Bernard Boudreaux – Virtual Fundraising During COVID-19 is Boudreaux’s take on how to raise money during these new and uncertain times. Here’s what Bernard has to share:
“Necessity is the mother of invention” is an expression that has inspired many a business strategy, and nonprofits have lived by this mantra for decades.
In 1988, a major fire caused major damage to the Los Angeles Central Library. They decided to forego their traditional gala and tested a new fundraiser “Stay Home & Read a Book Ball”. The event was a huge success, and continues 30 years later. This past year, the “anti-gala/introvert’s ball” raised nearly $140,000 from over 400 donors (half of those donors were NOT current members). The “gala” did not require catering, location expenses or prep, gift bags, weather back-up plans, or auction items, while marketing was executed via social media and email.
As nonprofits across the USA strategize how to maintain their revenue streams in the time of the corona virus, many are faced with the reality that their in-person fundraising events (lunches, dinners, golf outings, runs, walks, dances, etc.) are not feasible. Revenue from a “successful” fundraiser event can raise anywhere from 10% – 70% of a nonprofit’s unrestricted annual revenue. Combine a cancelled fundraiser with dramatic decreased (or zero) revenue due to cancelled performances, reduced earned revenue and decreased contributions and nonprofits have a recipe for long-term financial disaster.
Enter COVID-19, and nonprofit leaders are much less focused on highlighting their brand, but laser focused on raising revenue to cover expenses and overhead.
We spoke with three nonprofit organizations that quickly converted their planned Spring 2020 live event to a virtual event in response to the corona virus crisis. All three organizations enlisted support from companies that specialize in online events and/or fundraising for their virtual event.
What: Gala dinner for 400, held at San Francisco’s Ritz Carlton hotel and represents nearly 15% of annual contributed revenue. Tickets range from $750 per ticket to $25,000 for tables. A live auction, paddle raise to “fund a need” and luxe gift bags were components of past OVATION events, along with an honoree.
This year’s event: Converted to a 60-minute virtual event, featuring a livestream conversation with playwright and actor Anna Deavere Smith, music by Bay Area composer and bass player Marcus Shelby. They scrapped the live auction, paddle raise and gift bags and their technical staff partnered with their event producer to produce the virtual gala. Their board and fundraising committees were actively engaged in fundraising (the board and various fundraising “teams” raised 35% of total event revenue). A donation of any amount counted toward the fundraising goal and provided the donor access to the livestream. “OVATION” raised $946,000, exceeding the goal and was viewed by an estimated 700 people – far more than would have participated in a live event.
Lessons learned: Berkeley Rep’s Director of Development Lynn Eve Komaromi said, “We pivoted from live to virtual with very short notice and in response to a crisis. While we are very pleased with the results, we would do some things differently if we do a virtual fundraising event in the future.”
What: The gala is their largest fundraiser, a 400 guest dinner that earns ~15% of their annual contributed revenue.
This year’s event: Pivoted from a live one-night dinner event to a 10-day online event with just three weeks notice. The virtual event featured a daily online medley of family-friendly entertainment and included silent auction items, a raffle, and alcohol sales ($25 for wine bottles and $30 “bar supplies”). The event proceeds exceeded last year’s event by 20%, but fell short of the 2020 goal by 15%. Revenue from the event came from three sources – sponsorships from local businesses, ticket sales for the planned dinner (which never happened), and the sale of auction items online. The majority of people who purchased tickets for the cancelled dinner donated their tickets, and less than a handful of donors requested a refund of their dinner tickets. The event was heavily promoted via social media by both the board and staff, and via email by staff. There were over 1,000 unique registered bids on the auction items, and more than 1/3 of those bidders were not known to have participated in the past.
