Boris Frank: From beautiful downtown Duluth where it is about 41 degrees below zero, keeping chilly at the moment. And that person in Orlando, yeah, I'm sorry to hear -- Participant: About 80 degrees down here. Boris Frank Yeah, it figures. I commiserate with all of you who are not up here -- really enjoying this. It's good to be with you today. What I want to do is -- Participant: Is somebody moving around? Boris Frank: Then we'll open it up for questions. So I want to emphasize something. If you pull out your handout that you received -- on the front of the handout, on the upper right hand corner is my e-mail address and my phone number. If there is anything that I talk about today where you would like some sample information, I'm going to talk about a number of pieces of information that I can e-mail to you and send to you as resource material. Obviously, in an hour, we are going to be just really scratching the surface of what I want to talk about. So anything you want to get to in greater depth, if you want samples of material, information, please do e-mail me, contact me, I'll shoot them off to you. I'm going to be back in the office next week and I can get some of these off to you. Let's go through the handout very quickly. The introductory things that I want to talk about first are the challenges of the board staff, if you have staff. I realize that's problematic. The ideas of getting ready and preparation. The whole planning process. The whole thing in fundraising is people give money to people. There's no question about that, the people part is very important. I want to talk quite a bit about that today. Some keys to success on the next page. I had some concerns about how fundraising is going these days. I think some of it has to do with our reliance upon technology and what technology is doing to the f undraising profession. I'm concerned about the loss of some personalization of it. And I want to get into that. There are a few basic principles that are kind of key. We have a tendency to sell our organization as opposed to market it and I want to deal with the differentiation there. But thanking of the donor is also something that I am finding is sometimes lacking. And the way in which we acknowledge-- the timing of the acknowledgements and the timings of how we handle some of our internal policies and procedures are important. Page four, I want to talk about the fundraising climate. What's happening out there? No question, the word is "change" these days. Change is going to affect all of us in terms of taxes, corporations, individual giving and government giving over the next 12 to 24 months. It's going to be very interesting and exciting to watch. I'm not sure the exciting part of it is going to give us any comfort but it's going to be there. And then, where can we get help? How can we bring other people into the process who might assist us? Many of us are already loaded up to the gills in terms of what we're doing.So go back, if you would, to page two. I want to deal first with challenges. The challenge for some of us, quite frankly, is survival. I know that many of you are not looking at this just from the point of view of Byways. Many of you have other commitments in your community and you may find some of the things w e are going to talk about today will apply to your other issues, concerns, activities that you take part of. And I am happy to deal with any questions that relate to that as well. But the big word these days is sustainability. We have a tendency in this country to start things. I love to start things. First thing we often think about is, let's get a grant to begin something. Well, grants usually have a finite life. Hopefully, they will have some sustainability and they will be with us for some time. But, for instance, in terms of government giving, the public sector, we know there are going to be huge changes that are going to be taking place over the next 12 to 24 months, depending upon the election. Depending upon new policies and procedures that are going to be instituted. Will the funding still be there for us in the traditional ways? I don't know. When I was with public broadcasting, I was the administrator for Wisconsin Public TV. Back in 1964. One day, my boss called me in, he said, congratulations. You are now not only a producer and director in charge of production here, but now you are the director of development and fundraising for public television. Oh, thanks a lot, just what I wanted. I didn't have a career of being interested in raising funds. I could ask for a show of hands, which I can't see. But I'll bet you, a majority of you are not terribly enamored with the idea of going out and asking other people for money. It's not one of our favorite activities. It's not one of the favorite activities of our board members and volunteers and I know that. It wasn't one of my favorite activities, to be very honest with you. But I realize that if you are going to survive as a public television entity, as w e wanted to survive, as the superior television operation, one of the best in the country -- we must have alternative sources of funding. And the sustainability of organizations has become a major issue. How do we keep this -- Some of the toughest money to raise for operational funding are ongoing funds. We've got to look at that, and that's really what I kind of want to focus on today. How are we going to be able to sustain ourselves? How are we going to be able to diversify the funding base so that we will continue to succeed? Well, the board -- There are some basic rules of the board members that are actually accredited usually by statute within the state in which you operate. There are some that are at the federal level, too. If you are organized as a 501 (c) (3) not-for- profit organization, incorporated, you have certain responsibilities as to how you operate the board. It's usually responsible for policy. The board is responsible for oversight. Making sure the funds that are used are used for appropriate purposes. By the way, this is something that is really concerning me.Now I'll bet, just about every day of the week, someplace in Wisconsin, where I am located, somebody is ripping a n organization off financially, to be very honest about it.We see embezzlement going on, we see misuse of funds, we see inappropriate oversight.The minute we have lost the confidence of our donors, in terms of our credibility, of making sure our house is in order, we're going to have a very tough time raising funds. We've seen what happened nationally with United Way at some point. Bobby Aramony who was their executive director misused funds of the organization and it affected United Ways all over the country. If there's a scandal of some kind, it can affect us, and it really hurts. We've got to make sure that oversight is appropriate, that we have the appropriate mechanisms in place to operate appropriately. Another role of the board, of course, is in terms of helping to raise funds. It's not one of the favorite activities of the board usually.Many board members are not aware that that is one of their roles but it is there. Now comes a controversial one. Every board member, I believe, should be making a cash contribution to the organization if you are out there asking for money in the community. Why? Very simple -- there are a number of donors who will not give a penny unless 100% of the board members have