Prospect Research - Finding Your Donors
Once upon a time, the internet did not exist. In these dark ages, I responded to an ad for a Donor Research Coordinator at a major hospital. I thought it had something to do with blood donors (donor + hospital = blood donors?) and I was a recent college grad with a beat-up Toyota. I needed a job.
It turned out that the position was to research potential donors for a capital campaign. They gave me a book, locked me in a room, and step-by-step I learned the value of prospect research. It turned out to be an ideal foundation for a fundraising career!
Research is a LOT easier now than it was back then. In the below I will share a few basics tips that will make your prospecting time effective.
What is prospect research?
Here’s a simple definition from Donor Search: Prospect research is a technique used by fundraisers, development teams, and nonprofit organizations to learn more about their donors’ personal backgrounds, past giving histories, wealth indicators, and philanthropic motivations to evaluate a prospect’s ability to give (capacity) and warmth (affinity) toward an organization.
Where Can You Find In-Depth Information?
An amazing amount of basic detail can be found using Google, including real estate information, political giving, and quite a bit of personal background. But of course, there is far more available using paid online systems. In fact, it's a bit scary what you can find - including specific real estate across the country, SEC transactions, political giving, philanthropic giving, board memberships, business affiliations and history, relationships, lawsuits, and much more.
Insider Tip: You can spend more, or spend less, for almost the same information. Some systems offer many bells and whistles and easier interfaces, but in the end, all the data originates in the same place and unless you are screening hundreds or thousands of names, it pays to be practical.
Four Basic Categories
1. Who else do your donors support?
People give to various causes, not just one. And there are many people who give generously, and some people who just don’t. The best prospect for a new donor is – drumroll please – a person who is a donor to a similar cause!
2. Personal and Relationship Information
What are their hobbies and interests? What clubs do they belong to? Who do they hang out with? What events do they attend? The old adage about “six degrees of separation” is true, but it is probably closer to three degrees for donors. The goal is to identify a connection through one of your board members or other existing relationships. One connection leads to another.
3. Wealth Markers
Using online software systems will provide plenty of clues to capacity. But here’s a key reminder: Just because a donor has the capacity to donate, it doesn’t mean they have an interest in giving to your organization! Too often I see people focusing on only wealth, rather than matching the interests and relationships of a potential donor.
4. Foundation Research
There is an enormous amount of grant information available from both free and paid sites. Among my favorite free sites are Guidestar and ProPublica. Or if you Google IRS Form 990 and the name of a Foundation, you’ll find core information. Of course, it’s tough to beat the Foundation Center as an affordable site when you want more detailed and organized information.
So what do you do with the info once you find it? Your first step is to organize a table with a process to review actions. Without this, you are guaranteed to lose track of steps.
If you don't write it down in an organized system, you will lose track.
Review the information, develop an approach strategy and think through the ways a potential donor could get involved. And then track your moves every week, and update, update, update.
Here is a simple and effective format:
Memories and sticky notes don't work. It's easy to do a lot of feel-good work and get absolutely nothing of value from it.
Formulate a research strategy based on goals and fundraising plans.
Review, organize and clean your own data base in a practical way.
Begin collecting prospect data, starting with accessible public sources.
Analyze the results, seeking prospects with potential interest and capacity.
Make a plan for approaching and engaging those prospects.
Prospect research is one of the most basic things you can do to raise more money regularly. It takes time, but it’s not difficult. Assign someone and make sure they are accountable. Prioritize your lists if you have too many. Meet weekly to review and discuss.
Share lists (carefully) with board members or others who may be able to help, individually or in small groups. Try presenting a short and prioritized list at a board meeting with a simple question: “Does anyone know anyone on this list”.
You will be happy that you did.