Designing a Major Gifts Strategy: Steps for Small Nonprofits
While every nonprofit leader understands that major gifts are important, a study by Bloomerang reported that up to 58% of nonprofits don’t have a dedicated major gifts strategy. If you want to secure more major gifts for your organization and increase your fundraising capacity long-term, creating a major gifts strategy is essential.
In this guide, we’ll cover everything you need to know about major gifts and how to design a strategy that leads to impactful organizational growth. We’ll explore the following:
Major gifts aren’t just large donations that fuel your nonprofit’s mission—they’re also the doorway to relationships that transform your organization. Let’s start with the basics so you can point your nonprofit in the right direction.
What is a major gift?
Major gifts are your nonprofit’s largest donations from individual donors. Every nonprofit has a different amount that they consider to be a major gift, ranging from $1,000 to millions. No matter what size donation you consider a major gift, these donations typically make up a large portion of your overall fundraising revenue.
Why do major gifts matter to small nonprofits?
For nonprofits of all sizes, a majority of their fundraising dollars typically come from a small number of donors. This is sometimes called the 80/20 rule—a concept that states that 80% of a nonprofit’s donations come from the top 20% of its donors. Naturally, the donors who are responsible for so much of your organization’s revenue deserve plenty of your attention.
To understand just how important major gifts are in the grand scheme of nonprofit operations, take a look at these statistics:
Gifts over $1,000 represent 85% of fundraising revenue for the average nonprofit.
82% of nonprofits include major gifts in their strategic plans.
Donors who give over $5,000 contribute three-quarters of the total dollars donated to nonprofits.
For small nonprofits, these gifts can make even more of a difference in your long-term success. Major donations can help you fund your first capital campaign, launch new programs, and invest in capacity-building efforts like staff hiring or buying improved technology.
What if my nonprofit doesn’t have the resources to prioritize major gifts?
This is a common concern. Many small nonprofits don’t have a major gifts officer on staff, let alone a full team they can dedicate to major gift fundraising. The good news is that having a small team shouldn’t stop you from pursuing major gifts!
Small nonprofits secure new major gifts all the time—we’ve seen small organizations secure gifts of $1 million or more thanks to informed prospect research and personalized cultivation efforts.
If you’re looking to grow, we recommend working with a consultant who can fill in the gaps, train your team on major gift fundraising best practices, and even help you hire a major gifts officer. This way, you won’t have to waste valuable team time trying to navigate do-it-yourself prospect research, and you can prepare your team to maintain a thriving major gifts program long-term.
How to Create Your Major Gifts Strategy: 6 Steps
Now that you’ve brushed up on the basics, follow these steps to create a detailed major gift fundraising strategy for your organization.
1. Understand the major gift fundraising cycle.
First, take a step back and think about the entire major gift fundraising cycle. This is the process you’ll go through time and time again to solicit major gifts, so you need to understand the phases and what goes into each one before formulating a specific strategy.
The basic major gift fundraising cycle is made up of four steps:
Identify prospective major donors. Using the information in your database along with other prospect research tools, research potential donors who have the financial capacity, affinity (warmth for your cause), and propensity (habit of giving) to give a major gift to your organization. Then, you’ll verify the information you found across multiple sources and prioritize prospects based on those most likely to donate.
Cultivate relationships with prospects. In this stage, you’ll work to develop personal relationships with each of your major giving prospects before discussing any donations. Through regular communication, in-person meetings, and personalized engagement opportunities, your team should spend multiple months getting to know the prospect and what they value most.
Solicit major gifts. When you feel that you have a strong enough relationship that a prospect will likely say yes to giving a major gift, you’ll create a tailored fundraising appeal and make your ask in person. Use the information you learned during the research and cultivation stages to determine an appropriate ask amount, and highlight specific programs and initiatives that the prospect is passionate about in your ask.
Steward major donors. After you secure a major gift, your work isn’t done! In this stage, you should thank major donors and recognize them in ways that will resonate with them to retain these relationships. Keep them updated on the campaign or project they donated to, and continue to invite them to engage with your nonprofit in a variety of ways.
The entire cycle may take months or years to complete for a specific major gift prospect, but it’s useful to keep the bigger picture in mind even when you’re in the weeds of cultivation or another stage. Remember that every step takes you closer to securing major gifts and provides opportunities to strengthen relationships with potential major donors.
2. Define major gifts for your organization.
Next, calculate your major gift threshold to determine exactly what size donations you’ll classify as a major gift. Base this number on historical donation sizes to give yourself an accurate estimate of what’s achievable for your organization.
You can calculate your major gift threshold in four simple steps:
Pull a list of the largest individual donations you received in the last few years. Organize the donations in your CRM by highest to lowest gift size, and zero in on the top 25-30 donations.
