Fundraising 101: The beginners guide To fundraising:
What is Fundraising?
Fundraising is simply raising funds. Whether for funding a project or a starting a venture fundraising is using different sources to get funds to do something. These funds can come from bank, grants and foundations. Funds can even be generated online through crowdfunding.
Confused between crowdfunding and fundraising
? Read the complete guide on Crowdfunding.
Fundraising can sound a bit daunting, but any one can do it. We've created a handy guide so you can understand the basics. Below we will cover:
Fundraising for non-profit organizations
Sources for raising funds
Fundraising ideas for non-profits
How to do a fundraiser
Crowdfunding: best way of fundraising?
1) Non-profit organizations and fundraising:
Most organizations, especially non-profits obtain funds from funding agencies. Depending on their area of work such as research, religious, disaster management, relief work, etc. these organisations can apply for funds from agency that support those causes.
Natural disasters also get fundraising. A good example would be the funds given to various organizations providing food and shelter to the recent flood victims in Chennai. In such calamities, the government also sanctions funds for relief efforts. The Prime Minister relief fund is one such example, where any one can contribute their bit towards making the cause successful.
Other non-profit campaigns are those for political parties. Various political organizations across the globe use crowdfunding techniques to raise funds. In fact, in countries like the United States, the government conducts pledge drives, to raise funds from the people for public broadcasting stations. In India, contributing to political parties is tax exempt!
2) Sources for raising funds:
Funds can be raised from many sources by using various different methods of fundraising. One can apply for funds from government grants, non-profit organizations and foundations or big corporations and even crowdfunding. In fact, crowdfunding is the best way to raise funds - it is completely under your control - all you need is good Internet and some online supporters. But, let us look at these sources in greater detail.
Raising funds via grants:
Many established and well-connected non-profits raise funds through grants. It is an excellent source of funding for non-profits of any size. This kind of fundraising is called grant funding. One has to be a skilled and well established to apply for this type of funding. The grant needs to be applied for with a formal proposal.
The proposal must be well-written clearly stating exactly what you will do with the funds. The fund utilisation and your intention as well the background of your project must be in it. Sometimes, grants also have a format - to make it easy for the person investing the money or the grantor to understand your project.
A grantor won't only be impressed by the way you write a grant, but, will want to check your financial records and your accounting. Only after all these hygiene checks, will the grant move forward. After you've successfully got a grant, the organization must send follow-up reports to the grantor to show how the money has been used and how your project is progressing.
Grants come in all sizes - small and big. A good rapport with the grantor helps gain funds at a later stage too. Also, many big corporate companies conduct volunteer grant programs yearly, so many non-profits keep an eye out for these since they are usually sizeable.
Individual donations can start pouring in as people become aware of your work and your cause. It also helps in branding your non-profit. Many individuals want to donate and support you in your work. It is a good idea to build up a donor base from your alumni networks, private foundations, friends, and corporations. Perhaps the most interesting thing about supporters is that they can contribute not only financially, but also give gifts and volunteer their services and time. Once you gather enough supporters, you can take it online and begin crowdfunding, but we'll shortly come to that.
Services and Sales:
Fundraising involves people donating money to your cause and this money can be generated through sales. For example, an NGO can make handcrafted wallets and sell it to individuals and use the money generated to further their work. Small items like T-shirts, bags, wallets, and craft items work well for fundraising sales. It is not uncommon for organsations to fundraise through events like charity balls and galas.
3) Fundraising ideas for non-profits:
Raising funds is always a challenge but there are some easy, established ways non-profits raise funds. Here are a few of those ways:
Support from corporates
Capital campaigns are time-limited. In such campaigns, the organisation has to raise a significant amount of funds, in a limited amount of time for their project. This kind of campaign is usually used for the construction or other infrastructure. The funds raised can also be used as an endowment in the future. These type of campaigns need volunteers to help and coordinate and usually span over 2-4 years. A lot of strategic planning is necessary in such campaigns - or it may not succeed.
Support from corporates:
The greatest advantage of corporate funding is that it builds successful corporate partnerships and also allows expansion of the volunteer base. Another advantage of corporate funding is that it can be pulled off in a measly budget. A company gives a percentage of its money towards philanthropic projects. Corporate giving usually happen when both the company and the non-profit have a mutual gain. The benefits include cause branding and cause-sponsorship. Non-profits have monetary benefits from corporate sponsorships whereas corporates gain visibility among the public.
Corporates can also give sponsorships to non-profits. The company makes products for the nonprofit organizations. The money earned from selling the product contributes directly to the nonprofit's cause.
These campaigns are philanthropy-driven which help to convert prospects to regular donors. It builds strong bonds and strengthens relationships between the donor and the organization. The major advantage of conducting membership campaigns is that it increases donor loyalty and maximizes trust. The donors who get converted as members feel a sense of responsibility towards the cause and organization may offer other services apart from money, such as volunteering.etc
Before starting a membership campaign, one must think of questions like, "what benefits members have over donors" and "What should be the cost of the base membership fee?".etc
Special events are a great way to gain publicity for the organization. People get to know about the agenda of the organization. Conducting special events and raising funds via that is one of the common methods used my non-profits. Special events may include concerts, auctions, contests.etc Very often, pop singers like Britney Spears, conduct charity concerts to their bit towards the cause.
4) How to do a fundraiser:
Superstar fundraisers are not born, they're made. Anyone can be superstar fundraiser with a little amount of effort and by knowing the tricks of the trade.
To start a fundraising campaign, you must choose two ways, Online or offline. Let us say, you want to start it online because offline fundraising requires more effort and initial funds for branding.etc
Raising funds online in just 5 simple steps:
Choose a good fundraising platform like Milaap,ketto.etc which will suit your needs.
The next step is to register as a fundraiser and begin your campaign.
Enter all the details of your cause. It can be charitable or any social/personal cause.
Enter all the details and fill the columns with relevant pictures.
You must enter a set target/goal of how much amount of money would be sufficient for your needs. This is really important.
That's it! Now, wait for your campaign to be published on the site.
What to do after it is published:
One cannot sit calm and wait for funds to appear magically in their account after the campaign is published. After it is published, one must publicize it by sharing it among their circle of friends and explain them about why you want to raise funds. Let them spread the cause in their social networking circles and it goes on. That's the beauty of crowdfunding. In the meantime, one must also be noting down feedback from different people. If everything is done right, the campaign at the end of the goal period becomes a huge success!
5) Crowdfunding: best way of fundraising?
There's no question about the success of crowdfunding. Crowdfunding is an easier and less complex way of getting funds. The cause is presented in a clear format to people and if interested, they support the cause by donating money. Crowdfunding is the future and has changed the way how funding works. Crowdfunding can be done both offline and online depending on one's choice. Online is preferable as it has the capacity to make a cause go viral at the cost of a shoestring.
There are various types of crowdfunding one can opt for:
One has to note that equity-based crowdfunding is not permitted in India
, but is permitted in other countries like the United States.etc
Fun fact: The foundation for The Statue of Liberty was constructed by raising funds from the people.
6) Best fundraising websites:
Fundraising can be a tough task, but, it's a lot easier job right now, thanks to these fundraising websites which help raise funds online at the click of a button by means of crowdfunding.
Read more on the comparison of different crowdfunding platforms in India
Any kind of fundraising technique requires a good amount of effort to make it successful. In few cases, it requires a team of volunteers who are willing to work towards the cause. Choose a good fundraising platform among these which suit your cause and get started on your fundraising journey.