According to a national survey covering around 28 percent of urban India and concluded in August 2001 by Sampradaan:

-96% of upper and middle class households in urban India donate to a charitable cause.  The total amount donated is Rs. 16.16 billion.

Other Findings of the Survey:

-In terms of average annual donation, Christians in India take the lead, followed by  Hindus/Jains; Sikhs; and Muslims. 
-Christians also give the highest average annual donations to other (non-religious) organizations (Rs. 301 per year).

The most popular purpose for which money is donated is to relieve distress of victims of calamity,
21% donating for this purpose.

Important Reasons for Giving (According to the Survey):

1) Feeling of compassion (68%). 
2) Feels good (48%).
3) Religious beliefs and practices  (46%)
4) Believed in the cause or the organization (29%).

2. Foundations, Trusts & Funding Agencies

-According to a study by Charities Aid Foundation ( India ) and Voluntary Action Network of India, it is estimated that an aggregate Rs. 25,717 million (1997-98 data) comes into India by way of foreign funds to the voluntary sector.

-The study also revealed that, out of 18,700 organizations registered under the Foreign Contribution (Regulation) Act, 12,000 filed “nil” returns in 1998. 
In other words, only 6,700 organizations are recipients of foreign funds.

-The same study estimates funds from government sources to voluntary organizations to be around Rs. 2,000 million.

-The bulk of foreign funds from bilateral and multilateral agencies are channeled through government and are, to that extent, indistinguishable from government funds. 
-Only the funds of foreign funding agencies like Oxfam, Ford Foundation etc., flow directly to private voluntary efforts, albeit with government permission.

-In the year 2000, India received foreign contributions aggregating Rs. 4,000 crores.

3. Corporations

-Corporate giving in India during the year 2000 was estimated to be Rs. 2000 crores.
-ActionAid & IMRB Study:

According to a study of Indian companies with stated and unstated policies on philanthropic activity, conducted by the Indian Market Research Bureau  & commissioned by ActionAid India , 83% of the survey companies saw themselves as major players in everything from rural community development to running projects for the disabled to upgrading infrastructure facilities for the underprivileged.

Reasons for Adopting a Philanthropic Policy:
-70% believe they have an obligation towards society upon whose resources they are drawing;
-50% felt concern for a specific group;

-40% felt concerned for the underprivileged;
-23% cited benefits to the organization.

-“Benefits” Perceived by the Surveyed Companies

-Satisfaction (in fulfilling social obligations) 45%
-Improved credibility (with general public and the Government) 28%
-Builds confidence and pride in staff     19%
-Tax benefits  09%

-Factors Influencing Corporate Giving/Partnerships:

-Is the project for the community in which the industry operates?
-Is there scope for the company in projecting a “caring-sharing” image about itself?
-Is there any tax benefit? 

-Is it a long-term investment for the company?

(e.g., economic growth of the community  leading to increased consumerism or a better educated or technically skilled community leading to a better workforce for the company)

-Is there a possible link between the company’s philosophy and goal and the project?
 (E.g., pharmaceutical company supporting a community health program or a housing development corporation supporting a project for low- cost housing).

-The Right Approach:

-Never approach a company CEO with a “begging bowl”.
-Approach the CEO with a business proposal - a “social investment strategy” in areas where there is a major societal concern.
-Appeal to the Bottom Line
-The fund raiser has to appeal to the CEO’s “business sense” that his business is more likely to thrive in a healthy society and environment and it would make “good business sense” for the company to adopt a philanthropic policy.

4. Government

There is no reliable information available on the volume or the specific areas in which Government disburses funds for welfare or development purposes.

Government Schemes:
The Central and State Governments, have several schemes for assistance to voluntary agencies in areas of Human Resource Development, Welfare of Women, Children and marginalized communities, Health, Family Welfare, etc.

-Ministry of Human Resource Development
 Shastri Bhavan
  New Delhi 110 001
Ministry of Welfare
 Shastri Bhavan
  New Delhi 110 001

-Central Social Welfare Board
Jeevandeep, Parliament Street
  New Delhi 110 001
Ministry of Health & Family Welfare
 Nariman Bhavan
  New Delhi 110 001

-Ministry of Agriculture Co-operative and Rural Development
Krishna Bhavan
New Delhi 110 001
Ministry of Science & Technology
 Technology Bhavan, New Mehrauli Road , New Delhi 110 016

-Voluntary Action Co-ordination Cell (Planning Commission)
            Yojana Bhavan
            Parliament Street
            New Delhi 110 001

5. Religious Institutions

Some temple trusts in the city of Mumbai are parting with some of their funds for educational purposes. Example:
-Mahalaxmi Temple Trust,
-Mumbadevi Temple Trust and
-Siddhi Vinayak Trust.

-In South India , Tirupati Devasthanam has also devoted some of its funds to secular activities like establishing colleges and hospitals.

Methods of Fund Raising:

·         Face-to-Face Solicitation

·         Direct Mail

·         Legacies & Bequests

·         Special Events

·         Payroll Deductions

·         Cause-related Marketing

USEFUL TIPS

·         Fund-raising is an art, not a science. Bring your own creativity to it and remain flexible.

·         Recruit staff with commitment first, techniques second.
Say what you mean; mean what you say.

·         Make the donor feel he is an insider - that he owns the organization. He will defend and support his institution.

·         Write copy as if from one person to another person; not from an organization to a donor.

·         Make sure you see and read mail from donors. It is the way to know what they are thinking about you.

·         In every piece of mail and all publications, including Annual Reports - always provide the opportunity to give.

·         The person answering your phone represents your organization.

·         Please do not fund raise if your organization is unable to cope with opening the mail and answering it properly! 

·         Tell the truth and facts always - credibility is important in fund-raising.

·         Tell your donors how their money helped to make a difference.

·         Emotion, rather than reason, leads to charity.

·         Induce action; always use a reply envelope.

·         Be specific; speak of specific cases or individuals - avoid generalities.

·         Long words put donors to sleep and sleepy people cannot write cheques.

·         Use more photographs – one picture is worth a thousand words.

·         Do not write about a huge problem, which an individual cannot solve through his donation.

·         Aim for something within the reach of an individual.

·         Talk about sponsoring a child and not 10,000 children.

A fund-raising communication should be one that:
- Catches the eye
- Warms the heart, and
- Stirs the mind.

Directory of Donor Organizations
Published By: Sampradaan (Indian Centre for Philanthropy)-
 

It consists of 4 types of data:

-Indian Trusts and Foundations
-Foreign Donor Organizations
-Organizations giving Scholarships/Fellowships
-CSR- Corporate Social Responsibility Organizations

To Order Directory of Donor Organizations-

Price Rs. 300/- Plus Rs. 50/- postage

Sampradaan
Sector - C, Pocket - 8 / 8704 Vasant Kunj,
New Delhi - 110 070
Tel: 91-011-26899368,
Telefax: 91-011-26121917
Email: icp@ndb.vsnl.net.in
Web: www.sampradaan.org

Useful websites:

South Asian Fundraising Group
 www.safrg.org
Resource Alliance ( U.K. & India )
 www.resource-alliance.org
Mal Warwick (Fundraising expert)
 www.malwarwick.com

Good Luck!

In Fund Raising -You Need Lots of Luck.The Harder You Work-The Luckier You Get.

For Further Assistance Contact:

Centre for Advancement of Philanthropy
Mulla House, 4th Floor,
51 M.G. Road
Flora Fountain
Mumbai 400 001
Tel: (022) 22846534
E mail: centphil@vsnl.com
Web: www.capindia.org