Episode 22: Donor Cycle Series - “Cultivating a Prospect” (Part 2 of 4)



Welcome to another edition of “Around with Randall.” Your weekly 10 to 12 minute podcast and making your nonprofit more effective for your community. And here is your host, the CEO and founder of Hallett Philanthropy, Randall Hallett. 

Thank you for joining me again on, “Around with Randall”. Today, the second part of the four-part series on the donor cycle. Today we're going to follow up what we did last time on the idea of qualification, with the idea of or the concept of cultivation. Cultivation in its basic essence is about building the relationship. We talked about rapport. Now we're going deeper into a relationship that is based on a basic element, trust. If done correctly, during the cultivation process, donors begin to trust their organization at a much deeper level, and in particular, the gift officers that they're working with that are stewarding them, kind of facilitating them through this intellectual and emotional process. Let's start with some bigger picture thoughts and before we get to the tactical. The New York Times just printed a pretty lengthy article, talking about gift giving and in particular, what donors at the higher end, which is where most of the dollars are coming from when I started in this industry. Before I had as much gray hair as I do now, it was the mantra was 80/20. 80% of your dollars come from 20% of your donors. What we know today is, and Giving USA provides a lot of this data and its annual assessment of the philanthropic market in the United States is it's closer to 95/5. 5% of the people are giving 95% of the dollars.

Well, this article talks about how donors feel in this process. What is it that they like and what they don't like? And frankly, the article talked more about what they don't like. And they talked about that they didn't feel like they were listened to, that it was salesy or had a salesman perspective rather than a relationship. That's what cultivation is trying to avoid. In the tactical pieces that we'll do here in a moment, I want to talk about some things you might consider doing to alleviate or reduce that problem. One of the great challenges we have as nonprofits grow as non-profit work and the needs of our community expand is that we have a push and a pull regarding needs that the organizations articulating and what donors want to give to, what moves them, what's their interest. There've been many times in my career where I've had to have hard conversations, not just with finance people, but more often than not that's where it lies, sometimes the CEO, or President is that what they want, may not be what donors want to give to, and no matter how they try to express its importance to the organization, I have to have conversations around that’s reasonable, I don't run the organization in that way, but I'm telling you, our donors don't want to give to that. There's this push and pull that needs to occur. Cultivation is where this rub becomes because donors like The New York Times article is telling us they're interested in certain things: outcome, value, emotional impact of what their donation can do for people. We may have an organization that says, yes, but we need “X” and there's not a lot of emotion with that. So one of the things that I think The New York Times article tells us is that we need to listen more, talk less when we're building those relationships and we need to, before we ever get to this cultivation stage, or at least on an ongoing basis, always be trying to push the organization to have a lot of different options where philanthropy can be impactful on the work. If there's only one or two things that you're doing, and you don't have any donors who want to do them, it's hard to generate large sums of money. Organizations generically have lots of things that they do. Think about it -- let's talk about healthcare. You have education. You're constantly educating people, whether it's outreach community education, or internal education with nurses and their credentialing or physicians. There is social impact. There's the ability to, whether it's through a social department or through social workers, but people who spend their time figuring out how they can help the community at a wider perspective. There is technology and innovation and research. If we go to education, each one of those areas, education obviously has education, but a lot of times there's research. Sometimes it's pure research, sometimes academic research. You're always trying to help those who fall under the radar through scholarships and things of that nature. 

We have to have a wide array of opportunities and sometimes the fundraiser has to push back and say, I need things that we can offer as opportunities for people to invest or engage in. 40-50 years ago, the adage of, well I'll give my money and I'll make it unrestricted. You'll use it best. Those days are gone, dead. They don't exist anymore. Very few donors, very, very few donors say here's $5 million and I don't care how you use it. That's a challenge in budgetary times with a CFO or CEO or a finance committee or someone who's saying, well, we just need unrestricted dollars. We'll choose where it goes best. We have a disconnect. Part of cultivation is getting the organization to better understand this. Sometimes you have to bring in an outside expert to help them understand that. At the end of the day, it's about trust. How do you build trust? 

Let's go from the bigger picture to the tactical here in our last couple minutes. For cultivation, the first thing I would indicate is a one of my favorites quotes of all time by John Wooden, the legendary UCLA basketball coach, who I believe took his UCLA basketball team to 11 championships in 12 years, through the 1960s and the first 4-5 years of the 1970s. He had a pyramid of success as he called it. One of his sayings on this pyramid of success that he taught his players is don't confuse activity with achievement. The reason I like that saying, in particular with cultivation, if the idea is to get people to feel better about the organization and begin moving them towards a potential solicitation it's time to get moving. 

One of my greatest frustrations is where people would literally spend 12 to 15 months cultivating someone. Now I'm not saying that you need to push them, but cultivation should happen in a reasonable timeframe. It happens in two steps. The first is general. What is the general area of interest? Where is it that they have a higher level of potential investment than just the wider perspective. If it's education, then you should be concentrating and driving that, if it's research, you should be concentrating and driving that conversation. It's about focus. You're going to get more value, more opportunity if you're able to figure out by listening and that's what The New York times article was telling us about. What's actually of interest to the donor. So the first is bigger picture. The second is okay now let's get into the specifics. What are the nuances of their interest? Think about it in two steps and it may take two or three meetings to figure that out.

What language can you use to begin to figure out that opportunity? It's about asking questions and it's usually about past and emotional connection. What moves you? What's important to you? Where do you find value? What have you given to in the past that really made you go to bed at night feeling great? What was it? What is it that you want to change? If you were to look back, what is it in your legacy that you would like to see different in our community? If you can hone in on that emotion that will lead you to the second piece, which is about focus. The other thing I would recommend in the language piece is figuring out which face the prospect wears.

