[Podcast] Why Being A Data-Driven Nonprofit Is Crucial Amidst Uncertain Times

On this episode, Justin Ellis took us into the trenches to see how a successful VP of Development approaches their work amidst uncertain times. We discussed the importance of development staff being data-driven decision-makers, the difference between transactional and transformational, and how to transform asks into investment invitations.

Justin, the VP of Development at Thompson Child and Family Focus, oversees fundraising and relationship development of all the many individuals and organizations that support the mission and vision of Thompson.

He leads a team that is engaging in vision building initiatives and works to enlarge the footprint and deepen the impact from those that stand in the gap with us in our communities. He brings over 10 years of experience in nonprofits and fundraising work.

3 Fundraising Best Practices from a VP of Development

Justin provided three practical steps that you can use to increase fundraising using donor signals and your internal team. Here are the top three takeaways from this episode.

1. Data-Driven Leadership

Like many nonprofits, Justin hasn’t always had an easy time raising adequate funds. Using fundraising strategies inherited from previous eras lead to alienated donors and a lack of generosity. However, with leaders committed to letting data guide their decisions, Thompson was able to make radical changes that significantly increased fundraising. 

“We were really privileged enough to have a leadership team come in a few years ago that said, ‘Hey, we need to really change the dynamic of what we do here. And we need to address the immediate needs of the community, but also do it in a way that fits a sustainable model for an organization like a business would.’ So, the idea of doing things that may lose an immense amount of money, when you don’t have that money, is not a good business model.”

Changing the model meant making tough decisions. They made significant alterations to programs, reduced staff by 15%, and rewrote some program models while creating new contracts for others. On the fundraising side, they went to their long-term supporters and asked them why they gave, and what they would give to moving forward. 

Justin says, “It was really enlightening…to learn those answers.” Equipped with real data, leadership can make decisions that are more likely to deliver results. “You start to see where there are a lot of inefficiencies and where you can trim those to put more focus and time on the programs and the initiatives that can really bring return to a community.”

Digital engagements and comprehensive software solutions make it easier than ever to collect the necessary signals to make the right data-driven decisions. Leverage the right software mixed with your experience and personal knowledge of your constituents in order to find the right responsive fundraising strategies for yourself.

2. Invite Investment

With data in place, you can approach new endeavors with intention and knowledge, which you can, in turn, communicate to your donors. 

“We’re able to lay out real data and outcomes of what it is we’re trying to accomplish and what their investment would do in that process,” Justin says. “We strive very hard to put our ‘Thompson triumphs’ in actual numeric form. So rather than just saying you’ll help a child, saying there are 2200 children in the Mecklenburg County that fall under the poverty line and have more than three traumatic incidents before they reach the age of five. Here are two programs that have documented outcomes that will really work on moving the needle in that sphere.”

Justin approaches these conversations as an investment invitation, more than a simple appeal. He invites donors to invest in the program and explains how it will work to become more sustainable. Three years into this approach, just says momentum is picking up. “It’s a constant conversation to have internally and externally to create,” he says. 

Use the data you have for each of your donor personas to identify who might be more receptive to an investment opportunity and who would need a direct appeal. A varied strategy will not only create personalized experiences, but it will also ensure that you’re always learning about your base. 

3. Transformation Over Transaction 

Most importantly, Justin says, the team had to realize that the work they were doing needed more funding, and to align the work with the passion and impact that donors wanted to make.  “That’s such a powerful way to present that opportunity to them,” he says, “You’re not asking again, and again, and again, you’re presenting an opportunity for them to execute what they told you they wanted to do.”

Fundraising builds the link between the programs and the donors. “I can connect the dots. I can build that bridge between the donor. And if I’m not actively encouraging that donor to cross that bridge, then it’s a waste,” Justin says. 

Donors are looking to help, but they might not know the best way to do so. “The way that we look at it is we live in a community here in Charlotte that is extremely philanthropic,” says Justin. “There’s a genuine care for the needs of the community. There’s just a lack of knowledge or a lack of accessibility to how to help. We address our asks as an opportunity to invest in both the current and the future of Charlotte.” He positions Thompson as the springboard to accomplish that.  

