October 18, 2017
 
Smaller Mass. Nonprofits May Face Fundraising Challenges

September 26, 2017 — Smaller Massachusetts nonprofits may have to work harder this year to raise funds—meaning seeking more gifts from individuals who are likely to make smaller average donations—if findings from a recently completed study of nonprofits nationally hold up for the Bay State.

According to the Individual Donor Benchmark Survey, based on input from 155 organizations with annual revenue under $2 million, completed and released by Third Space Studio, a North Carolina strategy consultant to nonprofits, 36% of overall revenue came from individual donations last year. That was up from 34% the year before.

At the same time, 48% of individual donors gave $1,000 or more, down from 50% the year before.

Adding to fundraising demands is a reported drop in the share of board members who are engaged in individual fundraising work, falling to 38% last year from 40% the year before.

According to the survey, nonprofits retain 60% of individual donors from one year to the next. However, consistent with the drop in average individual gifts, recurring gifts last year accounted for 12% of individual donor revenue, down slightly from 14% the year before.

The smaller the organization, the more dependent it is on individual donations. According to the survey:
  • Organizations with annual budgets under $200,000 derive 48% of their revenue from individual donors.
  • Those with annual budgets of $200,000 – $499,999 get 41% of their revenue from individual donors.
  • Organizations with annual budgets of $500,000 – $999,999 derive 25% of their revenue from individual donors.
  • Organizations with annual budgets of $1 million to $2 million get 24% of their revenue from individual donors.
Online fundraising seems to be on the rise. Last year, 24% of individual donations came through the web, up from 21% the year before. And 40% of online donors gave an average gift of $300.

Seventy-four percent of nonprofits reported having a fundraising plan, with 82% of those plans including strategies, goals, and a calendar of fundraising activities. However, only 47% of those plans included a breakdown of activities and sub-goals, and only 31% included a clear articulation of resources available for fundraising.

Fundraising plans are more fully useful if they're consulted: only 12% of survey respondents said they often consult and adjust their plans. Another 42% said they look at their plan on a regular basis, and 8% rarely consulted their plan.

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