This is probably the most complicated question out there for fundraisers. How much to ask for is almost like a budget — odds are better than not, you won’t receive what you are asking for. Either you will be asking for too much or asking for too little.
You should come up with a starting figure. There are some unique algorithms that I have seen in the past. These include:
- A Capital (major) gift is usually ten to twenty-fold of the Annual gift. But remember that these gifts are usually paid over three to five years, while Annual gifts are …… annual.
- I saw a colleague once use the formula of (Age times Income) divided by 10 as a ‘quick and dirty’ way of calculating net worth. I don’t believe that I have seen this proven, as few people will disclose their net worth (or even know their net worth). Additionally, I have seen some people calculate the net worth figure as a ten-fold of annual income. I believe this, too, to be flawed and generally overstated.
- I’ve also read about someone who figured that a prospect’s giving ability is calculated by Annual Income divided by 10 (and spread over 5 years). That may be true (the old tithing rule), but it does not reflect what they have already committed to or charities of choice.
The only one of the algorithms that is neither a guessing game or wildly speculative is the first. It reminds the fundraiser to look in their own database for trends and mine the information that is there.
The last bit of advice is to never ask for a gift. Literally. Don’t ask for $25,000 over 5 years. Ask someone to consider a gift of $25,000 over 5 years. That makes all the difference in the world,
By the way, some of my most successful canvasses haven’t involved me asking for a gift at all. It involved inspiring a donor to the point that they ask “what do you need to be successful in this endeavor”? Isn’t fundraising great?
Until next week,