The 501 S(c)ene

The latest view on not-for-profit accounting issues

Healthy Skepticism: Hiring a Professional Fundraiser

The competition for donor contributions continues to rise as more nonprofit organizations register with the Internal Revenue Service (IRS). With this increase in competition, many nonprofits are choosing to hire a professional fundraiser to help maximize their earnings potential. Before hiring your own, you should consider the following factors:

  1. Is it necessary? Some organizations give up prematurely on raising money themselves when they have plenty of fundraising potential. Are you one of those? If so, consider a few less costly options.
  2. Conduct research and seek advice. Network with other nonprofits in your region and obtain advice on how to successfully raise money. Ask them about any problems they have experienced with fundraising. If they are using a fundraiser, ask them about their experiences with that specific fundraiser.
  3. Does the fundraiser subcontract their fundraising phone calls? It is extremely difficult to monitor how they treat your prospective donors if they subcontract the work.
  4. Is the fundraiser interested in your mission? Have them attend an event to better understand what they are raising money for and have them become involved in the organization.
  5. How is the telemarketing staff hired and trained? If they are working on commission, they are more likely to exaggerate or make untrue claims over the phone. Additionally, if the employees are paid poorly, they are more likely to experience high employee turnover rates.
  6. Have an attorney review the contracts before they are signed. You do not want to become involved with any lengthy lawsuits to invalidate “bad” contracts.
  7. Does the contract give your nonprofit sufficient control over fundraising efforts? Your nonprofit should be able to review phone calls made by fundraisers to potential donors, provide a script for them to follow, and be allowed to visit their office for follow up conferences.

The overall message is to do your homework to be sure you make the right decision for your nonprofit organization.

By Kristian Haralson