made a contribution. The usual response is, well, I gave my time, isn't that enough, isn't that appropriate? Sure, time is a very essential part of the process. But if there are people in your community -- and we've got them here -- who will not contribute unless you can guarantee 100% of the board have stepped up in a dvance and have made their own personal, meaningful commitment -- and that's the word, meaningful commitment -- to the organization, why should they? So that is a tough message. And you're most welcome to take that back to the board members and say, if you want to, you can say Boris Frank says, that is something that board members need to think through. If they are not willing to do that, they will be eliminating certain potential prospects and that is just a fact of life. There will be people who will check that question out. If you would like a job description for board members, I will be happy to send one along to you. Here is one of the documents I can help you with. The job description for board members and performance standards and what is considered appropriate. If you have a current board and one of the issues is not giving money, it's in the job description, it's in the performance standards. So as you recruit people to work with you, they understand at the outset what the criteria are for their becoming involved. It's not something that is a surprise at a later time. If you would like to see the job descriptions and the performance standards, e-mail me., I'll get you a copy of it. Another thing we are finding more of -- more and more board members and key volunteers signing agreements with the organizations. Saying, this is what I understand are my responsibilities, and the criteria that will be used in terms of judging my value to the organization. I have a sample of that. What can be expected from the organization, what can be expected from the volunteer, the key volunteer or the board member? I'll be happy to send that along as well. We are finding more and more of those are becoming formalized and not just verbalized. The role of the staff, the staff in some cases are not paid, they are unpaid staff, that is understood. I helped to start the canine unit at the Madison Police Department about three years ago. We do not have a staff person. We are the Friends of the Canines of the Madison Police. We have a very, very low overhead. We have no administrative costs of any consequence. I'll bet we spend one cent on the dollar in terms of any kind of administrative costs. It's extremely lean and mean, and that's great. You have a great case to make. So the staff member might be an unpaid volunteer. If you don't have staff, as we do not -- our president in effect is our executive director. We have other board members who are filling administrative positions on an unpaid basis. So whether you have paid staff or volunteer staff, it still is a staff position. The lowest staff generally supporting the efforts of the people who are out raising the funds, getting involved with the direct solicitation of funds. In terms of getting ready, a couple of things that I feel strongly about here. One, having a strategic plan. If you do not have a strategic plan written, in place, approved by your board, approved by your key people, recently developed, looking at least a year or a couple years down line -- you may have a much more difficult time raising funds. A good strategic plan will say where are you now, where do you want to go, how are you going to get there. It will be the key document in terms of driving a solid development and fundraising plan. There will be donors -- especially the more sophisticated ones -- who will ask to see that plan. It does not have to be an agonizing, ad nauseam project to put the plan together. I am going to be doing one for a library in Eagle River this Saturday.Help them with advance interviews, giving an agency assessment, which I will talk about in a moment. And we are going to have a retreat, a planning session starting in the morning, we are going to finish by three in the afternoon. By the time we are done on Saturday, we will have the strategic plan in place. Mission, vision, goals, objectives and who will be doing what next to accomplish that plan. That's where I find a lot of them fall apart. You come up with a whole bunch of wonderful ideas, wonderful goals and objectives, but nobody is stepping up to implement them, to put the plan into practice. I will send you again, if you would like to see one, an accelerated planning model like this, you might find useful as you think about putting a plan together. Another thing I would suggest to you. As you do your strategy plan, it is useful to have an outside facilitator assist you. That doesn't mean you necessarily have to pay somebody. In our state, and this is true of many states, university extensions already have people who are skilled in this. You have county extension agents. Check with them, they offer a facilitated planning process. Major corporations in your area have people who are sensitized, who are skilled in planning. They might provide pro bono and free services. Check with other organizations in your community. Maybe one of your volunteers can facilitate their planning, and one of their volunteers can facilitate your planning-- you can make the trade. And yes, there are consultants out there who can do it too, but you don't necessarily have to spend a lot of time. But literally, in a couple of weeks, you can put together a strategic plan that will serve you well and will serve the foundation for just about everything else. You may be asked for that, what is your vision, what's your dream, where do you plan to go? The agency assessment that I just mentioned. I have about a 9-10 page document that I have been working on for myself, for the board members, for the staff, for the key volunteers -- to determine if our house is in order. Where are we? I'll send you a copy of that -- be happy to. It is something that I found extremely valuable in terms of raising issues as to where are we in terms of best practices compared to other organizations. The number of policy questions, for instance. The IRS, if you are incorporated as a 501(c) is starting to request a document retention system. You have to retain documents in certain ways -- this is the result of the Enron debacle and the Sarbanes-Oxley Law which applies to for-profits, that is now being applied more and more to not-for-profits. A conflict of interest statement and policy, donor fund acceptance policies, investment policies, banking policies. A whole number of things you will find in there, and I have samples of many of those policies that I would be happy to send along, as well. It will kind of give you a foundation from which to start. Coming out of a strategic plan is a development plan. Now I use that word advisedly, development. Not a fundraising plan, but a development plan. A development plan to me is much more comprehensive. Fundraising is part of development. A marketing plan, a public information plan, is also part of a development strategy, if you will. We need to implement that strategic plan -- the development plan, the marketing and public information plan, are all tools in terms of implementing those. I've done a little bit of homework on American Byways. I've talked to a lot of people about it and raised the question, do you know about America's Byways? What is it? What do they do? I have to send them an explanation of what they do. Some people say, well, America's Byways is one of the best kept secrets in America. My answer to that is, why? It doesn't have to be. A good marketing nd public information plan implemented and involve your community in awareness of what you do is part of that development plan goes hand in hand with a fundraising strategy. I will be happy, again, to send you an example of a development plan. It is for one real organization which happens to be a humane society type of organization. It will give you some ideas as to what goes into a plan. What some of the elements are. What some of the marketing elements of that are as well. I can e-mail that out to you as well. Another thing to do is to consult with others. I have no idea what we did before Google. What did we do before Google? Google is an amazing tool and there are some others out there. I went on this morning. I was checking something out. I put in some word for Google feedback. 