This may be unpopular and you may not like it, but it’s the truth.
You cannot build sustainable funding with events. In other words, you’ll never fully fund your nonprofit’s good work through golf tournaments and 5K races.
Most events are labor-intensive, transactional in nature, and don’t bring a great ROI. In fact, here’s what it costs, on average, to raise a dollar using various kinds of fundraising strategies:
|Direct mail to non-donors||Spend $1.15 to raise $1|
|Special events||Spend $0.50 to raise $1|
|Planned giving||Spend $0.25 to raise $1|
|Direct mail to current donors||Spend $0.20 to raise $1|
|Grants||Spend $0.20 to raise $1|
|Major gifts||Spend $0.05 to raise $1|
(James Greenfield, Fund Raising: Evaluating and Managing the Fund Development Process)
Too many small nonprofits get on what I call the “special event hamster wheel” and they go from one event to the next. It’s exhausting for the staff and volunteers, and it’s exhausting for donors and the community.
And really, there are way more effective ways to raise money (I refer you back to the table above).
Good Events v. Bad Events
I love a good event just as much as the next person, and when they’re done well, they can be fabulous. The problem is that most events are not done well.
A good event will bring you one of these four things:
- Significant money
- Great awareness
- Deeper relationships
- Something else (like in-kind gifts)
Good events will blow past your goals for them and you’ll feel really good about your success. Good events also generate buzz—everyone in town will talk about the event for days, maybe weeks.
A bad event will barely break even, draw a small crowd, and make you so tired that you wish you’d never done the event (been there, done that). It’ll cost as much as it brings in, and the day after the event, you’re no better off—no new donors, no extra money, and you’re still the best-kept secret in town.
As you work on your fundraising plan for next year, think about your events.
Evaluate them with a critical eye. Don’t try to justify keeping one just because you like it. Be brutally honest with yourself about what’s working and what isn’t.
Put each event into one of the following categories:
- Keep – definitely keep this event!
- Tweak – find a way to make it better and it might become a keeper
- Dump – get rid of it!
Keep it. Only keep events that are bringing in something you need. And in large quantities. Keep the event that everyone loves and looks forward to, and spends a ton of money at. Keep the one with a HUGE return on your investment of time, energy, and money.
Chances are good this is your signature event. A signature event is one you’re known for, brings in an enormous amount of money, and everyone looks forward to. The type or theme of the event is usually aligned with your mission. For example, a Food Bank’s signature event might be an Empty Bowls event, featuring hand-thrown pottery and homemade gourmet soups. An animal shelter might have a Hair Ball gala where people are encouraged to bring their pets. See how this works?
Tweak it. Sometimes an event isn’t bad enough to cancel, but it’s not good enough to keep, either. This is the time to look for ways to give it fresh life.
I sit on the Board of a local nonprofit with an event that fits this description. About this time last year, I commented to the Executive Director that I thought there were several things we could do to make the event better, including forming a committee. She said “Great! You head it up.” Ok, I walked right into that one!
The committee started working about 5 months ahead of time, setting goals and looking for additional revenue streams to add to the event, like a photo booth, better silent auction items, higher sponsorship fees, and so forth. The event was budgeted to raise $25,000. The committee’s wild and crazy goal was $40,000. When the dust settled after the event was over, we made $53,000! Talk about success!
What made the difference? Fresh ideas and fresh energy. This will change an event every time.
So, how can you add some freshness to your event? Who can you pull in to help you plan and execute the event?
Dump it. Chances are good that you have events you need to stop doing. It’s painful to pull the plug on an event, especially if you’ve done it for a while. Remember that when you stop doing an event that doesn’t really work, you make space for something else that can generate much bigger revenue for your nonprofit.
When I worked at the Food Bank, we held a 5K every Spring, with our lead sponsor being Outback Steakhouse. The owner of the restaurant sat on our Board and was very supportive. As you can imagine, it was a lot of work to put on the event, and it was very popular. At the end of the race, there was a full Outback buffet, complete with steak, chicken, and bloomin’ onions. Live music and beer made it a fun time for everyone.
I remember sitting with the owner after the race one year going over the numbers. He was shocked that we only cleared about $2,500 on the event. He said “That’s about what I spend on the food and staff. How about I just write you a check next year and let’s call it a day?” Oh wow! I was thrilled. That cut out a ton of work for me, and we had another big event where he could get the recognition he wanted for his business.
Being clear about the events you hold and what they’re generating will help you a lot as you plan for your next year of fundraising.
This article was originally published in Get Fully Funded. It is republished here with permission.