Justin says, “When you take that approach and back it up with real data …you become so much more confident. People are seeing not only the need but the light at the end of the tunnel, if they invest in the program.” 

Responsive fundraisers figure out how to bring donors closer to the cause and inspire long term commitment. With these three philosophical shifts, you’ll be able to not only grow revenue, but most importantly, do more good in the world. 

 

 

Full Transcript

Justin Ellis: I’ve been a part of organizations that the development director did not see themselves as a data person, that wasn’t their quote unquote strength. And I think that that’s a real danger when you’re expected to lead a team that has some real significant goals to keep the organization either afloat or moving forward.

Noah Barnett: From Virtuous, I’m Noah Barnett. And this is the Responsive Fundraising Podcast. The show where we talk with fundraising leaders and thinkers to uncover how today’s top nonprofits craft remarkable donor experiences and build lasting relationships at scale. On this episode, I’m joined by Justin Ellis. Justin’s the VP of Development and oversees fundraising and relationship development at Thompson. And he is no newbie to fundraising. He’s been around for a long time and has worked at many organizations that are established community service nonprofits in Boston and in Charlotte.

And what’s great about this is we get to dive in with someone that’s in the weeds, in the chair, and really understand how you can move your fundraising from transactional to transformational and move your asks from just expressing a need to inviting people to invest in change. Justin is a wealth of knowledge and we dive into this conversation quickly. So get ready. And let’s dive into the episode.

Justin, you work in fund development alongside a nonprofit organization. And the thing that I love talking to operators about is not necessarily always just jumping in and saying, “How are you running fundraising?” But even how you got into this, like most people don’t wake up and say, “You know what, I want to raise money, or I want to engage donors in doing good business.” So I’m always curious, how did you get to where you are today, Justin?

JE: Absolutely, Noah. Yeah. So, I actually didn’t really know that fundraising was something you could base a career on when I was in school. I always was comfortable around people. I always really enjoyed the opportunity to engage in conversation, especially with people I don’t know. 

I don’t think I have an introverted bone in my body, but I didn’t really know it was a thing. I started in college admissions after I graduated and had a tendency to work with a lot of the families coming from different parts of the country that weren’t going to be full-pay students and full-pay families.

And as many people know, the first program to get in touch with those families when a kid starts at college is development. And I kind of fell into the back end of realizing that I could talk to people about supporting an organization I believed in and ask for money and that could be my job. And I really couldn’t believe it at first. I thought someone was joking, but I kind of fell into it that way, started working in development in higher education and the rest is history.

I’ve worked with a number of different nonprofits in a few different states. Originally from up north of Boston area and then moved down to North Carolina, the organization I work at now. I have steadily been moving my way up through annual fund, major gifts to working totally with a development team for an organization.

NB: It’s so interesting to hear the different paths. And I love how you said like, “I didn’t even realize fundraising was a job.” I think the whole elementary school activity where we say like, “What do you want to be when you grow up,” is a completely flawed, misunderstood activity because it’s like, what scope of reference do you have as far as the mass amount of jobs that you can actually dive into? It’s so much broader than maybe we really had. And I know my path was relatively similar. 

I wanted to do the job of the person that gets people to wait in line at a store at 04:00 in the morning in the cold. I was like, “If there’s a job that they’re designing something in a way that gets people to wait outside of a store at 4:00 AM in the morning to buy some sort of widget or products, I want to do that and whatever that is, but not to sell more widgets, but to hopefully make the world better.”

But, I had no idea what that actually meant. I was just like, “Wow, if we can get people to do this, why can’t we get people to invest in children or invest in impoverished communities around the world? Why can’t we use that same skillset?” So, it’s interesting how that’s now evolved to me working in a high-level marketing role at a nonprofit tech company to help really enable organizations to engage their donors in a more effective way. So, those paths are always really interesting.

Yeah. So, you mentioned, obviously, you’re currently with Thompson-

JE: Absolutely.

NB: Actually, let’s dive into that. If you don’t mind, can you give some background on the organization that you currently work with and then even how the organization’s fundraising structure is? Because a lot of organizations are different, kind of the mix of funding. So, I wanted to kind of reveal that and then I want to get into the weeds a little bit with you as well.

