Patience is powerful.
When pursuing major gifts, it’s tempting to want to go fast, and to accept the first gift a donor offers. You don’t want to risk losing this donor, and if they’re putting money on the table, why would you say anything other than “Yes” and “Thank you”?
As it turns out, there are at least six reasons to do exactly that. Pause. Delay. Wait. There are situations where a gift officer’s best move might be to not accept the first gift a donor offers. We’ll look at some specific scenarios a bit later.
As you keep reading, consider this quote from philanthropist Naomi Levine:
“The quicker you ask, the less money you will receive.”
You’ve probably heard that a typical major gift takes from six months to two years to come to fruition. That’s not because all that time is spent coddling, begging, and persuading donors. When major gifts fundraising is done well, it takes that much time because the gift officer has more in mind than just the gift. They also want the donor to have the best possible experience.
Because giving the donor the best possible experience advances their hero story to the fullest possible extent, which researcher Dr. Russell James calls the single most important goal in major gifts fundraising. It also greatly increases your chances of winning a second gift.
So, if you’re securing major gifts from donors just days or weeks after reaching out, there’s a very good chance you are leaving a lot of money on the table. Some of your donors could – and would – give much larger gifts if you paused the solicitation process and let time be your friend.
Major gift fundraising is not meant to be transactional. If you’re calling up major donors in November to secure a matching grant for your year-end campaign in December, you’re being transactional.
But fundraising at this level is best done as a collaboration, not a transaction or a prescription. We’re not just coming to our wealthier and more generous donors and asking for money. We’re not treating them like an ATM.
In contrast, research has found that getting donors to delay their decision to give by a mere 60 seconds doubled their willingness to give a larger gift.
In his book, Megagifts: Who gives them, Who gets them?, Jerry Panas says, “The chances are almost certain you won’t receive a meaningful answer or a consequential gift on the first visit. If you do, odds are you could have gotten more!”
The most successful fundraisers take time.
They develop the relationship. Build trust. Become an ally. Position themselves as a guiding sage.
And once the dialogue approaches the decision to make a gift, the gift officer can comfortably extend the process even longer to make sure the donor experiences their most fulfilling and satisfying outcome, knowing this will probably also mean the organization receives a larger gift.
Here are six reasons from Dr. James for why pausing the major gifts solicitation process often leads to bigger gifts.
1. Maintains the Collaborative Relationship
If all you care about is the gift, you’ll take it right when it’s offered and then end the dialogue. That’s what a transactional relationship looks like. By pausing and delaying, you are confirming for the donor that this is about more than just their money. You are keeping your meetings socially enjoyable, inquisitive, and collaborative.
2. Gives Time to Develop Customized Options
As the gift officer learns more about what the donor wants, and the types of assets and resources they have, creating a menu of customized giving options will produce a far greater outcome than just ‘winging it’, or taking the first gift offered by the donor. We’ll look at some examples in a bit of how this works.
3. Makes Supporter Feel Safer
Pausing builds trust, and trust leads to better outcomes for everyone. Where trust is, compulsion is nowhere to be found.
4. Gives Donor Time to Reflect
Remember the study mentioned earlier? Just a 60 second delay increased the willingness to give a larger gift. When considering major gifts, the same principle applies, but is amplified to weeks or months, because the gift is so much larger.
Reflection is good. When donors have time to ponder their connection to your cause, why and how much they care about your mission, how your work aligns with their identity, the permanence they can achieve by giving a transformative gift, and all the other positive ideas and feelings that will grow over time, the resulting gift given will be larger in most cases. More importantly, it will be given with far greater enthusiasm.
5. Moves Donor to Consider Assets Instead of Cash
Cash is transactional. Assets are collaborative.
Why? Because giving assets is inherently more complicated, and most people need help to work through the details. This is good, because the collaboration, all by itself, increases the donor’s desire to see it through and feel great about their gift and the outcomes it provides for them.
Assets are also much larger than cash. Most wealthy people have far more of their net worth wrapped up in assets than in typical bank accounts. Consider someone who has $500,000 in various bank accounts, but two homes, several retirement accounts, a business, and various other assets worth $10 million.
If you’re looking for a gift from just that $500,000, you might get a four figure gift, at best. But no one is going to hand over $250,000 if that’s half their bank account. However, the same person could conceivably give that same amount from their assets, and not ‘feel’ the loss nearly as much.
Pausing invites the donor to give from their assets instead of their cash.