Lesson learned: Childsplay’s Executive Director Steve Martin said, “We might do a virtual event again, but definitely not in this format. We executed this event in three weeks due to the crisis, and we had a great net primarily because we had already sold dinner tickets and then we didn’t need to feed anyone. Also, we used social media to its fullest! We had designated posters and our board posted on Instagram, YouTube, and Facebook. It was all very successful. Some of the posts/videos were pushed out thousands of times. We were careful to avoid a “crisis” pitch. It was all fun and light to match our brand…and we wanted our audience to have fun.”
What: An education organization dedicated to improving children’s lives through shared reading. Their annual dinner is typical a sold-out 400 guest gala, last year’s event was held at the National Museum of Women in the Arts and represents one-third of their annual contributed revenue.
This year’s event: In March 2020 EWDC celebrated their 25th Anniversary, but they were forced to cancel it 28 hours prior, and then scrambled to present a virtual event one week later. The one-hour virtual “event” was a series of pre-recorded videos from EWDC stakeholders and staff, with over 200 auction items. Due to the last minute cancellation, EWDC is still navigating the cancellation of the catering and venue, but they are very pleased with the results of the event – so pleased that they are planning multiple virtual events (one for later this spring, and one for Back to School). The virtual event raised just over $300,000 (85% of the original goal for the live event). Two-thirds of the revenue was generated from sponsorships which were sold long before the live event was cancelled – and those funders have honored their sponsorships. The remaining funds came from the sale of auction items on the EWDC site during the event, as well as individual donations. Heavy lifting came from their Leadership Circle (similar to a “junior board”) and the Board of Directors who heavily promoted the virtual event via FaceBook, Instagram and Twitter, as well as three EWDC staff members.
Lessons learned: Jordi Hutchinson, Executive Director said, “We totally winged it! Timing was EXTREMELY tight, but fortunately we had our sponsorships and auction items secured and posted to our website. Our Leadership Circle and our Board of directors were phenomenal in promoting the virtual event via social media – with messaging from our Communications staff. We attracted dozens of new followers and grew our supporter list based on social media outreach. To say that we are pleased with the results is an understatement. We have never done a virtual event before, and now we already have two more we are planning for this year. Now that we have time to plan and we are not in a crisis mode, we will do several things differently, but we know that leaning heavily on social media to promote the event is a winning strategy.”
Many nonprofit leaders have challenged their existing in-person fundraisers for years. These events are extremely labor intensive, often resulting in a very small return on investment, especially when adding both the indirect costs of time from staff as well as direct costs associated with the event. When counseling our Georgetown University New Strategies nonprofit participants, we closely review their fundraiser events and challenge whether the juice is truly worth the squeeze. A $300,000 event that nets $50,000 is almost always NOT worth it, when staff time is factored into that “net” of $50,000. “Our board really loves this event” or “It’s less of a fundraiser and more of a friend-raiser” are common phrases we hear to justify the event. The phrase/excuse we hear the most though is “The event is great exposure for us to get our mission out and showcase our organization, building our brand”. In my nonprofit experience and I have attended roughly 75 lunches/galas a year, and RARELY were those events a great venue to “showcase” the mission and programs of the organizations. There are SO MANY more efficient ways to build a brand than in a room with a fixed audience of 300 people.
Finally, none of these three organizations planned to execute a virtual fundraiser in 2020, but COVID-19 necessitated that they quickly re-invent their major fundraiser event or risk losing a significant percent of their annual revenue. All three met their revenue goal. Virtual fundraisers may not be right for every nonprofit organization, but they just might be part of the “new normal” that we all come to embrace in the time of corona virus. I for one will enjoy “attending” several of them from the comfort of my home.
Bernard Boudreaux – Virtual Fundraising During COVID-19 was first posted at INSIDE CHARITY
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Feel free to contact Bernard Boudreaux at [email protected] Bernard Boudreaux is the deputy director of the New Strategies Program – a signature program within Business for Impact at Georgetown University’s McDonough School of Business. In this role, Boudreaux focuses on direct engagement with corporate partners, as well as the nonprofit leaders attending the New Strategies program.
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