Next Steps for NextStop Theatre Company

As Covid-19 crashed into our area a year ago, the arts faced unique challenges as stages went dark and classes moved to virtual platforms. Professional theaters, such as the NextStop Theatre Company in Herndon, Va,, were thrust into unfamiliar, unprecedented circumstances. Not every arts organization survived, let alone thrived, but NextStop Theatre Company, working with Capacity Partners consultants Amy Selco and Stephanie Hanson, reached for … and attained … a new level of strength and stability over the past year. A capacity-building grant from ARTSFAIRFAX brought Capacity Partners and NextStop together.

When the pandemic rocked our economy to its very foundations, NextStop Theatre hesitated to fundraise because they believed their community’s need for food, shelter, and other basic necessities ought to be Northern Virginia’s top charitable priority. Evan Hoffmann, NextStop’s Producing Artistic Director, said, “Our roots grow deep in our community, so before we asked for funds – even though we believe the arts are essential for our souls -- we made sure that our neighbors were getting their basic sustenance needs met first.”

Capacity Partners Consultant Amy Selco adds, “In June, the board recommended the launch of the NextStop Now Fund with an audacious goal of raising $100,000 in just six months to ensure their theater and its invaluable programs would make it through to the other side of the pandemic.”

Working with Capacity Partners, NextStop didn’t simply raise funds; it changed its culture. “NextStop did the difficult work, especially since all the work happened in a virtual space, to move from a transactional fundraising culture to one that embraced philanthropy as a core value,” said Capacity Partners consultant Stephanie Hanson.

With the change of culture and the smart implementation of development strategy and tactics, NextStop Theatre has come within inches of making its long-shot goal of raising $100,000, added four new board members, and made fundraising an expectation of all board members.

“NextStop Theatre is a vital part of our community, and because of the generosity of our board members and hundreds of donors, we are here today and will be here tomorrow, producing theatrical performances and educational programs that are uniquely ambitious, intimate, and accessible both in and for the Northern Virginia community,” said Evan Hoffman with a determined smile. “The insight and wise advice from Capacity Partners, the fierce determination of our excellent board and staff, and the much-appreciated support from the community merged through our incredibly successful NextStop Now campaign to ensure the arts will continue to be a treasured pillar in Northern Virginia.”


The future of fundraising

“Giving Plunges 6% in First Quarter” “Number of donors dropped by 5.3 percent”. “25 billion in lost revenue for nonprofits”

The headlines about the latest Giving USA study are scary, but do they portend an apocalyptic future?

Capacity Partners is encouraged that donations under $250 rose by six percent during the first quarter of 2020. We also know of some nonprofits that saw their coffers swell during the pandemic; organizations providing disaster relief and pandemic-related services have seen a surge in generosity. Organizations focused on racial equity are also seeing an upswing in contributions. Of course, other organizations are realizing mergers might be their only salvation as they watch income plummet.

Foundations are still making grants, but many are shifting funding to emergency relief for basic human needs, making it harder for arts groups to get funding.  Organizations who were hoping for a grant for projects such as strategic planning may also find it more difficult to get support.

So far, virtual events are more successful than anyone thought they would be.  Hopefully that stays true as virtual events remain the norm for the foreseeable future.  It is difficult to imagine any in-person events being held for the rest of 2020, and maybe even the first part of 2021.

Right now, the rising stock market should result in major donors feeling comfortable keeping their commitments, but as we know from past experience, the market is capricious and as the economic recovery chugs along with a high unemployment rate, that could change. As furloughs become layoffs and as special unemployment benefits run out, budgets could tighten with less money available for charitable giving.

Fortunately, local and federal government grants and loans have kept many nonprofits whole in FY21; the question is what happens in FY22 as disaster relief programs end and government budgets are slashed due to revenue shortfalls.

In general, most corporations will be decreasing contributions, either cutting out all or a portion of many of their sponsorships. Capacity Partners predicts the effect on revenue will likely be in the second half of the fiscal year.

So much about future fundraising is uncertain; actually, so much about the nation’s future is uncertain. Covid-19 will be forefront in everyone’s minds for many months. The economy will remain fragile until coronavirus is controlled. Politics and the November election will generate stress-inducing headlines. All this is true, but equally true is the remarkable power of resiliency, caring, and determination.

Our advice? Stay close to your best donors. Stewardship is more important than ever. Don’t forget to give some of your attention to new donors, too.

