should we put our endowment on the website?
It seems that more and more small to medium-sized organizations are starting endowment funds. The pandemic really drove home the need for such things.
CEOs and board members are told that an endowment will increase donor confidence and encourage bigger gifts. Not surprisingly, they are eager to show it off to supporters.
So imagine the surprise when I tell my many of my small to medium-size clients to remove the shiny new “Endowment” page from their websites.
That’s right—get it off the website and most definitely get it off your direct mail appeals. Let’s analyze the overall financial situation before we mass market this thing.
Do you really want your bread-and-butter donors—the folks who reliably send $250, $500 or $1,000 per year—to push the “Endow My Gift Now” button?
Most small and medium nonprofits often struggle to meet annual operating budget needs much less fully fund their emergency reserves. And what if you have major capital fundraising needs on the horizon? Will a small endowment funded by a trickle of little contributions help you with any of these things?
Not really.
The truth is that endowment fundraising isn’t really for everyone, and endowments aren’t practical income sources until they become quite large. Unless you are in a very strong funding position, with reserves brimming over, you will want to be selective about promoting this option.
So why have one in the first place?
For overflow. Overflow mostly created by large, unexpected “windfall” gifts.
Windfall gifts most often in the form of estate bequests. If you are doing your due diligence with cultivating planned gifts, windfalls will eventually start coming.
But, sorry to say, I don’t necessarily want to see your endowment promoted on your planned giving webpages and other material either. At least not prominently. Not now.
I know you are eager to fund that endowment, but the best thing for your organization is not endowed estate gifts. The best thing for your organization is unrestricted gifts of all kinds.
The choice is then in your hands, though it should be guided by your windfall gift policy. Unrestricted windfalls most certainly can fund your endowment, but you never want to be in a position of struggling to fund payroll while you watch the endowment grow.
Of course, there are exceptions. And there will be select donors for whom the option to endow is a prime motivating factor. I’m not saying your endowment should be top secret. But I am saying that you don’t need it to entice most of your donors to give.
Always remember, your supporters give because they believe in your mission and trust you to make an impact. Keep nailing the basics of relationship management. Be a good partner. Keep advancing your donors.
Soon you will have a funding pipeline so strong that you can start thinking about rarefied things like endowment campaigns . . . and maybe even putting your endowment back on the website.
Copyright Emily Snelling 2024