How to Secure Major Gifts for Your Nonprofit: Encouraging Large Donations

How much does your average donor contribute to your nonprofit fundraising events?

According to statistics provided by Nonprofits Source, the average online donation amount is $128. Yet some nonprofits are able to engage with donors who write checks for $1000, $10,000, or even $100,000 -- and more -- on a regular basis.

Large donations like these are considered major gifts, and they are the largest donations a nonprofit receives from individual donors. Depending on the donor, these major gifts can be used to fund specific projects, reach fundraising goals, or just support your general operations. You can receive major contributions in the form of cash donations or non-cash gifts (like stocks and real estate) which can be even more valuable.

Of course, not every donor in your support network is willing or able to offer such large donations, which is why nonprofits and charities focus on building strong relationships with the philanthropists, business people, and other prospective donors who are known to engage in major charitable giving.

This involves developing a major giving program where your nonprofit identifies large donors, builds a portfolio of good prospects, and works out how to engage with your top donors. Any charity or nonprofit -- including yours -- can establish a major giving program which helps direct major gift campaigns and secure major contributions.

Let's examine the type of large donors you'll need to identify when engaging in major gift fundraising. We'll look at how top donor relationships are created and the best practices for encouraging large donations.     

Understanding Donors Who Offer Major Gifts

High-value donors come from a variety of backgrounds. Some may be philanthropists. Others may be the managers of foundations or other charitable organizations. Still others may be wealthy older individuals who are interested in leaving a portion or their total estate to your nonprofit or charity in their will.

That said, all major gift donors are characterized by a high giving capacity, such as a high net worth, large income, stock ownership, or large estate. In addition, major gift prospects have strong philanthropic inclinations toward charitable programs and nonprofit missions.

When engaging in donor cultivation, it's important not to focus entirely on wealthy donors. Instead, to find the best major gift prospects, look for high-net worth individuals and organizations with an existing interest in your mission. Connecting with philanthropists who already want to serve the same populations you do increases the likelihood that they will want to support your nonprofit or charity.

One good place to start is in your current donor pool. Your donor database should contain pertinent information about donors with a high-net worth and a history of generous donations. Many donor databases contain wealth screening which uses algorithms to assess the giving capacity of your donors according to public resources like property records and stock holdings. 

Once you identify some good prospects, look at their donation history. Check your database to see how often they have engaged with your nonprofit. How many fundraisers have they attended? What was their largest gift? Have they volunteered in your group or helped promote it in any way? Knowing this history gives you a starting point for building a better relationship with these high-value donors.

You should also look beyond your existing support network. Find charities and nonprofits with similar missions to yours and identify their top donors. Perhaps they would be interested in supporting your programs. Look at networks and professional associations that work with populations similar to yours and see if you can find any major donors there as well.

Network with your board members. Do any of them know of any major donors who might be interested in supporting your mission? Having someone with a personal connection to these philanthropists could make forming a professional relationship easier.

Consider investing in prospect research tools that can offer more detailed donor profiles than your donor database. These tools can help reveal donors and philanthropists you may have not considered before. Some can also offer other useful information, like prospects eligible for matching gifts or grants, which can provide additional sources of funding for your nonprofit.  

Building a Major Gift Program

When building a major gift program, it's important to first establish what constitutes a "major gift" for your organization. Some nonprofits consider any contributions over $1000 a substantial gift. Other charities need major gift donors to offer gifts in excess of $100,000 for them to fall into the "major gift" category. 

Consider the budgets of your nonprofit programs, your operating costs, and what you hope to accomplish now and in the future. Having clear figures of what you need to raise helps you communicate vital information to your prospects.

Now you'll need to identify prospective donors using some of the strategies listed above. Keep in mind that good prospects need to possess not only a high net worth but an existing interest in supporting a group like your nonprofit. Segment your own donor base, taking into account giving patterns and supporters with the ability and motivation to increase their donation size. Use this to create your ideal major gift donor profile and have your team search for potential supporters who match this profile.

Connect with these high-value supporters. When possible, see if you can arrange an introduction through someone who has an existing relationship with these major gift donors. This could be a member of your board, a community member, someone who belongs to the same professional association as a donor etc. It's often easier to build new relationships upon existing ones, so part of your strategy should be to form connections with community members who know major donors, as well as the donors themselves.  

