Back to Online Resources

Why Most Fundraising Initiatives Fail

There Are Seven Primary Reasons Why Fundraising Efforts Fail…And They’re All Painful


Fundraising is a tough business.

To be sure, there are no guarantees that your fundraising initiative will flourish. Indeed, quite the opposite is true. In fact, fundraising initiatives—too numerous to count—fail miserably every single day.

The good news is, it doesn’t have to be this way.

In this article, we’ll examine the most common explanations as to why fundraising initiatives fail. Specifically, we’ll offer up seven primary reasons—which will capture about 99% of all the potential reasons—why fundraising initiatives go south. As a result of reading this article, you’ll have a much better understanding of why fundraising initiatives fail and what you can do to avoid becoming a casualty yourself.

The Frustration Of Fundraising

It goes without saying, fundraising (and keeping a nonprofit afloat) is difficult and frustrating work as the journey to success is littered with pitfalls and landmines. As many nonprofit executives have learned the hard way, one misstep and things can get ugly fast. By acknowledging the fact that many fundraising initiatives are less than successful—and understanding the reasons for their failure—nonprofit executives can better arm themselves with strategies to avoid failure and blaze a path to more successful outcomes.

In essence, there are seven primary reasons why a nonprofit’s fundraising efforts fail. These reasons include the following:

  • No case
  • No conviction
  • No communication
  • No connection
  • No confidence
  • No closure
  • No credible framework

Let’s take a closer look at each.


REASONS FUNDRAISING EFFORTS FAIL #1:

No Case

According to fundraising expert, Simone Joyaux, a nonprofit’s case statement (case for support) serves as the organization’s communication document—one that is carefully crafted in a way to emotionally connect with your prospects and existing donors.

A nonprofit’s case statement is important because it answers the most essential questions that donors have—and they need concrete answers to these questions before they’re willing to make a contribution. Perhaps one of the biggest mistakes that nonprofit executives make in undertaking an aggressive fundraising initiative is that they fail to craft this case statement in a way that meaningfully connects with potential and existing donors.

Ask anybody in the business who’s failed, neglecting to create a compelling organizational case statement is the absolute kiss of death. (Oh, and by the way, we’ll be taking a deeper dive into creating killer case statements in an upcoming article.)


REASONS FUNDRAISING EFFORTS FAIL #2:

No Conviction

Even though you may have created a killer case statement—one that crosses all the t’s and dots all the i’s—if you’re not 110% committed to that case statement, your fundraising initiative will fail.

And sadly, this happens a lot.

You know it and we know it. There’s something magical about commitment and people who are convicted to righting wrongs and helping others. In fact, when someone is willing to risk their personal and professional reputation—and in some instances even their lives—to take on an important social issue, the effect is inspiring.

Remember, for example, the young man who stood in front of the tanks in Tiananmen Square on June 5, 1989. By way of background, days earlier, the Chinese military had resorted to suppressing protests taking place in the square by using any and all means necessary. Convicted by these actions, an unidentified young man stepped in front of an intimidating line of military tanks. The effect inspired the world—in fact, the photograph of this act has become one of the most iconic ever taken.

If you expect your fundraising initiative to succeed, you—and your people—will need to be 110% convicted and push all in.


REASONS FUNDRAISING EFFORTS FAIL #3:

No Communication

A third reason why fundraising initiatives fail is that they are grossly and egregiously under communicated. In fact, it’s not uncommon for nonprofit executives—and their boards and staffs—to invest enormous amounts of time to conceptualizing and planning fundraising campaigns only then to fail to dedicate the appropriate resources necessary to communicate them appropriately and effectively.

While there’s not a lot of statistical documentation to back this up, there is a mountain of anecdotal evidence to support this observation—and it’s written on the corpses of all the dead-in-the-water fundraising initiatives that have perished as a result. The rule of thumb is this, whatever resources you’ve dedicated to communicating your fundraising initiative—double it. Now double it again. Even though you’re still not where you need to be, at least you’re in the ballpark.

That being said, the third reason why fundraising efforts fail is a failure to effectively communicate.


REASONS FUNDRAISING EFFORTS FAIL #4: 

No Connection 

Yet another reason why fundraising initiatives fail is the inability to effectively connect with your prospects and donors. There’s no question that nonprofit executives and fundraising professionals spend a lot of their time in meetings and consultations with a variety of important constituents. But understand this: there’s a huge difference between spending time with someone and connecting with them.

To be successful, nonprofit executives and fundraising professionals need to dramatically up their games with respect to creating indestructible connections with their most important people. To do this, requires not only a significant investment of time, but also a substantial outlay of energy getting to know these people as living, breathing human beings who want to make a meaningful contribution to something larger than themselves. Too many times, nonprofit executives and fundraising professionals fall prey to creating transactional relationships with potential and existing donors.

It’s tragic when this happens—and it’s the fourth major reason why fundraising initiatives fail.


REASONS FUNDRAISING EFFORTS FAIL #5: 

No Confidence 

The fifth major reason that fundraising efforts fail is a lack of confidence on the part of those involved. It’s hard to explain how it happens, but when people believe that an objective/goal is achievable, it generally is. Heartbreakingly, the opposite is also true.

Too often fundraising initiatives fail because those involved never really bought in to the goals that were developed from the outset. As a result, nonprofit executives and fundraising professionals spend more time trying to explain away or provide nice-sounding rationales as to why the goals couldn’t be met rather than scratching and clawing to make it happen. And although it’s hard to explain, having confidence in your ability to reach a fundraising goal is a huge part of the success equation.

