The Art & Science of Fundraising Presented by Jay Ornellas & Lisa Feldman October 15, 2011

MISSION STATEMENT The UCLA Fund builds enduring relationships with alumni, parents, students and friends and secures annual discretionary funds for UCLA’s Chancellor and academic leaders to maintain and enrich UCLA’s tradition of world-class excellence.

Fundraising Fundamentals Some Basic Truths Giving & Volunteering In The USA Key Concepts In Fundraising Understanding Donors And Prospects Effective Volunteers

Some Basic Truths People don’t give to causes. People give to people with causes People don’t want to give to an organization that has needs, but rather to one that meets needs Knowing why you care about a cause is important to keeping you motivated The best thing you can do for your prospect/donor is believe in the mission you are representing

Giving & Volunteering in the USA By Sex By Age 16-24 22.0% 25-34 23.5% 35-44 31.5% 45-54 30.8% 55-64 28.3% 65+ 23.9% 23.3% 30.1% Women Men By Race/Ethnicity Generational Giving 14.7% How much the average member of four generations gave to charity in the past year 19% Generation Y (born 1981-91) $341 Generation X (born 1965-80) $796 Baby Boomers (born 1946-64) $901 Matures (born before 1946) $1,066 Sources: Conivo, The Chronicle of Philanthropy, Bureau of Labor Statistics --- for 2009

USA 2010 Contributions: $290.89 B by Type of Recipient Organization Religion 35% Education 14% Human Services 9% Health 8% Public - Society Benefit Arts, Culture & Humanities 5% International Affairs Environment/Animals 2% Foundations 11% To Individuals Unallocated 1%

USA 2010 Contributions: $290.89 B by Source Individuals 73% Foundations 14% Bequests 8% Corporations 5%

FY11 UCLA Development Year-End Results FY11 Actual % of Total YTD Private Support by Gift Level $10M+ $159,500,540 33% $5 - $9.9M $35,000,000 7% $1 - $4.9M $65,789,099 14% $100K - $999K $119,929,594 25% $10K - $99K $66,482,238 $1K - $9K $23,493,643 5% $1 - $999 $9,303,433 2% $479,498,548 100% # of Gifts 4 6 39 544 2,451 9,238 67,515 79,797

FY11 UCLA Fund Year-End Results FY11 Actual % of Total YTD Private Support by Gift Level $2,500 - $100,000 $9,055,163 62% $1000 – $2,499 $1,505,716 10% $1 - $999 $4,072,179 28% $14,633,058 100% # of Gifts 2,428 2,145 36,059 40,632

UCLA FY11 Giving By Source FY 2011 Total: $479,498,548

Key Concepts in Fundraising Ethical Fundraisers Fundraising Terms The Heart of an Organization The Prospect Cultivation and Solicitation Cycle The Pyramid of Giving The Gifts Chart

Ethical Fundraisers Match donor’s passion/interests with University’s needs Determine and support donor’s ability to give (capacity + affinity + willingness) Invest in long-term relationships and not just a single gift—especially in an annual fund environment

Fundraising Terms Case – The combination of reasons advanced by an institution or organization in justification of its appeals for support, with emphasis on its services — past, present and potential. The case is one of the three basic pedestals on which fundraising success must rest, the others being volunteer leadership and sources of support.

The Case for Chancellor’s Greatest Needs (CGN) Touching Lives Worldwide Gifts that transform lives are the most powerful, and the Chancellor’s Greatest Needs Fund (CGN) offers that potential. Allocated not just where support is needed, but where it will reverberate most, CGN generates campus-wide change.   The Chancellor’s Greatest Needs fund is closely aligned with UCLA’s mission of enhancing education, advancing research, and promoting community service for lifelong civic engagement. The University endeavors to integrate these three hallmarks of a great university so that each enriches and extends the others. This integration promotes academic excellence as well as nurturing innovation and scholarly development. Much like venture capital, CGN enables UCLA to maintain its entrepreneurial culture and approach in teaching and research. The Chancellor’s Greatest Needs fund provides the unique flexibility to support unforeseen opportunities as they arise. Above all, CGN empowers students to enhance their social mobility by enhancing academic programs and student services, recruiting the best faculty, and out-of-the-classroom learning opportunities. A professor can help guide an undergraduate’s life’s path; a fellowship for a talented graduate student may hold the key to a groundbreaking discovery that will benefit millions. With gifts to the Chancellor’s Greatest Needs fund, the sky’s the limit.

Fundraising Terms Charitable Institution – Any private institution or organization that operates on a nonprofit basis for the public good and which is therefore exempt from taxation, with the exception of commercial operations in which it may be involved. Most are classified in Section 1954 of the Internal Revenue Code as a 501(c)(3) organization.

Fundraising Terms Development- The process of aligning fund-raising goals with institutional planning and objectives in order to move a university forward utilizing professional staff and volunteers—alumni, parents, students and friends–who become advocates and ambassadors for the university and whose efforts ultimately aid in the financial health of the institution.

Fundraising Terms Restricted vs. Unrestricted Gifts-Restricted gifts are designated to a specific project or purpose whereas, while an unrestricted gift can still be targeted to a designated fund, its use is not restricted to a specific purpose.

Fundraising Terms Prospect – A potential donor who has been identified as having the capacity to give at the target level, an affinity with the organization and/or its work, and as one to whom the organization has access through his or her relationship with one or more volunteers and/or staff persons.