In 2019, even though it feels like a lifetime ago, charitable giving showed solid growth, climbing to $449.64 billion, making that year one of the highest for giving. Capacity Partners believes that in good times and in bad, people will donate to the causes they believe are critical. Mary Robinson, Founder and President of Capacity Partners says, “Yes, even in a pandemic and in a period where unpredictability is the only thing one can accurately predict, people will give to the causes they care about.”

In a couple of weeks, we will be conducting a survey of nonprofit leaders to enable us to do a deep dive into the current state of the nonprofit sector in the DC metro area. We hope you'll participate in this brief survey so we can better understand the current situation and make recommendations to nonprofits as they navigate these unprecedented times.


Fundraising in these unsettled times

The world feels unsettled as our news feeds and lives fill with protests against pervasive racial inequity, a powerful and capricious virus that affects nearly everything, and an economy officially in recession. As nonprofits know better than anyone, this is a situation ripe for an increased demand for services while boards of directors and development staff fret over fundraising. Here are some tips to help you and your nonprofit organization raise the money you need.

1) Tell your story well and tell it often. Your donors -- both individual and institutional -- need to hear how you are making a difference under these unique circumstances. Use a variety of methods -- emails, social media, videos, Zoom calls, phone calls, etc. While it's always important to be a good donor steward, it's especially critical in uncertain times like these.

2) A matching gift can boost fundraising efforts. Perhaps your board will chip in to create a matching gift fund. Perhaps a long-term contributor will agree to a matching fund. The prospect of doubling a donation may help motivate on-the-fence supporters.

3) Avoid emergency, desperate requests for funds. You may not be sleeping as you obsessively pore over spreadsheets, but this is not the moment to share your anxiety with an anguished plea for money. Convey realistic optimism rather than panic.

4) Don't pre-judge your supporters. Don't assume they no longer have funds to give or won't appreciate hearing from you. Give your contributors the chance to show you how much they treasure your organization's mission.

5) Focus your time and efforts on current or past donors.because some organizations, especially those not providing direct coronavirus or racial inequity services, may find it more difficult to attract new donors right now.

The last three months have shown how many organizations are continuing to raise money effectively. Some are even surpassing their goals ... and not just disaster relief organizations. Some of our clients' events are hitting record highs, and some are getting generous grants. Unfortunately, some nonprofits are still having a tough time. Recovery will be an ever-evolving process so stay nimble — and ask.


Crafting your spring appeal during Covid-19

By Capacity Partners Consultant Kristen Engebretsen and Capacity Partners Associate Stephanie Hanson

 

In January, you had just come back from the holidays, and planning for your spring appeal was well underway. Now, after a month of fundraising during a pandemic, you’re likely asking the question, “Should we still do a spring appeal, and if so, how?”

Capacity Partners recommends you should still raise funds through your annual spring appeal, especially if you have not yet reached your goal. However, your messaging may need to change, and how it changes depends on your organization’s mission, sector, and whom you serve.

Here are a few strategies and tactics to help you build a successful campaign:

Keep your message positive and place impact front and center. It is important to acknowledge the strange and difficult times caused by the coronavirus pandemic, but you should be sure your overall message is positive. Even if your organization is in a crisis, link your appeal to your organization’s long-term strategy, using language like “with your support and partnership, together we can [fill in the immediate impact made].”  This is not the time to be fundraising for a special “nice to have” project. Instead, positively demonstrate both the need and impact while making a clear and compelling ask.

Join #GivingTuesday, the global campaign for charitable giving, for a special spring edition.  #GivingTuesdayNow is designating Tuesday, May 5, 2020 as a day of unity in support of the unprecedented need created by covid-19. Download a campaign toolkit, including ideas, graphics, and social media hashtags on the Giving Tuesday website.
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Play off the idea of spring rejuvenation with your appeal—spring is a time for growth, and flowers are still blooming, even in a global health crisis.

Think about whom you are trying to reach. Is a mail appeal and/or a digital campaign going to best reach your audience? While some of your donors are struggling, others are grateful to be employed and are looking for ways to give back right now. Look at your donor list and segment it according to which groups would be most receptive to an appeal at this moment. Consider using one of the many online giving platform options to get your message out digitally, and combine that with regular social media postings. Engage your organization’s board and closest friends to help push the message out.  Who knows – you might gain some new donors in the process.

Some funders are offering matching funds right now as a way to support their grantees. Contact your top ten funders and ask if they’d be willing to conduct a match with you right now. Or, look for local matching opportunities, like this impressive list from the Chronicle of Philanthropy.

Be sure to include CARES Act language and the new charitable tax deduction in your spring appeal, noting that all donors who give during this time will receive a tax break, whether or not they take the standard deduction. Specific language can be found here.

