Stop Self-Funding Your Nonprofit: How to Build a Donor Pipeline that Pays
Today we bust the fundraising myth. No, you're NOT supposed to fund your organization. Not in the beginning, not in the middle, not ever. You just don't know what to do. Grants should only make up 30% of your budget. Of the top 8 funding sources grants is #7 and why most founders are self-funding their organizations. Their infrastructure is raggedy and they don't qualify. Learn what the #1 source is and how to stop self-funding your nonprofit.
Episode 150 | Stop Self-Funding Your Nonprofit: How to Build a Donor Pipeline that Pays
----------------------------------------------------
🔦 NONPROFIT SPOTLIGHT 🙌🏿
First Fifteen Pt. 2
---------------------------------------------------
🚀 RESOURCES TO HELP YOU RUN A SUCCESSFUL NONPROFIT 🚀
The Nonprofit Mastery Academy
https://thenonprofitmasteryacademy.com/nonprofit-mastery-academy/
----------------------------------------------------
Learn more about my success with helping nonprofits
Visit My Website👇🏿👇🏿👇🏿
CONNECT WITH AMBER:
Follow me on Facebook 👇🏿👇🏿👇🏿
https://www.facebook.com/amberwynnphilanthrepreneur
Follow me on Instagram 👇🏿👇🏿👇🏿
https://www.instagram.com/amberwynnphilanthrepreneur/
Listen to my Podcast! 👇🏿👇🏿👇🏿
Spotify: https://open.spotify.com/show/4G9QNaVAYz8eXTmz48gagl
-------------------------------------------------------------------
Got Questions? "Ask Amber" on any of my social media platforms or email me at [email protected].
Speaker 1 (00:00):
So today I'm going to tackle the elephant in the room. It's called self-funding, and I want to tell you, not only is it not noble, it is not necessary for you to burn yourself out and bankrupt yourself trying to complete your mission. In this episode, I'm going to teach you how to shift from, I'm paying for everything to I'm building a real fundraising engine.
Speaker 2 (00:29):
Welcome to On Air with Amber Wynn, where nonprofit leaders learn to fuse passion and commitment with proven business strategies to create long-term funding impact and sustainability. And now here's your host and resident Philanthrepreneur, Amber Wynn.
Speaker 1 (00:53):
Today we're talking about how to stop self-funding your nonprofit and how to build a donor pipeline that pays because at the end of the day, it is not noble for you to self-fund your organization. I get this all the time. Oh, Amber, I understand that I've got to invest in my nonprofit or I understand that for the first couple of years I'm going to have to fund my nonprofit. And my answer to you is no. Actually, you should not. Because what happens is when you start self-funding your nonprofit, you tend to continue to self-fund your nonprofit because you put things in place that shouldn't be there. I want you to start your nonprofit off powerfully so that you go into the game generating revenue so that you go into the game getting yourself paid so that you generate enough revenue so that you can hire staff.
(01:46):
So no, it is a myth that you need to start your nonprofit and self-funded. It is a myth that funders believe that you're supposed to self-fund your nonprofit. So today's conversation is going to cover that. It's not easier for you to do it yourself. It is not okay for you to start fundraising later. What you need to understand is there are certain things that need to be in place that positions your organization for funding. You may have started your nonprofit with just filing your articles of incorporation, getting your 501(c)(3), and then you just jumped into things nilly willy. That's going to put you on a fast track to self-funding. We want to break that habit. We want you to understand that you can actually start generating revenue and enough revenue for you to secure a salary within one year forming your organization. When people start self-funding, two years, three years, trust me, there are people out there 20 years in the game and they're still self-funding their organization talking about we do this and we do that looking good from the outside, but internally, their house is all, I don't want that for you.
