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Posted on Nov 1, 2012

Are You Ready for a Capital Campaign?

Are You Ready for a Capital Campaign?

by Gerry Ebbers, SCSBC Executive Director

So you’re thinking of running a capital campaign to raise funds for additional or improved facilities. You’re wondering if your goal is achievable. Do you have the donor base to reach it? You could hire a campaign consultant to do a feasibility study, but that would cost you $20-25,000. Can you determine your own readiness? Here are a few key questions that you can answer yourself.

First, do you have a successful annual fundraising program? Well, what defines success? I suggest that you should be raising, annually, $1000 times the number of families in your school. That does not mean that all that money comes from current parents. You need to be receiving half that money from other supporters: alumni and alumni parents, grandparents, and others who support your mission. Another factor is the percentage of participation of your current parents. It should be seventy-five percent. Even if some of the gifts are small, it’s the participation rate that is important.

A review of your donations over the last five years will also tell you what goal you could achieve in a capital campaign. Your smaller donors, on average, will likely be able to double their annual giving for the duration of your capital campaign pledge period. Those donors capable of larger gifts need to be challenged to support your campaign, and determining the potential there is more complicated.

Remember the 75/25 or the 80/20 rule. Seventy-five to eighty percent of your goal will come from twenty to twenty-five percent of your donors. Let’s use an example. Say your campaign goal is $2.5 million. That means $1,850,000 to $2,000,000 will come from one quarter of your current donors. The top gift for your campaign will need to be one-tenth of your goal, $250,000. You’ll also need another gift of $150,000, two gifts of $100,000, two gifts of $75,000, and five gifts of $50,000. A campaign consultant will ask you for three potential donors for each of those gifts. In other words, do you think you have thirty donors in your support base that are capable of making gifts of these sizes?

As you analyze your potential for a campaign, here are some sobering realities:

  • Thinking that there is a big donor somewhere in your community who is just waiting for you to ask for a major gift is wishful thinking. Donors with the potential for significant gifts are already supporting the causes closest to their heart and if they are not already supporting your school, it is not likely that they will begin to do so at the level you are hoping for.
  • Don’t expect significant gifts from people, businesses or corporations who are outside your circle of supporters.
  • Do not expect any grants from foundations. Those foundations in Canada that support Christian education like to see their grants go to the Christian colleges and universities in this country.
  • You can’t turn non-donors into significant donors by launching a campaign, but you can turn smaller donors who are committed to your mission into larger donors by sharing your need.

This article has addressed the question of your financial readiness for a capital campaign. There are other factors as well. Do you have the staff to carry out a campaign? Are there issues in your school community that would inhibit people’s support for your school? Does your school operate with fiscal prudence?

If you need help analyzing your school’s readiness for a campaign, get in touch and I’ll assist you with your analysis.

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