3,500,000 hits in 3/10 of a second. You and I know that's absolutely impossible. It can't be done. I have this theory that if you ever dug down 50 places on that list, you find everything from there on is the same, no matter what you were searching. But it's an amazing tool. A lot of things on there you can utilize to give you some ideas of the direction you might take. That's what I've done, I've gathered this stuff and that's why I'll be able to share a good amount with you. Diversifying the funding base. If you are sole source dependent, if you have one event and work with one organization. Like, 15 years, all we've had is a golf outing. Now, the golf outing looks like it is in trouble and they are not going to get revenue for the next year or two. They are really scratching to find out where should they go from here. Think of diversification. So many ways you can think of going. Yes, Events are one thing, but events can also be very labor intensive. If you were to analyze organizations in terms of where they raised their money, you will probably find that somewhere in the neighborhood of 80% to 90% of their funds come from 10% to 15% to 20% of their donors. It's not like, well all we have to do is average $40 from each person, and we will make our goal. It doesn't usually work that way. It used to be the old 80-20 rule. We get 80% of our funds, 80% of our business, from 20% of our donors, 20% of our customers. We're finding it's now going much more 90-10, 95-5, even. So, focusing on those major donors at the top end is becoming more and more important if we are going to make our goals, in terms of fund goals that we are establishing for ourselves. That doesn't mean we want to ignore everybody else. Somebody might win the lottery, and that would be very interesting. We may find that there will be people who had sufficient and adequate funds, but are not giving it away at the moment because they are concerned about their retirement, let's say, or they're concerned about the economy. They may be holding it, but at a later time, they may be more generous in terms of giving us funds. I want to diversify that as much as I can. That's what I was charged with doing when my boss told me, we've got to find alternative funds for Wisconsin Public Television. Until that point, we were relying only on the levy -- only on the tax dollars. Now we have a friends organization. We started with six people back in 1966, now we have well over 75,000 donors. Our initial donors averaged about $25, now the average gift is about $125. A significant increase in giving -- it's now the biggest single source of funding for Wisconsin Public Television. Even more than the government dollars we receive. So here's an agency supporting a government institution in the highly successful Friends of Wisconsin Public Broadcasting. We have an auction now. We didn't used to have an auction. It evolved because the prints were successful. The friends used that as a vehicle for raising additional money. We probably net out about $150,000 to $200,000 in the auction annually. It's labor intensive, it takes a lot of time, but it's also a friend-raiser, not just a fund raiser. That's a very important role. You have got to think about the cost-effectiveness. The way you are raising funds may not be the most effective way. We have a thing called Edgefest in Madison, Wisconsin supported a Catholic high school, a weekend event. Friday, Saturday, Sunday.It did very well in most peoples' eyes, netting about $130,000 to $140,000 over that weekend. Then they did a little analysis. They started applying a dollar figure to the time the volunteers were spending, they quantified that. The time the staff were devoting to it. They discovered they were making 16 cents on the dollar, for the time that was being put in. They said, back up, said maybe we should be focusing more on major donors. Not ignoring the small ones, but focusing on major donors. Within a couple of years, they had a new science building-- because they focused on the people who had the ability, the capacity to give larger amounts. So, different approaches depending on your community and what the situation is. In fundraising, people give money to people. Who is asking can be very important. I will give more examples of that as we go ahead. Having people who have the ability to make appropriate and sizable contributions and can lead the way, open the doors for you, very, very important. That's kind of what I want to get into here, some specifics. I have farmland. I have about three acres, my wife and I. We have an animal hospice that we run as a not-for-profit ourselves. We've got dogs, cats, all sorts of things. Most of them I think sleep in my bed. We've got about 30 to 40 cats, eight dogs and goats and a cow and all sorts of things out there. We raise funds for that effort out in the community. There's a woman who lives down the road, Molly, she's sort of the oracle of the community. She knows everybody. She's gossip -- gossip-central you might say. Every year Molly calls up at the end of the growing season. Her and her husband run a farm down there, and they've got 8 0 cows that they milk. She calls up September or October saying, I've got the envelope for the Red Cross, can I come on down? Well, absolutely, Molly, we'd love to have you come on down. We've got to catch up on everything that's happening in the community. If you live out in the country, you know what happens. She brings bars and cookies and we make the coffee. Where do we sit? We sit at the kitchen table. What do we talk about? Everything except the Red Cross. So we go on for about an hour, and I catch up on everything. We have just a fine old time and then at a certain point, Molly says, you know, I've got to get down to the Yonke farm. Would you do something about the Red Cross? Well, yeah, of course, Molly, we want to support Molly. Molly is a dear friend, people give money to people. We have some good feelings about the Red Cross. We make out the check and put it in, she goes down to the Yonke farm and shares all the gossip down there that she's picked up at our farm. So that is sort of the way that fundraising used to be done extensively in our communities. It was relationships. If you lived in a small town, it was probably done in the block. Somebody would go down the block, that was the way you got to know your neighbors. I grew up in the middle