WHAT IS A CAMPAIGN FEASIBILITY STUDY?
Does your organization have a big, exciting project on the horizon and is considering launching a campaign to fund it? If so, an essential part of the due diligence process is conducting a Campaign Feasibility Study.
A Campaign Feasibility Study is the best way for an organization to determine the viability of successfully planning, implementing and completing a multi-million dollar philanthropic campaign. The goal of the study is to determine whether or not it is feasible for an organization to raise a certain amount of philanthropy (example: $10 Million) over a certain period of time (example: 3 years) to fund a specific purpose (example: capital project, create an endowment, etc.) before making the decision to launch a public campaign. In other words, the study determines the likelihood of raising the money for the proposed purpose, at this time, from your donors and donor prospects. It is truly the only way, and most efficient way, to understand the willingness within your current donor base to fund your organization’s special project.
WHY IS IT IMPORTANT TO DO A FEASIBILITY STUDY?
Campaign fundraising is not business as usual. This is especially true for time-sensitive capital campaigns with expensive costs, fixed deadlines and major short and long-term financial implications. Therefore, it is vitally important for an organization to be as confident as possible, in knowing that it can succeed, before putting the time, energy and financial resources into a campaign infrastructure and proceeding with a high-stakes project you may not be able to fully fund.
Organizations that choose to jump into campaign mode without first conducting feasibility do so at great risk. There can be enormous consequence for an organization that publically launches a campaign it cannot complete. For instance, it can create a financial set back that lasts for years, it can result in donors and other funders loosing confidence in the organization, and it can damage the organization’s reputation. In some cases, if the campaign is not completed, unfavorable situations can arise, such as donors wanting their campaign gift back, or substantial Board attrition. These are positions no organization wants to face.
To avoid this, a Feasibility Study is a hallmark method that empowers all key staff and Board of Directors to make thoughtful, data driven decisions, ensuring success for the organization in both the short and long term.
FEASIBILITY STUDY METHODOLOGY
At the heart of a Feasibility Study is a written Case for Support (typically 5 – 8 pages) that thoughtfully outlines the organization’s proposed campaign project with emphasis on how it will meet a critical need in the community. The Case for Support is designed to be a compelling document chock full of persuasive narrative, relevant data, and inspiring quotes.
The Case for Support is then shared with a select group of the organization’s most promising campaign donors. Confidential 1:1 interviews and surveys are then conducted to evaluate donors’ interest level and capacity in supporting the proposed campaign with their philanthropy. This is where it is so important to work with an experienced, objective consulting team. Donors are much more willing to share confidential information about their potential giving, concerns or objections with trusted third parties. When your donors know they can speak freely, you get the best data to inform your path forward.
Some studies can be small, involving 20 – 30 donors and others may involve 40 – 60 (or more) participants. The number of donors that need to be included to test a campaign’s feasibility depends on a number of variables, but it is primarily driven by the size of the proposed financial goal. In addition, the philanthropic capacity of individuals in the organization’s donor pool plays an important role as well. In other words, the number of people who have the capacity and inclination to give six or seven figure gifts often influences the number of interviews necessary for a valid outcome.
The questions focus on collecting feedback in the following thematic areas:
A: Strength of the Case for Support / Proposed Project:
Is the proposed campaign’s Case for Support clear and compelling? Does it excite and inspire your donors? Do your donors validate the proposed plan and are they eager to invest in it? What hesitations and questions do your donors have about the case, if any?
B: Organizational Reputation & Strength of Staff and Board Leadership:
How is the organization perceived in the wider community? Does the organization have strong, well-known leadership with the internal capacity to fundraise at the necessary level? Are donors confident about the organization’s ability to succeed with a campaign this large?
C: Feasibility of Reaching the Campaign’s Financial Goal:
Is there enough philanthropic interest in the proposed plan from within the organization’s most promising campaign donors? Are donors inclined to give, and if so, would this campaign be a philanthropic priority for them over the next 3 – 5 years? What size gift would they be willing to consider? Are Principal and Lead donors identified.
D: Interest in Volunteer Leadership & Timing:
Are people close to the organization eager and willing to provide volunteer leadership? Is now the right time to launch a campaign of this magnitude? Are there any competing campaigns in the community or external factors that may impact success?
An Internal Campaign Readiness Assessment is typically completed concurrent to interviews with donors. This involves an internal review of the strengths, challenges and areas for growth within the current development program. The goal is to identify any improvements and capacity building investments that will be necessary to create the conditions for campaign success. This can include a variety of elements essential to a high functioning campaign operation: training needs, staff structure, donor database systems and procedures, communications infrastructure, effectiveness of the current major gift program, reporting and metrics, etc.
IDEAL STUDY OUTCOME (AND OTHER POSSIBILITIES)
A successful campaign feasibility study identifies strong interest among your donors in supporting the project at the Principal, Lead and Major gift levels. Ideally, the Top 10 Campaign Gifts and 50% of the campaign’s philanthropic goal are identified (this is especially important for capital campaigns). It is also important to identify a strong pool of experienced, prospective volunteers eager and willing lead the campaign. In addition, a study unveils how much time your organization will need to raise the money.
I regularly conduct Feasibility Studies with my colleague Jennifer Weber, and we like to frame up the possible outcomes like this:
Outcome Possibility #1: You receive the green light to launch a campaign as planned. This means your donors validated the Case for Support and their interest level in supporting the campaign is strong enough to validate the financial goal.
Outcome Possibility #2: You receive a yellow light to launch a campaign with modifications to the goal / pace. This means your donors validated the Case for Support, but the philanthropic interest to achieve the full philanthropy goal is not present.
Outcome Possibility #3: You receive a red light and are not able to launch a campaign at this time. This means your donors may not understand or find your campaign’s Case compelling, the support needed to fund the campaign is not present, there is not enough interest in volunteer leadership, the timing is not good, or some combination of above.
If the outcome of the study is positive (Possibility #1), and your Board of Directors votes to proceed with a campaign, the next step is to lay the groundwork for implementation by preparing a Campaign Plan. The results of a Feasibility Study are typically good for about six months, so it is important your organization be prepared to move into planning mode shortly after the study is complete.
Everyone hopes for the bright green light. And any other result can seem disappointing. However, regardless of the final outcome, a Feasibility Study provides a treasure trove of invaluable insight and data. They are a unique, one-of a kind opportunities to solicit candid feedback from key donors. Participating in a Feasibility Study is also a highly effective cultivation move, bringing donors even closer to the organization.
Campaign fundraising is very exciting. If done well, a successful campaign will not only fund your special project, it will also be catalytic to your long-term success – strengthening your development program, reputation, brand, infrastructure, volunteer base, etc. But it is vitally important to complete your homework before diving into a campaign! Feasibility Studies are truly a vital prerequisite to campaign success. With study findings in hand, both you and your Board will be able to confidently proceed, adopting a campaign goal, timeline and plan that is realistic and achievable. And then the fun begins!