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Examples of Successful Challenge Grant Strategies

In the following examples organizations describe, in their own words, how they used the challenge grant.

Although each example highlights only one approach, many organizations use multiple approaches to complete a challenge. We encourage you to share your story with us so that others can learn from your experience.

Please also see Challenge Grant Tactics.

General


 

Starting from Scratch

Our organization is very new to fundraising. Up until last year, we were fully funded by two funders. But the downturn in the economy caused us to lose one of those funders, sending our very small staff scrambling to fill the gap. While my coworker went off in search of increased earned revenue, my job was to go looking for grants – not something I’d ever done before.

We have a very hands-off board, so it was up to staff to create relationships. We used the annual reports of organizations similar to ours to identify potential funders, then sent out a few dozen letters of intent, and used LinkedIn to see which of our business contacts could connect me on a more personal level to some of those potential funders we’d identified. As novices at fund-raising, we found that being able to call the leads we found through LinkedIn with a matching offer was a great reason to follow-up, and it was an excellent way to gauge real interest, particularly with those foundations that focus on a particular neighborhood.

By acting quickly, they could double the effect of their money in that neighborhood. If they waited, the matching grant would be applied to someone else’s contribution. We pointed this out in the calls we made, and pursued by phone and email those grant-makers who demonstrated a real interest, keeping each apprised of how much of the matching grant remained.

In eight months – with no additional costs to our program – the matching grant helped us fill half of our shortfall. Additionally, we continue to reap the benefits of the matching grant: some of the supporters that could not act quickly enough to participate in the match have since made grants to us, and we believe the dialogue that we now have with them was generated by the calls we made regarding the matching grant.

The Importance of Timing

We learned that timing can be very important in terms of connecting with a donor. For instance, we wanted to follow up with individuals who were invited to our spring gala during the summer months with the matching opportunity. However, reaching many of our donors with the challenge opportunity during the summer was difficult; many were on vacation or made their gifts regularly at the end of the calendar year.
When we asked them to consider increasing their annual gifts to help us meet the challenge closer to the time when they made their annual gifts in November and December, we were more successful, with four of our major donors increasing their gifts by $1,000-$5,000.

Presenting a Compelling Case

We have not added a new staff position for many years, so it was necessary to present a compelling case regarding its critical role in meeting our core mission. We did this by presenting the board of directors a “Case Statement” that clearly detailed how this position would support our participants throughout their challenging collegiate experience. The use of data and research outlined how this position would strengthen our organizational outcomes as well as convince our donors that their support of the challenge grant would ultimately increase the return on their investment. In the end, we had the full support of the board, who determined that we not only needed the position, but that it would play an integral role in our sustainability.

Call To Action

The challenge grant served as a useful “Call to Action” for our donors, providing our individual annual campaign with a sense of urgency and increased importance. We believe that the challenge grant is a key reason we were able to grow our Individual Annual Campaign by more than 34% year-over-year.

Staff Involvement

The fundraising strategy we used for our challenge grant focused on strengthening our organization’s overall “culture of fundraising” through the involvement of our staff. Staff members participated by fundraising for events. They solicited local businesses, community leaders, and individual contacts, and their efforts resulted in both in-kind and monetary donations. They also helped us execute an annual-giving campaign targeted at individual donors. All staff members were involved, and each was able to identify ten prospective donors to solicit through a holiday giving letter, which helped us increase the number of individual donations we received.
We are pleased to report that our individual-giving revenue doubled in the past year due to dozens of new individual donors along with an implementation of payroll donations through staff and payroll matching donations through other agencies. We are eager to see what the future brings and how we can utilize our challenge grant to increase individual giving through additional staff involvement.

Staff Giving Champions

For the first time, we specifically solicited our staff during our annual campaign. To help make this a success, we identified volunteer “Giving Champions.” These individuals sent out targeted solicitations to specific groups of staff that they worked closely with. Along with the solicitations, we also implemented a few other changes to help increase donations. We made it possible for staff donations to be taken directly out of payroll checks.

This meant staff members could choose a small amount that would be taken out each month, that overall would result in a larger, yearly contribution. We also set a giving expectation for our leadership staff of $1,000 per person. Overall, these changes helped us almost triple our staff giving from the previous year.