(03:01):
When you self-fund your organization, you're taking from your household, you're taking from your family. You should not have to break the bank, dip into your, I can't tell you how many relationships have been destroyed because of a nonprofit. I have people coming to me, my husband said he going to leave me or my wife says she going to leave me. And you know what? Not that they should leave you, but you should not be dipping into your hard earned savings to fund your nonprofit. There are systems in place for you to fund your nonprofit and we come back from this one break. I'm going to talk to you about a three-part donor attraction system that will allow you even if you just got your 501(c)(3) tax exempt status that will allow you to start funding your organization because there is nothing, nothing, nothing, nothing.
(03:55):
I can tell you that's good about you self-funding your nonprofit. When we come back, are you looking to leverage your 501(c)(3) tax exempt status to get products and services donated for an event silent option or to support your program but aren't quite sure what to say? Get the donation request letters toolkit. It provides you with the templates you can customize to fit any request, eliminate the guesswork of what to say, how to say it, and what to offer potential donors as benefits for their donation. You had no idea you should offer donors something in exchange for their donation. Did you offering benefits triples your response rate. Plus the toolkit comes with the donor acknowledgement form template. It's the form you give them after they donate. This toolkit has everything you need for a successful donation request. Order your copy today. Hey y'all, we're back.
(04:43):
You're on air with Amber Wynn, and today we're talking about how you're going to stop self-funding your nonprofit. It is not cool. You don't need to be a martyr and it is not the expectation that you should fund your nonprofit. Your nonprofit is a business and as a business you need to be generating revenue. So that number one, you as the founder, if you're serving as the executive director, should be generating a consistent salary. And today we're going to talk about individual donors because of the top eight funding sources for a nonprofit. Guess where Grants land? No, Uhuh Grants land at number seven. Number seven, y'all. Yet nonprofit leaders spend most of their energy producing proposal after proposal unsuccessfully because the payout rate is very low. Number seven, the number one source for revenue for a nonprofit is individual donors. Do you know why? Because people connect with people, corporations, foundations.
(05:50):
Legally, they're only required to give out 5% of their revenue. And if they're only giving out 5% of their revenue, guess what? They're not funding a lot of organizations. And if they're not funding, a lot of organizations, guess who they're funding, the ones whose houses are in order, they have strong infrastructure, they have funder ready budgets, they have systems, they have season. Those are the ones getting all of the money. And if you've just gotten into the game or if you don't understand the rules of engagement, you don't have any of those things in place, which means you're not getting the money, which means self-funding. So today's conversation, I want to talk about a three-part donor attraction system. If individual donors is the top source for generating revenue, that's where you need to focus your energy. What's going to give you the most ROI on your effort?
(06:44):
You need to be able to connect. And I'm not saying your friends, because what happens is after that third call when you say, can you support, they're stop taking your calls. I want you to get out into your community. I want you to expand your community. The way you do it, number one is through visibility. If people don't know you exist, then people can't support you. The first thing you want to do is to get out there. How do you do that? There are multiple ways. I'm going to share with you my three part system. I'm going to drop the link in my bio. I break down how to do all of the things I'm talking to you today, but I'll give you an example. Two examples. One, you can create a newsletter, create a newsletter that focuses on your programs up under that you're going to say and help us to continue.
(07:34):
You can do a podcast. Why not get in front of your audience. Let them know that you know what you're talking about. You can be a thought leader in your community. You can share some of your practices. You can bring some of your clients on, interview them. Let them share with the world how your programs transform their lives. Listen, you can be on social media, and I'm not talking about being on social media, doing the latest dance. Nobody cares about that. You can get on social media, do a couple of lives, share with people with the work that you're doing, do clips of your programs. The goal is visibility, right? The second thing you want to do is create connection. This is the reason why getting on social media, doing dances is not helpful to you. You're doing the dance or whatever. Y'all know I'm old, I don't be doing all that stuff.
