Capital campaigns can feel overwhelming, but with thorough planning and the help of your board, volunteers, and an outside consultant, you can find great success and raise enough funds to reach your campaign goal. This article will let you know what’s needed and provides best practices to help you run a capital campaign.
As a fundraiser, you may or may not find yourself responsible for running a capital campaign. But if you’re not sure where to get started, the task can feel impossible. Don’t worry – we have you covered! Read on to learn all about capital campaigns and how to run them.
A capital campaign is a fundraising strategy where the ultimate goal is to raise a large amount of money in a short period of time.
Nonprofits can start these campaigns to purchase land for a new building or addition to their current facility. Smaller nonprofits may hold capital campaigns to buy equipment or vehicles that cannot be afforded with their annual budget.
Every size nonprofit can hold capital campaigns, but the time and effort that goes into this type of campaign may be difficult for smaller organizations without sufficient staff. The two types of nonprofits that hold capital campaigns regularly are healthcare and educational facilities. These types of organizations are in greater need of larger facilities and equipment with substantial costs.
If you live anywhere near a hospital or clinic, you may have noticed one or two additions to their facility. Capital campaigns likely fund these additions. The ability of healthcare facilities to raise funds for these additions is due to the number of staff they can utilize and how well funded this type of organization already is.
In addition to new buildings and additions, healthcare facilities will need new equipment like x-ray machines, MRIs, and other screening and treatment machines to use on their patients. This equipment can run several thousands of dollars, and it is necessary to purchase new whenever there are significant changes to the equipment or mechanical difficulties.
Faith-based facilities consistently need upgrading, but the money to make these improvements is not easy to come by. Annual budgets rarely include this cost, so it is necessary for churches, mosques, or synagogues to hold capital campaigns of their own.
Schools and Universities regularly need to purchase land or construct new buildings or additions to keep up with the growth rate of their organization. New students and general wear on the building can create a financial need for these nonprofits that cannot be covered with general fundraising practices. As universities grow, their focus may change and new buildings are needed for new departments and extracurricular activities. Capital campaigns can be a lifesaver when a new addition, bus, or computer system is needed.
Capital campaigns may seem overwhelming, but with the inclusion of a few important steps, you can run a successful campaign regardless of your organization’s size.
Before you start, it is essential to plan out every aspect of the campaign. A plan for your capital campaign will include everything from the cost of the project to who will be working on your team. When in the planning stage, you will want to develop a strategic fundraising plan to detail what needs to be done. Below is a list of steps you should include in your capital fundraising plan:
Finding out the cost of a project before you start may seem obvious, but it is vital that you include all costs when forming your plan. If you are erecting a new building, you will need to incorporate the cost of supplies and workers, but you will also need to add in fundraising costs, insurance, and more.
After costs, you need to give yourself an idea of how long the project may take. This information will be one of the first questions your board of directors and donors will ask. Remember, especially with construction projects, it always takes longer than originally expected. Add on a few months to try to overcome any delays that may come up.
A capital campaign is a serious project and cannot be done by only one person. If you are lucky enough to have a fundraising staff, you are off to a good start. Smaller organizations, and even those with a large staff, may need to search for help in other places. Will your board take an active role in this type of campaign? Your board of directors is an excellent place to find free fundraising help. These individuals may be volunteers, but they have connections and passion for the organization that you should be able to count on. If your board is not as involved as you would like, you can always hire freelance fundraising help for your campaign. Websites like Upwork.
Finally, you will want to research your organization’s past fundraising efforts to see where the potential is to find more funds. Do you already have major donors that may be willing to give to this campaign? Do you have access to grants that can help fund this purchase? These are questions you will want to ask before committing to a campaign of this size.
We have provided a checklist to help you during this planning phase.
Running a capital campaign is time-consuming and strenuous. Everyone in your organization should take part in this type of campaign if possible. Your board will need to take a leading role in this type of campaign. If your board was not the deciding factor in running this campaign, you would need to get their approval.
When presenting this type of campaign to the board, help them understand that their involvement is necessary and find ways to get them excited about the process. Some of the best ways to get your board involved are with major donor outreach and presenting this project to your community.
