I typically have lots of calls with nonprofit leaders at the end of the calendar year. This past year was at an all time high. Makes sense. You're thinking about climbing that revenue hill again and want to know what it looks like if I was at your side for those 12 months training you, your staff, and your board.

Well, I had an interesting day this past year during these calls. I had two potential client conversations scheduled on the same day.

There were a lot of similarities between the two nonprofits:
- Both leaders were running similar sized organizations
- Both knew they needed more unrestricted revenue for general-operating expenses.
- Both had reached out because they are experts in something other than fundraising.
- Both suspect their development teams and boards might be leaving money on the table.

But, here's where the similarities stopped . . .

I asked . . . What are your growth plans? How much money do you need?

Fundraisers: When you go into a donor meeting, what’s your biggest fear?

The simple answer, that donors will simply say “no,” is real—but a bit broad.

Let’s dig a little deeper…

Playing the Numbers Game

I often hear development staff say their biggest fear is not knowing the answers to a donor’s questions. I talk about this a lot in regards to “the numbers.” It’s certainly a valid concern in some cases, if staff members aren’t privy to the financial aspects of their organization’s overall strategic initiatives.

To that, I say:

1) Your staff should have access to and knowledge of the true financial need of the organization. How else would they convey the need to investment-level donors? That’s why it’s so important to budget for training - to provide development staff the skills they need to lead donors to their best gift.

2) If there are questions that cannot be answered at that moment, what a perfect opportunity to get back in touch with that donor once you do have the answers. It’s a natural progression into relationship building!

As a nonprofit leader, how many times have you put weeks, maybe months, building out your strategic initiative and at the end of the day you didn’t have money to do them! The entire process didn’t live up to your expectations. Worse, it didn’t live up to your board’s expectations?

Frankly, this happens more often than you might think. Why?

Fundraising is strategic, yes. But unless you optimize the foundational elements of your fundraising plan (which really should be a financing plan), all of that “strategy” is for naught.

Sadly, unfulfilled Strategic Plans is one of the Top 3 reasons nonprofit CEOs reach out to me.

Nonprofit CEOs: Has this ever happened to you?

My client was telling me about an unexpected (and unrestricted) legacy gift they received a few years back to the tune of $2 million.

But, every year since, they’ve finished in the red and haven’t been able to accomplish the amazing initiatives outlined in their strategic plan. In fact, this client told me the organization “planned” to finish in the red for the next few years.

Gulp.

Why (and how) did the nonprofit get into this pickle? Well, the board decided that gift should be restricted to program growth.

I have no doubt the heart and root of that decision came from the right place. After all, if you want to see more lives changed, more impact, and more mission… you invest in programs, right?

Not so fast.

Nonprofit CEOs and board members, let me ask you this: Can we do a big (alright, HUGE) reframe in our sector, together?

Here’s what I’m proposing... cost versus investment.

A real-life example: The first time I invested in a coach to help me with a sticky part of my business, I was terrified by the cost. My finger hovered over the send button on my “YES” email for longer than I’d like to admit.

How’d it work out?

• My 2nd coach… cost 4X

• My 3rd… cost another 10X

• My 4th… you get the picture

Now, I don’t flinch when I see the cost. The value and results each have provided has been beyond transformational.

Nonprofit CEOs - What’s the last “AH-HA” moment you’ve had?

Mine is a good one. And it happened after starting to follow personal finance coach Ramit Sethi on Instagram. Ramit was talking about how many of us have learned how to SAVE our money, but we didn’t necessarily learn how to SPEND money.

[AH-HA!]

The last person I want to be is the one who saved blindly for decades, penny-pinched at every corner, and just kept my head down in a stockpiling strategy...but never enjoyed it.

You must learn how to spend well, too. Not only to enjoy the fruits of your labor, but know that, “If I take a risk with my money, it won’t be catastrophic.”

I can’t stop thinking about this in the two months since I heard it.

Here’s something I ask all of my clients and potential clients to consider (get ready, it’s a mind flip!):

The revenue trajectory of your organization has way more to do with the leadership's comfort level with investing in spending than some of their revenue-generating ideas.

People come to me all the time saying:

• We’re not growing.

• We need more money.

• We just can’t seem to get ahead.

But, too often they haven’t been truly honest with themselves. They haven’t considered if they’re spending enough money to equip their teams to make more money.

You see, when you want to raise more money for your nonprofit, this is simply self-sabotage. And often, this approach tends to yield mostly restricted revenue—a double whammy.

So, how would you secure more unrestricted revenue, so you can invest in the growth of your organization. Not just from a “What are the needs of this program?” perspective, but also in terms of operational expenses, administrative expenses, and my favorite word . . . OVERHEAD.

Where do we start?