(08:27):
Whatever they're doing on social media is not what you want to do. Your goal is to create connection. You want your community to see the work that you're doing because at the end of the day, that's what they're writing that check for. So if it were me, if I'm trying to connect with my audience, I'm going to share valuable information, things that's going to help you as a nonprofit move forward. I'm connecting with you. That's what you want to do as a nonprofit, right? If your goal is to stop sex trafficking, if your goal is to decrease homelessness, your connection has to come from something that a normal human being is going to respond to. It's to create emotion. It's to demonstrate that you are a subject matter expert in your, you know, what you're talking about. And then the last part is conversion. I have people out there who just talk and talk and talk and talk and talk and talk and talk and talk and talk and talk.
(09:20):
Lord, have mercy. Where is the ask? People are afraid to ask. But if you don't ask, you will never get the dollars. I've been at galas where they have events and they're trying to raise money, but they never ask. And I'm sitting there like, “When they going to make the ask?” You have to ask. People aren't just going to give if you don't ask. They think that you don't need. So the three part donor attraction system is visibility, connection, and then conversion. And when I talk about conversion, it's not a doom and gloom ask, right? If you don't give us this money, then we're going to close our doors. Listen, people do not want to hitch their wagon to something that's going downhill. I know it sounds counterintuitive, but if your doors are going to close in the next couple of days, in the next couple of months, why would I give you money?
(10:18):
That means I'm going to lose my money because here's what I know. After you run through the money that I give you, then you're going to be begging for more, right? So you want to give your funders, your potential donors something exciting. You want to say, listen, we're working with these youth. We are transforming lives. Or listen, we get our seniors up dancing. So now they have a reason to live. We are having them work with our youth. So now we've got this intergenerational connection. So older folks like myself, gen-X is excited about technology because I have this young person over here showing me in a simple way how to do it. You want to create excitement. That's why innovation is important. When I tell you we don't need another tutoring program, if you are going to bring into this space another tutoring program, it needs to be innovative.
(11:11):
So when you start your strategy for trying to recruit individual donors, there's three elements. Visibility. How are you going to get out there? Connection. You want them to connect to you emotionally, and then you want to convert. Make the ask. And here's the thing, do not say this. If I could erase this slogan from the world, I would. Do not say every dollar counts. It doesn't. You have a budget that's $250K, $350K, it's probably $450,000. You just don't know it because you've been in this scarcity mode. But when say, every dollar counts, when we talk about conversion, guess what? You're going to convert a dollar that is not going to help you. You need to be realistic about the type of money that you need. If you need $250,000, this is what you say. The work that we're doing in this community is transformative and it costs.
(12:16):
This is where your money goes, it goes to the mortgage, it goes to ensuring that our residents are safe. It's making sure that they have hope. So the room has to be lively and bright and exciting. So we paint every year we get new betting. You want to let your audience know where their money's going. We know that this is real world. Things don't just happen, but you need to break down where the money's going. There's a lot of mistrust right now about nonprofits, so you want to be as transparent as possible, but saying every dollar counts is begging and you're not begging for anything because you're bringing value with your program, but you want to be transparent and let them know it costs to run this organization. Yes, it's going to go to salaries because we need talented people who are going to help bring about this transformation in this community.
(13:09):
And a person who's making $15 an hour, they don't have the skillset. They haven't been around long enough. We need qualified clinicians who've gone through years of training and that costs. Regular people understand that. And if you want the, think about it, if you're working with people who have been sex trafficked, Amber Wynn can't come in and make that transformation, that goes deep. That trauma goes deep. So you need someone with the skillset, with the background to come in and that costs and real people understand that. And when you're committed to making that change, those individuals need that type of support. So really quickly before we go to commercial visibility, connection and conversion, when we come back, I'm going to talk to you - how to build your donor list without begging because who the heck wants to do that when we come back? If you're thinking about hosting a golf tournament or any other kind of event, make sure at the end of the event you generate a profit and not come out with a loss, there's a formula for guaranteeing that your event will generate a profit.