Develop content specifically designed to persuade major donors to support your mission. This can be anything from online material detailing your organization's community impact to a formal proposal outlining how you will use donated funds to further your cause. Bear in mind that this material should connect with the values, beliefs, and interests of each major donor, so be sure to show how their support will further their own interests and benefit the populations they're interested in supporting. 

Understand that once you start getting the support of major donors, it's important to nurture this relationship so you can count on their continued support moving forward. In the next few sections, we'll cover how major gift campaigns and smart nonprofit major gift strategies can cultivate a mutually beneficial relationship between your nonprofit and your supporters.

Cultivating and Engaging With Prospects Who Offer Major Gifts

When you begin building relationships with donors, it's important to connect with them on a personal level.

This means getting to know who your prospects are -- not just in terms of their net worth but also their backgrounds, interests, and philanthropic goals. 

Research your prospective donors thoroughly before approaching them. While you can start online by reading their websites, social media posts, and giving history, don't limit yourself to this. Join the professional associations and organizations they frequent and get to know the people they interact with. Not only will this provide you with valuable information on your prospects, you may also be able to arrange an introduction through one of their friends or business partners.

Once you've learned enough about a major gift donor to decide they're a good prospect, reach out to them. Send them a thoughtful email introducing yourself and mentioning your shared values. Let them know you're looking for support and show them how their contributions could impact your charity and the communities you both have a vested interest in.

Go beyond basic emails and casual conversations. Invite your prospects to an exclusive event hosted by your nonprofit or a site visit. These don't have to be fundraiser related but should provide your prospect with a first-hand view of what your group does and how it benefits your target population. Provide opportunities for your prospects to volunteer at events and activities to experience what your nonprofit does and how it feels to be part of your group. The better they understand the work your charity does, the more they'll appreciate how your goals and values align with theirs.

Keep your communication channels open and consistent. Just because a prospect didn't immediately agree to support your programs the first time doesn't mean you can't continue to inform them of your activities or invite them to future events. Be friendly, but make sure to respect any boundaries the donor indicates. Some major donors have specific expectations for how their donations will be used, what their level of involvement will be, or how much they're willing/able to give to certain organizations.

One excellent engagement strategy for cultivating relationships is to assign a member of your team (or multiple members) to manage relationships with prospective major donors. These dedicated officers will be responsible for staying informed of donor interests/values and maintaining donor communication. They can provide personalized information about your group and be your point person when it comes to requesting donations. 

How to Ask for Large Donations and Encourage Giving

Once you've invested adequate time building a relationship with your major donor, it's time to formally request a large donation.

Don't just spring this request on them unexpectedly over lunch or in casual conversation. Instead, spend time preparing a detailed explanation of exactly what you're asking the donor to provide (financial support, non-monetary aid etc.) and communicate your organization's financial situation and challenges. Explain what the donor's contribution will be used for and highlight the difference it will make (i.e. Will it be used to offset your charity's operational costs? Buy much-needed supplies and equipment for the schools you support? Fund essential programs?)  

It's possible that you'll need to create a formal proposal or arrange a special presentation to explain all the details. In this case, make sure to collect plenty of data about your nonprofit programs and events. Provide measurable, concrete examples of how your actions are making a positive impact in your community. This can be conveyed through charts and statistics, but don't overlook the effectiveness of a well-placed case study or success story either. 

Some nonprofits like to offer different tiers for donations. For instance, major donors can be presented with multiple donation options that allow them to give $1000, $5000, $10,000, or $100,000+. While each tier would be considered a major donation, this strategy does make it easier for contributors to give at a level they're comfortable with. Make sure to indicate what giving at each level will accomplish (for instance, perhaps giving $5000 would provide disaster relief for a family of four, while giving $100,000 would build a new relief center). Placing donations in this perspective encourages giving.   

Keep your presentation donor-centric. Regularly remind your major donor how your organization's values and goals align with the donor's. Establish how you'll be working together to achieve these goals. Will you provide the donor with regular reports showing how their funds are being used? Does the donor need to conduct periodic audits of your organization's activities? The more you can show how you've anticipated the donor's expectations and funding requirements, the greater your chances are of a successful future partnership.

Regardless of how your meeting turns out, be respectful and express gratitude. Thank the donor for taking the time to listen to your needs and follow up with sincere thank you notes, calls, and invites to future events. Knowing how to ask for a donation professionally and diplomatically is part of building positive relationships with your donors too, so be mindful of your etiquette.   

