The following is a glossary of fundraising terms for nonprofits that we hope you’ll find helpful to reference. Feel free to bookmark this page and know that we’ll be expanding it regularly with new termology as we can.
501(c)(3) — Section of the Internal Revenue Code that designates an organization as charitable and tax-exempt. Organizations qualifying under this section include religious, educational, charitable, amateur athletic, scientific or literary groups, organizations testing for public safety or organizations involved in prevention of cruelty to children or animals. Most organizations seeking foundation or corporate contributions secure a Section 501(c)(3) classification from the Internal Revenue Service (IRS)
Annual Report — A voluntary report published by a foundation or corporation describing its grant activities. It may be a simple, typed document listing the year’s grants or an elaborately detailed publication. A growing number of foundations and corporations use an annual report as an effective means of informing the community about their contributions activities, policies, and guidelines. (The annual contributions report is not to be confused with a corporation’s annual report to the stockholders.)
Appeal — Your fundraising appeal is your organization’s request for donations to support your mission. It can take the form of an email, print letter, social media post, even during a live or broadcasted event. An appeal explains your cause, shows its impact, and creates a sense of urgency on the part of your donor.
Crowdfunding — A Fundraising method where an individual or organization asks many people for small donations to reach a larger goal. In an online crowdfunding campaign, the fundraiser creates a personalized page on a site that allows them to collect donations, share the page via social media channels and email, and update people on their progress.
Donor-Advised Fund — A donor-advised fund is an account administered by a 501(c)(3) organization, which acts as a fiscal sponsor to manage donations on behalf of organizations, families, or individuals. This fund allows people to make a donation in return for an immediate tax benefit. The fiscal sponsor has legal control over the fund, but contributors retain the right to recommend (or advise) which groups or projects the assets should benefit.
Donor Database — Your donor database is the list of people who’ve given to your organization either currently or at some point in the past. It might also include people who are strong potential donors, such as volunteers or anyone who has attended one of your events. A donor database will include things like contact information, when and how much a person gave, whether they’re recurring donors, and how often they volunteer with your nonprofit.
Donor-Designated Fund — A fund held by a community foundation where the donor has specified that the fund’s income or assets be used for the benefit of one or more specific public charities. These funds are sometimes established by a transfer of assets by a public charity to a fund designated for its own benefit, in which case they may be known as grantee endowments.
Donor Retention — Donor retention is the percentage of people who repeatedly support your organization. Retention rates are typically calculated by year.
Giving Tuesday — This is a global day of giving that takes place on the first Tuesday after Thanksgiving as a way of countering the consumer-oriented holiday shopping season. Often hashtagged #GivingTuesday on social media, the event began in 2012 by the 92nd Street Y in New York City in partnership with the United Nations Foundation. Today, it’s a global fundraising event that has engages more than 10,000 nonprofits.
LYBUNT (or Lapsed Donor) — LYBUNT is an acronym for donors who gave “Last Year But Unfortunately Not This” (year). They can be great prospects to reach out to during your year-end appeals.
Monthly Giving — A monthly giving program allows supporters to make an automatic donation of a specific amount every month, typically as a recurring credit card charge. Donors who might not be able to give a large one-time gift are often willing to sign up for monthly giving, ultimately donating more over time than they would have otherwise.
Peer-to-Peer Fundraising ( or Social Fundraising) — A fundraising method where your supporters raise donations from their social networks on your organization’s behalf. The nonprofit usually supplies the tools, such as social media assets, a personalized fundraising page, and sample messages, to help their fundraisers succeed.
Recurring Giving — An important option on your donation page that allows donors to give an amount in regular increments, typically monthly. Donors will often choose recurring gifts when presented with the option. Recurring giving is an easy and effective way to boost overall fundraising over the course of a year, so this option should be prominently displayed on your donation page. People who strongly support your cause but might not be able to make a large donation all at once like recurring giving because it allows them to give more over time than they could otherwise. It also helps your organization budget more effectively since you can predict how much money will come in going forward.
Segmentation — Breaking down your overall audience or email list into smaller, targeted groups that your organization can market to directly. Some ways to segment your audience are by giving history (frequency and how long they’ve been a donor), lapsed donors, gift size, program interest, email inactivity.
SYBUNT — SYBUNT is an acronym for donors who gave “Some Year But Unfortunately Not This” (year). Depending how long it’s been since they gave and how often, these folks can be good prospects to reach out to during your year-end appeals.
Tax-Deductible Amount — This is the amount of a donation that a donor can claim as a deduction on their income tax return. Charitable donations must be paid in cash or as other property before the close of the tax year to be deductible. In general, donations to charities can be deducted up to 50% of adjusted gross income, though some gifts to private foundations, veterans’ groups, and the like have lower limits.
Unrestricted Funds — Unrestricted funds are financial gifts that an organization may use as it sees fit, such as to offset operational expenses like rent, payroll, and utilities.