Posted by: michgilb | December 21, 2009

An Ecology for Giving

I worked for an organization where 40% of the donors gave 1% of the money. In such a situation, why bother with little gifts. What’s the point if they contribute so little to the overall financial picture?

There are four categories for charitable giving. I believe that each category is equal in importance. Together, these four categories constitute a well-balanced development program for a nonprofit organization.

The four categories for giving are defined by the impact of the gift:

Gifts to Transform: A gift that transforms is a large, one-time gift made for a special purpose. Transformative gifts are essential because they result in something new, from buildings to programs. These contributions often retain a close connection to the donor even after the gift has been made.

Gifts to Preserve: A gift that preserves is made in the form of a permanent endowment. These gifts are also large in amount and therefore limited in number. These gifts are essential because they help to ensure the continued operations of an institution, its facilities, or one of its programs.  Often the donor’s name is attached to the gift for the life of the endowment.

Gifts to Sustain: These are annual gifts and they are essential because of the impact they make on a nonprofit organization’s daily operations and ability to deliver on mission. Sustaining gifts often start at about $1,000, but the giving range varies from place to place. The donor’s satisfaction comes from the knowledge that they are enabling the good work of a nonprofit that represents their philanthropic interests.

Gifts to Participate: These are smaller annual or one-time gifts. Gifts at this level are essential because they provide an invaluable, communal vote of confidence in the mission and work of a nonprofit organization. The satisfaction for donors comes from being “counted in” – they are demonstrating their support for a particular cause.

How does this ecology of giving work within a nonprofit?

  • Participatory gifts do provide some financial support, but more importantly, reward your nonprofit by providing community endorsement. Acceptance by the community provides a critical foundation for your credibility and boosts the morale of the entire organization.
  • Sustaining gifts represent a circle of friends for your enterprise, a pool of well-meaning donors that believe in you and what you do, and would probably be willing to do more if the right opportunities for deeper involvement were made available.
  • Preserving gifts help to provide a secure financial base and ensure the long-term continuity of your organization and its core programs. These gifts provide perpetual support as well as build trust by promising long-term viability.
  • Transformative gifts enable you to realize your dreams for increasing your reach and impact. The combination of community endorsement, a broad circle of friendly sustaining donors, and gifts that endow programs and operations create a robust environment from which to seek and raise transformative gifts.

And let’s not forget that some donors will have the ability and desire to move up the ladder of giving – there are many examples of participatory donors eventually becoming sustaining, preserving and transforming donors.

While this giving structure is highly functional there is, most crucially, a moral factor at play: No gift should be taken for granted; every gift comes from the heart; every gift is inherently meaningful.

The point is this: ALL giving is GOOD giving. Every gift makes a difference and deserves to be celebrated.

What do you think?

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