JE: No, absolutely. Yeah. So, I discovered Thompson Child and Family Focus when my wife and I were looking to move down here. Thompson is actually one of the oldest and most established children and family serving organizations in the Charlotte Mecklenburg area of North Carolina. So, the organization itself is almost 134 years old. They started as an orphanage through the Episcopal Church and have evolved into a full host of continuum services, addressing pretty much every need that a child and a family may experience when it pertains to trauma.

So, we have a whole host of programs that operate along the scale of intensity and acuity, whether that’s basic therapy or whether it’s all the way up to what we call psychiatric residential treatment facility where we host and students live on our campuses. So, the organization has evolved, but always with the mindset and the mission of standing in the gap for children and families in our communities that do not have access to the services that they need to kind of rewrite their life narrative.

So, we are a little bit of a unique organization, how we approach our revenue streams different, certainly from anything I’ve worked for in the past. We have a fairly robust fundraising mission with a fairly small and lean team. So, we have an individual that works with annual fund, mid-level donors, major donors and grants. And each one of those people really stay in their specialized lanes and we all work together to bring in our fundraising goals. But, really every one of our 21 programs outside of two of them have their own integrated revenue streams built-in. So, we do a lot of work within the Medicaid, Medicare community. Most of our programs have some level of a billable part to them.

So, it actually is a really freeing opportunity as a development leader to be able to look at and talk about how we do fundraising. Every initiative that we build at Thompson is designed to talk about investment outcomes and returns. So, when we approach a donor or a corporate client or a foundation, we’re really looking to jump on the back of a program that with some startup funding or with some continued donor investment, we can grow that program to fit the need of the community, which unfortunately is ever-growing when you’re talking about mental health, trauma, anxiety, things of that nature.

How Data-Driven Nonprofits Talk to Donors

NB: And I think what stood out to me when I was introduced to Justin was that specific model and how you all approach that. And so I would love for you to almost dive deeper into that, into how you then package that in a way that gets those initial funders. Because I think in some ways it’s this idea of being able to present a more sustainable opportunity for donors, especially major donors to invest in is like, we want that but I think sometimes it’s hard to get out of the regular cycles of just asking people for a certain gift amount and moving beyond that and moving into that investment ROI conversation with their donors. 

So, I guess reveal anything that is unique to that for you all and how you approach it, but then kind of recommendations you might have for other fundraising leaders on how they might transition or infuse that thinking into their suggested asks to investors really, they’re their donors.

JE: Absolutely. And I mean, no, I’ll say we’re three years into doing this and I’ll tell you it doesn’t get easier on the ask side or on the donor side. It’s kind of a reeducation for the entire process. Thompson as an organization pulling back the covers a little bit while we have a tremendous historical story, it was an organization that was suffering to floundering a few years ago. I will be very, very transparent about that. It’s very difficult sometimes to not build yourself a very significant bubble in this industry where you are just kind of talking into an echo chamber, or you’re saying things and talking about programs and words that no one in the outside community really understands. And you’re finding yourself constantly swimming against the flow of trying to just generate enough income to keep the lights on.

And so, we were really privileged enough to have a leadership team come in a few years ago that said, “Hey, we need to really change the dynamic of what we do here. And we need to address both the immediate needs of the community, but also do it in a way that fits a sustainable model for an organization like a business would.” And so, the idea of doing things that may lose an immense amount of money when you don’t have that money is not a good business model. And so, we did some really significant altering under the hood to our programs. We reduced our employee size by about 15% to start. We rewrote some of the program models, created some new contracts for some, and then on the fundraising side really started addressing some donors that had been longterm supporters and asking them first and foremost, “Why did you give to Thompson in the past? And what would you give to moving forward?” It was really enlightening to learn those conversations, to learn those answers.

And what we’ve done since then is every program and every endeavor we start at Thompson, we look at it in a way that says, what need or problem will it address in the community? What is our definition of solving that problem? And what is the investment needed and the return on that investment? So, when we approach a donor, be it let’s say an individual, we’re able to lay out real data and outcomes of what it is we’re trying to accomplish and what their investment would do in that process. We strive very hard to put our, we call them Thompson triumphs, to put them in actual numeric form.