(14:15):
You'll find it in my Hotter price event. Tickets for Profit toolkit. Learn the insider secrets for how to ensure your event will always make a profit every time. Order your copy today and we're back. You're on air with Amber Wynn, Philanthrepreneur, and today we're talking about how to stop self-funding your organization because that is a travesty and it is a trap that a lot of my founders get locked into, and we don't want that. We don't want you to tear down your family in order to build up your community. So today we're talking about the three-part donor attraction system, and today I want to talk to you about how building your donor list is important. And a lot of people are uncomfortable because they feel like, oh, I've got to beg. There's no space for begging. You are going to offer people the opportunity to be a part of change.
(15:09):
Now, isn't that sounding a whole lot different than begging? Will you give us some money? Please? Will you help us? Will you? No, this is what you're saying. You're saying we are building a movement. We are transforming lives. We are setting people on new pathways. We are disrupting the poverty side. We're doing all of these things that from a community perspective is bringing about change. That's the language you want to have. You don't want to beg people, right? When people hear other people beg, it's like you smell it, you feel it. It's this sense of desperation and no one's attracted to that. So you want to position your offer as that. It is an offer to be about something different about this major change that's going on in the community. So when you build your donor list, the things you want to do is, number one, realize that your friends on social media are not your friends.
(16:06):
You know what they are? They are Facebook and Instagram and all of the other social media platforms that I don't know. There's so many new ones, threads and all of this. I have no idea. But wherever you are, they don't belong to you. They belong to that platform. Think about it. If Instagram went down today, how would you contact your friends? You don't have their telephone numbers. You can't call them up and invite them to the picnic, honey. So what you got to do is create a system whereby you can collect their emails. So today I'm going to drop in the bio, my three-part donor attraction system. But in order for you to get that donor attraction system, guess what? You have to give me your email.
(16:50):
So then I take your email and I ask you, do you want to be a part of my list right now? You're in my database. That's the first thing you want to do. You want to collect those emails from people. If you have 10,000 people on your social media, friends, connected subscribers, whatever the right word is, you need to get them in your email list. You need to have their actual emails. Once you have their emails, then you need to cultivate them. This is where the connection happens. So you were seen on Instagram, you're going to offer them something. It could be something as simple as a checklist. It could be something as simple as an article. Whatever it is, get that email, put it into your constant contact, your MailChimp, whatever, get that information and then cultivate them once a month, once a quarter, send out a newsletter so that they get to know you and understand your program.
(17:51):
When you're put on to my newsletter list, I send out a weekly article giving information like I'm giving here on my podcast. Something informative. You want to create a connection. You know why? Because come giving Tuesday, when everybody and their mamas start asking people, give to my nonprofit. You've already established a relationship. These other people are just WW Charlie Brown. But you've demonstrated in your article that you're making a difference in your community. You're highlighting your success stories. You want to be seen. You want to create that connection because on giving Tuesday, that's when you're going to make the conversion, but you don't have to wait till giving Tuesday under that article, you're going to put a donate button that's going to allow them to contribute because they're excited about your success, that success story, what you're doing in your community. So you want to make sure that you are excited and you're giving your people something to actually look for.
(18:52):
The other thing you want to do is to create your toolbox. Maybe today you want to send out an article, so you need to have an email list as we said before, in order for you to create this connection on different levels. You don't want to just do it once. You got to do it over and over so people know that you're actually making a difference. You need a toolbox, right? So first is to gather that email list. Then you want to have a donation page, right? And you want to have a storytelling strategy. All of these things are important because people don't just write a check the first time they see you. When people visit your website and that popup comes up, it says, donate. I can't stand that popup. You know why I just visit your page? Why am I going to donate to you and I know nothing about you?