Once you have the board’s involvement, the process of finding major donors may be easier than you would expect. Board members are often community leaders and will have their own professional and personal connections to help your organization with prospect research.
Your nonprofit can build upon these relationships and use board members to reach out to your current donors for their involvement in the upcoming campaign. As a fundraiser, you need to keep track of each of these conversations and find ways to involve your office in building relationships with current and potential donors.
Here’s a Donorbox webinar by nonprofit professional and president of Frost on Fundraising, Jay Frost, to help you learn the art of acquiring major donors and make big money even if you’re a smaller nonprofit.
After planning and starting conversations with potential major donors, it is time to get the rest of your donor base and community interested. Create branding and marketing plans to promote the campaign, along with visuals of the building, addition, or equipment to inform donors about where their funds are going.
Your office will likely send out solicitation letters and updates on the campaign regularly, but at the beginning, you will want to let donors know what to expect from the campaign, why you are holding this type of campaign, and how much needs to be raised. Find ways to let donors feel like they are part of the process instead of just sending out an ask every few days.
After your campaign ends, you will want to do a thorough study on the successes and failures you came across. This will most likely not be the only capital campaign your organization holds, so learning from your successes and failures will help your office achieve greater things in the future.
Several organizations have shared information on capital campaigns, and you can benefit from others’ experiences. The following best practices are based on other nonprofits’ successes and can help steer you during your next capital campaign.
Online fundraising will be a significant part of your capital campaign. Your organization will need to purchase the best donation software you can before the start of this campaign. Software that includes customizable donation forms, matching gifts, donor management, and crowdfunding will be especially helpful for a capital campaign. Donorbox offers affordable software for nonprofits of all sizes.
A feasibility study will be essential to get board approval for your nonprofit’s capital campaign in many cases. This type of study can be done by a nonprofit or by hired consultants with more experience running campaigns of this size and scope.
An organization will want to get a better idea of the community’s perception of the organization and the upcoming project before starting a campaign. In your feasibility study, your organization will want to know:
A feasibility study gives you a better idea of how successful your campaign will be. If your organization can hire outside consultants for this type of study, you will receive an unbiased opinion from someone with experience. This can be critical to the success of a larger capital campaign.
As we mentioned before, a capital campaign will be held over a shorter amount of time. This is likely going to be a few months to a year for many campaigns. During this time, your organization will want to have several goals to hit to make sure you can reach the determined amount needed for your campaign. To reach your goals, you want to use a technique that helps you effectively use your time and resources.
SMART goals are a technique used by management in for-profit businesses and have helped many companies achieve success. This type of goal setting works well with capital campaign planning since your organization will have a set time frame and will need to keep track of your successes. The following criteria of SMART goals will help you along the way:
Your capital campaign is being developed for a particular reason. When planning goals for this campaign, you should include equally specific goals throughout the project. Who will be helping you reach your goals, and how? What events or fundraising activities will be used? When will each of these smaller campaigns take place?
Since you have taken the time to mark specific goals to meet, along with people and events that will take place, it will be easier to measure the success of each of these goals during your capital campaign. Keep track of everything you have done during this process and where you have had difficulties.
Before starting on your campaign, you should have researched the likeliness of achieving your goal. This was an essential part of presenting the capital campaign to the board. As you create your SMART goals for the campaign, you will want to do a smaller feasibility study for each of your campaign goals. What are you hoping to raise from grants or smaller events? Will the cost of these smaller events be worth the fundraising that can be accomplished, or should you spend more time on letter campaigns and online fundraising?
As you start to create your goals, you will want to keep the end goal in mind. Will your fundraising efforts help raise enough? Do the events or grants make sense for your organization?
Throughout your campaign, you will need to make a timeline and set dates to achieve specific amounts in your fundraising. If you fall behind on these goals, you will have a better chance of catching up with additional fundraising activities. If you wait, you may be struck by how behind you are in reaching your goal at the end.
It will be critical to creating financial and other goals for a capital campaign to keep your nonprofit on track. When you reach a goal, make sure to let your donors know about the success.
Most nonprofits know the importance of a powerful mission statement. A capital campaign will need a mission statement of its own.