So, rather than just saying you’ll help a child, we do a lot of work in saying there are 2200 children in Mecklenburg County that fall under the poverty line and have more than three traumatic incidents before they reach the age of five. Here are two programs that have documented outcomes that will really work on moving the needle in that sphere. And if you invest at this level, you’re able to help us get that much closer. Once your investment is in, here’s how the program will work to become more sustainable so that we don’t need to go back to you and ask for that same gift in two years.

Is that possible with everything? No, but when you take that perspective, you start to see where there are a lot of inefficiencies and where you can trim those to put more focus and time on the programs and the initiatives that can really bring return to a community. And like I said, we’re three years in and we’re starting to get some real movement, we’re starting to get some real momentum on it, but it’s a constant conversation to have internally and externally to create that.

NB: Absolutely. And I can imagine that, like you said, it impacts so much. And what I find encouraging by this model is the integration between programs and fundraising and how there’s this alignment that’s pretty instilled. Which one thing that we see a lot with organizations that struggle to maybe get the funding that they need is that there’s too much of a disjointed approach to fundraising and programs. 

What Does a Data-Driven Nonprofit Look Like?

NB: And what I like about this approach is this joined-ness where you’re inviting people to be basically a part of, instead of just give to. And I think that’s a growing trend, not just amongst major donors, but everyday donors that are saying, “I want to be a part of not merely give to, I’m not a transactional donor, I’m a transformational donor.” And so I appreciate this example for those that are looking to bridge that gap in their own organizations.

Any recommendations for those listening, they’re like “Great, Justin, but our organization’s different.” You know what I mean? That’s a typical response. That’s how I would think if I was listening to something like, “Oh yeah, good job, Justin.” 

JE: Well, and I love how you said that, because take that same approach of not transactional, but transformational and then turn around and look in the mirror. And not just the development leader, but an executive team. Now, I’m sure not everybody listening is at the executive level. But what I would say is the leadership defines the momentum that we’ve had here at Thompson. 

So, while I am responsible for running the development team, my chief operating officer, my chief of programs, my CEO, every single one of them has the lens of data and outcome and return investment when it comes to fundraising and programs in their own sphere.

And I can tell you what it used to be was that development almost literally at Thompson sat in a bubble, three offices in the top floor of our administration building all the way in the far right. And I have seen that a thousand times. No one really knows what we do. No one really knows where we are because we’re never in the office and you just kind of come and go. What we needed to change was that the culture of fundraising and philanthropy at Thompson needed to kind of infect the rest of the executive staff.

And so, when you start to see that happen, when your chief of programs is looking at his budget and looking at what they’re aiming to do and seeing where there can be the best return and talking to funders or talking to individuals in their network, the same way that you’re talking about it to your donors, there starts to be this continuity amongst an executive team where you start to create a real culture of philanthropy, rather than just being a one off-program in an organization. 

And you don’t need to have external revenue sources to do that. I do think you need to have the right leaders and that’s a conversation for another time. But, I do think that if you get it, there’s an opportunity for you to teach. And even for someone that’s not running a department, but wherever you are, start to try to infect that culture of philanthropy throughout your own team and throughout the organization and you’ll see things start to shift.

Should I ask for more donations?

JE: My other advice, and this is more directly for a development team, is that things start to go better when you ask more. I had a great mentor when I first started in this field. And he said, “If you are not asking a donor enough times to get four nos before you get a yes, you’re not doing your job right.” Most of what we’ve learned has come directly from the notes that we get from our donors. So, we have an idea, right, we think this is going to work. Just because we think it’s going to work, doesn’t mean it’s going to work. And it’s certainly not perfected in the language or in the culture of the individuals that are going to give them money.

So, we have dramatically and I mean, dramatically increased the amount of asks that we make from an individual level to a mass mailing level, to a corporate level, to a major gift level. And I think that, we look at over the last three months, particularly look at what’s happened with everything with COVID-related, at one point, we were making an ask every other day to our annual fund donor base. We were reporting on the needs of the community. 

We were reporting on the impact of what we were fundraising, but in almost every single communication we sent out, we were making a push for support. And as we started to see that the numbers and the response come in, it gives you a much larger sample size of what’s working, what needs to change and how to better tweak what you’re doing.