As an important aside, it’s probably much better to set a more modest goal to ensure confidence than taking the biggest bite possible and having people believe that it was never attainable in the first place.

Nevertheless, it’s the fifth major reason why fundraising efforts fail.


REASONS FUNDRAISING EFFORTS FAIL #6: 

No Closure 

The inability of nonprofit executives and fundraising professionals to close the deal is the next major reason why fundraising initiatives fail. And, while effectively “closing” on a contribution oftentimes is comprised of a lot of moving and disparate parts, it really all boils down to one thing: asking for the donation.

And, excruciatingly, this simple “ask” is commonly overlooked. In fact, huge percentages of nonprofit organizations do not adequately make their requests known. For example, recent surveys relate that up to 1/3 of fundraising professionals fail to ask for a contribution. What’s more, 20% of all charitable organizations in the U.S. do not have a call to action on their landing pages—and 36% make their donors click three or more times to make their contributions. Although these are just snapshots of the current state of fundraising in the U.S., the information certainly supports our contention.


REASONS FUNDRAISING EFFORTS FAIL #7: 

No Credible Framework 

Last but certainly not least, the seventh reason why fundraising initiatives fall short is that nonprofit executives and fundraising professionals fail to employ a credible framework that’s designed to navigate them successfully from beginning to end. As a result, most fundraising efforts in the U.S. are largely activity-centered, rather than results-oriented.

“It is our belief that not having a credible framework is the major reason why most fundraising initiatives fail.”

Activity-centered fundraising approaches are those that sound good, look good and feel good, but can’t be counted on to produce consistent and reliable results—and according to researchers, this is descriptive of most of the fundraising efforts taken on in the U.S. To the contrary, results-oriented fundraising initiatives are those undertakings that have been carefully designed and follow a specific set of steps that lead you successfully to the desired destination.

It is our belief that not having a credible framework is the major reason why most fundraising initiatives fail. To help you better design comprehensive, results-oriented fundraising initiatives, we’ve designed a user-friendly blueprint known as FundingLogic. When employed strategically, FundingLogic has been shown to create the concrete outcomes that nonprofit executives and fundraising professionals are looking for.

In upcoming articles, we’ll spend copious amounts of time indoctrinating you into the FundingLogic model and showing you the power of putting these principles into practice.


Summary 

In this article, we’ve addressed seven major reasons why fundraising initiatives fail. As a result of digesting this information, it’s our hope that you now have a better understanding of not only why fundraising initiatives fail, but also what you can do to avoid flaming out in your efforts to advance your cause. By avoiding these pitfalls we believe that not only can you achieve success, but you can help a lot of people along the way.


ABOUT THE AUTHORS & IMPACT FOUNDATION 

Patrick Traynor, J.D., is the Executive Director of Dakota Medical Foundation and Impact Foundation. In 2004, Pat led the establishment of Impact Foundation and its Institute with the support of Dakota Medical Foundation and Alex Stern Family Foundation. His visionary leadership is guiding North Dakota and western Minnesota to become the most generous and healthy region on the planet.

The Impact Institute equips exceptional leaders to make an extraordinary impact. The Institute provides an annual pathway of tools and trainings that unleash the limitless potential of people to create greater impact for their nonprofit missions. It was founded and is a proud partner with the Dakota Medical Foundation and Alex Stern Family Foundation.

Scott Holdman is the Impact Institute’s Director. He is an innovator in nonprofits who, through training, coaching and product creation helps organizations to thrive. He is a professional creative with 17 years of experience in the social sector solving complex challenges.

Dr. David Hunnicutt is the CEO of David Hunnicutt Int’l. He is a sense-maker, simplifier and the arch-enemy of underperforming cultures. Obsessed with helping leaders create breathtaking change, he is inspired to do cool stuff daily.

Impact FundingLogic™ is a six-segment, revolutionary sense-making system for fundraising that will help you achieve greater results to dramatically impact those you serve.


REFERENCES 

Belford, T. (February 25, 2016). “6 Main Reasons Fundraising Fails.” The Agitator. Accessed on 12/1/16 via http://www.theagitator.net/ nonprofit-management/6-main-reasons-fundraising-fails/.

Dunham+ Company & Next After. (January 2014). “Online Fundraising Scorecard: A National Study Analyzing Online Fundraising Habits And Donor Experience.” Accessed on 12/1/16 via online at http://members.simpledevelopmentsystems.com/wp-content/uploads/2014/03/Online-Fundraising-Scorecard-Webinar-Slides.pdf

Grimes, G. (2011). “Case Statements (and Proposals and Campaign Brochures). Gail Terry Grimes. Accessed on 12/1/16 via http://www.gailterrygrimes.com/case_statements_proposals.html

Joyaux, S. (2007). “Telling your story: the case statement.” Joyaux Associates. Accessed on 12/1/16 via http://www.simonejoyaux.com/downloads/TellingYourStory.pdf

Mostert, C. (2007). “8 Essentials for Your Organization’s Case Statement.” Fundraising IP. Accessed on 12/1/16 via http://www.fundraisingip.com/fundraising/case-statement-nonprofit/

Plummer, J. (August 24, 2015). “Lessons from a Failed Nonprofit.” Triple Pundit. Accessed on 12/1/16 via http://www.triplepundit.com/2015/08/lessons-failed-nonprofit/

Whitmore, S. (2008). “The Role of the Case Statement in Fundraising.” The Moran Company. Accessed on 12/1/16 via https://www.morancompany.com/role-of-case-statement-in-fund-raising/.

Get the latest news & updates