There are some really great ways to fund a church or nonprofit, but there’s also some very common bad ways to raise funds that I want to share so you can steer clear.
The statistics of struggling nonprofits are quite high: some struggle because they avoid fundraising, but others struggle because they’re monopolized by these fundraising ideas I’ll be disclosing here.
I personally love the causes that the nonprofit sector stands for: whether spreading the gospel, helping the underprivileged, or helping people overcome tragic events: the nonprofit sector is a key contribution to the world economy.
When nonprofits can be funded well, they can be a safe haven for many situations where help is necessary.
Unfortunately, I’ve witnessed many well- intentioned nonprofits and churches that lean too heavily on poor fundraising practices, and the life of their missions stays heavily strained or is shut down.
I wrote this article and others here at KOHA to empower ministry leaders to apply sound practices and impact the world.
Good Fundraising Practices vs. Bad Ones
Now, you may be wondering, “How did you decide a good fundraising idea from a bad one?”, so let me tell you. A good fundraising idea is one that rallies suitable donors and supporters. Some people will support the cause simply because the fundraiser is exciting, while others will feel compelled to support the mission.
A bad fundraiser uses manipulation, poor leadership, or other unethical practices intertwined in the fundraising to provoke donations or sales. Let me give examples of 20 top fundraising ideas you should avoid…
1. Fundraisers Where Paying Customers are Mandated to Participate or Be Charged
There are some nonprofits like Universities or churches where they have a loyal customer base. Students are trying to complete a level of schooling, so their more cooperative because they can’t be fluid customers otherwise it will take them much longer to complete their education.
Churchgoers are very similar to the student-to-School customer base because they tend to be loyal based on their belief system, their honor of the leadership, and the relationships established among the church body.
Some nonprofits and churches take advantage of a loyal customer base by augmenting fundraisers and making customers feel forced to participate.
I have personally run into this twice with private schools. At one school where I’d enrolled my son, they had sports.
Parents had to pay for their kids to be in sports, but they didn’t want to pay the janitorial staff to clean up after practices and games, so they REQUIRED parents to clean up: mop, sweep, pick up trash, put up and tear down popcorn machines and so on.
If parents did not participate in clean up, they were charged, and had to pay the fee in addition to normal tuition. Needless to say, many parents were very upset about the policy.
We were all paying customers who simply wanted our kids to play sports. As a result of the clean up policy, the school lost many customers who may have been recurring sports signups, and due to poor fundraising practices (sports being only one example), the school eventually shut down.
2. Fundraisers Where Religion is Manipulated To Invoke Action
This fundraising practice is very common in churches, but other organizations may practice this on smaller instances. The normal scenario goes….
The church has financial objectives to meet (bills, upcoming events, and congregants may have special needs), the pastor is aware of the church financial position, so he does a sermon on scripture and giving.
He uses several scriptures to persuade people that the Bible wants them to give.
Now, the Bible does talk about giving, but even though giving is good, it doesn’t have to be the sole basis of the church income. Instead, when there are multiple streams of income in the organization, it makes it a more comfortable giving atmosphere for donors and the organization.
From personal experience, I’ve been to churches where the pastor will show your name on projectors before the entire congregation if you did not give a specified donation amount he requested. They felt like the pastor is a vessel of God, therefore, it’s frowned upon when he asks for something and you don’t give it. Unfortunately, their requests were not catered to income level or situation.
Fundraising like this is a bad idea and an unethical one.
3. Fundraisers where the Product or Service is not a Value to Potential Customers
Have you ever seen fundraisers where you look thru the entire pamphlet or inventory, and you think to yourself, “I want to support this person or cause, but I can’t practically use anything they’re selling”?
When fundraisers are chosen, you don’t want to simply choose because of the perks or potential profit to the organization. You also want to choose a fundraiser that will offer value to the customer whose expected to buy from the fundraiser.
The worst fundraiser I’ve seen is coupon books for $35.00 or expensive wrapping paper, but I’m sure there are even worse ones (leave them in the comments section if you know of any). With the coupon books, the destinations and offers inside weren’t a great value because they coupons were for businesses that were uncommonly patronized by the customer base. As a result, many people didn’t want to buy or sell the coupon books because they didn’t want the coupons and the book was “expensive” in comparison to the value it added.