NB: Yeah, absolutely. And I think what’s interesting is this idea that you’re not asking just to ask, but you’re asking because there’s real needs to be met. And I think there’s sometimes a gap that we don’t believe that. In some ways it feels, as fundraisers, it’s almost like our understanding of fundraising is very much reflected in the response that we’re going to get from our fundraising as well. And it’s like, we’re asking because we’re being opportunistic or we’re asking because of this. 

And I think what we forget, and I know because I experienced this, because we moved from nine kind of strong appeals. We had like hyper-segmentation in our donor base at the organization I worked for. But when we looked at it and said, “Okay, we want to present.” And we phrased it differently. We didn’t necessarily present it as an ask, but we’re still presenting an ask and an opportunity for someone to engage was we moved from nine to like 15 a year that we’re very clear to a specific segment and saw a huge increase.

But first and foremost, before we could do that, is we had to realize that the work we were doing needed more funding and the work that we had aligned with the passions and the impact that our donors wanted to make. And it was our responsibility to present that opportunity to them. We see fundraising in that way, like that’s different, then you’re not asking again and again and again, you’re presenting an opportunity for them to execute what they told you they wanted to do. And we miss that as fundraisers.

JE: I think it’s interesting and I was told this a few years ago, you always know it’s going to either be really good or really bad when someone, before they make their point, they say, “Now this may offend you.” So, my ears always perk up when someone says it in the development community. But, they said, “If you can’t convince yourself to give to the organization that you work, you shouldn’t be convincing anybody else.” 

And what I think is very powerful is that no matter what I believe, no matter if I think that it’s opportunistic or I think it’s overwhelming, if the data shows that the need is there, then we have a job to do.

And what I’ve always said is that nobody is ever going to give to an organization or solve a problem like Thompson addresses because of me. I am not the therapist. I am not the expert. I am not the person in the trenches, right? Those people are some of the best people out there and they’re the ones doing the actual work. But, the need that they bring back to us, I can connect the dots. I can build that bridge between the donor. And if I’m not actively encouraging that donor to cross that bridge, then it’s a waste. 

And the way that we look at it is we live in a community here in Charlotte that is extremely philanthropic. There’s a genuine care for the needs of the community. There’s just a lack of knowledge or a lack of accessibility to how to help.

And so we do the same thing. We address our asks as an opportunity to invest in both the current and the future of Charlotte. And that Thompson is the landing or the springboard in order for them to do that. And when you kind of take that approach and back it up with real data, I think I’ve now said data about 10 times, but I tell you, we live our life by that. Your asks become so much more confident and then you really start to build kind of that culture of investment fundraising. People are seeing not only the need, but the light at the end of the tunnel, if they invest in the program.

Three Top Priorities for a New Development Director

NB: And now, Justin, this isn’t your first rodeo in fundraising, you’ve been in fundraising for a bit. And so I want to make sure that we glean from those insights as well. And so I think what I like to do is challenge you to kind of take the posture that you’re stepping into a new organization right now, as the head of development, disregard the title, doesn’t matter, but you’re in charge of fund development for the organization. What are the three priorities you’re focused on?

JE: So, first and foremost, it’s learning the current culture of the organization from the team there, not only development, but from whatever programs or parts of the organizations that make up that company. I think what I’ve seen is that a lot of development directors immediately spring right into, “What’s our next appeal. What’s the next mailing? What’s the next video we’re making?” And I think that you are the most outward-facing individual in the organization outside of potentially the CEO. You’re meeting with so many constituents that if you don’t know the culture of your own organization, you’re not able to build a really good case statement.

The second thing would be to learn the data of the donor base. I’ve been a part of organizations that the development director did not see themselves as a data person, that wasn’t their “strength”. And I think that, that’s a real danger when you’re expected to lead a team that has some real significant goals to keep the organization either afloat or moving forward.

And the third would be to get to know the board of directors and the most influential donors. And that may not be the donor that’s given the most money. I was told early on the first group you want to look at are the donors that have been giving the longest. And why have they been doing that, no matter the level, but really what is their tie-in because they have become the story of your organization?