This statement will be used to inform and excite the community about what you hope to achieve with this project. The capital campaign mission statement will need to fit within your organization’s mission as well.
When prospect researching your donors for a capital campaign, you will want to find those donors who are most interested in giving to the type of project you are planning. If you hope to build another school, find donors with a history of giving to schools and other construction projects.
These donors may be willing to give more in exchange for their name on a donor wall. You may have noticed a wall of named plaques at your local hospital. These are likely donors who gave enough to help construct the building or addition.
If you are hoping to get one or two donors to fund most of the project, you may want to offer something more substantial. In these cases, naming a room or wing of the building you are developing after a donor can be enough for a large donation.
Branding during this type of campaign is critical. If you are trying to get new donors involved with your organization, you will need to promote your organization and the project in the community and online. Capital campaign branding is a way to distinguish this fundraising from the rest of the fundraising your organization does. You will create new branding for your campaign with new images, typeface, and wording. Here are a few other ways to differentiate this campaign from the rest:
Once you have developed new branding for your capital campaign, use it on all marketing and solicitation materials sent out to the community. Your capital campaign will continue for months, and you do not want donors to forget about it until you have reached your goal.
Each time you meet one of the smaller goals you developed in your campaign plan, you will want to share that with your donor base. Send out emails and social media posts with new pictures of the building being constructed or a picture of one of the major donors who have given a significant amount to the project.
These updates will continue to excite and involve donors in the success of the project. If you have involved some donors in a crowdfunding campaign, it is essential to keep them informed about all these updates. Get them to share these updates online to get even more people interested in your campaign.
Most nonprofits realize they cannot solely rely on events or letter campaigns to reach their annual budget. When starting a capital campaign, this is even more important. Online fundraising through crowdfunding and peer-to-peer campaigns, grants, small events, solicitation letters, and more can be included in your capital campaigns.
For example, if you need a huge building for your nonprofit’s or its beneficiaries’ needs, an online campaign that shows your donors how much you want to raise can be great. Look at this campaign here. All Paws Safe Haven wanted to become a sanctuary for all the dogs that need their support. What could have been better than an online capital campaign? This is quick and easy to set up. All you need is some online marketing and perhaps, sending letters to let your community know.
After you have finished your campaign, you will want to thank those who helped you along the way. A gift acknowledgment will be sent out for each donation, but many people have been part of this campaign and can be thanked with an event. This may include your donors, volunteers, members of the community, and vendors who worked on the project. An event like this can be another fundraising opportunity or one to simply say thanks.
The purpose of this event is to celebrate the campaign and finalize a long-running project so you can move on to the next phase. At this event, you can let people see the results of their efforts and share how the funds were raised by revealing a donor wall or wing in honor of a major donor.
Your capital campaign will need to include several fundraising events to reach your end goal. Some of these can be done by your office, but others may need the involvement of donors and volunteers.
Before sending out any marketing material for your capital campaign, be sure you create a custom donation form. When sending out your solicitations you can link directly to this form. When creating this form, you will want to use the same branded logo, typeface, and wording created for your campaign.
The following fundraising ideas can help make your campaign a success:
If you have an older donor base, many of your donors may be more comfortable sending checks through the mail. You will want to send solicitation letters by mail and email to reach all your donors.
When creating these letters, find stories and images that tell the story of how the project will help your organization reach its mission. If you are constructing a new building, share stories of students in your current building. Let donors know how an additional building will make a difference for students or how many new students you can reach because of a new building. Personalize these letters whenever possible, especially for donors who have given more in the past.
Remember to include a link to your online donation page in all emails and mailed letters. You may be surprised by those who would rather donate online, even when getting a mailed letter.
Social media has become the main way of communication for companies and individuals. Thanks to more people using Facebook, Twitter, and Instagram, nonprofits have found new ways to fundraise using these apps. Crowdfunding is a way for anyone to raise funds for nonprofits or friends and family who need help. These campaigns can be used by your organization to raise funds for your capital campaign.
Before starting a crowdfunding campaign, find volunteers and donors who are comfortable online. These donors will create their own crowdfunding campaigns and send them to their friends and family. Keep track of these donors and send them updates and images they can use on their crowdfunding campaigns. These donors will be another group of fundraisers for your organization during your capital campaign.