Individuals


 

Individual Giving

The challenge grant prompted our Board of Directors to review and update their 2011-2012 fundraising plan. Their primary goal for the year was to increase individual annual giving, since this was an area that traditionally hadn’t received as much attention as grants and special events. As an initial step, we asked Board members to make their own “stretch” gifts to serve as role models to others who were solicited later.  All Board members contributed to the annual appeal, and several increased their gift by 20%. We also used the match as an incentive to encourage friends of our organization to contribute for the first time – or, in the case of past donors, we asked them to increase their gift through a separate, personalized letter. We posted information about the matching grant on our website and on our Facebook page, and we included it as a call to action in our year-end solicitation, which was mailed in late November 2011. 

In the meantime, we featured information about the matching grant in our new email newsletter, along with a link to “donate now.” In addition to publicizing the challenge grant, we also sent two solicitations this year. This increased the cost of our annual appeal, but given the results, it was well worth it.  We particularly emphasized the challenge grant in the second mailing, which was timed to arrive in homes just after Thanksgiving.  The challenge grant gave urgency to our call to action and provided extra motivation for year-end giving.  It was tremendously helpful to us in achieving our goals for the year!

Annual Appeal

We started by creating a list of all past donors from our donor database, including those donations from our Board of Directors, Auxiliary Board members, and current and past staff members. We then reached out to each of our board members individually, requesting that they look over the list and make any changes and add new or prospective donors. We created both an email campaign and a direct mail Annual Appeal brochure with programmatic updates and request for support. In the direct mailer, we encouraged all board members and staff to write a personalized note on each card to donors asking them to make a contribution for 2012. Using the different platforms for correspondence was beneficial because it provided donors the option to donate online via credit card, while also still giving the option of direct mail contributions.

By utilizing both of these tactics, as well as personalizing as much of our correspondence as possible, we saw a  significant influx in donations this year, both from new donors and existing donors, increasing donations by 45%. Further, we were able to intentionally track which types of donors gave in which ways, allowing us to reduce the volume of direct mail sent out moving forward. The one difficulty we faced was capturing the most current contact information for our donor database, as a small portion of our donor’s information was outdated. Next year we will begin preparing our materials sooner so that we have more lead time to update our donor listings and reach out to board members and major donors.

Targeted Current Donor Annual Appeal

We were very strategic in our year-end appeal. Each letter to current donors noted their prior two years’ gifts and asked for them to increase their gifts this year by 25 percent. Over half of those donors met or exceeded that request. Indeed, overall our returning donors gave an average increase on their gifts of 35 percent.

New Donors – Families and Alumni

We fulfilled our challenge largely through new donations from individuals, particularly family members of our participants and program alumni. By making specific asks to these groups during our quarterly participant orientations and mailed appeal letters, we learned that challenge grants are particularly motivating for families that want to show appreciation for the services provided. We worked to publicize our challenge grant with these audiences, emphasizing that new donors could double their impact. This gave an average increase on their gifts of 35 percent.

Lapsed Donors

For us, the challenge grant gave us an avenue to renew some old relationships, and build some new ones. Our organization was founded by a coalition of church leaders. Over the years, these religious leaders and the members of their Mission Committees have changed, retired, and even in some cases, passed away.  We need these Samaritans back, as donors, and as partners.

We used our Challenge grant, in part, as a catalyst to reconnect with these churches, asking them to join with us in observing National Hunger and Homelessness Awareness Week through sermon, volunteer effort or special collections.  Several did, re-igniting the call-to-action that had previously prompted them to provide social services to the homeless by opening their church basements on cold winter nights, and hosting soup kitchens during the day, at a time when government and nonprofits had not yet entered the picture. We expect to enjoy our renewed partnership of these churches for years to come.

Major Gifts

Our goal was to increase the number and amount of major gifts (gifts over $1,000). Over a several-month period, board members worked along with development staff to seek and solicit particular potential donors. In our communications with donors, we were deliberate about messaging the challenge grant to potential donors and we updated donors on progress toward the goal. There were virtually no costs above our usual fundraising expenses. The prior year’s total from the segment consisting of gifts at or above $1,000 was $40,000. With the match in place, we saw this level of major gifts at or above $1,000 rise 74%!

Giving Circles

This challenge grant coincided with our plan to introduce new “giving circles” as a major donor fundraising strategy. Therefore, we used the challenge grant as an opportunity to launch that strategy. We hosted an event introducing our new Giving Circles and emphasized at the event that any new or increased gifts would be matched. This event provided a casual, friendly atmosphere that gave donors the opportunity to talk to staff and program participants and see how their increased gifts could benefit our organization. Invitees to the event were donors who had been consistently giving $250 or more for the last few years; at the event, we asked them to increase their support and highlighted benefits for individual donors who pledged $1,000 or more per year.

