Business Workshop: Fundraising challenges face nonprofits

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A recent study suggests that many nonprofit organizations across the country are in trouble because they have disorganized or ineffective fundraising programs.

The study, by CompassPoint and the Evelyn and Walter Haas, Jr. Fund, finds that many nonprofit organizations are stuck in a vicious cycle: not enough funds to invest in their programs and not enough staff to raise the money they need.

CompassPoint, a foundation for nonprofit management, surveyed more than 2,700 executive directors and development directors of nonprofit organizations of all sizes. The survey revealed a number of fundraising challenges plaguing the nonprofit sector:

• There is widespread instability in the position of development director, the executive at a nonprofit who leads fundraising efforts. Development directors frequently change jobs and when they do, the position is typically open for six months or more. Many executive directors complain their organization cannot find -- or keep -- a competent development director.

• Board members are often not engaged in fundraising activities and need to be better trained on their role in raising funds for the organization.

• Many nonprofits lack the basic fundraising systems and plans, with 12 percent of all nonprofits reporting that they don't even have a donor database.

The study found that the fundraising challenges were far greater for organizations with budgets of less than $1 million.

Having the right people and systems in place are important for development efforts, but fundraising must always start with the mission of the nonprofit organization. Nonprofit management should seek to instill in staff, volunteers, board members and funders a sense of the mission of the nonprofit -- the reason that the nonprofit is essential to the community. The mission will energize the board, staff and volunteers to actively participate in fundraising.

It is also the reason donors will give.

-- Rig Riggins
The Y of Greater Pittsburgh


Business Workshop is a weekly feature from local experts offering tidbits on matters affecting business. To contribute, contact Business Editor Brian Hyslop at


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