of New York City. Vertically instead of horizontally. We got to know people in our apartment. We've lost a lot of that. We have lost some of those relationships. I think a lot of that has to do – it’s so easy to press a button and send out letters to everybody. They look very personalized, but are they really personalized? I'm not so sure. I think we're losing some of those relationships and the cultivation of those relationships, that lead to sustainability, the key to the long-term security of our organization. One thing important in fundraising to me is being a good schmoozer. Many of your board members -- many of the people who volunteer for the organization, they may dislike fund raising. But you know what they're good at? They're good schmoozers. They're good at relationship-building. That's probably why they're serving in a leadership organization. Because they have those skills of relationship-building. They are the movers and shakers. People who can open doors and have good contacts that can be utilized to help. I am told very often by consultants -- when you contact somebody, you must, during the time you are making the appeal, ask for the money, you’ve got to do it in every possible way and you've got to ask for it. I'm not so sure about that. Maybe you need to think about cultivating relationships first. Maybe even before you ask. We have a woman in the state named Mary Burke. She was our secretary of our Department of Commerce until a couple of months ago. She and her family owned a truck driving company. Mary recently raised about $3 million to build a new community center in Madison. She did it almost single-handedly. She came up with that line that you see there. “Visiting one time is like going on a first date and proposing marriage” I liked that, I always liked that. She's got it right on. First you have to date. Then you get engaged. Then you get married. It may take two or three cultivation contacts.Now, that will not be true with everybody. There are some people who know you well, know what you are doing. They are already committed to the organization. But they just weren't asked. The biggest single reason people don't give -- they are not asked. 50% it is estimated. People don't give because they were not asked. You can add a word to that -- they were not asked appropriately. They were set up, or it was said, we have got you down for $5,000. Things like that. That they feel were most inappropriate in the way that they were approached. Being a good schmoozer is important. Start thinking more about the relationship in terms of development, about continuity, so that we are seeking ongoing support from people and not just one time. Recapturing that personal touch and having a long-range perspective. One way in which some organizations are looking at sustainability is asking for pledges over a period of time. Not just the one year at a time approach, but asking for multi-year commitments. We're finding some corporations and even a few foundations that are willing to take a look at that. I've got several situations where companies have made a three-year pledge on a rolling pledge basis -- on a rolling commitment. So every year, on a three-year pledge, that pledge is evaluated. Has that money been money been used appropriately? If they agree, then they add a year to that rolling pledge. So there is sustainability over a period of time. You have a three-year period in case something does fall apart, you have time to regroup. You are not just dependent on one year at a time. Building a donor, a prospect list is also very important. You have prospects out there. One of the things I like to do is build that prospect list up and then triage it. Build up in a list. Come up with an A list, a B list, and a C list. There are people at the top who might be my best prospects. I then like to take that A list and triage that. Break that down to a one, a two, a three. You might have a couple hundred people on the master list. You may end up with 10, 15, or a relatively few number as your number one. That is where I want to put my energy. That is where I want to put my focus. If we agree, that in many cases, it is the old 80-20, 90-10 rules. That is where I need to put my energy, my emphasis. Then I want to evaluate those top people and come up with a specific strategy for each one. A tailored approach to each one. Who should be making the contact? What team of people? How do we open the door? Do we do it initially with a letter and then follow up with a person? We know personal contacts usually make more generous gifts. Face-to-face usually means more generous support than doing it by letter, or doing it just by phone. So I want to come up with a specific strategy for each one to come up with an assessment. Great marketing principle. Most of us do what we've got and then we stop. Give to America's Byways because we do good work. Look at what we have accomplished over the years. Look at what we could accomplish if we had more resources. Look at what we need in terms of your support. I used one word in every sentence that has been the same, it is “We” e have a tendency to focus on our needs, our goals, and our objectives. Understandable, absolutely -- if you are not passionate about this, you need to rethink your relationship with your organization. I would hope we are passionate about it. But we also need to focus on the donor. Their interests, their needs, and their goals. If there were an overlying -- I hate to call it a secret, because it is not. A basic tenet of success in raising funds, here it is. The minute you can show a potential donor that you're going to help him achieve their needs, their goals, and their objectives -- by giving you money—they’re going to want to. That is what it is about. You need to be market-driven. We have needs, goals and objectives and they have needs, goals and objectives. We need to meld the two together. That is why some marketing principles are important. Differentiation and segmentation. If you know anything about the marketing areas, you know how important they are. McDonald's does not sell less in New York City. That is kind of a Midwestern-Minnesota- Wisconsin thing. It would not do too well in New York. Out here -- there are certain things in New York, knishes, that do not do as well in Duluth and Madison as they do in New York City. Why? Because they have analyzed their market and they have satisfied their needs, goals and objectives. For people in each segment of their markets, they differentiate, that is why they are successful. So we need to tailor our approach to each individual situation, each group of people, not just deal with everybody the same. I had 81 requests for money between Thanksgiving and Christmas this last year, 81 requests. Just about a whole lot of nothing, to be honest with you. See, I bet you got the same thing. In general, there's a tendency for organizations to send the same letter out to everybody. Everybody gets the same letter. But it doesn't make sense. Am I going to send the same letter to someone who gave $100 as to someone who gave nothing? Doesn’t make sense. I need to differentiate. I need to segment. I need to think about tailoring my approach to different groups. Does that mean you can do it all at once? No. Maybe you have two different letters in the first year, if you are using mail for raising funds. One type of letter goes to people who have donated