Many, if not all, charitable organisations have two principal funding requirements – continuing revenue funding and periodic funding for major capital projects. Some organisations such as hospitals, schools and universities also have a third requirement – endowment funds.
A capital campaign is the appropriate solution for funding major facilities or other projects, although it can also be suitable for raising substantial endowment funds. It has a specific objective or set of objectives; it is time-limited; and it is normally directed at a well-defined potential ‘constituency’ for support. In comparison with continuous fundraising programmes (where fundraising and administrative costs typically vary from 25% to 35% plus, mainly because of the continuing resource requirement), costs tend to run from 5% to 15% of the gross total raised.
A capital campaign does not require a high level of resourcing, especially if full use is made of high-level, active volunteer leadership. The process of fundraising is essentially the realisation of goodwill in a financial context, so the primary requirement is that an organisation can call upon the goodwill of potential supporters. The exceptions are emergency or crisis appeals, but these are normally only successful in the context of national or international emergencies.
Are you ready for a capital campaign?
To help determine whether your organisation is in a position to consider a capital campaign with reasonable prospects of success, or whether you still have work to do before you are ready, ask yourself the following questions:
- Do you have a specific project or number of projects which are essential or important to identifiable beneficiaries and can only be funded (in an acceptable timescale) with substantial help in the form of voluntary funding?
- Have you fully defined and costed the project and tested its general viability (in terms of planning, sustainability, etc)?
- Does the campaign have the active support and involvement of a majority of trustees?
Other key requirements include
- A flexible plan capable of being amended in the light of actual, rather than planned, progress. This applies in particular to the timetable.
- A thorough and relevant risk register and risk management process, to identify and address potential risks.
- A realistic timescale, with progression from one phase to the next dependant upon achieving the benchmark objectives for each phase before moving on to the next, rather than a need to meet inflexible deadlines. Most capital campaigns require a minimum of 18 months and major campaigns may take three years or more.
Careful preparation, detailed planning and assiduous risk management are vital. We can help you prepare and manage a capital campaign to ensure a successful outcome. We have helped more than 1,500 clients over 50 years with successful capital campaigns raising up to 30 million.