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Dear Friends: In 1937, Bill Wilson was desperate to secure funding for the fledgling Alcoholics Anonymous (AA). He was lucky to have a brother-in-law who had a connection to John D. Rockefeller Jr. (Jr.) Not only was the Rockefeller family known for their substantial philanthropy, they were also known for supporting temperance and prohibition, making Jr. an ideal donor prospect. One of Jr.’s top aides, having done a detailed analysis, recommended a $50,000 donation (the equivalent of $679,069 in today’s dollars). Jr. rejected it and instead came back with a gift of $5,000 and an additional promise of a $30 weekly stipend for Wilson and his co-founder. Jr. said: “Not this time: if we give these fellows real money it’s going to spoil them and it will change the whole complexion [of AA]...this thing should be self-sustaining.” Three years later, Jr. again supported AA by hosting a reception, attended by 400 of America’s wealthiest citizens. Bill Wilson gave a moving presentation with testimony from recovering alcoholics. Reporters were present and the evening was a smash success, except for one thing – no one was asked for a contribution! In fact Jr.’s son, Nelson, gave a speech about how the last thing the new movement needed was money! Not a dime was raised that evening. To correct this, Jr. wrote a letter to every guest after the event announcing that he had given AA a check for $1,000 and asking all guests to give their own personal best. The guests responded by comparing their worth to Jr.’s and gave in scale to his gift. As a result, the gifts were paltry at best. Bill was appalled. It took Bill Wilson a few years to get over the disappointment, but slowly he realized that Jr. forced him to think deeply about how money would work in AA. That is why I think revisiting this piece of philanthropic history is so rich. You see, Jr.’s most significant gift to AA was to force it to be financially self-sustaining, a byproduct of Jr.’s own deep thinking about what sort of philanthropy the organization really needed. Jr. knew that money changed people—as Bill Wilson put it, “This man who had devoted his life to giving away money said, ‘not this time.’” After Bill came to appreciate Jr.’s “gift”, he used Jr.’s $1K as a benchmark for the maximum allowable gift from anyone ever: no one, from that point on, would be allowed to give more than $1K, a policy that stands today. All members are expected to do their best in giving to AA. Judging from this slice of philanthropic history, some would say the lesson learned is that sustainability is what all nonprofits should achieve. That is a tempting idea. But I think that view casts its net too wide because nonprofit missions vary so much and not all nonprofits can achieve that level of sustainability. I think the lesson learned is that gifts sometimes come in forms other than money and that the best gift you can give your organization is to think about what kind of money you want, why you want it, and how do those who give it get a voice in your agency’s development. I welcome your thoughts on this: email me through the Contact page on our website, lp-associates.com. In this issue of News & Views we look at the many ways in which people of influence can give to your organization. Asking a donor to host a reception or join an advisory or honorary council are all positive ways in which you can ensure the long-term survival of your organization. We urge you to think more deeply about your organization’s money because what you do today will (or won’t) set a solid foundation for the future.* * For more information on the life of Bill Wilson, I recommend “My Name Is Bill” by Susan Cheever. - Laurence A. Pagnoni, President Gathering Prospective Individual Donors: A Guide to Friendly and Effective Fundraisers
The informal gathering is probably the most enjoyable fundraising technique both for the fundraiser and prospective donor alike. It is an easy, inexpensive, and highly effective way to connect with potential donors and begin developing a relationship with them. What makes it so effective is the opportunity to convey the dramatic impact your organization has on the lives of your clients, what Terry Axelrod has called the “emotional hook” of your vital mission. The gathering usually takes the form of an informal get-together at someone’s home. The host is a well-connected person who may be a director of the agency, a major donor, or a volunteer. The guests are assembled largely from the host’s personal and professional acquaintances. Modest refreshments are served. Guests enter and are made to feel at home. In fact, the initial stages of the gathering feel like a party or reception. The event lasts approximately 90 minutes. People leave in good spirits, having made new contacts, had a drink, some pastry and hors d’oeuvres, and learned more about an initiative that interested them. The fundraiser has not intruded on too much of their time. The direct expenses are usually under $200, and the proceeds typically average $6,500. An informal gathering recently staged for one LAPA client generated pledges of $24,000. LAPA organizes informal gatherings for its clients in the following way:
-- Sheldon Bart, MA, Grants Officer "ASK LAPA": ANSWERS TO YOUR QUESTIONS ABOUT MANAGEMENT AND FUNDRAISING ISSUES.
Dear LAPA: Is there a difference between an Advisory Council and an Honorary Council? If, so what are the benefits of having one or the other? - Jennifer, Executive Director Dear Jennifer, An advisory council (AC) is created to lend prestige, funding contacts, and expertise to your agency without being legally responsible for the agency (non-governance). Often the AC is comprised of former Board members who wish to still offer time to the organization as well as people who are interested in becoming involved, but to a lesser extent than is required of a governing Board member. An honorary council (HC) is for people who have little time to devote, but either deserve to be honored for past work or have clout that brings positive notice to the organization. Note I use the word Council, rather than Board. It is important that you do not confer more authority than is warranted upon people who are not voting members and decision makers. You, along with the chair of your board, should meet with the advisory council once or twice a year to keep them engaged, create opportunities for involvement, and elicit their advice. Before these meetings, consider sending a specific question that requires their input, such as: “Which three corporations do you have relationships with that would help us fundraise?” Action-only minutes should be drafted and distributed, but voting should never occur. Each member of your AC can also be helpful individually. A lawyer on the AC can be called upon to offer pro-bono counsel or a banking executive may advise you on financial issues. It is not necessary to hold honorary council meetings, for people on the HC wish to remain less involved. They appreciate being acknowledged and informed about organizational events and programs. Do not expect them to be working volunteers. Instead see them as important individuals who will either lend a prominent name to the organization, be a good-will ambassador on its behalf, or do both. Further, their names are impressive when listed on your stationery underneath your board of director names. To summarize, advisory and honorary councils are assets for many reasons; they
However, one note of caution: If you are going to add advisory and honorary councils to your to-do list, make sure that you have the time and resources necessary to form, develop, and maintain them. LAPA offers services relating to all elements of advisory and honorary council development, so give us a call if we can be of help. – Blanche L. Norman, MA, Director of Grants Services
Click here to contact Laurence A. Pagnoni, MA, MPA. To reach a LAPA associate, click on the name below: Sheldon
Bart, MA |
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Laurence A. Pagnoni & Associates
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Phone: (212) 932-8001 |
