How to establish “the land of wealth sharing” for major gifts donors

Dr. Russell James

January 23, 2023

The “one big thing” in fundraising is always the same: Advance the donor’s hero story. That’s the right story. But for major gifts, we need one more element. We need the right setting.

Major gift setting: Is this the land of wealth sharing?

In a story, setting matters. Setting creates expectations. It defines appropriate behaviors. Are we in a fantasy realm? Then we’re open to fantasy events. Are we in the Old West? Then we expect Old West things. The story should match the setting. A John Grisham legal thriller won’t include zombies. A Zane Grey western won’t have a magical elf.

In fundraising, setting matters. Typical gifts come from disposable income. They’re in the category of regular daily or weekly expenditures. This is a small reference point. This creates small comparisons and small gifts. A story in that setting will never lead to a major gift. A major gift doesn’t fit the setting. It’s like a space alien landing in a Danielle Steele romance.

Major gifts are different. Of course, they’re larger. But they’re also different in type. Major gifts are not gifts from disposable income. Major gifts are gifts of wealth. To advance a major gift story, we need the right setting. We need to be in the right world. We need to answer the question, “Is this the land of wealth sharing?”

Establish the setting

The major gifts story is set in the land of wealth sharing. How can a fundraiser establish that setting? It starts by talking about wealth. But this is Socratic fundraising. So, this means getting donors to talk about their wealth. It means getting them to talk about their businesses or investments.

How does talking help? First, just reminding people of their wealth is powerful.[1] This, by itself, encourages sharing. Second, it can reveal capacity. It can uncover assets. Third, it can reveal plans. It can show plans to buy or sell, acquire, or retire.

These assets and plans create opportunities. The fundraiser can share stories of what others like the donor have done before. She can provide creative solutions. She can deliver value.

The fundraiser archetype

In the universal hero story, a guiding sage helps the hero. The sage gives advice, planning, and guidance. The sage introduces the hero to friends and allies. The sage provides a magical instrument or weapon. These help the hero complete the journey.

The effective fundraiser can be the guiding sage for the donor’s hero story. She knows wise friends and allies. (She knows technical experts. She knows donors who have made complex gifts before.) She has “magical” instruments that can help with the journey. (She knows about gift instruments and agreements.)

But not every instrument works for every journey. Not every ally is helpful for every hero. Socratic inquiry reveals what fits each hero’s specific journey. The guiding sage asks questions in order to help. Major gifts are set in the land of wealth sharing. For major gifts, the guiding-sage fundraiser should ask about assets.

But it’s uncomfortable!

These conversations require talking about wealth. But many fundraisers are uncomfortable with this. They aren’t wealthy themselves. Often, they aren’t wealth experts. So, the topic can feel a little scary.

How can you overcome this? First, think of the goal as social, not financial. Suppose your job was to build relationships at a Star Trek convention. How would you prepare? You might want to learn a little about Star Trek. Why? Because it’s what the other person cares about. It makes conversations easier.

Wealthy people are interested in wealth. Building and managing wealth is a big part of their lives. You might want to learn a little about the topic. Why? Because it’s what the other person cares about.

Maybe you think tax law sounds like Klingon. But you can still learn a little.[2] You don’t have to become a leading expert. The point is just to make conversations easier.

The right destination: A request to share options

Fundraisers may fear financial conversations. What if you say the wrong thing? What if you give bad advice? A conversation can feel like a scary pop quiz! These worries come from an underlying error. They come from having the wrong destination in mind.

We want to ask wealth and asset questions. We want to have wealth and asset conversations. We want to spot solutions where some option might be helpful. But the goal is not to quickly give the right answer. The goal is this. Get permission to share options at the next meeting.

Phrasing the request to share options

It might sound like this:

“You remind me of another donor.[3] He was in a similar situation. I remember he[4] used some creative planning. It avoided taxes and helped him make a big impact.[5] Would you mind[6] if I put together some ideas for you to look at?”

This phrasing can be powerful.

• It shows that people like the donor have done things like this before. (“You remind me of,” “similar situation”)
• It leads with value. (“creative planning,” “avoiding taxes,” “big impact”)
• It asks for permission to share more value. (“put together some ideas”)
• It asks in a way where the desired answer is “no.” Saying “no” feels safer. It’s usually the less risky, status quo response. (“Would you mind if I”)

Introducing the ally

If the fundraiser isn’t comfortable presenting a proposal, that’s OK. The guiding-sage fundraiser introduces the donor hero to a friend and ally. This ally helps advance the donor’s journey. One fundraiser shares this phrasing, “I can’t tell you the ins and outs of a CRUT, but I would be happy to introduce you to someone who can. I’ve been told that this instrument offers ways to maximize your giving, minimize income taxes, and provide a degree of flexibility in your financial situation. Is this something you’d be interested in?”[7]

Others suggest, “You mentioned that you are going to pass the business to your kids. Did you know there are some ways you can do that that will actually save you money on the transaction by being charitable? On my next visit, I’ll bring our specialist in that area so we can talk about it in more detail.”[8]

In either case, the goal is not to be quick with a solution. The goal is to spot an issue and get the next meeting. Only then does the fundraiser (or an ally) present valuable options.

The power of delay

The right destination is to get the next meeting. Creating this time delay is important. It keeps the initial conversation social. It separates the conversation from any financial ask. It gives time to build creative options. It makes those options feel more valuable. An “off the cuff” answer is more easily dismissed, even if it’s right.

This delay also gives the donor time to think. The donor knows the meeting will show asset giving options. This moves the donor’s mindset into the land of wealth sharing. The more time the donor spends in this setting, the more likely a major gift becomes.

