What is a Capital Campaign?
A Capital Campaign is a dedicated effort by a nonprofit organization to raise money for a large capital expenditure (like buildings, property, or something physical that is going to last a long time). A capital campaign will have a specific dollar goal to be raised within a specific amount of time.
The Hodge Group has assisted with many capital campaigns, including a multi-year effort by Rhodes State College to establish a new building in downtown Lima, Ohio. You can view a good example of the messaging and scope of work that goes into a capital campaign effort here:
Is a Capital Campaign Different from a Fundraiser?
A Capital Campaign can be seen as a type of fundraiser, but usually we draw a distinction between the terms. We usually use the term “fundraiser” when we are looking at a project that will last about a year or less. Fundraisers often target smaller dollar amounts.
Because Capital Campaigns are normally for the purpose of raising very large amounts of money, many will take place over one to three years and very large campaigns may go even longer. A proper capital campaign will have more planning than the typical fundraiser in order to reach your goal.
What can I use a Capital Campaign for?
While there are no limits to what a Capital Campaign can be for, generally capital campaigns are for large capital expenditures that are durable assets (durable assets = expensive things that will last a long time). The most common reasons for having a Capital Campaign includes raising funds for land, new buildings, building renovations, or expensive equipment.
What are the Steps of a Capital Campaign?
While each campaign is different, below are some of the basic common steps of capital campaigns.
Determine you have a need or opportunity that will not be met through normal fundraising :
This may seem obvious, but by ensuring there is a genuine need or opportunity, you will save a lot of time, energy, and potentially money as well because the planning work for a capital campaign can be extensive, so make sure you need a campaign before you start one.
Create a team or committee dedicated to the Campaign :
Ultimately, it is not the “organization” that is running a capital campaign, but people who will do the work of running a campaign. Identify the people who will actively work on the campaign and also document who the campaign “support” personnel will be. At the beginning of the team/committee building process, you need to find a good capital campaign consultant or advisor (and certainly before you finalize who is on the team).
Create a Case Statement :
The Case Statement is the “why” of the capital campaign and it will serve to describe why people should contribute to your need or opportunity.
Complete a Feasibility Study :
This study not only helps make sure you can achieve your goal within a reasonable time frame, it also documents key stakeholders, potential donors or donor groups, and determines what it will take to make the campaign a success.
Complete the Campaign Plan :
This is where you will take the Case Statement and Feasibility Study then add all the details you will need to make the campaign a success. You will compile a list of gift prospects, ensure your team members are trained for the task, detail how you will go about raising the capital, create contingency plans, create a gift range chart, and so forth. A proper campaign takes a long time to plan but follows the adage "go slow to go fast." Proper planning will maximize the likelihood of success of your Capital Campaign and will almost always take less overall time than a poorly planned campaign.
Approach major donors about support for the campaign :
Approaching your major gift donors before making a campaign public compliments them showing you feel they are a major partner or major potential partner in your work and it also helps the larger donor pool feel like there is already momentum for the project when you begin your public solicitation for the capital campaign. Many times, more than 50% of the needed funds can be committed before the Capital Campaign is even open to a broader audience.
Raise public awareness of your capital campaign :
At this point you want to create awareness, excitement, and commitment from your larger audience of potential donors. You will have a “kick-off,” but you will also continuously cast the vision of your campaign’s beneficial outcomes before your audience. Throughout this time, you will continue to inform people of how the campaign is progressing, so they can see your capital campaign is moving forward and yet they will hear you can still use help
Completion of the Campaign :
When the funds have been secured to complete your project, you need to go through with the project! You also need to thank all of the donors which includes keeping them in the loop during the months or years it takes to complete the expenditures planned in the campaign. You want to make the donors feel like they are a part of the work through every step of what happens during and after the campaign. Finally, you need to review what went right and what went wrong during the campaign to ensure campaigns go even better next time.
Keep Donors Informed :
Long after the campaign, keep your donors informed of the impact of your organization and the impact of the campaign. Many one-time donors will become champions for your organization after they understand the positive impact your organization is having upon its target beneficiaries. Too many organizations lose out on the benefit of gaining new champions because they do not take the time to reach out to the donors after the money has been raised.
What is a Capital Campaign Case Statement?
A Case Statement (or Case for Support) for a Capital Campaign is where you document the “why” you need the capital (money) and why someone should contribute to the need. The Case Statement is very important since it will serve as the “true north” of the capital campaign.
If you cannot clearly articulate “why” you need money for the capital expenditure in a way that will move potential donors, you will have an uphill battle trying to meet your goal…if you meet your goal at all.
Some key points of the Case Statement include the following:
- The case statement needs to be written from the potential donors’ perspectives because they are the ones that need to “catch the vision.” There are many organizations vying for donor dollars, and taping into donor passions will be key.
- It should include the mission of the organization (why you exist in the first place) as well as the benefits the capital expenditure will have when the campaign is complete.
- The Case Statement should include specifics like the amount you are raising, the anticipated timeline of the capital campaign, and how long it will take to see the benefits of the campaign (through purchasing what you were raising money for).
- Making the Case Statement into an easy to digest brochure will aid you in your campaign when sharing your vision with potential donors.
What is a Capital Campaign Feasibility Study?
The feasibility study basically answers the questions, “Is this campaign feasible?” and “How do I best go about having a capital campaign?” A feasibility study answers these questions in general terms (the planning portion works out the details).
