Keys to Peer-to-Peer Fundraising for Small Nonprofits
For small nonprofits a large fundraising goal can seem insurmountable. Breaking down a large target into smaller chunks can help identify ideal supporters who can each help by contributing and recruiting others to give as well. Using an example from a small Wisconsin nonprofit, this article explains how they targeted a $100,000 fundraising goal with a peer-to-peer model centered on grassroots recruiting of 100 women. Seven takeaways are presented that can be used by any nonprofit.
Six years ago, the Eagle River Historical Society (ERHS) — a small organization dedicated to collecting, preserving, and interpreting local history in a small Wisconsin town — had a realization about its own growth trajectory. Sooner or later (sooner as it turned out), ERHS would need a paid staff member to keep things on the rails. At the very least, paying that person would require constant fundraising. So, we decided to begin an investment account to spin off the necessary income.
It quickly became apparent that soliciting funds for an account that couldn’t be seen and wouldn’t yield results for some time was very difficult.
This was especially the case in a community where fundraising itself is a perpetual challenge: our community’s average household income is below the U.S. Census national average and we are served by organizations that supplement local government in a number of areas. All of these factors make generating funds for our small organization challenging to say the least. Enter peer-to-peer fundraising.
Peer-to-Peer Fundraising and 100 Exceptional Women
The concept of 100 Exceptional Women was picked up at the annual Wisconsin Historical Society’s local history conference and has proven to be a high performer. It is a classic peer-to-peer fundraising technique, although it took a bit of explaining and a fair amount of trust. The first time around, someone asked if it worked like a Ponzi scheme. Admittedly, it does work a little like a Ponzi scheme, except without fraudulent get-rich-quick schemes or boxes of unsold merchandise left in your garage.
The concept is simple: the ERHS first enlisted ten committed supporters and then asked them to recruit nine additional women in turn. Each woman pledged a gift of $200 per year for five years to the fund. The goal was $100,000.
A question arises: why women and not men?
Another member of our group previously used this concept in a different context. She explained that this type of program doesn’t tend to work with men. On one hand, women tend to be attracted to the small groups, especially those clustering for a cause. They also enjoy the social aspect — men, according to a professional fundraiser who has used the concept, not so much, although we do have a plan to exploit male competition in a future program.
Twisted Tea Party Kickoff
In 2016 the 100 Women kickoff was a tea party — yes, that old classic. But we had a twist: a well-known speaker from the Wisconsin Historical Society entertained our group with a colorful presentation on Victorian lingerie.
Each year thereafter, there was an annual event, funded through ERHS’s fundraising budget, featuring a venue or activity that was not available to the public. For example, we had a wine tasting at a new bistro before the general opening, a cocktail event at a newly renovated resort, a preview of a vintage fashion display at the ERHS main museum, and in 2020, with masked guests, a gala lunch to close out the program.
All About Community
We realized the social aspect was critical to keeping this program running. There was a regular contact schedule, both directly from the ERHS to all the 100 Women as well as from the ten team leaders to their own group.
However, contact also came via written material. The participants had a dedicated newsletter, both about the program’s progress and the ERHS in general. This was shaped to the 100 Women in particular, not simply an extension of the regular newsletters. The content focused on the potential future benefits of the group’s contribution, news about annual special events, photos from 100 Women functions, and of course, analysis of the benefits of participation.
And it seemed to work. Because it was so well publicized, additional women even asked to join throughout the five years of the pledge program. Many had read about the program either via social media or in our own newsletters and the local press. For others, it was a word-of-mouth contact. These newcomers were given the option of beginning in the current year or pledging the full five-year amount of $1,000. Many chose to pay the full five-year pledge in the first year; some later members also paid retroactively for past years. One woman, recruited by her neighbor, was very actively involved with another nonprofit but nonetheless not only made her own pledge but recruited two additional members from her other nonprofit group. Throughout the first five years, we had a less than 2% default rate.
Tangible Perks
To keep the excitement about the community going, we wanted our benefits to be fairly tangible: for example, ERHS membership dues were waived for the full five years. The 100 Women were also at the front of the line for our traditionally sold-out home tours and other ticketed events. After these events, the 100 Women received copies of the pictures. In all aspects, we tried to offer a tangible benefit — whether a ‘100’ charm or some other physical keepsake — in order to make sure that we maintained excitement about the program. The recognition and the events were instrumental in creating a bond among the group, many of whom did not know those outside of their own team.
In the two years since the program closed, the 100 Women have not been forgotten. Because all nonprofits struggle with donor retention, we wanted to make sure we kept our exceptional women in our community. As such, the 100 Women are recognized both at annual ERHS meetings and in print (usually when the fund is referenced). However, we have also made sure to track each one personally with emails and other contact. Our dedicated group worked hard to keep the 100 Women excited during the pledge program, and we want to make sure we honor this effort by continuing recognition for donors after the fact.