With Donorbox, you can quickly create crowdfunding campaigns and send updates to keep your donors excited about the campaign.
Donation designation can be a great way to give your donors the freedom to choose where to give. You may need a good amount of funds for 2 or 3 of your capital projects. In that case, you should add those many options to your donation form. Tell donors to choose one from the dropdown and make the donation. You never know donors may have their own personal favorite when it comes to a cause. This freedom builds trust and transparency for your nonprofit as well. It’s a simple idea that can have a long-lasting effect on your supporters. Here’s a good example for you –
Before and after your capital campaign, you can let donors know how they can increase their donations. Donorbox has partnered with Double the Donation to offer nonprofits the chance to encourage matching gifts.
By offering an easy way for the donor to find matching gifts, your organization will increase the revenue for your capital campaign and your organization.
Grant funding is not always considered for capital campaigns, but if your campaign is well-planned, you should have enough time to research and apply for project grants. You may even learn whether you have received the grant before the end of your campaign.
Many foundations are interested in funding projects instead of nonprofit operational budgets. Your capital campaign can be the perfect opportunity for these foundations. If you can keep the foundations aware of how your campaign is doing, they will appreciate it and potentially choose your organization to fund because you are more likely to succeed.
Darlington County Humane Society is a nonprofit providing necessary care to the homeless dogs and cats in the community. They have set up a crowdfunding capital campaign to raise funds for building a new shelter for their homeless animals.
This new shelter is to provide better healthcare and decent housing for the animals. Naturally, it requires huge funds but time is less. Crowdfunding is effective in this case. By using a recurring donation form, the nonprofit has also made way for monthly/quarterly/yearly donations from supporters. The goal meter creates a sense of urgency and the donor wall on the page displays an appreciation for donors.
Crestwood Athletic Foundation is a 501(c)(3) registered charity supporting the enhancement of athletic facilities for student-athletes and the community. They needed to renovate their baseball and softball fields.
With the need for edging the fields, grass inlay, fencing, drainage, repairing, and a lot more, the fundraising goal was huge. Hence, the capital campaign. As you can see in the image below, the donation page has a branded look, a simple and suggestive donation form, and social media buttons. It even has necessary tax-deductibility information under the form, that helps donors take the plunge.
Yokohama International School Japan needed a new campus for their school, which would provide a myriad of opportunities for their learning community. But the need for funds was huge – ¥200 million.
They set up a capital campaign to encourage staff, families, alumni, corporate employers, and supporters to help them meet the goal. This campaign page has donation designation options for their donors. It helps with transparency since the project is big. Plus, the form is recurring. Interested donors can opt in to give regularly to help the school.
Your capital campaign can be a great success with the right planning and resources. When planning for your campaign, make sure you create a feasibility study and make SMART goals to ensure your success. If this is your first campaign, take advantage of the experience of other organizations by hiring a consultant or learning more about their successes and failures.
Donorbox has affordable fundraising features to help your organization during your capital campaign. Learn more about our features on our website. If you would like some nonprofit management tips and resources, do take the time to check out our blog.
We have answered some commonly asked questions on capital campaign fundraising.
Hiring a consultant is not necessary, but they can be helpful if this is your first capital campaign. These consultants have more experience running this type of campaign and will address any questions you may have.
Consultants will give your organization an unbiased opinion of the feasibility of the campaign. They can also give you a better idea of how the community feels about your organization and the goal of the campaign.
According to Capital Campaign Masters, the cost of your campaign depends on how much you expect to raise. Smaller campaigns will cost approximately 15% of your goal. If your goal is over ten million, you can expect to spend four to five percent of your goal on raising the necessary funds.
There are several ways to get your board involved with your capital campaign. Here are a few ways to excite your board:
Feasibility studies help determine whether a capital campaign will be successful and if your nonprofit has enough resources to meet your goals.
Kristine Ensor is a freelance writer with over a decade of experience working with local and international nonprofits. As a nonprofit professional she has specialized in fundraising, marketing, event planning, volunteer management, and board development.
Subscribe to our e-newsletter to receive the latest blogs, news, and more in your inbox.
Kristine Ensor