Nine Ways to Build a Robust Challenge Gift Plan
Two years ago, we received a call from an enthusiastic donor who was ready to make a seven-figure gift to support capital projects. His one condition, however, was for his gift to be structured in a way that would encourage giving from others in the community. Only a few million from our campaign goal, we had an ideal opportunity to turn this into a challenge gift and close our fundraising gap. The donor agreed to our plan, and over the next 12 months we reached our campaign goal, thanks in large part to his leadership gift triggering millions more.
As we approach the New Year, now is an ideal time to incorporate a challenge gift, or matching gift, into your 2016 fundraising strategy.
Benefits of challenge gifts
1. Create a sense of competition among donors
2. Provide an incentive to give within a specific time frame
3. Allow donors to share their giving publicly, if they so desire
4. Promote philanthropy among constituents
Nine tips for building a robust challenge gift plan
1. Listen to your donor: This critical first step can make or break an exciting and successful challenge gift campaign. Understand your donor’s needs and desires, determine why he or she is making a gift, establish his or her expectations – and match them with your organization’s goals.
2. Build a plan: Like any successful campaign, a challenge gift requires a plan mutually agreed upon between the donor and the organization. Map it out on paper, and ensure you maintain updated drafts as the process progresses.
3. Determine the match ratio: Decide how much of your donor’s gift will be triggered for every dollar given. For example – every $1 given will trigger $2 of the match. Ask yourself whether this ratio helps to reach your fundraising goals.
4. Decide on gift parameters: Which gifts will trigger the match? Will gifts from new and recurring donors count? Remember: the more restrictive your giving parameters, the more challenging it’ll be to reach your fundraising goal.
5. Set a minimum matching gift amount: If you’re in the middle of a major capital campaign, you’re likely looking for five-, six- and seven- figure gifts. Set a minimum gift amount to trigger the match – for example $10,000. We found setting a minimum gift encouraged donors to stretch their giving level. Matching gifts to boost your year-end campaigns may require lower-level leadership gifts to qualify.
6. Identify your target audience: Decide which cohort of prospects the challenge gift will motivate most. Is it your five-figure prospects? Six-figure? $1,000 and $500 prospects? Craft your message to address your target audience.
7. Build a timeline: Set a proposed start and end date, and share this with key prospects in your community. Setting an end date puts pressure on donors to make the giving deadline.
8. Organize a marketing plan: Determine how, when and where the challenge gift will be announced. This is a perfect opportunity to invoke your multi-channel marketing genius! Don’t forget to share gift details in private meetings, receptions and other appropriate settings, keeping your target audience in mind at all times.
9. Have the donor sign off on the plan: Once you’ve completed a plan, ensure your donor is in complete agreement with the details, and GO!
This strategy proved generosity begets generosity and encouraged an entire community to rally around the importance of leadership giving. With this donor’s $1,500,000 challenge gift, we raised an additional $5,140,000 and reached our multi-million dollar capital campaign goal.
Good luck planning your fundraising strategy!