Capacity Partners is prepared to help you in any way we can. Our job, quite simply, is to help you do yours in this extraordinary environment.


Things you’ll need to apply for a Paycheck Protection Loan

You'll need to gather the following documents before you apply for your coronavirus stimulus Paycheck Protection Loan which is an SBA loan that helps businesses and nonprofits keep their workforce employed during the Coronavirus (COVID-19) crisis.

  • Payroll reports from April '19 through March '20 – both the total payroll numbers for those months and each month separately, as you have to load them individually
  • A picture of the principle owner's government ID
  • Date organization founded
  • Proof of EIN
  • NAICS number
  • CEO’s date of birth, Social Security Number, home address, and cell phone number
  • Documentation of health insurance paid and life insurance policies paid into
  • The last 4 quarters of 941 tax documentation


Emergency Grants for Operations Available

March 26, 2020

To our Friends and Partners,

I know that we all have received a huge amount of information in the last days about government support of the small business and non-profit community.

For Maryland non-profits with budgets of less than $5 million and less than 50 employees, we suggest that you take a look at the Maryland Small Business Covid-19 Emergency Relief Fund.  The State has allocated $75 million for direct payments of up to $10,000 to help organizations respond to Covid-19's impact.

https://onestop.md.gov/licenses?utf8=%E2%9C%93&q=emergency+small+business+grant

You will need to set up a registration before starting the application.  If we at Capacity Partners can be helpful to you in the process, please let me know.

Best wishes,

Barbara Wille, Partner Consultant


The M&Ms of Corporate Fundraising

Your house may be like mine. Every holiday, we have baskets of M&Ms all over the house. At Thanksgiving, we have orange and brown M&Ms; at Christmas, green and red. And this past Valentine’s Day…you guessed it, red and pink M&Ms. Even though they all taste the same, except when you venture into peanut, peanut-butter, mint, caramel and hazelnut, I credit Mars with making the ubiquitous little chocolates our go-to candy throughout the year.

There is a lesson here for nonprofit corporate support. Hint:  it is NOT to deluge your corporate sponsors with M&Ms. Although that may be a strategy for retention, you must first master the M&Ms of nonprofit corporate partnerships.

Although the marketing of your mission and message through various media merits mentioning as does your mindset, mentors, and the mind-numbing miscellaneous minutiae of macros and modifiers, more and more there are only two M’s that matter the most.

Metrics. Corporations love to show positive numbers. Everything is measured. If you have not yet embraced the power of metrics, this is a good time to do it. How many people do you reach, this year’s program completion rate compared to last year, how many different ethnicities, what are the results of your intervention, etc. These and other measures can determine not just how well your program is doing but also how well you will be funded. Outcomes based philanthropy means that everything – every program, event, volunteer training, publication – must reflect the measured accomplishment of your work.

Mirrors. Corporate branding increasingly means helping the company look good to its broadest constituency base. When corporate philanthropists place  your organization in the mirror, they insist that it must enhance their brand and reinforce their values. They report to their own board, investors, suppliers, employees, and above all, customers. They will carefully evaluate whether your organization can accommodate their branding needs. To the extent that you can help them look into that mirror with confidence, you have ensured that your organization stands a greater chance to retain their all-important support.

Metrics and mirrors. These concepts matter to the companies you are hoping to reach, and they will likely matter for many years in the future. When you remain close to your corporate partners, you will find more creative and relevant ways to market your mission and learn how to adapt your fundraising strategies to meet their seasonal needs, just as the flavors and colors of M&Ms adapt to each season. But if you prioritize your metrics and mirror M&Ms, you will fund your corporate stakeholders to be among your most loyal donors.


Encouraging your Board to Fundraise

We all want board members to help our organizations grow and thrive, and raising funds is central to every nonprofit's success. However, while our board members typically embrace their governing role, they are less frequently comfortable with fundraising responsibilities. It is not unusual to hear board members say they don't like asking for money, especially from their friends. Below are some ideas for helping your board understand that fundraising is more than just "asking" and everyone can play a role in successful revenue generation. These ideas are intended to help shift your board's perspective on fundraising and help them understand it’s something they can – and must – do.

1) Outline Expectations: Set clear expectations from the outset, beginning with recruitment of board members. Your Board Roles and Responsibilities document should clearly state that in addition to governance there is a financial responsibility of serving on the board. Include a goal dollar amount, either for each individual or for the board as a whole. You will need to work with your development committee to identify this amount and recommend it to the board.