Fundraising Terms Cultivation – The process of developing the interest of a prospect through exposure to institutional activities, people, needs and plans to the point where he or she may consider a leadership annual or major gift. Focused cultivation activities can extend over a period of a few weeks to many months or even years in the case of a major or principal gift strategy.

Fundraising Terms Personal Solicitation – The preferred method of fundraising, involving one or more individuals meeting face-to-face with a prospect to invite that alum, parent or friend to make a charitable gift to the University.

Fundraising Terms Stewardship – The development process by which an organization shows gratitude to a donor through timely and meaningful acknowledgement, recognition and involvement and through annual reporting demonstrating the impact of the gift on the mission of the organization.

The Heart of an Organization: Work from inside out and top down Level 1: People closest to the heart – board and council members, major and principal donors, leadership-level annual donors Level 2: Volunteers, Alumni Association members, staff, below-leadership-level annual donors Level 3: People who are not current donors but have given in the past (lapsed donors) Level 4: Non-engaged alumni, students, parents and friends you haven’t reached yet (non-donors)

Prospect Cultivation & Solicitation Cycle Identification Cultivation Solicitation Stewardship Re-solicitation

Pyramid of Giving Individual annual gifts Major and planned gifts Principal gifts Major and planned gifts Individual annual gifts Potential gifts from non-engaged alumni, students, parents and friends

Pyramid of Giving $$$$$$$$$$$$$$$ $$$$$$$$ $ Individual annual gifts Principal gifts Major and planned gifts Individual annual gifts Potential gifts from non-engaged alumni, students, parents and friends $$$$$$$$$$$$$$$$$$$$$$$$$$$$$$ $$$$$$$$$$$$$$$ $$$$$$$$ $

Understanding the Pyramid of Giving Simply stated, development can be considered a game of numbers and methods used. Approximately 30% - 35% of first-renewal donors will make a gift their 2nd year 60% of 3-year donors will make a gift their 4th year 86% of 5-year donors will make a gift their 6th year 97% of leadership-level donors renew at their 5-year mark

Understanding the Pyramid of Giving There is a direct correlation between the size of one’s gift and the method used to solicit it Most first-time contributions are secured through telemarketing and e-solicitation methods. Second and third gifts are often also solicited through this type of appeal or through direct mail. Once a gift reaches a certain level — leadership- level gifts ($1,000+) are secured through personal solicitations (also referred to as “face-to-face” solicitations), ideally by someone who knows the donor on a personal basis.

Understanding the Pyramid of Giving The top 10% to 20% of the gifts received will account for 75% to 90% of the dollars produced 75% to 85% or more of the total number of gifts received will typically be in the smallest giving ranges and equal about 10% to 20% of the total dollars given. Usually less than 100 gifts will account for 75% to 90% or more of the total dollar production.

UCLA Fund Projected Gifts FY12 # of Gifts Gift Size # of Prospects Total 5 $100,000 20 $500,000 4 $75,000 16 $300,000 10 $50,000 40 75 $25,000 300 $1,875,000 100 $10,000 400 $1,000,000 325 $5,000 1,000 $1,625,000 1,500 $2,500 4,000 $3,750,000 $1,000 Many Under $999.00 $5,250,000 Grand Total $15,800,000

Understanding Donors and Prospects Qualifying prospects Why people give Why people don’t give It’s all about relationship building Are we on the same page?

Qualifying Prospects Capacity Affinity Willingness Do they have a level of income sufficient to support a leadership gift? Affinity Do they have an interest in and/or an emotional tie to one or more parts of the University? Willingness Are their circumstances such that they are amenable to making a gift if asked?

Why People Give A desire to make an impact and do something with lasting meaning A responsibility to share good fortune To be a part of the solution, make a difference Emotional response, belief in the mission, empathy, sense of belonging, giving back Recognition, personal gain, networking, peer influence, to set an example, image Tax benefits

Why People Give What are the three primary reasons why people say “yes” when asked to give? Because the are expecting to be asked Because they are asked Because the right person asked

Why People Don’t Give What are the primary reasons why people don’t give? It’s not a good match; they are not emotionally compelled Weak case for giving and/or insufficient stewardship The wrong person did the asking, for the wrong amount, at the wrong time They weren’t asked

It’s All About Relationship Building Create opportunities for involvement and interaction Personal contact is critical Attentiveness is key Phone calls are more effective than snail mail or email Face-to-face interaction is more effective than phone calls Let the donor/prospect know that they are important and that their contributions matter

Effective Volunteers Believe in the mission of the organization and understand the case for giving Are donors themselves Have one or more of the following characteristics Personable, good at telling their story Attentive, good listener Dedicated, good follow-through, dependable Sincere, genuinely interested Don’t take “no” personally

From Sales to Fundraising Sales Skills… …Applied to Fundraising Communicating product/service value to your customer Communicating the case for UCLA and your passion to the donor Listening to your customer’s needs and requirements Listening to your donor’s concerns and interests Helping the customer find the right product/service Helping your donor find the right giving level and program Closing the deal Making an effective ask and receiving the donation so it can start doing good right away

“The Tiny Essentials of Fundraising” Neil Sloggie One thing has remained constant in fundraising for two thousand years, that is that the more personalized approach works the best. For the future of fundraising, no matter what happens, it will come back to the levels of personalization that can be provided.

Thank You. Any Questions?