NB: Yeah. I love that. So, I think you mentioned culture, understanding your own division in your organization. You talked about understanding the data and then really diving into the donors as well. And I think those are spot on. So, thanks for going through that exercise with me, Justin.

Donor Development Through a Crisis

NB: And I think the thing I want to end on, we don’t have much time left and I wish we could talk for like an hour and a half, and I think many of our listeners would agree. But, in summary right now, many people are dealing with the response of COVID, the crisis of COVID, obviously we’re moving out of the response, but there’s fluctuation as to whether we’re moving back into the crisis moments, but either way, we’re kind of in this in-between where I feel like there’s a lot of uneasiness, there’s a lot of unrest. 

There’s a lot of uncertainty. And the challenges are like, how do we lead well in our organizations? How do we still fundraise? How do we stay focused on the task?

And so, I wanted to get your thoughts on this. You obviously mentioned that you all increased asks and that was helpful, but how else are you thinking about this moment where it’s not clear what the reality is we’re within and there’s a lot of uncertainty as to what’s next or where the future goes, or how long? How are you navigating that? And what advice would you have for our listeners as they do the same for their organizations?

JE: I mean, no, I truly believe that people that choose to be in the nonprofit sector have some of the biggest hearts and have the ability to make some of the most impact and change. And so what we’ve done is take a real internal look at what it is that we feel like we do well and what it is that we’re connected well to, and start to offer that to the community. 

One of the first things that we did in response was to create this on the fly webinar series for our local constituents here in Charlotte, called Pivot in the Panic. We’ve had speakers come on, that really the intent is just to talk with and through some of the current situations that people are going through and talk them through how to pivot where they were and to where they should be to get through this crisis.

It has nothing to do with Thompson. Now, we’ve taken a lot out of those conversations and put them to good use at our organization, but the idea was we have a responsibility as a part of the foundation of Charlotte. And not just because we’ve been here for 130 years, but because we work with those that don’t have access to some of the basic human needs where this organization is working on supporting a real problem. 

And so, we had some connections, some people, some opportunities that could really help the greater community. I think that for every ask that we make, we also want to make sure that we’re giving something back. That’s real investment, right? We can’t just stand there with our hands out and not offer something and every single person in an organization has something to offer. This goes back to that figuring out your culture, knowing your people, knowing your teams.

And so, we’ve really tried to do that from the start of this. Sometimes that’s as simple as getting on a microphone or getting in front of a camera and saying, “We see you, and we’re in this with you too. We’re scared too. We have no idea what the next six weeks will look like, but hey, here’s something that we think could help,” with really no strings attached. We live in such a technological era where you can make a webinar. You can make a video, you can get on social media. And the cost is remarkably little in terms of financial costs.

So, I would say that’s probably what has garnered us the most respect throughout this process. We also are very cognizant of listening to our donor base and our supporters. When enough is enough, it’s time to stop. So we took a few weeks back in the end of May, beginning of June to just acknowledge our supporters, to acknowledge our community, to say, “Okay, what you did was so phenomenal and was so not out of character, but so unexpected in a time of a global crisis that we can’t do anything but thank you.” And that’s a really powerful movement. The responses we’ve gotten from people to say, “I really can’t believe you’ve had the time to thank us while there’s so much swirling around. That’s memorable.” So just always make sure that you are reinvesting in your communities, not just asking them.

NB: It’s so good, Justin. And I appreciate those reminders because I think they embody so much of what we’re trying to promote through this podcast, and through so many of the other formats where we talk about organizations and kind of this call to be responsive. And so many other principles you just mentioned are key principles of responsive nonprofits. They’re listening well, they’re looking at data, they’re connecting with their donors. They’re adding value more than they’re asking. 

And these things are so important as we build and look to sustain resilient nonprofits that are so essential to our communities. And I think we need courageous leaders, and you hinted at that and I’m thankful, to know that we do have organizations because we get to work with them on a daily basis. And we get to talk to organizations like you at Thompson. And Justin, it’s just your leadership as well and I can hear it in your recommendations.

And so, it’s encouraging to know we have this path forward. The challenge is, are we going to have the courageous leadership to really believe it and drive forward? And I think that’s a call that we hope to elevate on this and not just elevate by words, but also show examples. So thanks for being a part of that, Justin.

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