Three board members were in attendance, including the board chair as well as our alumni board member, who spoke to the gathered guests about his experiences with our organization. The third board member, one of our newer members, made the request for donations. This special event resulted in roughly $9,000 of new or increased donations. No additional direct costs were incurred because we utilized the challenge grant to dramatically improve the return on fundraising activities that were already planned and budgeted

Board


 

Strategic Board Giving

We focused the implementation of our challenge grant on educating and soliciting our board of directors. Beginning with our board and resource committee chairs, followed by our full resource committee and finishing with our board of directors, we shared a multi-year analysis of the board’s give-or-get performance and personal giving. After explaining the challenge grant opportunity, we made the case that we needed to increase board personal giving and increase the total board giving by more than 26 percent. We worked with our board leaders to develop a set of recommendations, including a $200 minimum personal gift and sliding scale for personal gift expectations based on how much each director would be responsible for raising.

Through the spring, our executive director and board chair had conversations with each member of our board. Overall, directors’ responses to the recommendations were positive and most were willing to consider personal increases. As a result, our directors exceeded the $20,000 goal, giving more than $5,000 more than they had the year before.  We were able to establish a new expectation for personal giving that will impact revenue for years to come. This year, we will present our results to the board, discuss formalizing new recommendations and discuss additional strategies to maintain and continue to grow board giving.

Board Giving Champions

Approximately 50 percent of our board members are individuals who have been served by our organization (“consumers”), so the giving capacities of our board members vary greatly. That has made it a challenge to create a board giving policy that would encourage an appropriately high level of giving for each of our board members. This year we implemented an expected giving policy for the first time, but with no minimum amount. Then, to encourage individuals to give a donation that would be meaningful for them, we identified two board members who volunteered to be “Giving Champions”.

One Giving Champion was a consumer, and sent specific solicitations to the other consumer members of our board. The other Giving Champion was a “non-consumer”, and sent specific solicitations to the other non-consumer members of our board. This strategy allowed us to request certain amounts from different board members, depending on their ability to give. Having our Giving Champions craft these targeted appeals helped us reach 100 percent board giving and triple the total amount of unrestricted board giving.

Subcommittee Development

Our long-term goal was to use the challenge grant to help our board implement structural changes in the way they govern themselves and support the organization. Our short-term goal was to increase board involvement in fundraising efforts and ensure 100% board giving. The challenge grant helped inspire our board to revitalize its Development Committee in order to have a subgroup of the board encourage their peers to fundraise and make personal contributions. We created more specificity in the board members’ job description to include explicit language about fundraising and giving. The Development Committee Chair discussed the board’s fundraising/giving and progress towards meeting the challenge at every board meeting. We utilized the challenge to engage board members in our annual fundraising event as host committee members and event planners. During the challenge period, our development staff worked closely with the board to expand our current donor base through prospect identification and cultivation of new and lapsed individual donors.

Thanks in large part to the challenge grant, we raised board giving for the current fiscal year and, along with our direct mail appeals, surpassed the challenge goal of $20,000. In addition, our board placed a renewed emphasis on the importance of board giving and fundraising and the challenge grant inspired our board to institute a new “give or get” policy. We are now more confident that we will meet our goal of 100% board giving and increased board contributions and are excited that a new group of board members have joined a revitalized Development Committee of the board. These new board members are particularly committed to working to increase board giving and expanding the board’s role in raising donations from other sources. The challenge grant was integral in achieving these recent successes.

Board Fundraising

Each year, we run a workshop for the board on cultivating individual donors, which includes how to identify prospective donors, develop a relationships with them, and find a common ground between their interests and our work.  The board is always the most nervous about ‘the ask’. The challenge has offered the board an effective tool with which to make the close easier.  Prospective donors are more excited about the prospect of giving when a board member can say “the impact of your donation will be doubled (up to X amount).”   And it makes ‘the ask’ less nerve-wracking for board members.  Furthermore, the board has been asked to use the challenge in a very intentional way—highlighting the challenge to their networks, as well as highlighting it at our events, and in our annual appeal.