Donor Retention and Stewardship

Once a major donor has contributed generously to your organization, it's time to focus on responsible donor stewardship. After all, you want your donors to be regular contributors, not one-time gift givers, and there are major donor stewardship strategies you can employ.

Some donors may have formal requirements for using their funding. For instance, you may need to keep careful records of where and how you use their money. You'll need to be able to show how much you invested into key programs, and also the impact of these programs on your community (and therefore the impact of their investment).

Donor management software can help with this. Not only can you automate a lot of bookkeeping tasks that will track your major gift funds, the software can help build reports revealing their impact. You can create visualizations of fund usage through charts and graphs, and highlight key performance indicators (KPIs) that demonstrate the difference you made. For instance, your reports might reveal how many more houses your housing programs built for at-risk community members after your major donor made their contribution. All this data will become very valuable during annual reviews and formal audits.

Beyond tracking fund usage, donors also need to be recognized by the organizations they support. Finding ways to offer major donor recognition is one of the more effective donor retention strategies that can lead to long-term engagement.

Invite donors to your events and make sure they're recognized in your posters, speeches, and activities (unless they want to remain anonymous). If the donor's funds were used toward a specific project, such as building a new headquarters, it could be appropriate to name your building after the major donor -- or someone meaningful to the donor, like a family member. All this should be discussed with your donors in advance of any formal decisions.

Arranging luncheons, dinners, and other activities specifically meant for recognizing key donors is important. These aren't fundraising events but activities meant to show your appreciation to major donors. Tailor these events to your donors' interests. If several of your major donors enjoy live entertainment, you can arrange for them to attend a popular concert or stage performance -- or perhaps even host one of your own.  

Small gestures can be extremely effective in keeping major donors engaged. This can mean anything from sending prompt thank you notes to major donors after they contributed to providing updates on their fund usage, complete with success stories, photos, and videos. Your donor database should also emphasize how each donor prefers to be contacted. For instance, many donors are fine receiving email updates while others prefer a phone call, face-to-face meeting, or direct mail.  

Measuring Campaign Success

When tracking and evaluating the success of your major gifts strategy, it's important to have certain key performance indicators in mind. While the amount of funds you were able to raise is certainly important, other factors need to be taken into account too.

For instance, how many major donors did your campaign manage to retain? How many new major donors did your campaign get to come to one of your events? Did any donors increase (or decrease) the size of their annual donation?

Research the performance of the major contributions themselves. What programs received the most support from the funding? Did they achieve the goals you set for them, or did any fall short? Could your nonprofit achieve better results by reallocating the funds to other programs or teams? This assessment (and the data-driven decisions you make) could greatly impact your major donor relationships and affect your future funding.  

Again, donor management and fundraising software can help measure the effectiveness of your major gift fundraising program. Software tools can automate tracking donations and analyze program performance based on the performance metrics you set. You can then turn this data into visualizations to share with your board of directors and campaign staff to improve your future efforts. 

One additional factor to consider is the feedback of your donors themselves. Let your major donors evaluate the strengths and weaknesses of your organization. Let them offer their perspective on the effectiveness of your nonprofit or charity and tell you how well your activities align with their own goals. Not only can this give you valuable information about your programs, it can also let major donors reflect on their investment in your group and -- possibly -- increase their support.

Overcoming Organization Fundraising Challenges

While securing funding from major donors can be a great help to your organization, there are several challenges that come from major gift fundraising.

Shifting economies can affect a donor's ability to give

Since major donations are often tied to your donor's current economic well-being, recessions and periods of high inflation can affect your ability to sustain funding. Economic downturns can make even philanthropists hesitant about supporting charitable organizations, especially if they fund multiple nonprofits, and they may feel the need to reduce their donations or even pull out of your organization entirely.

To overcome this challenge, focus on cultivating a positive ongoing relationship with your donors. Regularly remind them of your nonprofit's mission and the impact their donations are making in issues and causes these donors care about. Recognize their contributions and offer your sincere thanks frequently. This can help you stand out from other organizations who don't communicate as much with their donors.

Work with your donors. If they can't always provide large gifts, perhaps they can still offer recurring monthly donations of relatively smaller size. This will still provide your programs with regular revenue while maintaining good relations with your major donors. 