Remove any outliers from your list. If most of your largest donations are in the $1,000 - $5,000 range but you secured one $17,000 gift, for example, you should remove that outlier. This step will ensure you don’t skew your data and overestimate (or underestimate!) the typical major gift size your organization receives.
Establish a range from the donations you have left. After removing outliers, look at the range of gift sizes remaining. Say that your top 20 gifts range from $5,000 - $20, 000, don’t worry if it seems too large of a range at this point.
Set a minimum amount that you’ll classify as a major gift. Calculate the median gift size and use that number to inform your final decision. For instance, if the median is $9,750, you might determine that anything over $10,000 is considered a major gift.
This amount doesn’t need to be set in stone once you define it. If you find that $10,000 isn’t realistic for many of your top donors somewhere down the line, you should adjust your threshold to reflect that. The same goes for shooting too low—if you discover in a year that most donors are giving over $15,000, go ahead and up your major gift threshold!
3. Choose your prospect research tools.
With your target gift size in mind, prepare for the identification stage of major gift fundraising by choosing your prospect research tools. At this point, you’ll need to decide if you want to take the DIY approach to prospect research or hire a consultant to perform the research for you. If you work with a consultant, they’ll have access to all the best tools already, so you can skip this step.
For nonprofits conducting prospect research on their own, explore your options and make a list of all the tools you have available to you. There are several free and paid prospect research tools to consider, including:
Google and Wikipedia: Quick Google searches are not a bad place to start your research journey. You might find basic information about a prospect, their career, and their public persona.
Your internal donor records: One of the most important tools is the data you already have in your donor database. Your existing records likely hold multiple potential major donors who you haven’t yet considered.
Internet archive tools: These websites allow you to view archived versions of web pages to find any information that has since been removed.
Social media platforms: LinkedIn, Facebook, and Instagram may provide information about a prospect’s career and charitable interests.
Government records: Public records that contain information about investments and political giving can serve as trusted indicators of a prospect’s wealth.
Matching gift databases: If you use a matching gift tool already, it can provide additional data about a donor’s employer and matching gift eligibility.
Prospect generator tools: These paid tools pull from the donor lists of other, similar nonprofit organizations to find prospective major donors.
Prospect research databases: Wealth screening and philanthropic databases help you supplement the information already in your CRM with new insights about your donors’ major giving potential.
You can access many of these tools for free if you have a limited budget. However, paid tools and professional prospect research services can provide you with verified data faster, allowing you to spend more time on cultivation.
4. Identify initial major gift prospects.
To ensure that your major gifts strategy is realistic, you’ll need to test it out with a few initial prospects. Use your chosen wealth screening and prospect research tools to identify people you already have relationships with who could be major gift prospects. These might include existing donors, loyal supporters, or board member connections who may have the potential to give at higher levels.
Remember, you’re looking for capacity (wealth), affinity (warmth), and propensity (habit) markers. Prospects should have markers from each category to be considered viable. This might look like a recurring mid-level donor who regularly attends your fundraising events (affinity), donates to multiple nonprofits (propensity), and holds a C-suite position at a large company (capacity).
Once you have a shortlist of prospects, qualify them to ensure that your information is accurate and up-to-date. The qualification process involves verifying the data you’ve collected using multiple trusted sources. For example, you could qualify our example prospect above by checking their LinkedIn profile for updated career information and searching other nonprofits’ annual reports for donor lists that include your prospect’s name.
5. Draft a basic cultivation plan.
After identification and research, you’ll move into the cultivation stage of the major gift fundraising cycle. Set yourself up for success in this stage by crafting a basic cultivation plan that you can tweak for individual prospects later on.
Your cultivation plan should include a variety of relationship-building activities that help you learn more about prospects, demonstrate your organization’s needs and impact, and cultivate trust. These might include:
Regular phone calls and in-person meetings to discuss your work.
Invitations to fundraising events and volunteer opportunities.
Personal tours of your office, facilities, or program site.
Informational outreach that provides concrete data about your impact.
Leave the timeline of your cultivation plan fairly open, since you’ll likely adjust the length of the cultivation stage for each prospect. Some may be ready to give in a few months, while others will take a year or two to get to know your organization before giving major gifts.
6. Create solicitation guidelines.
When it’s time to move into the solicitation stage, you’ll need a clear idea of how to make the ask. Many nonprofit leaders get anxious about this step, especially if they’ve never asked for a major gift before. That’s normal! After all, it’s not like sending an email or direct mail fundraising appeal—asking for a major gift should be a highly personal, delicate conversation.