in the past. One goes to people who haven't. I've broken it down into additional segments. So that I've got three, four, five, ten different letters. Maybe some people should not be getting a letter at all. Maybe some people should be getting a phone call. Maybe some ought to be contacted personally, and the letter is only to open the door. You know, vary it according to the who you're going to. We really need to think in terms of details. Another concern I have has to do with the thanking of the donors. I do not think we are doing a very good job of it in a lot of cases. It is easier to push a button, and a computer spews out not only that contact letter, but once they get the donation, it automatically takes care of the acknowledgement and the thanks. Well, isn't that nice and personal? I have a very simple rule for myself. Within 48 hours of receiving any commitment, donation, pledge -- they get a hand written note from me, thanking them. I think I was 6 years old, it was the day after Christmas, and I was at Grandma's house. I'd been up around three in the morning. Out there, having a great time playing with my toys. Grandma finally wakes up around 7, 7:30. I'm getting a little hungry, and she says -- you know, you are old enough now. Before breakfast, you sit down, you write a thank-you note to everyone who gave you a present. OK, Grandma. Around 9:00, I'm getting a little hungry. Grandma, can I have a bowl of cereal? Have you written your notes yet? I think it was 11:00, and I'm starving. Grandma, can I have a sandwich? No, have you written your notes yet? It dawned on me, I was never going to eat again until I wrote those thank-you notes. I sat down and did it, and she said something to me that stuck with me for many years. She said, that's good manners. We've lost good manners to a great extent. I am not sure any e-mail thank you is a very personal way of doing it. I am a great believer in the hand written note. What a great activity for some volunteers. What a great activity for some board members who are good at relationships and who are not terribly enamored of asking people for money. That type of approach is just as important in cultivating the relationships, as the actual asking for funds. I also have a rule for myself, that within 48 hours of receiving any money, that money is in the bank. In an interest-bearing account, by the way. Not-for-profit organizations are allowed to have interest-bearing checking accounts, a lot of people do not realize that. Ask your bank, if you do not have one, now check it out, you certainly can get that. If you are not putting the money in the bank in a timely manner, there are people who will test you. They will send you a check for $10, or $20, or $50, to see how you handle that money, how you acknowledge that gift. If they find it is not being done in a timely manner, they might not give you anything more. They may be sitting on larger amounts that they would not even send to you if they feel you're not appropriately managing your affairs. So those are just good manners approaches to it. I trust you to know you need to acknowledge now, as of January 1, all contributions to your organization under IRS rules and regulations. It used to be the old $250 rule. Now you have to do it for everything, in most cases. If somebody sends you a check, and they have a copy of that check that has cancelled, they can use that as proof to the IRS. However, I recommend a note going out to everybody thanking them for their gift, with the appropriate IRS acknowledgment. If you want to see the language that needs to be used -- again, e-mail me, and I will send you a copy of that. As of January 1, this past January 1, it is under the new rules. I was on the board of directors of the Wisconsin Library Association Foundation, and everybody who gave us $100 was assigned an award number. My job was to send them a hand written note and also to give them a phone call. Make a call, and thank them personally. Tell them that we appreciated it, that I am a volunteer board member and we want to thank you very much for this. Can I stay in touch with you during the year for the living newsletter? We want to be able to just maintain a contact. First of all, they were flabbergasted, in most cases. There were very few people who had ever gotten a phone call from a board member thanking them. We found that about 85% of the people we contacted that way were not only totally flabbergasted, but also said, sure, stay in touch with me during the year. We had about 15% that said, no, no, I don't need to stay in touch. You are our eyes and ears in the community about libraries. Here's my home phone number, here is my e-mail address. Would you get in touch with me if you hear anything? Wouldn't it be neat to get feedback about America's Byways from people who are your supporters, who are our partners now in the community? Because, indeed, that is what they are. You’re linked at the hip in terms of supporting America's Byways. Can we have a cup of coffee? I would love to get together with you. Sit down with you and just talk and schmooze a little bit. What a wonderful way to cultivate potential additional volunteers. To bring other people into the process in terms of governance, running your programs, management of your operations. We found that it really brought people to the fore that would not be there otherwise. Because now they felt they truly were a partner and participating. Not just as being a donor of money. Don't forget the anonymous donor. There will be those out there who want anonymity, they should have that right. That leads up to donor empowerment. Why did I get 81 l etters between Thanksgiving and Christmas asking for money? Because that is when most money is given away in this country. That is when they wanted to contact me and that is when they thought I wanted to hear from them. Well, not necessarily. A faith-based organization that I'm aware of did this. With their acknowledgement of your donation, they sent out a little card. A return card to come back to the organization. Check off "this is a onetime gift, do not ever contact me again." I want anonymity to that. I do not want to be recognized in any way, I do not need to be recognized. I would want the following acknowledgement to be sent to somebody because this is an honor gift. I would like to be contacted in the future in the month of -- whenever they want to be contacted. Please use e-mail or the phone or -- in other words, a whole list of things that will enable the donor to tell us how they want us to relate to them. Rather than our trying to predict and to prescribe the way in which we relate to them. In this we talk about the donor control, the donor direction, the donor operation. In about two minutes we're going to take about a 15 or 20 second break to re-load tape. Let's get over to page 4 and start dealing with the current fund-raising plan. Foundations -- pretty good time to think about going to foundations. Foundations, in general, have to give away 5% of their assets every year. Many foundations had very good investment packages over the last 12-24 months. The market was up, the asset base at many foundations has increased over that time by as much as 10%, 15%, even 20%. Foundations are going to have more money to give away over the next 12 to 18 months. There could be a downturn after that time because the market has had a very difficult