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Current Issue - May 2008

Fundraising: Working With Consultants

While nonprofit staff and board members must be ready to shoulder their share of fundraising responsibilities, it is appropriate in some instances to outsource a portion of the development work. Organizations large and small have crafted successful relationships with fundraising consultants. Consultants may specialize in a particular type of fundraising (e.g. special events; direct mail; major gifts) or may offer a variety of services under the same roof (often for large capital and endowment campaigns).

In order to foster a successful relationship with a fundraising consultant, nonprofit board and staff members should do the following:

• Convene a small committee composed of the executive director, the director of development (if your organization has one), and one or two board members to decide upon the appropriate consultant
• Determine which fundraising approaches are appropriate for your organization but have not been implemented due to lack of staff time
• Contact your local chapter of the Association of Fundraising Professionals to secure names of reputable consultants in the subject areas in which you need help
• Speak with folks at other nonprofits who have worked with consultants to unearth additional prospects

When interviewing consultants, keep in mind that the person or firm must have impeccable professional credentials and must be an appropriate "fit" for your organization. It is obviously important to ascertain that the consultant has a wealth of experience in your area of interest, and references are therefore vital. In determining whether the consultant "fits" your organization, the committee members must be honest with themselves. When the prospective consultant made his or her sales pitch, did you feel discomfited? Enthusiastic? Bored? Did you have a hard time imagining this consultant working harmoniously with your board? Did the three-piece suit and silky delivery make you queasy? Remember: you want the professional experience, but you also want a person or firm that will complement your organization's personality.

If the interview goes well, request a proposal from the consultant that will enumerate specifically what that person or firm will do (and, if it is a firm, who from the firm will be doing the work), what your staff and volunteers will be expected to do, when the major tasks will be accomplished, and what the consulting assistance will cost. With reference to cost, we are proponents of a straight fee rather than a percentage of the money raised. Many organizations assume that percentage-based fundraising would leave them "off the hook" were no money to be raised. We believe that percentage-based fundraising borders on the unethical; if fundraising consultants make the front page, it is usually because they have been accused of keeping an obscene percentage of the money they raised. In an article entitled "The Ethics of Consulting Fees," the Association of Fundraising Professionals puts it well: "Percentage-based compensation encourages abuses, imperils the integrity of the voluntary sector, and undermines the very philanthropic values on which it is based." It is good business for the organization to know the services it is buying and for the consultant to secure a respectable fee for his or her services.

This article was originally published by Zimmerman Lehman, and has been reprinted with permission. Visit Zimmerman Lehman at www.zimmerman-lehman.com.

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