To ease your team’s anxiety and approach major gift solicitation strategically, create a list of guidelines to follow during these conversations. For instance, your nonprofit’s guidelines might look something like this:
Build a strong relationship before asking. Prospects should never feel surprised by a major gift ask. Wait to solicit major gifts until you feel confident that the prospect will say yes.
Ask in person. It’s important that these conversations be exactly that—conversations. In-person meetings allow you to gauge how the prospect is feeling and shift your approach as needed.
Tell an impact story. Before you jump into the appeal, use storytelling strategies to remind prospects about the power of your organization’s work and who it benefits.
Request support for a specific project. Choose a project or campaign that you’ve already discussed extensively with the prospect and know they’d be willing to support.
Personalize the appeal as much as possible. Use the information you’ve learned from the research and cultivation stages to personalize the ask amount and steer the conversation toward each prospect’s specific priorities.
Prepare for different responses. Go into every conversation with plans for what to say if the prospect says yes, no, or maybe. For instance, you may immediately thank a prospect who agrees to contribute, reassure a prospect who says maybe that they can take all the time they need to make their decision, and offer non-monetary engagement opportunities to prospects who turn down the ask.
These guidelines should serve as a basic structure for your team’s major gift asks, but practice makes perfect. Take time to train everyone who’ll be involved in major gift solicitation (such as board members, development staff, or loyal volunteers) on these best practices, and work with them to improve their pitches before they make their first ask.
Best Practices for Successful Major Gift Fundraising
As you start putting your major gifts strategy into practice, use the following best practices to help secure the donations you need.
Hire a major gifts officer.
If you have some room in your budget, hiring a major gifts officer can make a big difference in the long-term success of your strategy. A major gifts officer is a nonprofit staff member who takes responsibility for implementing your major gifts strategy, leading everything from prospect research to solicitation and stewardship.
Hiring a qualified major gifts officer not only saves other team members valuable time, but it also allows your nonprofit to devote significantly more energy to major gift fundraising, helping you boost your overall program’s success.
If you don’t have the time or resources to hire a major gifts officer right now, Donorly offers transitional nonprofit staffing services that can help you prepare to make the best eventual hire. In the meantime, our team will step in to fill the gaps and ensure your major gifts strategy stays on track until you’re ready to hire.
Create a major gifts page on your website.
Your website’s giving pages can be a valuable tool for generating interest in your major gifts program. By creating a specific major gifts page, you can consolidate information about major giving and use it as a resource to share with prospects early on in the cultivation stage.
On this page, include information like the benefits of major giving, reasons to consider giving a major gift, and how major gifts help your organization in tangible ways. Then, provide contact information so prospects can easily ask questions or start a conversation to express their interest.
Take a look at the major gifts page on the Doctors Without Borders website for inspiration:
On this page, the nonprofit provides social proof (“our team of major donors”), specifies the amount that they consider a major gift, and explains what special privileges major donors get after donating. Then, the page gives major donor prospects the contact information of someone they can reach out to to learn more.
Work with a fundraising consultant.
A professional fundraising consultant who specializes in major giving, prospect research, or donor cultivation can provide valuable support for your major gifts program. These experts can:
Handle the wealth screening and prospect research process for you, helping you identify donors with hidden potential.
Step into the role of a major gifts officer while your organization prepares to hire one.
Design a capital campaign strategy that prioritizes major donor relationships and helps you secure the support you need for a major project.
Train your team on fundraising best practices to put them in the best position to successfully cultivate and solicit major gifts.
To get started with a fundraising consultant, research a few options and evaluate if they’d be a good fit for your nonprofit. Look for consultants who’ve worked with similar organizations in the past, and set up a consultation to ask questions and learn more about their methodology.
The Donorly team is made up of seasoned fundraising professionals who specialize in working with small to mid-size nonprofits, so we understand exactly where you are and how to help you transform your organization’s major gifts strategy. We believe in the power of small nonprofits to better their communities, and we’re here to help you maximize your fundraising potential so you can do more good.
Wrapping Up
Major gifts are vital to small nonprofits, and they’re not out of your reach! With a comprehensive, data-informed major gifts strategy, any organization can secure the major gifts they need to sustain their work.
Excited to learn more? Explore these additional resources from our major gift fundraising experts:
Finding Major Donors: How to Identify & Secure Major Gifts. Learn more about the identification and solicitation aspects of major gift fundraising in our guide to finding major donors.
Fundraising Strategy for Beginners: How to Create Your Own. Looking to make more holistic improvements to your nonprofit’s fundraising strategy? Go step-by-step with this beginners’ guide.
Prospect Research Guide: Everything Nonprofits Need to Know. Explore multiple approaches to prospect research and find the best fit for your organization’s unique needs and goals.