time. If the market does not increase, they're going to have less in terms of an asset base to give away. So this may not be a bad time to think about approaching some foundations in your community. Give some thought to that. Corporate giving is starting to flatten out. We are seeing some corporations pulling in their horns. They want to wait and see what is going to happen with the economy. A wait-and-see attitude is starting to be felt out there. One more minute? About a half a minute until that break--So corporate giving, watch out. It may be a flattening situation. Now, don't give up on it. Corporations are still doing very, very well. Keep in mind, corporations do not just give from their giving budgets. More money might be available in their marketing budget. When we come back, I will give you a strategy there with corporations. Participant: Well good. Chel Ethun: I'll go right ahead with the tape. We're all set. Boris Frank: Corporate giving. There is much more money in the marketing department than there in the donations budget. That is why you see in Milwaukee, Miller Park, which is funded by the Miller Brewing Company. There is a quid pro quo there. The money that funded Miller Park did not come out of the donation budget. It came out of the marketing department. Because they felt that there was value in having an identity with a not-for-profit government entity in the community. There are many other examples we have of corporations getting a quid pro quo, some kind of benefits from their donation. That often will go through the marketing department. Think in terms of how you might be able to relate to the marketing efforts of a corporation. Is it appropriate for you, in some way, to assist them with that identity in the community and that recognition? Could be a possibility. Government giving -- boy, that is up in the air right now. Who knows what is going to happen over the next 24 months. Something's going to change. We know that. Things will be changing. Keep an eye on it. Watch what is happening. Some of that could be local changes in terms of how money is going to filter down from Washington. How it is going to be re-utilized in your county, in your city, in your village, out in the rural areas. It is going to change. Something's going to happen. The biggest single source in the private sector, however, in terms of giving, are individuals. The latest figure I saw -- 76.5% of all money given in the private sector is given by individuals. Not by foundations, not by corporations. It is by far the biggest source. You need to really look at the individual base in your community, because that is where most of the larger gifts and larger donations are coming from these days. There's a huge amount of wealth out there at the top end. You know, a lot of companies are being sold. A lot of wealth being created in our community at the high ends. So if we agree that the old 80-20, 90-10 type of approach is important, you need to really focus on those individuals who have control of substantial dollars. That doesn't mean we ignore everybody else, as I said. Absolutely not. But we need to think in terms of identifying those donors. Final point, then we open up for some questions -- where can we get help? That old saw, people give money to people, you betcha. Who can help in the fund-raising effort? You've got board members, you have volunteers, you have other people who are close to you and like very much what America's Byways is doing. Members on your board, how can they assist in opening doors? What can they do in some way to assist in that entire process? I also want to look outside the organization. What we often do is we put together a fund raising committee or an advisory committee. I've now used the second scariest word in the English language -- committee. I would say, only surpassed by terrorism. Oh my God, not another committee. Well, we want the very best. We want to associate with success. We want people who have trust or a credibility. The movers and shakers in our community, we want to enlist their assistance. Wouldn't it be wonderful to get the president of a bank on our committee? Wouldn't it be wonderful to get her to be the chair of our committee? She knows where all the money is in the community, right? She would be just the ideal person to serve as the chair of our fund raising committee. So you give her a call and have a relationship with her over time. She likes what you've done, and, you know, that's why you bank with her, because she's been supporting us in the past. You talk about the strategic plan -- here is what we want to do in the community, here are the goals. She says, boy, that's good. It's nice to see America's Byways starting to really come out and become better known. That is so important for our community, tourism and everything. Gee, this is great. She starts getting an enthusiasm talking about it, and you start salivating a little bit -- hey, maybe she might be interested. The glint in the eye is coming up You're about half an hour into it, and she says, it's good to see you have your house in order. That's good, you've got everything, you've got the policies in order, good for you, that's great. You know you're getting closer to that moment of "the ask" where you are going to say, would you become involved? You believe that moment has arrived. You know you have to ask her, would you consider -- By the way that is a great word, consider -- not would you chair Would you consider becoming a leader in this campaign and maybe chairing our committee? Let's see if you got the same answer I've gotten for 15 years of doing it. It never changes. I was working with a group this morning, 40 people in the room, they all shouted out this one word. I said, would you consider chairing the committee? Boris, I would love to, except I do not have enough time. It's always that word, time. So I am going to have to think about alternative ways of involving that person in some way. Jump down a couple words. Endorser. We have a Humane Society campaign in Madison, building a new building, a $7 million project. We accumulated a list of endorsers. We had Donna Shalala and her dog Bucky. We had Senator Russ Feingold and his dog Jake. All these people, we had about 50 people who were endorsers of our project. That is creating a big pyramid of people who are going to work on this committee. We had a very flat structure. We had one person who volunteers who led the way. Then we recruited all these endorsers for the project. We asked each one to consider taking on a finite task. You're not going to have to come to a lot of meetings. We're not going to immerse you in this project. We're not going to suck you into this black hole of involvement, Donna Shalala had, I'll bet, a contribution to our project of about 90 seconds, literally. She made one phone call to a board president -- to a president of a corporation were she had served on the board. She said, this is a project that interests me very much. When they call you and contact you, would you give them some consideration? Donna, honey, anything for you, you bet, give me a dozen. 