Almost 10 years ago, the Great Recession created a vast wave of mergers in the for-profit sector. Amid the worst economic contraction since the Great Depression, many businesses merged together—or found ways to integrate services together—to survive. Amid the worst economic landscape in decades and increasing competition for the charitable dollar, many expected to see the same trend among nonprofits. After all, the number of charities in the United States in 2009 had almost doubled from 1996—from approximately 650,000 501(c)3 organizations to more than 1.2 million. At the same time, the fundraising profession was maturing and growing, and technology was making it easier than ever to raise funds. With so many organizations trying to engender support from the public, it was widely accepted that the downturn would affect fundraising and giving so much that many organizations would need to merge to survive.
But while a few nonprofits did integrate, the expected vast wave of mergers never happened. Whether because of differences in mission, approach, operations, or leadership personalities, most charities continued on their own.
The recession did, however, force many nonprofits to examine how they could work together, share resources, and lower expenses. Today, it’s not uncommon to hear of charities sharing office space, technical or human resources staff, or even computers and other equipment.
So it’s hardly surprising that the next step in this evolution of sharing—collaborative fundraising—is now gaining popularity. And the opportunities are real: Fundraising together, charities can reach goals and create the sort of impact they might never be able to achieve by themselves. Through collaboration, they can expose their organizations to new potential donors and supporters, and experience heightened public awareness around their mission and work. Meanwhile, donors are looking for organizations to work together and bring in more of the community so that their support can have more far-reaching impact.
Nevertheless, there are significant challenges to collaborative fundraising, because charities are addressing some of the most sensitive aspects of their operations: public reputation and donor data. Here are some considerations for organizations thinking about partnering on fundraising with another organization.
Trust and more trust
Any collaborative relationship has to start with trust. One of the reasons we didn’t see so many mergers during the recession is because need alone isn’t always a strong enough reason to merge. There needs to be trust—among boards, among CEOs, among staff and others—and that trust doesn’t often develop quickly. It takes a long time.
Trust is built on shared values and principles. It’s not enough to simply have a common mission and goals. Even health organizations working on the same issue, for example, may have dramatically different approaches to achieving those goals—one may be more focused on awareness and prevention, another on treating symptoms, and another on finding the root cure. It’s also about the style of work and culture of each nonprofit; integrating different cultures is one of the primary challenges in collaboration, and organizations shouldn’t overlook it.
Integrating values and culture
Working together also presents challenges related to fundraising and donor stewardship. For example, what is the public reputation of each organization and its fundraising efforts? It’s one thing to partner with an organization and quietly share office space. It’s quite another to merge your “public face”—that is, your fundraising, marketing, and other external activities—with each other. The reputation of each charity is going to affect the other, and what happens during the fundraising campaign is going to affect both organizations equally.
Similarly, how does the other nonprofit treat its donors? Are your systems of thanking and cultivating donors similar? You need to be sure that your own donors are going to feel comfortable and that the partnership meets the expectations of both organizations’ donors.
Finally, make sure the impact of your partnership is worth the effort. You’re not just out to double your fundraising by working with another charity. You want to be able to accomplish a long-term goal that transforms both your organizations and the impact they can have in the community.
Transformative results
The results of collaborating to raise funds can be astonishing, and there are countless ways organizations can work together. Joint hosting a gala, and splitting resources and revenue is a common approach and has met with a lot of success. These kinds of events are now happening all the time—for example, different types of animal shelters work together to hold one event or a gala ball supports a variety of veteran’s causes.
Other real-life examples of fundraising synergy abound. Consider how several smaller arts organizations collaborated on a capital campaign to create a theatre and offices in a location none of them could afford by themselves. This partnership required intense and detailed planning across many different aspects of their relationship, including who was responsible for which aspects of fundraising, In another example, a very large hospital is helping smaller, rural hospitals raise funds so they can take on more local cases and reduce the patient load on the larger institution. This project was more informal, and focused on sharing resources and expertise, but it still required significant trust and understanding.
As I mentioned above, the benefits of fundraising collaborations go beyond raising money. Organizations stand to gain increased public awareness, exposure to a whole new group of donors, media coverage, and public goodwill. If collaboration truly makes sense for you, your constituents, and your donors, and if you can create a strong foundation of trust with your partners, it can transform the scope and impact of each nonprofit’s work.
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Read more stories by Jason Lee.