The feasibility study is the time to do the high-level research and is meant to get an understanding of what it will take to have success before too much time and money is invested into the campaign. It narrows the focus of “how” you will go about the campaign and allows you to make major course corrections in response to the research before a lot of time and money are invested.
The feasibility study will often answer questions like the following:
- Does my project make sense, and will it clearly answer a problem or capitalize on an opportunity?
- Do I have a larger enough donor base to support this campaign?
- Does the campaign have support from key stake holders?
- How much can we reasonably expect to raise and over how long a time period?
- What passions will this project tap into with donors/potential donors?
- What questions will donors have about the project?
- Who are potential campaign leaders and champions?
- Who are potential major donors?
- What is the best time to implement the different stages of the campaign?
Do I have to Wait Until a Campaign Is Complete Before Making a Purchase with the Funds?
Sometimes very big campaigns will be so large there will be points along the way that the organization can make some of their capital purchases while the campaign is still going on.
As an example, say a nonprofit needs to relocate and the organization starts a capital campaign to buy the property and construct some buildings. The overall campaign may have mile markers where at one stage they can buy the property, the next point allows the construction of the main building, and finally an addition onto the original building.
There is actually a benefit to making some of the capital purchases during the campaign as donors and potential donors get a tangible sense of momentum with the campaign and are more ready to support the work than a campaign that is seen as stagnant.
Should I Hire a Capital Campaign/Fundraising Consultant?
We know there are excellent benefits of a consultant for your capital campaign and even though we are biased, we would generally say “yes, hire a good consultant.” Here are the reasons you should think about bringing on a Capital Campaign Consultant.
- A good capital campaign consultant will save you money. A consultant has the training and experience to walk you through the process without one of your team members taking the time to learn all of the ins and outs of a capital campaign. The time saved is money saved because you won’t pay someone to sit and learn about capital campaigns from scratch.
- A capital campaign consultant has access to tools for large scale campaigns that make campaigns more successful. You would either have to pay for those tools yourself or go without the tools and likely see a less successful campaign.
- A capital campaign consultant knows the opportunities and pitfalls that can be found in executing a capital campaign. We all know there is no training like experience. If you make a significant mistake on your capital campaign you could miss a big opportunity for funding or even sink the whole campaign. By hiring a good consultant, you are ensuring a high probability of success.
- Hiring a consultant eliminates staffing problems. If you don’t hire a consultant, someone still has to do the work. You will be stuck with overworking your current team for the duration of the campaign or hiring someone you fully intend to let go when the campaign is done. With a consultant, you don’t have to touch your current staff, and since they have the tools and experience, a good consultant can often do the same tasks in less time than your average staff member. Even if your team does most of the work, a good consultant will show you how to use your time on the campaign in the wisest ways.
- A good capital campaign consultant can bring some realism into your capital campaign plans. When you are the one in need of a capital campaign, you are likely to be overly optimistic or overly pessimistic about what you can achieve in a capital campaign. A good consultant can take a step back and give you a clearer picture of what you should realistically expect in your campaign.
Who should help with my Capital Campaign?
While every campaign is different, here are some of the typical people who will help you out:
Board Members – You need the board’s approval and ongoing support and they will often be the ones whom can identify potential major contributors.
Staff – Since the campaign will have a major impact on your organization and since some tasks you will want to keep in house, be ready to include some key staff members.
Volunteers – Many nonprofit organizations receive excellent support from volunteers and help with the capital campaign will be no different. Volunteers are often some of the greatest champions of your organization and can help both do some of the work and identify new potential donors.
Outside Experts – This would include your capital campaign consultant but could include other experts to assist you as well.
Capital Campaign Marketing
Do I really need to “market” my capital campaign?
The term “marketing” is a dirty word in some circles, as if it means tricking someone to give up their money. Ethical marketing is about an amplification of your voice, making sure the right people hear your message.
We assume you have a great organization with a great mission. How are people going to know you are great if they cannot hear your message above the noise of all the other great and mediocre organizations out there? They won’t know unless you purposefully help them find out.
So, when we say, "capital campaign marketing," we are talking about getting your great message to the right people, helping the message stick, and helping those people get excited and rally around your cause, a cause they are passionate about.
Done well, your supporters will be happy about your marketing because through your marketing they learn how they can be a part of something they desire to be a part of, advancing a cause they are passionate about, feeling better about how they made a difference in the world.
The marketing will include several pieces.
The message of the campaign - This includes the case statement, slogans, and even “branding” for the campaign.
The medium of the message – This includes how you are going to get the message out and it looks like brochures, letters, audio announcements, video commercials, speeches, or whatever fits your purpose plus reaches your target audience.
The source/channel of the message – How your message is getting to people. Will your letter go snail mail or email? Will your board members give speeches or your volunteers? Will you use Social Media, YouTube, radio, TV, or something else?
The audience of the message – Who needs to receive which message? Sometimes the beneficiaries of the campaign will be the receiver of message, sometimes people who support your cause will receive the message, and sometimes the person who receives a particular message will be an influencer who you don’t even expect to donate but who will have influence on people who will donate.
Is this Everything to Know About a Capital Campaign?
We are sorry to say, but there is a lot, lot more to know about capital campaigns. Whole books are written about capital campaigns and even these books do not have everything because they are written to a generic audience rather than to your specific need. Unless you are about to run a very, very small capital campaign, we recommend getting help for your campaign.
Where should you start looking for help for your campaign? We are glad you asked! Give us a call to find out more is always free and without obligation! Spending five minutes with us on the phone now could be the best decision on your journey through your next capital campaign.