And for a couple of you, you're probably like, I know what he's talking about, for most may not have an idea. 1994, coming up on 30 years ago, Russ Alan Prince and Karen File did the best study on identifying what kind of prospect you have, how they communicate, what their likes and dislikes are. It was in a study called the Seven Faces of Philanthropy. It's an academic study. I don't know why it's not required reading every year for every fundraiser. I don't care if you've read it before. They broke prospects into seven major areas. I'm not going to go into the details of each one because it'd be too long, but I do a presentation on this because I think it's that important. I've done it for all systems for universities, because I think it's so critical in terms of the value that the information provides. There's the “Communitarian” who's interested in how the community does and how we're going to get to that next thing and we're going to do it together. The “Devout”, which is based on their faith and what their faith tells them to do. The “Investor”, which is about efficiency and financial management. The “Socialite”, which is about well they want to give by having fun. The “Altruist”, which is about selflessness, what is it that they can give back. The “Repayer”, which is about in healthcare and education, about repaying something that's happened because they think it's important to their wellbeing and the “Dynast”, which is about family dynasties and family foundations, really it's about legacy and tradition. Prince and Files, Seven Faces of Philanthropy and if you need to, give me a call and I'll do the presentation for you. It talks about what people want and once you begin to categorize them, how they want to be communicated with, what's important to them and most important, what's not important to them. They all don't want the same things. That's, again, what The New York times article was talking about. Communicate and ask questions and communicate with the information they want, versus just the unique communication you want to give. 

So a couple of other tactical pieces to just keep in mind. Number one, sometimes, maybe outside of a COVID world, you can have creative locations. My favorite cultivation was when I took a donor into the middle of a construction zone. He was in a wheelchair. He'd lost his wife to cancer. We were talking about cancer facilities. I took him in and did it right in the middle of a construction zone in the OSHU, which is the place where cancer patients will go through recovery, particularly those that are having challenges with immunity because they're going through chemo or have just come out of surgery. Right in the middle of the construction zone, I did the conversation about what this was going to be. He had his own hard hat. His Assistant was pushing him and I said, this is where this could be and the location stirred emotion. Consider where -- try to get to that emotional place, sometimes it's an office, sometimes it's a home, sometimes it's someplace that's creative. If you're going to bring in an outside expert, you want to bring in a physician, the CEO, the president of the university, a faculty member, someone who works on the front lines. Don't allow that meeting to occur unless you had a conversation with the other internal expert about how the meeting is supposed to go. What is it you want them to say? What is it that you need to say? Going into the meeting without some type of plan can be catastrophic as you step on each other. Plan the meeting so that everybody understands their role.

That includes if you're bringing in a board member. 

Lastly, I'm a huge believer of the soft ask, permission to take them to that next step, if you've cultivated well, the goal should be to get them to a solicitation. The soft ask allows you two options, to retreat, a little bit if somethings off and replan this cultivation, or to move forward into the solicitation. The language is pretty simple. It sounds as if you're really interested in “X” and we're doing the following things, “A,B and C” that are going to meet that goal of “X”. It sounds as if it might be something that we could work on together. Would it be okay with you if I brought you a formal written proposal for “X” amount for this project to meet these needs in the next week or two for you to review?

If the answer is yes, you know what your next step is, and we talked about that coming out of qualification, that next step. If the answer's no, it gives you a chance to retreat without formally having them tell you, “No, I'm not interested in the project.” Maybe it's you misread the amount. Maybe it's you've misread the area of interest. It gives you a chance to say, gosh, I'm so sorry. Tell me a little bit more about why this misses the mark. How can I, how can we better meet your expectations? A soft ask gives you a platform for the next step. Go to the ask, try to figure out exactly how you can refigure, so to speak, the cultivation process, to get to that solicitation at some point down the road.

Next time we'll talk about, “Asking and Closing”, which actually I think is somewhat separate. I can't thank you enough for joining me here. I enjoy doing this. I hope it's helpful to you. Don't forget, there's so much information on the website at hallettphilanthropy.com, two “L's” two “T's” not only the podcast, which you can subscribe to and get on platforms, leave comments, but also the blogs. I do a lot of 90 second reads every week about different things I read in the paper, or I see on the news or how they're connected or a client experience. If you want to reach out to me, please do so tell me about a subject. Actually, this series came from a couple of listeners who said in different ways, can you talk about this, talk about this and it kind of made me realize maybe we could talk about all of it. 

That's podcast@hallettphilanthropy.com, two “L's”, two “T's”. Or if you have something to complain about, you disagree, or I miss something reeks, reeks@hallettphilanthropy.com. I end every week, every podcast with the same, this is a worthy, unbelievable opportunity to give back in your community. You are part of a movement to make your nonprofit more responsive to your community's needs the holes where those who aren't served, don't have the opportunity, and need some assistance. You're helping them. You're making your community, your city, your state, your county, a better place. I can't imagine waking up, not thinking that you're affecting people. We are individuals in this profession who want to challenge the status quo, to make it better. That brings me to my favorite saying of all time, which I do every single podcast at the end, “Some people will make things happen. Some people watch things happen. Then there are those who wondered what happened.” 

We're people who want to make things happen. We partner and cultivate prospects to help us do that through their unbelievable generosity. We do this all for people who are wondering what happened. That is an awesome call for a professional life. And I hope you woke up this morning and wake up tomorrow and every day, knowing you're doing unbelievable things for people.

Thank you for joining me again this week on, “Around with Randall”. We'll look for you next time with the conversation around solicitations and closing, and don't forget, make it a great day.