Not all donors want to be found

Another fundraising challenge lies in the challenge of finding major donors in the first place. Not all wealthy donors keep a large public profile and advertise their charitable contributions. This is particularly true of individuals who feel people only want them for their money. Even generous donors can experience "donor fatigue" after receiving requests for support from multiple organizations.

To counteract this, it's important to connect with donors on a personal level. Spend time researching potential donors in databases using wealth screening tools to identify philanthropists who fly under the radar. Then, before approaching them, take the time to get to know them. Appreciate who these people really are, why they engage in philanthropic activities, and how they want to be approached.

When it comes time to reach out to these donors, do it on their terms. Don't just cold call them or send form emails hoping for a response. See if you can arrange for a formal introduction through a mutual friend. Invest time socializing before asking for any financial support. Ask about their own goals for their charitable work and reflect on how your own nonprofit can help them achieve these aspirations. By showing major donors that you see them as people with missions of their own, the more they'll see you as more than another nonprofit.

Differentiating yourself from other nonprofits can be difficult

On that note, making your nonprofit's mission sound urgent and unique can be challenging especially if there are several other nonprofits with similar goals. 

Let's face it -- as passionate as you may be about supporting at-risk students or building affordable housing, there are many other organizations that feel just as strongly about these issues. And if they are better at communicating their causes to a major donor than you are, that donor may feel better about supporting their group instead of yours.

To better differentiate yourself from similar nonprofits, build a unique niche identity. Instead of simply identifying yourself as a nonprofit that seeks to combat hunger, for example, focus on any creative strategies you use. Perhaps your team partners with restaurants and hotels to deliver excess perishable meals to homeless shelters and schools -- reducing food waste while also feeding the hungry. Or maybe your youth social services organizations partners with teaching artists, museums, and theaters to help heal traumatized children through art therapy.

Turn these unique approaches into your special brand identity. Highlight how effective your methods are through case studies, success stories, and concrete data like statistics. Let donors know what your future goals are and show them the impact they can make by becoming an active partner in your mission. 

Some donors may also be receptive to special benefits only your nonprofit can offer. For instance, you can start a major donor society for all of your top donors that gives them access to special events and networking opportunities. Certain donors appreciate being able to connect with fellow philanthropists as well as causes they believe in, so this can be another effective way of distinguishing yourself from the crowd.  

Best Practices for Major Gift Fundraising

So far, we've covered many of the fundamental major gift best practices to follow when identifying and engaging with top donors. Here are some other successful fundraising tactics for securing major gifts.

Create a major gifts page on your website

While many of the above tactics focus on finding and engaging with individual donors yourself, there's no reason you can't provide a major gifts page on your website to inform visitors of your major donor program. This is also a great resource to provide potential donors with while you're cultivating a relationship with them.

Your major gifts page should contain:

• A strong headline highlighting the importance of large contributions to your organization
• Compelling stories about the nonprofit programs that receive funding from major gifts. To make this especially powerful, include photos, videos, impact stories, and testimonials from other major gift donors
• A list of donation tiers and what each donation level will fund. You should also list any special benefits that come with each tier, like naming a building after a donor, access to special events, plaques etc.
• The contact information of your major gifts officer 
• A call to action that may ask the prospect to schedule a meeting, make a donation, or read more about your major donor program

Cater exclusive events for prospect donors

We've covered how you should host donor appreciation events that recognize the contributions your major donors have made. However, it's also a good idea to offer exclusive events to individuals who are still prospective donors.

Keep these gatherings small and intimate and cultivate an atmosphere of exclusivity. Make sure each donor gets lots of personalized attention from your staff to show how much you value them. Tailor your content to the unique interests of your donors. If you know many of your prospects have supported environmental programs, highlight the sustainable practices of your own programs and the impact they have made on the community.

Offer matching gifts challenges

One nice way to get your major donors involved is to provide them with a matching gift challenge. This is when a major donor agrees to match all donations made by your other contributors in a given campaign. For instance, if you can raise $50,000 from regular donations in a fundraiser, your major donor will match that amount, doubling your revenue to $100,000. Some major donors even offer to match donations on a 3:1 scale, earning you even more revenue.

This is a great strategy since it shows your major donor how much your other contributors believe in your mission. It also gives your regular donors increased incentive to donate since they know their donations will have double the impact. 

