Fundraising Consultant Fees: The Ultimate Nonprofit’s Guide

By susanlienau | April 12, 2018 | Hiring a Fundraising Consultant

Working with the right fundraising consultant can take your nonprofit to new heights, but hiring a consultant can be easier said than done. Your team needs to pick a partner who understands your organization’s mission and vision for your future while choosing a firm that fits your budget and provides the best return on your investment (ROI).

Even though fundraising consultants can be crucial to your operations, many nonprofit professionals are in the dark about the costs associated with hiring a fundraising consultant, what these fees pay for, and other financial details.

To set your nonprofit up for success with fundraising consultants, follow these three steps:

Is your nonprofit ready to learn the ins and outs of fundraising consultant fees? Let’s dive in!

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How to Hire a Fundraising Consultant

Before we explore the aspects of fundraising consultant fees, you need some context about the whole fundraising consultant hiring process. Your cadence will likely look like this:

The five steps for hiring a fundraising consultant (as explained below)
  • Identify your goals. Your organization-wide objectives are the main foundation for your nonprofit’s entire approach to fundraising. Use the tried and true SMART framework to ensure your most important goals are specific, measurable, attainable, relevant, and timely.
  • Use your network. Some of your biggest assets are your existing connections in the nonprofit space. Connect with your colleagues and ask them about their experiences with fundraising consultants for a broader perspective.
  • Meet with your top candidates. Once you’ve researched and narrowed down your options, arrange in-person meetings and interviews with representatives from different firms. Ensure you have questions prepared so you can understand their services and approach.
  • Request proposals and check references. Now it’s time for your top contenders to make their own cases. Request detailed proposals tailored to your nonprofit’s specific characteristics and goals. This is also when you’ll be inquiring about each firm’s fees.
  • Sign a contract. Congratulations, you’ve found your perfect fit! Now you can get up and running with your chosen firm.

This cadence is a good place to start, but there are other phases you’ll have to add on a case-by-case basis. For instance, your nonprofit might have to research niche consultants specializing in different processes. Agreeing to a partnership is a big commitment, so take all the steps you feel your organization needs to feel comfortable with your decision.

Determinants of Fundraising Consultant Fees

The determinants of fundraising consultant fees, as explained below

1. Payment Structure

All fundraising consultants request payment differently depending on the fundraising consulting firm’s practices and the services they provide. That said, you’ll need to get a detailed rundown from them before signing a contract. Here are the most common ways fundraising consultants get compensated:

Flat Fee

This fee structure works well when a partnership is intended to accomplish a specific task (like developing a case statement) or has a short-term end date.

  • Pro: The flat fee structure is predictable and budget-friendly for nonprofits who have already finalized their project requirements.
  • Con: The lack of flexibility can be a drawback for nonprofits who are less certain about their project’s scope or their desired engagement with the consultant.

Retainer

This is when the client pays the consultant on a monthly basis and receives a certain amount of services during each payment period.

  • Pro: Typically, this method is used for long-term fundraising campaigns (like a capital campaign or annual fundraiser) that may have a flexible or undetermined end date. These campaigns are usually the ones that need the most support anyway, so it’s advantageous for nonprofits that need more structure.
  • Con: Fundraising consultants on retainer often provide in-depth services that require an ongoing relationship and time invested before seeing results, so this isn’t the best solution for nonprofits with a limited budget or a one-off project.

Percentage of Fundraising Progress

In other instances, firms charge a percentage of the money you raise throughout the campaign as their payment.

  • Pro: The percentage of fundraising progress model might incentivize the fundraising consultant to perform higher, since their compensation is directly related to their efforts’ success.
  • Cons: These partnerships generally aren’t preferable and can often be a “quick fix” solution to fundraising challenges that require more direct attention. Even worse, partnerships with these kinds of firms often end up costing more in the long run and eat into your fundraising progress.

Depending on the kind of compensation agreement your nonprofit and fundraising consultant come to, you can always expect to sign a contract before your engagement begins. These contracts protect both your organization and your fundraising consultant partner. In your contract agreement, you will set goals for different fundraising metrics that must be met as part of your terms, financial incentives for reaching these goals, and even penalties for not meeting expectations.

2. Services Offered

When your nonprofit decides which fundraising consultant you want to be your partner, the next thing you’ll need to determine is how much their services will actually cost.

Much like determining how you’ll compensate them, this process depends on a few key factors. Particularly, the cost of hiring a fundraising consultant can vary depending on the type of project they take on, the nature of your nonprofit, and the prestige of the consulting firm.

General nonprofit consultants can provide a variety of key services to your nonprofit. Depending on your fundraising goals, your team might opt for a large-scale partnership or a short-term engagement.

