A Guide to Fundraising Campaigns and Donations

For some donors, the thought never crosses their minds, but for others, they want to know the ‘what, when, where, how and how much’ side of things. Here is a breakdown of fees, third-party fundraising sites, restricted and unrestricted funding and more…

Part A: Understanding the basics

Definitions

Business/For Profit

A for-profit organization is an entity whose primary goal is to earn a profit. Most business entities are considered to be for-profit organizations.

Social Enterprise/B-Corp

A Social Enterprise is a business that is mission-driven. It represents itself to the public with positive aspects of its business model and holds itself accountable for adhering to the mission of its business model. In some cases, a B-Corp is a social enterprise with a third-party standard it adheres to, and in some cases, a B-Corp and Social Enterprise are the same thing depending on the country they are based. As a minimum standard, Social Enterprises need to have their mission-driven/public benefit objectives defined in their constitution and delivered in their ethos and projects. This extends to defining its percentage of earnings, often 50%, to be either reinvested into improving its services or designated to defined project partners – i.e: community interest companies or not-for-profits. It also defines that as it is not profit-driven no more than 50% of income should go to shareholders (if applicable).

Sometimes, an easy distinction is that a Social Enterprise is half Not-For-profit and half For Profit with the caveat being that profits should be reinvested into itself.

Charity/Not-For-Profit

An organization that has the purpose of providing money, help or services to people or projects who need it. It usually does something useful for society: As a charity, the organization does not pay tax.

Cash Flow

Whether you are dealing with a business, a social enterprise or a charity/not-for-profit, and I have worked for and with all of these, the objective is the same – cash flow. Any charity/not-for-profit would be amiss at saying cash flow, and in their case, fundraising, donations and/or sponsorships, are not important. This does not mean, of course, that money is what gets a charity/not-for-profit up in the morning, if it did then we all know they are in the wrong vocation. But it does mean that no matter how many volunteers any given charity/not-for-profit has, how many service sponsorships they receive, and no matter how small an operation they are, they will at some point need a cash injection. More often or not, a regular cash injection and therefore a regular cash flow.

Overheads vs Project Costs

The difference is often defined as what of that cash flow is spent on overheads (salaries, rent, energy bills, phone bills etc) vs what is spent on project costs. Generally speaking the smaller the charity the smaller the overheads. But even this has a caveat, as a single employee charity could in fact have a salary which covers most of the overheads, and then it is up for debate as to whether this should in fact be designated as an overhead or a core project cost/project essential. Whichever way you lean, not everyone wants to donate towards someone’s salary, and if that is the case then you should also ask “would I want to do their job at their salary?”.

Part B: Fundraising

Fundraising

Donating Direct

As you can imagine donating directly to the charity and using their preferred method of transfer is preferable.

Collaborative Fundraising

Some charities use collaborative organisations to help manage fundraising campaigns or help manage the admin sometimes needed.

Eg: The Expedition Project, Helping Rhinos.

Third-Party Sites

Third-party fundraising sites are big business. And not only are they not all created equal, but should be avoided unless it is the charity’s only method of fundraising or what the charity recommends. Of course, there are benefits to the big third-party sites as they can increase your reach tremendously and this can offset any fees incurred in using them.

Eg: JustGiving, GivenGain.

Restricted and unrestricted funding

Unrestricted means you are happy for the project you designate to spend the donations in a way they see fit (recommended), and restricted donations mean you would like your donations to go towards a specific element of your chosen project or a specific function or sub-project (rhino dehorning, dog kennels etc).

Setting up your fundraiser

Part 1

Here are the four things to decide when setting up a fundraiser, especially via The Expedition Project:

  1. Choose the project or projects you wish your fundraising to go to – for example, you can choose one project or several.
  2. Choose your donation split (if applicable) – for example, 25% to project x, 25% to project y and 50% to project z etc
  3. Choose restricted or unrestricted funds – for example unrestricted means you are happy for the project you designate to spend the donations in a way they see fit (recommended), and restricted donations mean you would like your donations to go towards a specific element of your chosen project or a specific function or sub-project (rhino dehorning, dog kennels etc).
  4. Choose if you would like your fundraising released in one go or in stages – for example, you may wish to fundraise in stages with targets, all depending on how long you wish to fundraise for. You can release some funds now and some later. Some people leave fundraisers open and release them after each target is hit.

Part 2

The reason The Expedition Project handles these donations instead of recommending you do it via third-party sites (JustGiving etc) is for the following reasons:

  1. For the management of the funds in the way mentioned above in A
  2. We know and work with the projects unlike the big third-party sites
  3. We communicate regularly with the projects and so can monitor how, when and where the funds go
  4. We visit the projects and have done since 2012 
  5. We can connect fundraisers with not only our extended network but also with other ways we are helping the projects
  6. We can often limit donations fees (card fees, international transfers etc)

Part 3

The reason TEP likes to do this instead of saying to you to just donate directly to the organisation, although you can of course do this, is for the following reasons:

  1. For both the above-grouped reasons A and B
  2. It allows us to do more to support these projects
  3. It limits the workload for these organisations
  4. The projects do not receive less money than if you donated directly

Part C: Examples in action with The Expedition Project

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