6. Increases the Perceived Value of the Donor’s Options
The more you think about and work on something, the more important it becomes to you.
Whatever options you develop for the supporter you’re working with, taking more time to work on and consider each one will make them seem more desirable in the eyes of the donor – and ultimately produce the greatest enthusiasm for the option they select.
Every situation is different, so it’s difficult to make simple recommendations here. But we can look at some hypothetical scenarios to give you an idea of how and when to pause your solicitation process with a donor.
Compare Them to Another Donor
This works well, for one, because it further cements your position as an expert. You work with a lot of donors, and what you’re recommending to this person isn’t new. You could say something like this:
“You remind me of another donor who was in a fairly similar situation. I remember they used some very creative planning to avoid taxes… so they could make a bigger impact. Would you mind if I put together some ideas for you to review?”
Mentioning that the donor can avoid some taxes while giving their gift is often a very effective approach. It also almost always invites some delay, because this usually means they will be donating an asset, such as stock options or a business, or perhaps selling real estate.
Bring on Another Expert
Perhaps your organization employs or has access to specialists in things like estate planning, tax accounting, and financial planning. Offering to bring in an expert to make sure the donor gets the best possible outcome will usually be received warmly because they will feel in good hands. It will also delay the process, but this delay is a positive development.
For example, suppose the donor has a business they are planning to give to their heirs. You could say this:
“You mentioned that you’re going to pass the business on to your kids. Did you know there are some ways you can do that that will probably 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. OK?”
Again, every situation is different, but hopefully you are getting the idea. Better outcomes for the donor equal a better outcome for your organization.
Again, pausing works well when the reason for the pause is to give guidance, wisdom, and counsel. Don’t pause just to pause. You need a reason for it. You certainly don’t want the donor wondering why you keep dancing around their simple desire to give. You don’t want them feeling like you’re fighting their gift –
“Let me give!”
“Are you crazy? I need to delay you!”
So, have a reason. Often, the reason will be tax benefits.
For example, suppose a donor has decided to give $20,000 to your organization. That’s great! You’ve secured a major gift. But – do you have to accept it right then, or can you delay this process to work out a better tax situation for the donor?
Suppose you also know this donor has $20,000 in a particular stock, and they’ve owned it for a long time. After thanking them for their gift offer, you could ask if there’s a reason they would rather give cash as opposed to their stock.
They might say they like that stock and don’t want to sell it. People get attached to particular assets for all sorts of reasons – even when it makes good financial sense to part with it. But it’s common.
You could follow up with something like this:
“Sure, I can understand that. I’ve felt the same way about some stocks I’ve owned too. However, did you know that you can actually donate the appreciated stock? You’d get a deduction on the total amount, $10,000. Then you could use the $10,000 you were about to donate to us and repurchase that exact same stock. In other words, you’d get to make the donation amount you intended on making, you’d get a big tax deduction, and you’d escape paying the capital gains tax on that stock. But you’d also receive a stepped-up basis for the stock you gave us and then repurchased, so when you sell it later, you’ll pay much less capital gains tax.”
This is a double tax savings. They get a deduction now for donating from the stock, thus avoiding tax on the appreciated value. Then, by repurchasing the stock at today’s prices, this will reduce future capital gains taxes too.
The point is – look for opportunities like this that benefit the donor. More often than not, it will result in a larger gift for your organization, and an even happier donor. Everyone wins.
All this sounds great, but let’s not pretend there’s no danger in delaying your solicitation. Some donors might lose interest and give up. Others might just keep hemming and hawing, because that’s what it felt like you were doing and now they’re doing the same thing.
Don’t delay just to delay. And don’t delay out of your fear of rejection.
The best way to prevent this is to always schedule the next meeting before you conclude the one you’re in. Get it on the calendar.
Lastly, what if your own administrators are pressuring you to close this gift?
If you know your delays are strategically sound and will produce a better end result, stick to your guns and remind them of the power of patience. Remind them that most major gift solicitations take between six months and two years.
Also, you could recommend they take our signature eCourse – Donor Story: Epic Fundraising, from which some of what you’ve read in this article is based.
In this course, the greatest professional development you will ever take, you’ll benefit from all the knowledge and understanding from Dr. James’ decades of research into major gifts fundraising.
The best thing is, you and your entire team, including your administrators, can take the course for nearly the same price as if you took it by yourself. We want this to be a team experience, because your whole team will benefit and be on the same page. So, we’ve made it easy to take as a group.
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