Fundraising is unfair - so deal with it
October 1st, 2010
It's near the end of summer, so my reader must be finishing up a beach worn Grisham novel and realizing she has to get back to business. It's true that the fall is a critical time to gear back up, but that doesn't mean she has to read a book explicitly devoted to fundraising per se.
For my professional life, my favorite reading almost always comes from disciplines outside the nonprofit world. I believe one of the great benefits of books is that it opens you to entirely new worlds and new ways of seeing things. Since it is my job to bring such fresh perspectives to my clients, I try to read as widely as possible. In fact, I’ve argued elsewhere that when you are evaluating a consultant, one of the first things you should do is check out the consultant’s bookshelf.
In that vein, my favorite book about fundraising is a book that is ostensibly about baseball: . As is now well recognized, the book has wide applicability beyond the stadium walls. Many industries and disciplines have quickly adopted the book’s insights. It is widely lauded as one of the most important books (of any discipline) written in the last decade.
But it is only slowly entering the discussion within the nonprofit community. Where the book has made an appearance, the conversants have been mostly on the giving - and not fundraising -- side of the equation. For a couple of good examples, see my friendand the president of .
However, I believe the true spirit of the book resides more with those desperately lacking cash than those with extra to give. For the uninitiated, Lewis chronicles how Billy Beane, who is the general manager of the Oakland A’s and a particularly bright and scrappy leader, plays the hand he is dealt. The hand? Needing to succeed as a small franchise in a fiercely competitive environment, while only equipped with minimal financial resources compared to the big boys.
And the subtitle of the book gives you a clue about both its true message and its relevance to nonprofit fundraising: “The Art of Winning an Unfair Game.” That's your game he's talking about: you can’t hire a development staff, foundations are cutting back their grants, your board is telling you that you have to be up on Facebook and Twitter, there’s minimal money for marketing, and yes, you’ve got to raise another 10% over last year or you’re looking at layoffs.
I think Moneyball is a seminal enough book (it’s being made into a Hollywood move… starring Brad Pitt, for cryin’ out loud) that it should be translated for executive directors seeking to raise money but feeling like they face an uphill climb… which is to say it should be translated for all executive directors. So here’s one take on how the nonprofit leader playing this unfair game needs to learn to play Moneyball.
Change the formula
One of the ways that Moneyball was misunderstood by many in its immediate audience – the baseball community – was the notion that Lewis was advocating a particular formula for constructing a team. This missed Lewis’ bigger point: that the leader in the unfair but still competitive game has to always change the formula. In such a game, once a favorable formula has been discovered, other competitors – often larger and with more resources – will rush in to copy and erode the advantage.
When fundraising in our technological era, this dynamic is increasing in its pace. For those of you old enough, dial back to that wow factor when the first nonprofits started sending out appeals in Macintosh enabled page designs and laser printers. How about how your eyes jumped out at those first web sites that had Flash animation on the home page? Constant Contact e-newsletters? Online giving? Facebook campaigns?
Whatever cool new tool that some nonprofit used to differentiate itself in the crowded fundraising environment got quickly appropriated by the crowd. This is the nature of competition, and the reality that fundraising is a competitive game. Even if two agencies are in different fields and may not be going after the exact same funders, they are going after the same crowded “mind space” where they can stand out and be noticed.
Playing Moneyball means you can’t always be the late adopter. You have to constantly look for ideas that haven’t been tried yet – or at least by many others. There is just no substitute for this effort in any competitive game if you really want to stand out and succeed. Fortunately, however, the same technology that so quickly erodes first mover advantage also enables relatively inexpensive and rapid experimentation. Many of the most interesting innovations in donor development are absolutely free cash-wise.
In other words, what new formulas most require is the human talent to discover them.
Hiring outside the box
One of the ways that Billy Beane changed the formula was via unorthodox hiring practices. While his competitors would only hire seasoned baseball professionals who had already played or managed in the league, he deliberately recruited young recent graduates from Ivy League schools who had more quantitative backgrounds and never played an inning of professional baseball. With such unorthodox hiring practices, Beane gained two key competitive advantages: new skill sets (the math) but also a fresh set of eyes unencumbered by tradition and willing to question everything.
To play Moneyball, the nonprofit executive director will have to change the formula for hiring development staff. The typical director of development is 40-55, often a woman, and has held previous nonprofit positions in development. The competition for the classic, mature, and experienced development director of this profile is incredibly fierce. In the Bay Area, their salaries can rival the executive director's, and the average tenure is less than two years anyways. The latter stat means even if you win the recruiting battle for top talent, you’ll just be getting the same skill sets and perspectives that are circulating among all your competitors.
What could a Moneyball play look like? Well, here are three different ways to tinker with the recruitment formula:
1. Timeshare the job with 2-3 women in their 30’s who dropped out of marketing or sales jobs in the corporate world and are now stay at home moms. That is the formula for how I built my firm,and I can attest to the incredible untapped productivity of this demographic.
2. There are tons of 20-somethings who are now several years into their first jobs and are discovering how unsatisfying their work is and looking to make a more social impact. There is a lot of talent out there, talent that knows more how to harness the world social networking much better than someone not in that demographic. But they won’t necessarily be looking in the standard nonprofit job listings. And some of the especially talented ones may not even be aware that deep down they are looking. Go find them. Inspire them. Woo them. Here’s some more on how to do this.
3. I have never understood why there aren’t more retired, white, male business executives over 65 being recruited as first time development directors. Think about it: every organization wishes they were tapped into more networks of wealth. What do those networks look like? Why not hire someone from that world? Why not build in that perspective intimately into your fundraising operations at the ground floor.
When you recruit an experienced 45 year old female development professional, you can be sure that one thing you will NOT be getting is a ready to go pool of such donors. Whatever networks that person built previously are specific to those previous organizations. So getting a first development director who has years of networking among successful businessmen but hasn’t leveraged that network fully yet (except perhaps for some volunteer fundraising) is an incredible competitive advantage.
In Moneyball, there's a classic scene where Billy Beane is arguing with more established scouts who write off an overweight prospect. I think executive directors have a similar tendency to see old, rich, white guys and think only "board member." I believe that's a formula worth challenging and changing up.
I know of a few old, financially successful, white guys who would actually feel honored to be recruited for a professional position (even if it is paying well less their career averages), to be told that they still have more to give, to be challenged to a new undertaking.
Could any of these plays actually work? I don't know and I'd love the thoughts of Expert Advice readers. I do know this, though: you won't find out by sitting on the bench.