4. Fundraisers that don’t have clear goals
It’s crucial that before you plan a fundraiser, you think about how much you’d like to raise from it, and the size of your potential customer base, so you can plan congruently. You don’t want to plan a fundraiser where you’re selling something at $0.25 with a potential customer base of 100, and you’re expecting to get $10,000 in sales unless you have a group of people for whom this is a probable ask.
Make clear goals and find a fundraiser that adds sufficient value that the goals would be simpler to achieve.
5. Fundraisers that people feel uncomfortable to talk about or sell
When you know your target audience, you can gauge their comfort levels with certain things better. For example, if you know your target audience are churchgoers, then you may not want to do a fundraiser where you’re selling movies with vulgar language or heavy romance scenes.
In certain circles, it’s uncomfortable to talk about and sell things. Be conscious of that.
6. Fundraising like a Leech where You’re Always Asking for Money
There’s a fine balance that you don’t want to cross. You have to give value then ask for something in return. Some organizations stay focused on asking, and burn their advocates out.
Rather than being a leech, try being a gold mine where people feel like there’s such a huge benefit of their connection to your organization, so they want to stick around.
7. Not Using Data or Market Research
When you do market research, you can identify problems that you can impact or even solve. Doing market research can prevent horrible fundraising matches like we discussed in #1,2 or 3 because you can identify holes in the market and test ideas to solve the problem.
Market research can reveal things like:
- Buying habits
- Health trends
- and so much more
When you know more about your target audience, you can create better fundraisers that are a solution rather than ones that are narrow-focused on organization objectives.
8. Not Suggesting Donation Amounts
It’s difficult for donors to assume how much your organization needs to fulfill its mission. On the other end of the spectrum, if you need millions of dollars to accomplish your business mission, it’s difficult for smaller donors to see how whatever they give helps. The Billy Graham’s association has addressed both donor concerns by placing suggested donations amounts on their website:
Billy Graham’s association has impacted millions of people across the world and surely costs much more than $25.00 to accomplish what it has, but they still have the option for smaller donors to give what they can, and they remind everyone “every gift counts”.
9. Making it Difficult to Find the Place to Donate or “Donate” Button
There are two extremes, the organizations who are pushy with their donations and those that the topic seems nonexistent. I’ve been to churches with the intent to give, but cannot figure out where to go.
Then, when I ask “where can I give?”, they give me instructions for who to contact or a website URL to use, but the process is so complicated, I forget or never actually figure it out.
It’s important to make giving a simple process for donors, or purchasing a simple process for buyers. Check your website navigation and make sure it’s easy for people to buy and give. Also, check your physical location (if you have one) and make sure, it’s easy to purchase or give there also.
10. Having non-donating Board Members
Every organization needs leadership who “believes in the mission and vision”. One sign of belief is contributing time, connections and money: three of the most valuable resources you have.
When a church or nonprofit is founded and they have boardmembers who “don’t put their money where their mouth is”, it can be offputting for everyone else who attaches themselves to the organization.
11. Bad Recordkeeping
It’s never a good idea to be disorganized. It’s usually accidental, but if you start off with a good idea like maintaining a recordkeeping system, then you avoid things like bad recordkeeping that can corrupt a good mission.
The IRS and other organizations that will be paramount to your organization’s life require clean and consistent recordkeeping, so make sure to keep file cabinets, folders, receipt books, and a clean space to shelve them all.
12. Improv Fundraising effort Rather than Studying and Learning
In my article on the Richest Pastors, one fundamental they all had was clear goals. Rather than saying, we’ll raise “as much money as we can”, they were specific, with goals more like:
- With this book launch, I want to sell XXX amount of books for $XXX every week
- I want to plant (# of churches) this year
- or I want to travel to (# of locations) and speak to (# of attendees)
When you have clear fundraising efforts, you can create clear plans to obtain the outcomes.