Conclusion and Final Thoughts

Major donors can be a huge source of support for nonprofits due to their increased capacity and willingness to donate large amounts of cash or non-cash resources. That said, nonprofits need to be careful about the way they identify and engage with major donors.

Take time to carefully research every prospective donor. Examine their net worth, past giving history, and philanthropic interests to see if they'd be a good prospect to follow up on. When engaging with donors, be patient. Spend time cultivating a strong personal relationship before asking for their support, and be willing to invest resources into creating effective presentations and proposals to establish a mutually beneficial partnership.

Donor management software and online fundraising platforms can be a big help in working with major gift donors. Donor management software can come with wealth screening tools to identify donors with a high capacity to give. Meanwhile, fundraising platforms can help organize and host events for top donors, allowing your team to coordinate activities so your donors will receive the personalized attention they require.

When choosing the right software to use for building relationships with high value donors, it's important to see how the tools work for you. PayBee provides a free demo of its fundraising software to interested nonprofits. You'll be able to assess how user-friendly our platform is for donors and your staff. You can also ask any technical questions to our team who will be able to explain how our software can be adapted to multiple fundraising events for major donors. Discover for yourself how helpful our platform can be by signing up for a free demo today.   

FAQs (Frequently Asked Questions)

How do I determine the right amount to ask for a major donation?

While the term "major donation" might call up images of giant checks and million-dollar endowments, what constitutes a major gift differs from organization to organization. Depending on your group's reach and operating capabilities, a major donation can be anywhere from a one-time $1000 gift to a renewable endowment worth millions.  

Consider your current operating costs and program budgets. How much will it cost to pay for your general expenses this year? What type of budget do your activities teams have to work with? 

Think about your future plans. Do you have any thoughts about expanding your organization or starting a new program? What will you need to get things running? How much will you need to cover each expense?

Now turn these expenses into donation amounts. The nice thing about this approach is that you can match each donation request to a specific need and show a prospective donor what their contribution will go towards and what tangible results they can expect. 

How do I ensure that my nonprofit's major donation program remains sustainable?

To keep your major donation program sustainable, focus on building long-term relationships with your donors. Don't just focus on finding new donors and securing one-time gifts. Instead, show major donors the value of a regular partnership with your nonprofit. Share the impact their funds are making in your target populations and emphasize the benefits -- from recognition to tax deductions to inspiring generosity -- of regular giving.

What are common mistakes to avoid when soliciting major gifts?

Spending too little time researching prospective donors is a very common mistake. Nonprofits need to focus their search for major donors on individuals with not only the capacity to offer large gifts but also an interest in their nonprofit's mission.

Practicing proper etiquette when approaching and engaging with major donors is another issue. Your major gift officer should know all the decision makers involved in granting a major donation and meet with them in an appropriate fashion. Building good relationships with donors also takes time (often months or even years), so be careful not to rush into asking for a donation or making unreasonable requests. 

Giving up on prospective donors too quickly can prevent nonprofits from receiving a major gift. Just because a prospect isn't ready to give you nonprofit a large gift doesn't mean they aren't interested in supporting you. Take the time to introduce them to your organization, let them get comfortable with your team, and entice them with regular volunteer and donation opportunities to make a difference in their community.

What are the different types of major gifts and how do they differ?

Cash gifts are monetary donations that can be offered as a single or recurring gift by a major donor. These can make up a large part of your funding, however cash gifts are usually less common than non-cash gifts.

Legacy gifts (also known as bequests or planned gifts) are major donations from a donor's estate that can be given after the donor passes away. These donations can include cash as well as land and other property.

Major gifts can also come in the form of valuable assets such as stocks, bonds, real estate, and cryptocurrency. A donor may also offer more complex non-cash gifts like artwork or a family-owned business. While these can be quite valuable (and can provide the donor with tax benefits) not all nonprofits can accept such gifts. This can be due to legal or logistical considerations in transferring ownership. Thus, it's to a nonprofit's advantage to discuss the practical aspects of receiving such major gifts.

How should I follow up with a benefactor after receiving a large donation?

Sending a sincere, heartfelt thank you letter should be first on your list of priorities. Following this, regular updates on the use of their funds is beneficial (and sometimes required depending on the donor). Major donors should also receive regular invites to exclusive events that recognize their generosity, as well as fundraisers where they can contribute and inspire others to donate to your organization.