90 seconds, she opened that window, a $150,000 contribution came out of that. We never have gotten through the door otherwise. She was able to make that one finite contact. We had about 50 people doing that at this level. Different people opening the door, doing something specific rather than just that general serving on the committee, we found it worthwhile. The next word is also very important -- consultant. When I have asked people to serve as a consultant for our organization for fundraising, I've never been turned down. It changes the thinking, it changes the mindset. Oh, I'm not going to have to come to those meetings? I promised my family I wouldn't take another one on. I promised the kids I'd be at their soccer games. Yup, OK, but if you need help, if you have a question, if you want some advice and counsel, you'll come to me? It changes the entire attitude. We need to think about opening up new paradigms. New ways in which we operate and work. I started off for about an hour here. I want to emphasize again, there are a number of things you may find that I can e-mail or send you. Especially that assessment document. Take a look at that, because it very well could lead to other issues and other materials that we can send you. We can post these additional materials so that you can reference them through the normal way. But if you want to get them directly from me, you're most welcome to do that. Either way. But they will be on the discussion forums and on the transcription page for the teleworkshop if you would like. So I will make those available to you. I think some might already be up on there, others I will be able to make available as well. We will post them on the discussion board and we can continue to have the conversation. We will send them out to you. Questions, concerns, rebuttals, quip backs. What the heck was he talking about? Anything at all. Stunned silence. Participant: I have a question. This is Janet Kennedy calling from New York. There was a comment you made which I found interesting and I'm wondering if I got it right. Can you hear me OK? Boris Frank: I can hear you fine. Participant: OK. The role of the board you talked about as being responsible in a significant way in the fundraising. It sounded like you were thinking it is really the staff that just helps them. It is not the staff's job to do the fundraising. Is that the message you were trying to give? Boris Frank: One of the roles of board members is the fiscal integrity of the organization. They are ultimately responsible for that fiscal integrity. There are some board members who are very good at fundraising. I serve on some boards where there are some people on the board I would not let loose on the community to ask for money. But they are ultimately accountable and responsible for that. Now, can they delegate that to staff? You bet, it's a possibility. But, I do believe that the board should be available to the staff if the staff wants to engage them in fundraising -- to assist in some way. If you are delegating the responsibility to staff then you have to enable the staff to create the mechanism for how funds will be raised. That may include calling upon board members to participate in the process. So they should be available for that. But the board is ultimately accountable for that -- for the fiscal integrity, the budget, and the ultimate success of the organization. And I realize, a lot of staff -- Donna Shalala used to tell me she spent about 65% of her time raising money for the University of Wisconsin here in Madison. That did not eliminate the Board of Regents or others in helping with the process of raising money. She saw her role as supporting, in many cases, the volunteer effort. She played a key role in it, but the board also played a role when it was appropriate. I don't know if that answers your question. Participant: I think it gives some good insights, that's great, thank you. Participant: Barbara here in Oklahoma. We're toying around the idea, on our board, of looking at three things for the board to do. When they are asked to serve on the board, they pay a fee. Whatever we determine that we need to run the organization. Or, they can help raise the funds with an activity that we all agree on we'll do. The third thing is, they can go out and get the people to donate. Do the things you have been talking about, find the donors. So we're looking at that situation. If you sit on this board, you're going have to participate in one of those three ways. Boris Frank: OK. I am not a great fan, I'll be honest with you, of designating a certain amount of money they have to raise. I realize you have alternative ways in which they can do it. There are some boards where this is a requirement. There is a museum in New York by Columbus Circle, where if you want to serve on the board, it's $50,000. You are also responsible for going out and raising an additional quarter of a million. That has a tendency to cut down on diversity on the board. You have got to think that through. I'm, as you've said, however, I think the 100% concept is extremely important. I work with one board, it's a community action agency, 32 people on the board. One woman on that board gives $1 a year. For her, that is a significant gift. She's on welfare, she's paid a stipend to attend board dates because she needs childcare and transportation, she needs to take time off from work to attend the board meeting. But she understands the principle of the 100%. Now, if you're going to expect that people will have to play a role in one of the ways you indicated, my advice would be to put that into some kind of an agreement that is agreed upon between the board member and the organization in advance. Participant: Right. Boris Frank: So it is very clearly understood as a performance standard and a requirement for participation. Participant: We are working in that direction. Boris Frank: Good. Again, as I said, I've got some samples of that stuff I can send out to you. Participant: Thank you. Boris Frank: I think a lot of the problems arise because people came in with false expectations as to what their role would be on the board. Participant: I find a lot of times people get on the board and they think they are just there to set policy, and never do anything. Boris Frank: Exactly, and it's what I call the warm body method of recruitment. Participant: Right. Boris Frank: It's ambulatory, it takes no sustenance, therefore grab it and put it on the board, because it's going to help us with our quorum. That's a lousy reason to have people on the board. Participant: You're right on there. Participant: Old Canada Road. What percentage do you think you should hold your cost on raising the money? Boris Frank: The cost of raising money? Participant: Yeah. Boris Frank: OK, good question. National standards -- Better Business Bureau and some others others -- and by the way I have the better business bureau guidelines. I think they use a figure of no more than 35 cents on the dollar for administrative and fundraising costs. I think that's high. The average of United Way is probably about 15 cents on the dollar. The last figure I saw for the Salvation Army was about nine cents on the dollar, administrative and fundraising costs. If you can get down into those areas, you are doing pretty well. 15 cents on the dollar seems defensible to me. Relatively new organizations -- if you are relatively new, your administrative and overhead costs and fundraising costs will have a tendency to be higher. Obviously, the more money you raise with the same administrative responsibilities, that will bring that percentage down. Another way of analyzing this is -- take a look at your in-kind contributions that are