Looking to the Future
Of course, there has still been some attrition among these donors. Some of the pledges were business or corporate gifts that went with the woman’s profession. Several have left the area and no longer feel they have a connection to ERHS, although others remain both members and donors even living several states away. Two have even become active board members.
When surveying a number of the 100 Women, many of them had a common response: This was fun. I think that that is the glue that kept our peer-to-peer fundraising initiative together. These women knew they were doing important work for an organization they identified with, but the active (and novel) community engagement made a lot of difference.
This experience has been valuable for ERHS, and we will likely use the program again. Similarly, the origin of the investment account was used in a grant application that brought in several hundred thousand dollars to ERHS. Although the grant itself will not yet support paid staff, it will help get us there.
7 Takeaways to Apply at Your Nonprofit
Organizations thinking about trying the ERHS approach might want to consider the following 7 takeaways.
- This will work in any size community in any location.
The most telling thing about this specific program is that not only have organizations in the same region looked at it, but some of the 100 Women took it to other parts of the country. These women shared this model of peer-to-peer fundraising in other places where they volunteered and had community ties. Again, if it can work in our challenging community, it can work anywhere. When the donors want to copy it, it has been a winner.
- Pledge amounts do need to be adjusted to the target group.
We wanted to keep the pledge level uniform for all of the women but recognized that there was a range of giving capacities. We also took into consideration our final goal of $100,000.
If you decide to replicate this model for your own fundraising efforts, you might consider the giving ability of your potential donors. The higher the required amount is, the more attrition you will likely have. Keeping a relatively low donation amount and spreading it out over several years might require more donors for you to reach your goal but remember: if everyone is responsible for bringing in nine other donors, your networks will increase in no time!
- Five years is generally considered to be the maximum time frame.
Over our organizational history, ERHS has found that keeping a level of excitement alive is very hard beyond this period. Our goal was not just to secure these donors during the program itself, and we assume you share this desire. Presumably, you are hoping that these individuals will become life-long donors for your organization, even if the donation amounts are comparably small.
- You don’t need to know 100 women.
You need to know ten who each know nine. Even though we have a large communal contact group, there are limits. By asking each of these ten women (chosen in part for their own connections) to choose nine other women in turn, we extended those classic six degrees of separation. We wanted to grow our donor web, and we hoped this networking would benefit these women as well.
- PLAN AHEAD.
Before ERHS started this program, there was a general five-year outline for events as well as a media and publicity schedule. One of the first concerns for the program was keeping the initial level of fun and excitement at a strong level. Essentially, we wanted to offer these women experiences not available outside our organization while connecting these experiences to our mission — local history. This was evident in many of the aforementioned events like the fashion exhibit or the new bistro’s wine and cheese night. Look for ways that you can engage your own community, especially the things that make it special.
However, even the best plans go awry, as we are all now probably too aware. Our final event was a formal lunch where the program began, but the pandemic had other plans, so we had to pivot slightly. In your own planning, don’t just plan what will happen, also plan for a change in plans.
- Seize new opportunities.
Having planned, seize new opportunities as they arise. For example, for us the bistro opening was a substitution for a previous event. The bistro had a lot of publicity that we wanted to use for our organization and also get a first look at the new local business. Similarly, the owner was happy to have a large group of potential customers. Part of the community we wanted to build extended outside of ERHS itself. We wanted to cement community ties not just between these women but also with other places and people within our community.
For your own fundraising, make collaboration work for you by trying to find new ways to expand those networks. If you build the networks, the donations will come.
It would have taken years of growth to reach a point where the income from an investment account would support a staff salary. Like planting an oak tree, the best time to begin was 20 years ago. By seizing upon peer-to-peer fundraising we were able to reach our objectives in a much shorter timeframe.
And a final point, remember, fun begets funds!
Learn more about sustainable funding by attending the Sustainability – Campaigning to Potential – Part II: Big Gifts class on Monday, July 24, 2023 from 5:30 – 9:30 pm as part of the Sunshine Certificate in Nonprofit Management.
Source: Blue Avocado, the e-magazine of Nonprofits Insurance Alliance®, offering practical tools and tips for nonprofits, by nonprofits. Nonprofits Insurance Alliance has been a preferred partner of the Florida Association of Nonprofits since 1991, when they were formed by an Act of Congress. They are a group of 501(c)(3) nonprofit, tax-exempt insurers whose purpose is to serve 501(c)(3) tax-exempt nonprofit organizations by providing a stable source of reasonably priced liability insurance tailored to the specialized needs of the nonprofit sector.
https://blueavocado.org/fundraising/peer-to-peer-fundraising/
Author: Karen Sailer is executive director with the ERHS and lives in a small, northern Wisconsin town.