In story terms, the goal is to create an epic scene. The guiding sage delivers the perfect weapon. The weapon gives the hero confidence to take the journey. A great scene requires some build up. It requires some anticipation. In practical terms, it requires the next meeting.

The partial reveal

Having expertise can help. As knowledge increases, the ability to spot issues also increases. But expertise can also hurt. Instantly give the whole answer short circuits the process. Delay is valuable.

If we know the solution, a “partial reveal” is fine. It can create interest and attraction. (This is also true in seduction. A “partial reveal” works better than just walking around naked!) But make clear there is more to the story. If pressed, try to defer. For example, “I want to talk with some of my technical folks first. That way you’ll get all the best options. But I know there are some attractive possibilities here.”

Having the right destination changes things. It reduces fundraiser stress. It gives time to consult experts and build solutions. With this goal, even “failures” can be valuable.

Failing forward

Suppose we make an error. We think we spot an issue. We think we see an opportunity. But we later find there isn’t a solution. If we get the next meeting, we can still win. We can still present other powerful options to the donor.

Suppose we present options, and the donor says, “No.” This “failed” meeting can still lead to great success. We’ve shared useful options. We’ve provided value to the donor as a guiding sage. We’ve established our role in the donor’s story. The donor may say, “No.” The hero may at first reject the call to adventure. That’s OK. That’s part of the story. But in the hero story, and in life, things change.

Setting is a place and a time

Setting is a place. For the major gift, that place is the land of wealth sharing. But setting is also a time. The time for wealth sharing may not be today. It may be when an investment or business is about to be sold. It may be at the end of life. It may be when a new project arises at the charity.

The road to a major gift is often long. Major donors tend to plan their finances well in advance.[9] But asking about gifts of assets lays the groundwork. It prevents lost opportunities. (After a sale, many options are lost forever.) It prepares for moments of windfall gains when generosity is easiest.[10] It prepares for life events that trigger estate planning.[11] It keeps the donor thinking of assets as donation relevant.

Maybe we didn’t get the gift today. But the donor learned about new options. He saw what others like him have done before. He started a journey – a journey in a new land. He spent time in the land of wealth sharing.

Let’s get started

We know the destination. We know the reasons why. But how do we get there? How do we even get started? What are the words and phrases? The next article looks at this.

Footnotes:

[1] Morewedge, C. K., Holtzman, L., & Epley, N. (2007). Unfixed resources: Perceived costs, consumption, and the accessible account effect. Journal of Consumer Research, 34(4), 459-467.

[2] For 65 free animated videos on charitable gift planning, see http://bit.ly/TexasTechProfessor

[3] The goal is to communicate that “people like me do things like this.” “You remind me of” implies that this is a story of a person who is like your listener. If you have a particular donor example in mind and can think of a way in which this person is like the example, then point this out. For example, this might be a second sentence such as:

“He was in your same line of business.” “He graduated about the same time you did.” “He was about your age.” These are all forms of attempting to connect the listener’s identity to the forthcoming challenge.

For experimental results showing the importance of age matching in examples of other donations in a complex giving scenario see James, R. N., III. (2019). Using donor images in marketing complex charitable financial planning instruments: An experimental test with charitable gift annuities. Journal of Personal Finance, 18(1), 65-73.

[4] Gender match the pronoun here if possible. If gender matching isn’t possible, try to avoid a gender reference. Again, the idea is to communicate that the story is about a person like the donor. For experimental results showing the importance of gender matching pronouns in fundraising see Shang, J., Reed, A., & Croson, R. (2008). Identity congruency effects on donations. Journal of Marketing Research, 45(3), 351-361.

[5] The goal here is to lead with benefit. For experimental results showing that people are more interested in learning more about a gift of assets when the phrase “avoid taxes” is part of the description see, James, R. N., III. (2018). Creating understanding and interest in charitable financial and estate planning: An experimental test of introductory phrases. Journal of Personal Finance, 17(2), 9-21.

[6] This sets the desired response as being a “No.” People tend to feel safer when responding with a “No,” as it is usually the less risky, status quo response.

[7] Stroman, M. K. (2014). Asking about asking: Mastering the art of conversational fundraising (2nd ed.). CharityChannel Press. p. 165.

[8] Sagrestano, B. M. & Wahlers, R. E. (2016). Getting started in charitable gift planning: The resource book. CharityChannel Press. p. 91.

[9] Liu, Z., James, R. N., III, & Aboohamidi, A. (2020). Finding the next major donor: The relationship between financial planning horizon and charitable giving. Journal of Personal Finance, 19(2), 47-64.

[10] Arkes, H. R., Joyner, C. A., Pezzo, M. V., Nash, J. G., Siegel-Jacobs, K., & Stone, E. (1994). The psychology of windfall gains. Organizational Behavior and Human Decision Processes, 59(3), 331-347; Konow, J. (2010). Mixed feelings: Theories of and evidence on giving. Journal of Public Economics, 94(3-4), 279-297; Li, H., Liang, J., Xu, H., & Liu, Y. (2019). Does windfall money encourage charitable giving? An experimental study. VOLUNTAS: International Journal of Voluntary and Nonprofit Organizations, 30(4), 841-848; Reinstein, D., & Riener, G. (2012). Decomposing desert and tangibility effects in a charitable giving experiment. Experimental Economics, 15(1), 229–240.

[11] James, R. N., III. III. (2020). The emerging potential of longitudinal empirical research in estate planning: Examples from charitable bequests. UC Davis Law Review, 53, 2397-2431.

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