Expanding Board Reach

We specifically targeted our board and advisory council in implementing the challenge grant. We challenged our board and advisory council with an “each one bring one” initiative, with the goal being that every member would bring one person to the event who had no prior giving history. We learned that when you give the board and advisory council a very specific assignment, they will deliver! We simply asked for members to extend their reach to people outside of their usual circle, and, in the process, to identify people with capacity, affinity, and interest in the work that we do.  In the past, we struggled with board members filling their tables with the same guests year after year. Through this process, we secured a total of 52 new donors. The initial impact on our organization is much needed funding, and the longer-term impact is a larger pool of supporters.

Young Professionals Board

Due to ongoing budget cuts and increased backlogs in payments from the State of Illinois, many organizations cut or reduced their programs because of their reliance on state government grants. Because of these issues, we have focused our attention to increasing individual giving and identifying new private (foundation and corporate) sponsors.

We inaugurated the Young Professionals Board, a dynamic group of 30 young professionals under the age of 38 who have held numerous fundraisers and tapped into new potential donors. This group has played an instrumental role in our challenge grant campaign. Through their activities including cocktail hours, breakfasts and casual meet-and-greets, we have raised individual donations, identified new volunteers to the organization and attracted a young audience who may wish to serve our organization in various capacities throughout their lives.

Indeed, recently the chair of the Young Professionals Board was appointed to our governing board, ensuring the efforts of the Young Professionals Board are fully integrated into our long-range fundraising strategy. During the Young Professional Board’s first year, they raised $2,000 in new and increased funds! Although the challenge grant is set to expire, we have garnered some tangible skills in looking for ways to sustain the momentum and increase our individual giving through the newly created Development Committee, which combines leadership of our councils and board. In this manner, we anticipate that we will be able to preserve some of the best relationships through our work and continue to cultivate new donors for our organization.

Special Events


 

Planning For A Special Event

We utilized the challenge grant to increase day-of contributions at the Women’s Board Gala. This year, we utilized buy-in and enthusiasm from the members of the Women’s Board to leverage the challenge grant. A few months before the event, the Women’s Board members were informed via email and in person about the challenge grant and its terms. They were encouraged to consider increasing their own contributions this year and to encourage those donors at their tables to give for the first time or to increase their donations.

Reminders about the challenge grant were sent to Women’s Board members prior to the event as well. Women’s Board members were provided lists of the guests seated at their tables that denoted those guests who were new donors and those who had not given to the organization in over one year. The Women’s Board members were then asked to encourage those donors to give during the auction. The challenge grant was included in language in the Gala program and on auction cards provided to each guest at the Gala.

Soliciting Guests after a Special Event

Every year, we have an annual gala where Board Members and other friends of our organization buy tables and bring their friends, many of which are not familiar with our work. This year, after the event, we sent a mailing to people who attended our annual gala but had never made a donation to us. These were all “table” guests and therefore had not even purchased a ticket. We sent each of these individuals a letter thanking them for coming to the benefit and informing them that a donation at this time would be matched dollar for dollar. This solicitation resulted in 7 donations totaling $1,215 in new and increased donations to us!

Utilizing Technology

This year we focused on using technology to increase our donor base. We incorporated a “fund-a-cause” opportunity into our kick-off event for our Centennial Celebration using a company called Text-to-Pledge. Through a strong staff appeal, a personal story from a participant, and the announcement of our challenge grant, we asked our event attendees to use their cell phones to text pledges. Guests texted throughout the event and put up congratulatory notes to our organization (anonymously, if preferred). This strategy was helpful in engaging event attendees, especially those who come as guests of friends or companies and do not usually donate to our organization. It only cost $1,000 to raise over $17,500 and overall we raised twice as much as we ever have through our event appeal.

Paddle Raise

We used our challenge grant at our organization’s annual fundraising event. The challenge was announced to guests throughout the evening’s program to encourage donations during the paddle raise, which encourages guests to make a cash donation to the agency by raising their paddle. Presenters announced that new or increased donations would be matched to build enthusiasm for the opportunity. After all items were sold during the live auction, a three-minute video explaining the organization’s work through success stories was shown.

The video set the tone for what happened next: the auctioneer made an emotional appeal to those in attendance to raise their paddles to make a donation at a pre-determined level ($1,000). Bid spotters recorded the paddle number and the auctioneer then asked for donations at a lower level. This continued down to the $50 level. With the help of the challenge, the paddle raiser raised more than $8,000 in new or increased gifts, at levels from $50 to $1,000.