program related. A number of people you work with are not just involved in administrative duties but they're involved in some programmatic function. You ought to be counting their time as a gift to the organization. You should quantify that in terms of hourly rates, or other ways of assessing the value of that contribution so that you can show it as a program cost. That will bring your percentage down -- very often it is forgotten, it's not factored in. But going back to the basic question -- if you can get around that 15 cent figure or lower, that is the one I usually use as a rough guideline. It may take a little time to get there, I realize that. Does that answer you? Participant: Thank you, yes. Chel Ethun: Other questions? Participant: This is Wyvonne we had talked about how to raise money, I mean, this is the gist of it all. We know now the proper procedures and how to better it. But involving partnerships, such as our chambers, in our fundraising efforts and sharing that fundraising with them, sharing the duties of it -- since Byways are very understaffed, often just a small board and a volunteer director could incorporate chambers of commerce on the Byway to help with their fundraising, and then give them a share of the funds. Is that a good way to do things? Boris Frank: Why not? Participant: For instance, we're doing a Byway guide this year. I would like to include the chambers, give them their full page ad in exchange for them helping us get more ads from locals in their chamber of commerce organization. They're going to be doing newsletter solicitations for us. Boris Frank: I am getting very positive responses from many sophisticated donors to that approach. Partnerships, coalitions, co-ventures. All of those words are becoming very important because there is a lot of concern about duplication of effort. A lot of concern about, why are there so many people on my doorstep asking for money. I was talking to the person at American Family Insurance who gives the money away there. She says they're averaging 14 requests for dollars every day, 365 days a year. She says, why don't some of you get your act together and work collegially, in partnership with each other, and come with us if you are looking at mutual goals and objectives? We would be much more interested in working with you because you are going to be more efficient in terms of how you operate. You will be utilizing your resources better and we will welcome that because it is going to cut down on the number of people on our doorstep, looking for funds. So that approach to me is resonating very well with a number of donors. We have in Madison, Wisconsin -- we've got, I think, four or five agencies that deal with literacy. Frankly, a number of the donors in the community say, why don't you merge? Why don't you come together, why don't you partner, and do it as a group? We'll be much more receptive to responding to you. Because you are wasting resources in terms of overhead costs that we were talking about before. Why do you have all those multiple costs? Well, we deal with them all -- we deal with Afro-Americans, and we deal with Hispanics, we deal with left-handed Europeans, each person has got their own niche. And they say, come together and we will be much more happy to give you a good hearing, than if you are coming to us all independently. Participant: I think it's a good way to cut the competition and have the entire grass- roots movement come together. Because that is a big issue on a lot of Byways, duplication of efforts. Going after the same group of donors. Boris Frank: I met here -- a couple of months ago when we were starting to get this a ll going, we just started touching on the issue of regional fundraising, state fundraising and possibly national fundraising. I think there is not enough of this type of thinking going on. Now that happens with some of the larger -- I served on the board of the United Cerebral Palsy. UCP has local fundraising, they have some statewide efforts, they also have national efforts. It seems to me, we could do the same thing for Byways. Participant: I think it is a brilliant idea. Boris Frank: I think there are some corporations, for instance, who will want to identity with Byways. Who will be much more receptive to us if we went to them on a central basis rather than doing it state-by-state or byway-by-byway -- that approach. So I've -- we've just opened that door a little bit. Personally, I would like to pursue that. I think there is some great opportunities. Participant: Well, I agree. Very good, thank you for that idea. Chel Ethun: Other questions or comments? Boris Frank: If you want to schmooze a bit, don't hesitate, give me a buzz. If you get voice mail, I'll be happy to get back to you. Because I'm getting around. I just want to talk about some of these issues, not just do it by disembodied e-mail, but I'm always happy to do that, too. Also, if I am in your area anytime and you want to get together, or if you are around here. If you come up to beautiful, cold Minnesota or Wisconsin and would like to meet, I am always delighted to do that. Participant: Will you serve some cheese, please? [LAUGHTER] Boris Frank: I am not in cheesehead country at the moment, I am across the river so I’m a little nervous. Participant: Ooh, I thought it was all over. Chel Ethun: No, we don't have good cheese on this side of the aisle. Chel Ethun: Well, I did post a discussion forum on Byways on-line. The reference to this call is underneath "finances." It says Tele-workshop Community Fundraising. That is a place for all of you to be able to continue the conversation and network with each other. Also, we will post those items that Boris has discussed there. As well as on the teleworkshop page, on bywaysresourcecenter.org So you will have a chance to pick up those items at both locations as well as contact Boris at your leisure and ask more questions. Before we wrap up, I want to offer one final opportunity for anybody to ask Boris a question, and then we can wrap up. Is there any further questions, comments, suggestions, what have you? Participant: OK, this is a question for you, Chel. Chel Ethun: Yeah. Participant: Can you send us a link to where you are going to post that stuff? Chel Ethun: Yeah, we will -- Participant: Can you send all of us who are participating in this an e-mail that has that link? Chel Ethun: I'll tell you where it is right now and then we can also embed it. You will get a thank you e-mail which will give you the networking list and obviously tell you about the evaluation coming up. I will ask Jeanine to embed that link in the e-mail. Just so you know right now, if you go to Byways online and enter the discussion forum, right underneath finances is the latest one. It will say teleworkshop community fundraising. That's your opportunity to continue the conversation. But we will include it in the follow up e-mail. Participant: OK, thanks. Chel Ethun: Well with that I appreciate everybody's participation. I hope this was well worth your time, I know it was worth mine. I learned a lot. Boris is a wonderful resource. We are going to continue to learn from Boris in the future. He will be doing some more workshops with us on everything from organizational development to volunteers. We consider him a resource you can tap into and make your Byway a better Byway. Thank you. Participants: Thank you. Participants: Thank you, Boris!