To get an idea of what you’ll be paying for, note that you might bring on your nonprofit consultant to provide any of the following key services, including:

The determinants of fundraising consultant fees, as explained below
  • Fundraising campaign direction. One of the most common services is campaign management, in which you position the consultant as a leader of your next campaign to help see you through to your goals.
  • Marketing campaign advice. Nonprofits have unique marketing needs, and consultants can help you master them with custom strategies. For example, if you’re branching out into Google Ads, a certified Google partner is the best equipped to help your nonprofit succeed. Or, if you need help with branding, a consultant who provides graphic design services would be a good fit.
  • Internal training. Training your team is essential for not letting anything slip through the cracks. Consultants can help you with planning professional development classes, lectures, and other staff training events.
  • Campaign pre-planning services. Before you decide to take on a new campaign, you’ll need to conduct thorough research — and who better to help than a fundraising expert? Consultants can do anything from creating an à la carte fundraising feasibility study to ironing out your case statement.
  • Supporter stewardship management. Stewardship is a crucial element of supporter retention, and it helps to get an outside perspective on how to strengthen your strategies. You might get tips from a consultant like sending custom eCards and appreciation letters.
Click here to supercharge your supporter retention with Averill Solutions.

These are just a few of the possible services your fundraising consultant might offer. It varies from firm to firm, so ensure you get a thorough breakdown of the services available to you.

3. Your Nonprofit’s Identity

Additional major factors that can influence the cost of hiring a fundraising consultant are your nonprofit’s values, mission, and fundraising approach. You’ll want to find a partner who actually understands who you are, what you aim to accomplish, and how you’ll accomplish it.

Take into consideration some of these key factors that make up your organization’s identity and consider how they can affect your relationship with a fundraising consultant:

  • Your nonprofit’s primary fundraising sources. If certain types of fundraisers or events have worked well for you in the past, such as matching gift drives, in-kind gifts, volunteer grants, and more, your consultant should be well-versed in how to make them even better. Similarly, if you want to expand into a new area, your consultant should be able to provide realistic advice and a plan.
  • Your nonprofit’s mission. Who does your organization serve, and how well does the fundraising consultant understand your cause? The more aligned the consultant’s experience is with your particular mission, the more helpful they’ll be.
  • Your nonprofit’s culture. This refers to the internal culture among staff, volunteers, board members, and other stakeholders. Your consultant should fit in well with the dynamic at your nonprofit.
  • Your nonprofit’s fundraising experience. Newer organizations have different needs than more established ones, which your consultant should take into account.

Fundraising consultants come in all shapes and sizes, just like nonprofits. For this reason, you’ll want to take the time to find the best-fit consultant for your individual organization. This might mean paying a little extra for the perfect partner.

4. The Prestige of the Fundraising Consultant

Like any other business, fundraising consulting firms work hard for their reputations in the nonprofit community. However, not all firms carry the same clout.

When selecting a fundraising consultant, your team should carefully consider their prestige in the nonprofit world. Keep in mind some of these key factors, including:

Prerequisite for a fundraising consultant (as explained below)
  • Their experience. Ensure the firm has worked with nonprofits of a similar scale, mission, and constituency as yours. They should be well-versed in what your nonprofit is trying to achieve.
  • The diversity of their past clientele. You want to choose a firm that has worked with nonprofits like yours, but you also want to know they’re ready to take on curveballs.
  • Their references. Be sure to research external reviews of the firm’s services to get your own impressions of the firm’s work.

While prestigious fundraising consultants tend to come with a higher price tag, many excellent firms, like Averill Fundraising Solutions, offer quality services at an affordable price point. Don’t feel like your team needs to settle for anything less than a perfect partner.

5. Additional Costs

Some fundraising consultants charge miscellaneous costs associated with the process on top of their base fees. Organizations often wonder where additional expenses arise, how to navigate these costs, and what investments are truly necessary to get the most out of your partnership with a fundraising consultant.

Quality fundraising consultants will provide fair, straightforward bills. However, you’ll likely need to make an additional investment or two over the course of your partnership. After all, nonprofit fundraising can be unpredictable — your team may realize you need specialized services or extra attention from your consultant that wasn’t accounted for in your original price quote.

You should understand and prepare for common expenses that might arise during your nonprofit’s engagement with a fundraising consultant like these:

  • Travel expenses. In general, travel expenses will be included in your initial compensation agreement. However, if plans change and you need your consultant to meet your team at its headquarters in a hurry, expect to compensate them for their travel, especially for unplanned trips.
  • Ad hoc projects. Over time, you may need to adjust your compensation to accommodate additional ad hoc projects, especially if you started with a fixed rate. These could include developing prospect lists, producing campaign collateral, and more.
  • Internal investments. Your partnership with your fundraising consultant should result in changes in your fundraising strategy and positive action on behalf of your team, so you’ll likely need to make internal investments on top of hiring your fundraising consultant. This might include hiring new staff, training current team members, or investing in software.
  • Capacity building. Your consultant might take on capacity-building efforts to prepare your team to achieve its fundraising goals. These efforts will take time, work, and likely an expanded partnership with your consultant.

Knowing your partnership with a fundraising consultant could likely result in additional expenses outside of their initial services can be daunting. However, remember that these expenses are investments in the long-term success of your organization and will result in more effective operations.

Hiring a fundraising consultant can seem overwhelming, especially when it comes to predicting the total investment it will require. However, with this guide by your side, you’ll know what to look for and how to find the best fit for your organization.

Additional Fundraising Consultant Resources

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