University Business - June 2012 - (Page 82)

CAmpus FINANCE By Eileen Heisman Deepening the Donor Pool Opportunities open up with the donor-advised funds giving trend A mericans are increasingly choosing donor-advised funds (DAFs) as their preferred charitable giving vehicle. They have become the fastest growing vehicle in philanthropy, outnumbering private foundations by more than two-to-one. In 2010 (the most recent available data), grantmaking from DAFs totaled more than $6.1 billion, according to the “2011 Donor-Advised Fund Report” from National Philanthropic Trust. These statistics would indicate that many university donors are making charitable gifts from their DAFs. However, many fundraisers still ask me about finding and cultivating these donors. My answer is this: to capitalize on DAFs, you have to know how to communicate with your donors and prospects who have DAFs and understand their flexible benefits. DAFs create fundraising opportunities that are unique for universities. Administered by public charities, DAFs are created to manage charitable assets on behalf of a family, an individual, or an organization. A DAF’s main appeal is that it is convenient, low-cost, and flexible. DAFs allow donors to recommend grants and maximize their tax benefits without being responsible for the complex administration. However, their flexibility and multitude of benefits can appeal to colleges and universities. The key to success is for you to find the best way to work with donors who have DAFs. • Target existing donors by including “a grant from a DAF” as a way to give on solicitation materials. How to Find Donors With a DAF Cultivating alumni donors, and donors in general, who have a DAF is a little different than cultivating donors who have a private foundation or practice checkbook philanthropy. There are some special considerations for donors with a DAF. Here are a few key facts about DAFs to keep in mind: 82 | June 2012 Cultivate correctly. In general, charities that sponsor DAFs do not disclose their donors’ names. They rarely accept unsolicited grant applications, either. Instead of searching for complicated avenues into a DAF, I suggest you ask donors to report the information voluntarily. You can target existing donors by including “a grant from a DAF” as a way to give on solicitation materials. Consider expanding prospect research beyond the alumni pool, targeting those whose interests align with the university’s research programs or special projects in need of support. • Tailor communications. A grant from a DAF cannot be used to pay member dues, purchase benefit dinner tickets, or to fulfill a pledge because donors are not allowed to receive any goods or services in exchange for their contributions. After identifying the school’s DAF donors, send communications geared toward taking advantage of DAF characteristics, such as the ease of setting up a recurring gift schedule. • Start early…in-house. Some DAFs have a low initial gift requirement, which is appealing to young donors. DAFs can give them a way to invest their funds to maximize their charitable giving and tax benefits. Younger donors may also be inheriting DAFs. Making giving through a DAF easy for alumni—young or old— increases the likelihood of cultivating planned gifts and having predictable, ongoing support. • Highlight special causes. DAFs are often created to fund a specific, named cause (e.g., the John Doe Cancer Research Fund). You may be able to cultivate these non-alumni donors for grants by approaching them directly as a medical research contributor or other university-sponsored special interest. Once you’ve captured a new donor’s attention by appealing to their interests, consider cultivating them directly. • Remember the donor. When a grant is made from a DAF, the sponsoring charity will send a letter confirming the grant and identifying both the DAF and the donor, though some request anonymity. If the donor is identified, remember to thank the donor—whether he or she is a member of the university community or outside of it—as well as the charity, when possible. This will cultivate them for the next gift. Why Focus on Fundraising From DAFs? Consider these advantages and the reallife examples of how DAFs can partner

Table of Contents for the Digital Edition of University Business - June 2012

University Business - June 2012
Editor's Note
College Index
Ad Index
Behind the News
Independent Outlook
Special Section: Thinking Green
4G: Is It Time for an Upgrade?
Unified Security: All Together Now
Collaborative Workflow
Campus Finance News
3 Student Aid Myths
Deepening the Donor Pool
Keeping Tuition Within Reach
Internet Technology
End Note

University Business - June 2012