Prospect Research and Major Gift Fundraising: A Guide

When it comes to your nonprofit’s annual fundraising goals, securing major gifts is likely among your most pressing concerns. Where will they come from? How large will they be? These questions are no doubt on your mind, especially if your organization is carrying out a long-term fundraising project like a capital campaign.

Luckily, by incorporating prospect research into your major gifts strategy, your nonprofit will be well equipped to identify likely sources of the types of major gifts you need.

Prospect research describes the process of compiling and analyzing data about potential donors. This data can inform your nonprofit of:

• Their giving capacity (how much they could reasonably donate)
• Their giving propensity (the likelihood of them choosing to donate to your organization

Once your nonprofit gathers a robust collection of data through prospect research, you can make informed decisions. Which donors should you cultivate? Who should you approach for major gifts? And what size gifts you should request as part of your overall fundraising strategy? This data will help you answer these questions and more.

Here are some basics of prospect research and how it can impact your organization’s strategy for securing major gifts. These concepts include:

1. Biographical Indicators
2. Giving History
3. Giving Capacity
4. Matching Gift Opportunities

With the right prospect research in place, your nonprofit will be empowered to secure more major gifts and reach your fundraising goals faster.

Bonus Tip: Conducting detailed prospect research should begin during the feasibility study phase of any large-scale fundraising project. Learn more about improving your feasibility studies at DonorSearch.net.

1. Biographical Indicators

Before your team can begin to break down your prospect lists into specific, targeted segments, it’s important  that you have the right foundational data in place. This means ensuring you have consistent fields of biographical information on file to reference.

If your nonprofit has inconsistently collected data, you may be missing key indicators of an individual’s likelihood of donating a major gift. You may have duplicate fields of similar information. Or perhaps you have gaps in your donor profiles, where information was collected for some donors but not all.

With this in mind, it’s important for your nonprofit to take the time to flesh out your donor profiles to include some baseline biographical fields. Then you can more accurately assess an individual’s viability as a major gift donor.

Important Fields

• Name
  While it might seem obvious, it’s worth confirming the legal name of your prospects from the beginning. Later, when you may be researching their real estate holdings, tax history, or other publicly available wealth indicators, it’s important to know you are learning about the right person.
• Date of birth
  Similarly, knowing an individual’s date of birth can help you confirm the person you are researching is the person you want to approach with a major gift ask. Knowing someone’s real date of birth can also help when segmenting prospect lists by age or when planning a targeted donation request.
• Marital status
  Whether or not a prospect is married can reveal a lot about their propensity to give, as well as outline their connections to other potential donors. If a female prospect has taken her husband’s last name, learning her maiden name can reveal a relationship to her blood relatives you wouldn’t have previously known.
• Address
  Having an individual’s address on file is also quite helpful. By knowing where a prospect lives, you can more accurately estimate their net worth, uncover connections to friends, neighbors, or local schools, and better assess whether they might be inclined to give to regionally focused fundraising campaigns.
• Institutional affiliations
  Knowing the types of institutional affiliations your prospects have is crucial. In addition to learning what other philanthropic organizations they support, you might also want to learn their political party, religion/house of worship, or university alma mater.

The Bottom Line

When it comes to securing major gifts, building a strong foundation for your prospect research analysis is crucial. Be sure to start the process with a comprehensive donor database.

2. Giving History

After you’ve ensured your initial prospect research is in place, another area of interest for your nonprofit should be prospects’ giving histories. When you have an accurate history of a prospect’s philanthropic activities, your major gift officer can better estimate an individual’s likelihood of providing a major gift to your campaign.

To build the most accurate giving history possible on your prospects, there are a few key areas of interest your team should investigate, including people’s:

• History with your organization
  Have these prospects donated to your cause before? How much did they donate? When did they give? If they haven’t donated, have they volunteered for your nonprofit or attended fundraising events? When targeting prospects for major gifts, you want to approach individuals with a proven history of support.
• History with other organizations
  Which additional philanthropic organizations are they affiliated with? Are they active, recurring, or lapsed givers with another nonprofit? As you decide which prospects will make successful major gift candidates, extend asks to those who have previously supported organizations similar to yours.
• Gift history
  Knowing a prospect’s gift history (the number and size of donations they have previously given) can be an excellent indicator of whether or not they are good candidates for major giving. Gift history is one of the most accurate metrics for predicting future giving behavior.