13. Non Personalized Goals
It’s okay to see what other organizations are doing and to learn from them, but it’s not okay to mimic without a unique angle. You want to calculate the potential your organization could make with the resources they have (time, money, connections, ideas, wisdom, etc.), and create personalized goals based on that.
14. Avoiding Grants
Many nonprofits and churches are able to generate sizeable additional income streams by submitting grant applications. While you don’t have to apply for grants consistently, it’s a mistake to avoid them when the opportunities present themselves. Keep the idea in your back pocket (at least).
15. Staying away from Networking
For-profit and nonprofit businesses alike can benefit from the power of networking. It enables you to meet new people and discuss the great mission and goals you have within your organization.
Some organizations focus solely on their congregations or audiences rather than doing outreach or networking, and this can really paralyze or drastically slow their growth.
16. Not Furthering Customer/Client Engagement
Have you ever been to a church where you feel like you’re alone but you’re in a room full of people? The people are so “to themselves” they don’t greet you and the hospitality is just missing.
There are things that organizations can put in place to ensure people feel more engaged and appreciated: events (virtual or physical), small groups, training greeters, completing welcome cards, setting up an email list, doing follow-up, and intentionally engaging with people.
17. Not Sharing Enough Results
People respond to results. If you want people to donate or buy, show them what impact your organization can have when they respond to your request. If you’re able to quantify the results you get with certain dollar amounts, it anchors the respondents giving on an outcome. For example, Charity Water says:
18. Not Measuring Impact
In order to share results, you have to quantify results internally. You have to calculate how much money would it cost to help people in the ways you want to including:
- Customer acquisition costs – How much it costs to market and acquire funding: donors, sales, etc. You also have to calculate how much it costs to sort thru potential campaigns and situations before deciding which you’ll focus your fundraising on.
- Normal Operational Expenses
- and, Expenses specific to a Campaign
It’s important to quanitfy the desired goals, so you can clearly say things like “When you give $(dollar amount), we can (state the quanitified impact)”.
19. Avoiding Multiple Streams of Income
Having multiple streams of income is a way to stabilize the finances of your church or nonprofit. If you choose to focus solely on grants and a grant falls thru, then it leaves the organization vulnerable.
Similarly, if you base the income on donations, and they fluctuate, the organization becomes like a roller coaster. Instead, if you establish several streams of income, then when one stream fluctuates down, it’s a chance that others can fluctuate up, and it solidifies the business income.
20. Not Planning Well
Planning is crucial to fundraising. You want to plan well in advance and be very clear with how each fundraiser will impact the monthly, quarterly, and annual outcomes.
It’s important not to get too consumed with the day-to-day functions, but to also balance tactics with strategy because when there’s too much focus on tactics and little focus on strategy, that’s a main reason why ministries fail. Creating a plan for your church or nonprofit is crucial.
Final Words on Top Fundraising Ideas To Avoid
The goal of this article was to show you top fundraising ideas to avoid and what you should do instead. Churches and nonprofits have such commendable missions, and I’d love to see many of them gather the necessary funding to make a positive impact in our world.
I’m hoping that by you reading this article, you’ll be able to be mindful of these practices and implement ethical and sound practices in your fundraising.
These top fundraising ideas to avoid are often times implemented in ignorance, but they can negatively effect organizations. If you have questions or concerns about this, don’t hesitate to leave them in the comments section. I’d love to help you out!
If you liked what you saw here and you’d like to get the digital marketing and entrepreneurship skills to start or grow a ministry online, CLICK HERE AND CREATE YOUR FREE ACCOUNT! Get two free websites, ten free training lessons towards an Internet marketing certification, and access to a community of 1 million+ entrepreneurs (many who are making major things happen online!). CREATE YOUR FREE ACCOUNT NOW!
If you just want to see more people get empowered to live a life pleasing to God, or ministries get the information they need to start or scale, BECOME A PATRON with as little as $1/week. GET MORE INFORMATION ON PATRONAGE HERE.
Now, it’s Your Turn…
What’s your experience with fundraising? Have you seen good and bad fundraising practices? What are your thoughts about it? What would you add to the article I’ve written here? Leave your comments, questions, and feedback below.