(19:42):
Remove those popups. Let people visit your website. You're going to have a donation tab up there on your navigation bar, and that's your donation page. Let them click on it, but you want them to get excited first. So let them visit your website. Let them learn about the impact that you're making. Put some success stories on there, and then have a donation page that they can click on and get all of the details on, not how to donate once, how to become a recurring donor. They can donate to specific projects or programs. This is how you create donor engagement. Let them get to know you. Let them fall in love with the work that you're doing. Get rid of those popups, okay? Because they don't do nothing but irritate. That will make me leave a site in a minute. All right, when we come back, I'm going to talk about when is the perfect time to make the ask When we come back, if you're just starting out and have limited resources, you may be tempted to use a volunteer-based model for your nonprofit funders prefer paid staff because there's more accountability and consistency.
(20:47):
But if you want your proposal to be competitive, then having more than just volunteers who come and go is essential. Check out my building an effective nonprofit volunteer program toolkit. It provides all the essential elements of an effective nonprofit volunteer program. Things that demonstrate standardization, consistency and continuity. Learn How to Develop a Nonprofit Volunteer Program funders feel comfortable with funding. Order your copy today. Welcome back to On Air with Amber Wynn. We are tackling self-funding. A lot of my nonprofit leaders out there think, oh, it's so noble to fund their own nonprofits. When in reality, what you're doing is just bringing poverty to your household, and we don't want that. We want you to not only build up your community, but also provide for your family. That comes from having consistent revenue. Every nonprofit should have 10 streams of revenue and of the top funding sources for nonprofits, grants is number seven.
(21:51):
Number one is individual donors. So today we've been talking about how to build your three-part donor attraction system, and it consists of visibility, connection, and conversion. So when is the time to actually make the ask? The time to make the ask is after you've gotten your potential donor engaged. This is why I said before we went to the break to remove those pop-ups on your website. When a person comes and then six seconds in, it says, donate. You don't want donate, donate, donate all over your website because you have no relationship. You have to have a relationship. You want people willing to give, but if it's just this hard, ask, ask, ask. Think about it. It's like if you walk into a store and then the store owner comes up and says, can I help you? Is there anything for me anyway? I'm like, I'm good, right?
(22:47):
But if I'm walking around the store and I'm seeing things and they're like, would you like me to take that and hold it for you? Thank you. Yes. Right? Give first. Don't just come out asking. So it's important that when you make the ask, it's after you've established that connection. That's why newsletters are really good. Once a month, once a quarter, you're letting your potential donor get to know you. They're learning about your organization, they're learning about your successes. You can feature a donor. Why do you give? That's a perfect story. You can feature a volunteer. Why do you give your time to support this organization? That's going to create connection. Now, people can see themselves in the volunteer. Now people can see themselves as a donor. Oh, I never thought about that. Do not start your conversation with someone who does not know you by saying, can you give?
(23:42):
That is not the right time to ask. The right time to ask is when someone is excited, right? Think about it. If you have an open house and you have stations, and you have youth who are doing their STEM projects, you're going to get excited. If you're an art program and you walk around and you see the art or they're doing drumming, you're going to be like, yeah, yeah, that's the right time to ask. Because now they're excited. They're seeing the youth who are doing the work in action and they're like, yes, I want to be a part of the change. That's when you do the ask. You have them go through all of these stations, and at the end you can say, oh my gosh, are you as excited as I am? Yes, we are creating a new generation of do.dot, and you can be a part of this movement and people are going to pull out their checks or they're going to Zelle or Zap or whatever they do, and that's the time to ask when you've demonstrated that you're making a difference and when there's a true connection. Alright, so today we have been talking about how to stop self-funding your organization. We're going to move along in the episode to the part of the show where you get to ask me your questions. It's called Ask Amber, and today we have a question from Ku. Ku, what is your question for Amber?
Speaker 3 (25:04):
Hello, beloved. Peace and blessings, sending deep gratitude for your generosity of knowledge and the wisdom you share with community. My name is sku. I'm calling from New Mexico. My question is, how do I attract individual donors when I'm just starting out? Thank you, Amber.