2) Recruit Champions: Recruit people who are truly champions of your organization and who are respected in the community. These are the people whom others look to for leadership, have wide networks, and can provide validation for your cause. Find lots of opportunities to engage and showcase your enthusiastic board members. Enthusiasm is contagious.

3) Inform and Excite: Your board members said "yes" to serving on your board, so they have already demonstrated their enthusiasm for your mission. Board meetings can get weighed down with the business but be sure to dedicate a part of your meetings to something mission-related. Tell a story, show a video (taken on a smart phone), or bring a special guest to speak about the work. Be sure to keep your board engaged and up-to-date between meetings. Send a monthly update with highlights, stories or links to relevant work in the news. Board members are busy and having your organization top of mind helps them be better prepared to be a champion.

4) Make it Tangible: It’s easy to ignore fundraising when it appears all funds are for a general purpose. Yes, unrestricted dollars are critical. However, often board members and prospective donors need to have a better grasp on what can happen with dollars given. For instance, provide a tangible example: “If we can raise $50,000 then we can pilot the new program x that we’ve all been talking about.”

5) Make it Personal and Be Specific: Meet with each board member individually to set personal goals and outline specific projects they will work on. Everyone should have a fundraising responsibility, no matter what committee they serve. If everyone on the board is engaged in fundraising activities, and those activities entail roles they are comfortable with, it will become clear that fundraising is more than just asking… and fundraising becomes progressively less intimidating. You can work with each board member on the specifics, but roles can include:

  • A personal financial commitment
  • Hosting a "friendraising" event – work with the board member to set objectives and goals including the of number of attendees, specific follow up tactics and provide them the support they need to make the event and the outcomes successful
  • Accompanying staff to fundraising meetings
  • Making strategic introductions – staff can help brainstorm ideas and keep a running prospect list for each board member
  • Pro-bono support, if it relieves a budget item for your organization
  • Making thank you calls and writing thank you notes

6) Be Supportive: Be available to help your board members achieve their personal goals. Fundraising is hard. Don't let them get discouraged; give them the tools they need to be successful and don't expect them to be successful if they aren't supported.

7) Give them Ideas: Provide a funding prospect list to your board to scan through (ensure it is kept confidential) and see if they know anyone. If they do, ask if they will join you for a coffee with that person.

8) Share Gratitude: Say thank you. A lot. When a board member helps with an introduction, a solicitation, an event, or a project, say a very personal thank you to that individual and a public one at your board meeting too.

Remember, your board is there because they believe in your mission. Together, you can generate enthusiasm and revenue to achieve that mission. There really is no other way.


Three Steps to Cultivate a Major Gifts Prospect

If you are like most of us, the major gifts prospect list that sits on your desk stares at you and foils your boldest strategies. Those one hundred names have enough wealth to build an entire university campus several times over. Of course, you don’t know any of them, and your Development Committee hasn’t responded to your requests for introduction, despite your pleas.

Whatever the minimum major gift threshold for your organization, ten annual contributions from your top donors for the next several years with a solid annual retention rate means significant support for your organization.  So what’s a development director to do?

Here are three steps to a successful major gifts program.

  1.  Learn/Rank. Read the bios, the giving history, the speeches, and other information of the people on your prospect list. Explore the networks of these accomplished and generous individuals. As you identify their related giving and their relationships, however tenuous and distant, with your own board members, the ranking of your prospects will take shape. You will soon have drawn a web of connections between your people and those top prospects.
  2. Push/Pull. A major gifts team usually consists of board members and development committee members. Among those leaders, there is likely a small percentage who have agreed to enthusiastically reach out to their networks. Those are your favorite people, right? They are also the most time-challenged, and they often find it hard to fulfill their promises to talk with their contacts. Try push/pull. First, push them to do their work, to fit those calls and referrals into their jam-packed schedules. Of course, be creative and nice in your approach. Second, pull plenty of data and research in order to equip them with the information they need to successfully reach their goals. Pulling the appropriate data will make your board and committee members feel more comfortable when you do your push. Don’t forget to track not only the progress of your prospect but also the progress of your board advocate.
  3. First/Second. With your first layer of top donor prospects safely in the hands of your most committed volunteer leaders, it’s smart strategy for you to cultivate the second layer - the network that surrounds those prospects. Identify and cultivate those people; if even a small percentage respond, you are on your way to meeting your fundraising goals.

A strong major gifts program lifts an organization and unleashes the potential of your organization’s vision. And a successful major gifts program is only three steps away.