Help & Advice:

1. Getting started in fundraising
2. Planning your fundraising
3. Sources of money
4. Applications

 
Help for Community Groups - 2. Planning your fundraising

Mark Twain wrote, 'If you don't know where you're going, you're sure to end up somewhere else'. Planning your fundraising will help ensure that you get where you want to get to. There are two basic questions you need to address when planning your fundraising:

What exactly are you raising the money for?

How are you going to get the money required?

If your fundraising target for the year is £250 for some new equipment, you don't need to start off by planning a major strategy; you just get on with it. A couple of coffee mornings will probably bring in all you need. However, if you need larger amounts of money, or need to raise money on an on-going basis, you will need a more planned approach. The clearer you are about what you are trying to do the more likely you are to be successful in doing it.

What is a fundraising strategy?

When people talk of a fundraising strategy they often assume that it is a sophisticated plan that only a professional fundraiser can come up with. It is not. A good fundraising strategy should be a simple document, which basically states:

what your group wants to do

how much it will cost to do it, and

how you are going to meet those costs.

So, how do you develop a strategy? The following points will help you to draw up a basic plan that will make your fundraising easier.

1. What your organisation is about.

You need to be clear about two points:

What your group wants to do (often called its aims and objectives). You are going to be asking people for money. Therefore you need to be absolutely clear what you as a group are about, what you are aiming to do with their money. So ask yourself why does our group exist, what are we trying to achieve? For example, your aim may be to make sure that no elderly person in our community is totally isolated in their own home, or to make sure that every physically abused woman has access to 24-hour telephone help and support.

Why you want to do it. You have to show that what you want to do is important, that you are meeting a key need in the community. It is not enough to say to a possible donor 'we need a minibus to bring elderly people to our lunch club'. Why do you need one? Why is it important that elderly people come to the lunch club? Basically, you need to show that any work you are doing fits in with the overall aims of the organisation and makes a significant contribution to needs you are trying to meet.

2. What you are going to do to meet your aims.

What work does your group want to undertake in the coming 12 months (or maybe as far as three years ahead)? It may be that you are a new group, just aiming to get up and running. Or you may be an established group doing any or all of the following:

• carrying on existing work
• developing existing work in a new way
• carrying out a new piece of work.

Whichever of these you are doing, you need to get hold of enough money to meet:

• the day-to-day running costs (revenue), plus
• the building and equipment costs (capital), plus
• any resources needed to change and improve what you are doing (development).

However, it is far easier to raise money for something specific than to appeal for administrative costs or general funds. This is because donors can then match the support they give to some specific piece of work (or project) that they are really interested in. See below – Fundraising for projects – for more detail on this.

3. How much do you need?

Once the first two points have been sorted, you are in a position to work out how much money you need – in other words, the cost of everything that you want to do. This will involve drawing up a budget.

Again, people often get frightened off by the thought of budgets, as if they are something for accountants and people who are good with figures. They are not. A budget is simply an estimate of expected income and expenditure, normally covering a period of a year (though some people aim to plan three years ahead). To estimate your costs, you need to note down every foreseeable expense of your group over the coming year. It is really no different to planning your household expenses, making sure you include all your regular bills (gas, electricity, telephone, rates etc.) as well as the annual or less frequent bills (road tax, Christmas presents etc.).

There are basically two kinds of costs:

• capital costs – these are basically one-off purchases of physical items that generally have a resale value (e.g. buildings, equipment, furniture, computers).
• revenue costs – these are the costs of running your activity such as rent, heat and light costs, salaries etc., which have no resale value.

You need to be realistic about these costs. For example, you want a new photocopier (capital expenditure). You apply to Awards for All and get the grant. What about ongoing maintenance and paying for all the paper and toner? What about extra insurance costs? This needs to be thought through before you write for money. Just because you raise the money to buy a piece of equipment doesn't mean that you will automatically have the money to run it. The same principle applies when thinking about building work. For example, when applying for a grant for an extension to your community centre, have you thought through all the ongoing maintenance costs (caretaker, decoration etc.)?

4. Where is the money coming from?

Once you have established how much money you need to meet your costs, you need to sort out where that money is going to come from. If you can show that you have clearly thought through how your organisation will be funded, it will give potential funders an impression of good financial management – this will make them more likely to trust you with their money. It will also give your fundraising activities a focus. Look at each source of income you can expect (e.g. local authority, subscriptions, fundraising events, grant-making trusts). See where last year's income came from and make a reasonable guess about what will happen next year. Some sources may be relatively secure, such as a three-year grant from a charitable trust for which you have only had one year, or subscriptions from members. Others, such as a planned new fundraising event may be a little more speculative. You need to rely on your judgement and experience. Which type of funder you approach will also depend on the type of funding required. Some sources of funds such as the annual Christmas party can be used by your group for whatever it wishes. Other sources, such as trusts or companies, are much more likely to give for a specific aspect of your work. For more information on the sources of money and what they may fund, please see section 3 – Sources of money.