Speaker 1 (25:21):
Well, isn't that just perfect? How do I attract individual donors when I'm just starting out? I'm going to sort of reiterate what I've been saying in today's episode, which is it doesn't matter if you're just starting out or if you've been in the game for 15, 20 years. The bottom line is you can attract individual donors. If you can make that connection, listen, you can start your nonprofit and then tomorrow engage individual donors and then start making that connection so that I would encourage it. I would encourage, especially startups to have their first funding stream actually come from individual donors. You know why? Because you have a relationship with them, and I'm not talking about your friends and family people. Please stop calling up your friends and family asking them to support your nonprofit. It gets old after a while. You want to create these newsletters, and when you have your programs and events and people sign up, put them on your newsletter, you want to get a bigger, broader scope.
(26:26):
You want to, when you're talking to these program officers, ask them, is it okay if I share my newsletter with you? Put them on your email list. That's how you build out your individual donors. Every time you meet people and they're like, oh my gosh, I love the work that you do. Really? Would you like to be on our email? Put them on that list. Start sending them information about the impact that you're making. Don't beg, right? This is what Amber's doing today because of being in this program. Here's where she was three months ago, but today she's got her GED. Now we've got her in this vocational training program. You can be a part of this movement with $25 a month you can support. That is how you build out your individual donor, and it doesn't have to be that you've been around for 15 years.
(27:16):
If you're making an impact, then you can create this donor attraction formula where you number one, are visible, visible, and then number two, you make that connection, and then three, you make the conversion. Alright? Now it is my favorite time of the episode where I get to put the spotlight on the most amazing people on the planet. My nonprofit leaders. We are in conversation with Jamila Webb of First Fifteen who is doing the work to make sure that bipoc leaders have a voice in film and television script writing. I'm just going to go ahead and tell you guys, I know y'all think Amber is just steep deep into the nonprofit world. I am, but I also have a creative side and one of the reasons why I asked Jamila to join me on my show is because she actually did a reading of one of my scripts. And so I can tell you from firsthand account, having someone in the industry read your script and give you feedback. It is amazing. Me and my co-writer Keisha, we changed the whole format of our script just based off of the feedback from industry showrunners. They're giving you feedback. So part two of our conversation with Jamila Webb from First Fifteen,
Speaker 4 (28:53):
My vision is to continue to broaden the creative possibilities for black and brown writers. And there's so many stories that we have. There's so many stories that need to be shared and told, and it's just about really getting the infrastructure and getting the support to share those stories. And I just looking for funders because we have so many creatively talented dope writers who wants to take First Fifteen to the next level. So that's what I'm looking forward to. Just partner with someone who is ready to take us to the next level.
Speaker 1 (29:44):
Welcome back. I am so excited. This is part two. We've got two more parts of my conversation with Jamila Webb, but if you don't want to wait for the next two episodes, go on over to my YouTube channel. You can hear the whole interview, and if you want to be spotlighted on air with Amber Wynn, hit me up on my socials. I'd be happy to do an interview with you so that other people in the nonprofit sector can hear your story, can write that check. That's the whole goal visibility. That's what we're talking about today, right? What is the three parts of the three part donor attraction system, visibility, connection, and conversion. If you are spotlighted here on my nonprofit podcast, you get to do two of those things, right? You get to get visibility and connection. People connect to your story. The ultimate goal is conversion. Alright? Thank you my people. Fam, I love you for joining me this week. I hope you will join me next week. If you found anything valuable in today's episode, be sure to like, subscribe and share this episode with someone you think could benefit from it. And until I see you next week, be sure to take care of yourself, like you take care of your community. See you next time.
Speaker 2 (31:03):
Thanks for listening. If you enjoyed this episode, subscribe and leave a review on iTunes. Head over to www.amberwynn.net/podcast for the links and resources mentioned in today's podcast. See you next time.
