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Five Fundraising Ideas for Nonprofits That Don’t Work (or Why You Aren’t Raising Enough Money)

Five Fundraising Ideas for Nonprofits That Don't Work (or Why You Aren't Raising Enough Money)

It’s not easy to figure out what works in fundraising these days. If you’re like most, you’re trying lots of things, sometimes desperately looking for something that sticks and gets you the money you need to pay your expenses. In reality, you’re wasting a lot of time on strategies that just don’t work for where your nonprofit is right now in its growth. You see, there are no right or wrong fundraising strategies. But, there are ones that aren’t right for your nonprofit or aren’t right for you right now.

The Trick Is To Discern What Will Work Best For You

Sometimes when people are looking for fundraising ideas for nonprofits, they’re looking for a quick solution to solve their funding problems. “Where’s that magic pill that will fix everything?” It’s like a money grab because that’s what it’s all about — the money.

And If You Want To Fully Fund Your Nonprofit’s Budget, You’ve Got To Focus More On Your Donors, Because The Donor Is Worth More Than The Donation They Give

If you’re struggling to make ends meet, you’re probably using a broken funding model — one that will never bring you the kind of money you need this year and into the future. In short, the way you’re trying to raise money doesn’t work, no matter how hard you try. Let’s look at some fundraising ideas for nonprofits that just don’t work so you can skip these and the frustration that goes along with them.

Broken Funding Models for Nonprofits

Truly, it’s not your fault. You started your nonprofit to make a difference, not to raise money. But you can’t do much good in the world without proper funding. So, you found yourself sidelined while you tried to figure out fundraising. And you tried things you’ve done before or seen others do. Which makes sense. Sometimes those things work, but most of the time they fail to generate the kind of revenue you need to fund your nonprofit’s work.

There are some common pitfalls and rookie mistakes that many nonprofit leaders experience when trying to raise money — like these 5 funding models that we consider broken because they aren’t sustainable long-term, won’t secure your future, and won’t fully fund your budget.

Broken Model #1: Self Pay

You had the passion and the idea to start a nonprofit, and you’re fortunate to have a comfortable financial situation personally. So you figured you’d just write the checks yourself to keep the organization running. Maybe you envisioned that you could just skip over all the yucky fundraising stuff AND the begging. While you might be able to pay for the startup of your nonprofit (and maybe part of the way down the road), you can’t pay for everything yourself forever unless you’re independently wealthy.

Even then, paying for everything yourself is not good business for your nonprofit. It means that you don’t have the support of the community behind you and no accountability to go with it. It also means people aren’t experiencing the joy of supporting your cause and fulfilling their personal philanthropic desires. Look, you need others to come alongside you to support your nonprofit’s work so you can fulfill your mission and change the lives your nonprofit exists to change. Remember, many hands make light work.

Broken Model #2: Sole Source Funding

It’s tough to sit on a one-legged stool. Eventually, it WILL fall over. And trying to sit on a one-legged stool is exhausting, both mentally and physically. Fundraising can be a lot like that when you’re relying on one source of income to fund your nonprofit.

Look, in order to successfully fund your nonprofit both now and into the future, your funding should come from multiple sources. It’s called “diversified revenue streams” and it’s important to the financial health and stability of your nonprofit. In short, you should never depend on ONE donor, ONE grant, or ONE source of income to fund your entire organization.

If that one source goes away, you may find yourself in a very difficult situation, very quickly. At best, you’ll be scrambling to put together new funding sources. At worst, you’ll be scaling back, cutting programs, or maybe even closing the doors — leaving people without the services your nonprofit offers.
It’s easy to get too comfy when you have a big stream of money coming in.

But here’s the truth: nonprofits that have a fully funded budget and are set up for long-term success have diversified revenue. They have a fundraising plan composed of funding from many sources! If you’re applying for grants (or planning to apply soon), funders want to see that your nonprofit is stable and well managed. They may not want to give if they see your animal welfare nonprofit is living off of your adoption fees or your homeless shelter is solely running on a large government grant.

Don’t put all of your eggs in one basket when it comes to running your nonprofit. Create and maintain diversified funding streams for your nonprofit.

Broken Model #3: Fundraising Events

Fundraising events can be a good way to raise money, raise awareness, make new friends, and deepen relationships. A signature event, online giving days, and other kinds of events can be successful when well planned and executed. However, many young and small nonprofits do too many little events, which is exhausting for both them, their supporters, and their community. And many of these only bring in nickels and dimes, making it not worth the investment of time and energy to plan and host them. Has this happened to you? The local restaurant wants to host a chicken wing night and donate 20% of all sales to your nonprofit! How fun and easy, right?