The Bottom Line

Determining the ideal candidates for major gift-giving depends substantially on analyzing their giving history. Once you know their pattern of philanthropy, you can better predict whether or not they’ll turn down your solicitation.

3. Giving Capacity

Assessing a prospect’s giving capacity is a crucial step toward identifying major gift candidates. As previously mentioned, someone’s giving capacity reflects their economic ability to donate. As your team looks for individuals to provide the major gifts necessary to reach your fundraising goals, knowing how much a person can give helps you avoid leaving money on the table.

When developing detailed prospect profiles, your nonprofit should look for publicly available wealth information to inform how you assess giving capacity. These fields include:

• Real estate holdings
  If a prospect owns substantial real estate holdings, it’s a good indicator that they would be able to donate a major gift. Real estate holdings can be accessed through municipal records as well as through house-hunting websites, like Zillow.
• Political contributions
  Just as past philanthropic donations are a good indicator of a person’s likelihood of giving to your nonprofit, past political donations can indicate a person’s giving capacity.
• Stock ownership
  SEC filings are publicly available and can help your team determine the wealth of your major gift prospects. Similarly, if your prospect’s stocks have just gone up in value, it can indicate that now is a good time to make your major gift ask.

Bonus Tip: Assessing the giving capacity of potential donors is part of a larger subfield of prospect research called wealth screening.

The Bottom Line

It’s not enough to simply know whether or not a donor is likely to support your organization. When securing major gifts, it’s integral to know prospects’ giving capacity.

4. Matching-Gift Opportunities

One specific area of interest when it comes to maximizing the impact of major gifts is identifying prospective donors’ matching-gift eligibility in your donor dataset. Many businesses offer gift matching to their employees when they make donations. If your nonprofit doesn’t know which prospects work for businesses that have a gift-matching program in place, you may be missing out on a great opportunity to augment a donor’s major gift.

Some donors may be unaware that a program for matching philanthropic giving is in place with their employer. Others may know about the program but not be aware of how to complete the corporate gift-matching process.

For these reasons, your prospect research process should include some of the following procedures to maximize your knowledge of who to approach for major gifts:

• Segment by gift-matching eligibility
  Create lists of donors whose employers match gifts. Then use this data to better prioritize prospects for major gift solicitation.
• Identify gift-matching deficits
  Do very few of your prospects work for companies with matching gift opportunities? Perhaps it’s worth reevaluating your prospect lists and expanding your search to include more match-eligible donors.
• Determine matching-gift awareness
  If you uncover that prospects eligible for matching gifts are not aware of their eligibility, this can indicate their need for direction in completing the gift-matching process in order to maximize their major gift.

Bonus Tip: Looking to boost matching-gift results for your nonprofit? Visit 360MatchPro to learn more about automating the matching-gift pipeline.

The Bottom Line

When a prospect’s major gift is matched by their employer, that’s a win-win for both your nonprofit and the donor. Be sure to segment prospect lists by eligibility to make the most of your supporters’ donations.

Conclusion

Finding donors for your nonprofit’s major-gift needs depends on diligent prospect research. With this guide in mind, your team is ready to get started.

Good luck!

Free eBook: Jumpstarting Your Fundraising Efforts

Most nonprofit organizations, regardless of their size, have too many things to do and too little time or not enough people to do it. Balancing daily tasks and trying to raise money can be challenging and overwhelming, so Aplos put together this eBook to help you build strong foundations of sustainable fundraising and financial accountability.

This free eBook provides info on:

• Reviewing your donor database
• Building better relationships
• Reviewing your fundraising plan
• Creating a specific donation page
• Publishing an e-newsletter
• Growing your sustainable giving
• Engaging and mobilizing your board