5. How long it will take to raise the money

Try to estimate how long it will take for the money from different sources to come in. For example, it might take a month to organise a jumble sale, 3 to 6 months from sending a letter to getting a decision from a charitable trust or the lottery Community Fund, and applications may only be considered by the local council once a year. Using this information decide when you need to start filling in application forms and writing letters or planning fundraising events. You may find it helpful to enter dates of planned projects, closing dates for applications and the date when you need to start writing letters, when costings have to be ready, when you need to start planning fundraising events and such like. It may be helpful to write it up on a calendar to remind you of what needs doing by when.

6. Who is responsible for raising the funds

Different sorts of fundraising need different skills. One member of your group might be good at writing letters, another might enjoy running fundraising events, whilst others are good at telling people such as local councillors about how good your project is, keeping records, typing letters etc. For information on the qualities of a good fundraiser, please see section 1 – Getting started in fundraising. Where possible divide up the tasks as far as you can to match the skills of members of your group.

7. Who is coordinating all the activities

Someone needs to make sure that all this happens, that people do what they say they will do and at the right time.

8. Records of your fundraising

A simple card index or database can be used to record who you asked for what, when and with what result. This will help you to decide who to ask in the future, which fundraising events were worth doing, who to invite to your Christmas party and such like.

Fundraising for projects

More and more fundraising, especially from grant-making trusts and the Lottery boards, is for individual pieces of work rather than for the organisation as a whole. These individual pieces of work are called 'projects'. One of the great advantages of raising money for specific pieces of work (or project fundraising) is that you can highlight particular areas of your work that will interest the particular person you are writing to. The funder will then feel that their money is actually doing something and that they have made a real contribution. For example, a request for money towards the upkeep of your youth club may (just) work with your local authority; it won't get very far with BBC Children in Need Appeal. They will only want to fund a particular project or part of your work – say the anti-bullying work you do in schools, or the health advice provision for teenagers. Thinking of your work in project terms and designing projects, which will attract support is the basis of successful fundraising.

A fundable project should be:

• specific – an identifiable item of expenditure or aspect of the organisations's work;
• important – both to the organisation and to the cause or need it is meeting. If there is some long-term impact that will be an added bonus;
• effective – there should be a clear and positive outcome;
• realistic – the work proposed should be achievable;
• good value – the work should be a good use of the donor's money;
• topical – it should be looking at current issues and concerns;
• relevant – it should be relevant to the donor and the donor's particular funding concerns;
• bite-sized – it should not be too large or too small for a donor to support, although the cost might be shared through several smaller grants. If it is too large, it might be broken down into further sub-projects.

By breaking your work down into projects, you can focus on activities (e.g. homework clubs, disabled young people) rather than on your own needs (money for bills), and widen the range of possible funders. For example, rather than your youth group applying to just those funders that have a focus on young people, you may be able to apply to arts funders for an art project, sports funders for a basketball project, or environment funders for a neighbourhood clean-up campaign. If you are fundraising for projects, you will need to do an individual project for each budget. These smaller budgets will still follow the outline shown, with income and expenditure (both capital and revenue costs).

Putting it into practice

All this is very well in theory, but unfortunately none of this planning actually gets any money raised. At some point, you have to get on with the hard fundraising graft. Here are some ideas, which may help keep things on track.

Plan well ahead

Raising funds can take much longer than you think. It is always better to be planning your next year's fundraising now (and even the year's after), and even to have a three-year budget for your organisation. This allows you to see where the problems are, when grants are going to run out, and to start doing something about it.

Don't try to do too many things at once

Make sure that everything you do makes a significant contribution to your fundraising needs, and that you do everything as well as you can. It is all too easy to spread yourself too thinly, and try to cover too many fundraising bases. If you do you will end up doing everything badly.

Think through your strategy

The worst thing to do is simply to fire off a barrage of fundraising letters simply because you need the money. Think carefully about what you need, who might be interested in supporting you, why they will be interested in giving you money, how much they might be prepared to give, and what they might want or need in return. A carefully worked out approach will always be more successful.

Give yourself the resources you need to do the job well

This includes sufficient time to prepare the fundraising and to do it. It includes the right people to help you – you may need someone with a good telephone manner to ring around companies asking for gifts in kind, a prominent person as patron to head up your appeal and give your organisation credibility, an events committee to do all the organising for the fundraising event. It includes the right literature, which shows what you are doing in a forceful and attractive light.

Make sure you are effective

Set yourself targets, and then monitor your progress. Look at the time and costs you are putting into your fundraising, and make sure that what you are getting out (in terms of funds raised) represents a reasonable return on your 'investment'. As a guide, you will want to be raising at least four times what it costs to raise the money (possibly more than this) – although, when you are starting up, you may not be able to achieve this level of return. Make sure that you have sufficient back up – both the administrative and personal support you need – to help you work effectively.

Involve volunteers

At all levels. Your management committee members have the overall responsibility for the finances of your organisation; they may also have contacts, which can help you in your fundraising. If you are organising a large appeal, you may want to set up a separate Appeals Committee, specially to help you raise the money. You can involve volunteers in organising events and fundraising activities such as street collections and selling raffle tickets, in helping you with administration and research, and so on.

The same rules about planning ahead and keeping things under control apply just as much – if not more so – when you involve more people. On the one hand, the more people involved the more options you have; equally there are more things to go wrong and more people to promise to do something and then fail to deliver. Someone needs to take responsibility for the overall situation!

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