Wrong! You’ll be asked to promote the event, add your name to it (i.e., endorse it), and get people to buy whatever special thing they’re offering. If they’ve made it REALLY difficult and are requiring a flier or password, you can immediately expect almost nothing from it. So really, all you’re doing is promoting a local business, spending your valuable social media space driving traffic to the event, and maybe getting a couple hundred dollars from the event.

I get that if your nonprofit is new, a couple hundred dollars can be a big deal. But if you’ve ever done one of these restaurant nights, you know what I’m talking about here — it’s a lot of work for very little in return. The reality is that these events help the hosting businesses MUCH more than they help you. Other “fundraisers” and small events are equally draining and unproductive. Look, just say “no” to anything that doesn’t appear to be worth your time and that you can’t see a clear path for generating at least $1,000 for your nonprofit.

That means you should NOT say “yes” to every opportunity that comes across your desk. When someone on your Board or a volunteer has a “great idea” for a new fundraiser, do your due diligence and estimate both the potential revenue and the potential investment. How much do you think you can raise, realistically? How much time and energy will it take to pull it off? Remember, there’s an opportunity cost associated with everything you do. While you’re busy promoting that restaurant night, you cannot do something else…like growing your monthly giving program, running a successful Facebook campaign, or meeting new major donors. By the way, those are things you SHOULD be spending your time on!

You only have 24 hours in the day, and you can only do one thing at a time (unless you’ve figured out how to clone yourself!). So, choose wisely when it comes to fundraisers and events.

Broken Model #4: Grants

Many nonprofit leaders mistakenly think that they can open their doors and immediately apply for (and get!) grants to fund their new nonprofit’s operations. Nope!

Grants definitely have their place in a healthy fundraising plan. You should certainly do the research to find out what grant opportunities are a good fit for you and do the work to get ready to go after grants. But grants are tough to find for nonprofits less than 5 years old. And grants are usually available only for specific projects or needs. That means your chances of finding grants to fund your ongoing operations year after year are pretty small. Grants are NEVER guaranteed, and they’re not always renewable. Even if you receive the same grant for years, there may come a time when the foundation changes their areas of focus and that grant you depend on is no longer available.

Do your homework and create a grant deadline calendar of the best opportunities for you. But consider grant money to be bonuses that you weren’t counting on and didn’t budget for.

Broken Model #5: Crowdfunding

“If you build it, they will come” is definitely not applicable to fundraising! Many people think that posting an online crowdfunding campaign will result in masses of new donors and new donations. Nope. It doesn’t work that way.

Crowdfunding is great for something compelling like an urgent need or a large project when you have a large following. The problem is that funding doesn’t roll in just because you posted on GoFundMe. You see, no one wakes up in the morning and says “I feel like giving some money away. I wonder if there’s a good cause online I can support?” A good crowdfunding campaign requires strong, clear messaging and quite a bit of effort, INCLUDING promotion of the campaign. In other words, it’s up to you to tell people about the campaign, ask them to give, and give them the link to the campaign.

See how that works? And at the end of the day, crowdfunding is a good tool for your fundraising toolbox, not a reliable method for raising all the money your nonprofit needs for starting up or for ongoing operations. There’s no harm in creating crowdfunding fundraisers at the right time and for the right reason and with the right messaging. But tossing up a fundraiser to recoup your expenses for a completed project or to pay to keep your lights on will probably disappoint you.

What DOES Work in Fundraising

So if those strategies don’t work, what does? Building a big, loyal donor base of people who want to support your nonprofit’s work. Asking donors to give to help you change lives and giving them a great experience with your nonprofit in between the Asks. And wrapping it all up in a solid fundraising plan that includes multiple sources of funding with a nice mix of business support, private donors, a signature event, and both online and offline efforts.

Trust me – this is the path to a fully funded nonprofit, just like the big organizations. Not to mention, it will help you sleep at night, knowing that you have the revenue you need to fulfill your nonprofit’s mission.

About the Author: Sandy ReesSandy Rees

Sandy shows founders and leaders of small nonprofits how to fully fund their big vision so they can spend their time changing lives instead of worrying about money. She has helped dozens of small nonprofits go from “nickel-and-dime fundraising” to mastering donor-based fundraising, inspiring their donors to give often and give big. Learn how to raise the money you need to fund your new nonprofit without begging, doing without, or paying out of your own pocket.

Click here to learn more about Get Fully Funded.

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Sandy Rees is the founder of Get Fully Funded where she shows nonprofit founders how to fully fund their big vision so they can spend their time changing lives instead of worrying about money. She has helped hundreds of new nonprofits go from “nickel-and-dime fundraising” to adding 6 figures to their bottom line. As a trainer, she shows her students how to find ideal donors, connect through authentic messaging, and build relationships that stand the test of time, so that fundraising becomes easy and predictable. Grab her latest ebook “Fund Your Dream” at https://getfullyfunded.com/getstarted.

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