Many nonprofit organisations (NPOs) are struggling to cope with less donor funding since the start of the Covid-19 pandemic. At the same time, they are grappling with increased demands for their services. This discrepancy highlights the importance of identifying potential donors, in a professional manner, if cash-strapped NPOs are to survive.
A survey of over 1039 civil society organisations in 46 African countries in June and July last year, The Impact of COVID-19 on African Civil Society Organisations, revealed that over two-thirds (68%) had experienced a loss of funding since the start of the pandemic.
Less than a tenth (8%) had received any funding support from a government emergency relief fund in their country. Furthermore, nearly 41% experienced increased demand for their services in 2021, compared to 32% the previous year.
The biggest funders of these African organisations are Individual donors, followed by international NPOs and international foundations.
A key aspect of successful fundraising is detailed prospect research – activity that helps the NPO to identify potential supporters. This is a crucial message of Inyathelo, an NPO that has worked for 20 years to help other NPOs to become more sustainable in the long term.
Prospects include individuals, companies, government departments, charitable trusts and foundations, according to an Inyathelo publication Identifying potential donors – How can you do research to find supporters?. These potential supporters are likely to identify with the values and activities of the NPO, have benefitted directly or indirectly from its work, or have funded similar causes.
Prospect research involves a great deal more than listing the names of potential supporters. Firstly, one would search for people who are passionate about the specific type of work that an organisation undertakes and the need it meets in a community.
This can be undertaken by a dedicated prospect researcher, the NPO CEO, a staff member, a volunteer or board member.
Network connections, recommendations, personal introductions and references are also extremely helpful.
"All staff in the organisation can make connections or referrals, with the aim of identifying and cultivating potential prospects that have a fit with the purpose of the organisation," says Inyathelo Operations Director Feryal Domingo. Other resources include the internet, broadcast and print media, as well as company and NPO annual reports.
"Put together a resource mobilisation plan which lists prospects, and outlines the trajectory of the relationship and likelihood of anticipated income in order to track progress and institutionalise the information," says Inyathelo Finance Director Soraya Joonas.
Many NPOs do not consider asking their own board members for support. They believe that these trustees have already done enough by giving their time and expertise freely. However, board members can set a fitting example by making regular donations. Their actions can in turn motivate others to donate money or office equipment, or to offer pro bono services such as bookkeeping, legal advice or mentorship.
Inyathelo provides many online publications and other resources related to fundraising, most of them free. The organisation also offers a Funding Finder service with details of nearly 1100 South African donors.
"Funding Finder allows you to search for South African donors according to your sector (for example education or agriculture) and then to drill down into a sub-sector, such as primary school education or emerging farmers," says Ms Domingo. There are also hints on how to approach donors, who to contact and how, and information on what activities and sectors particular donors do not support.
Donors will only support an organisation when they are confident that it is well-governed and their funds will be used responsibly, says Ms Domingo. "Well before approaching potential funders, ensure that your NPO is appropriately registered and you have a strong board of trustees at the helm. There must be accountability and transparency.
"Before you begin the process of asking for financial support, you need to build a relationship with a potential donor, based on trust. It is only when rapport has been achieved that you can discuss funding and what resources you require."
Ethical management of a database of potential donors is also essential. The information gathered is for the NPO's use only and must be stored securely. Old documents that are no longer needed, such as financial records from donors and personal information, should be handled in a responsible manner.
Inyathelo offers considerable resources, most of them free online, on the topic of Advancement. This is defined as a systematic, integrated method of building and managing relationships and engaging with the external environment, to attract support, skills and funds for an organisation.