Kate Gillette feels “gala fatigue” from the two dozen invitations nonprofits send her each year. So she was intrigued by her latest invite to an unusual St. Paul gala: skip the fancy dress and pay to not attend.
“We’re tired and busy, so we don’t have as much time to get excited about those things,” said Gillette, 38, of Minneapolis, who would also need a babysitter for her two young children. “I would rather just give them a donation.”
That’s essentially what Tech Dump, an electronics recycler, asked for in its first-ever fundraiser earlier this month. With its creative nonevent, it joined the growing ranks of Minnesota nonprofits retooling their fundraising tactics in an effort to keep and attract donors amid a changing landscape for giving.
The St. Paul nonprofit rented an event center, set up black linen-covered tables and had an improv comedian host — all to an empty room. Instead, they taped a video of the event and charged people $40 to tune in from the comfort of their couch, helping the nonprofit meet its zero-waste mission.
“This is an introvert’s dream,” said Amanda LaGrange, the nonprofit’s CEO. “It also shows people want to disrupt the system.”
Funders — from Greater Twin Cities United Way to the Target Foundation — are narrowing their focus of grantmaking. Meanwhile, more donors are bunching gifts together to get the tax benefit through donor-advised funds, creating instability for the sector. Individual donations, which make up the largest portion of philanthropy, declined nationally last year, according to the annual Giving USA report, citing the federal tax change that doubled the standard deduction.
That all leaves Minnesota’s 37,000 nonprofits looking for new ways to reach donors.
“That nonprofit business model that has us all chasing the same pile of money is dead,” said Erich Mische, the executive director of Spare Key, a St. Paul-based nonprofit that covers mortgage and rent payments for families with sick children. “Every nonprofit has to start looking at its business model and it’s got to decide if it’s sustainable in the long run.”
‘The future of philanthropy’
Instead of just relying on a gala, fundraising events and mailers pleading for donations, Mische’s nonprofit launched its own crowdfunding website this year.
The site called “Help Me Bounce” allows donors to give to specific families instead of cutting a check to the nonprofit to decide where to spend it — part of a broader trend of democratizing philanthropy, he said, as donors seek more control of where their money goes.
“This really is the future of philanthropy,” he said. “If you’re 40 and younger, the likelihood that you’re going to write a check out to a single charity has become increasingly unlikely.”
Spare Key is launching social media ads this month for “Help Me Bounce” in six states. Since launching the site in April, half the donors have been people who haven’t previously given to Spare Key, Mische said, and they are giving smaller amounts under $50, mimicking the trend of political campaigns courting small-dollar donors.
While crowdfunding isn’t new, Mische said operating it through the nonprofit is and helps ensure the money goes to a family in need. Mische said he hopes to boost donations so the nonprofit can go from serving 300 families a year in Minnesota and three other states to 1,000 families in 33 states next year.
“I think in the next two to three years you’re going to see an avalanche of changes in how nonprofits raise money and deliver their services,” he said.
Earlier this year, GiveMN — the nonprofit known for its annual Give to the Max Day — launched RaiseMN, a service coaching nonprofits on fundraising by doing things such as establishing better relationships with donors to lock down long-term support.
“We have to be creative and we have to meet donors where they’re at,” said Jake Blumberg, who heads GiveMN.
Nonprofits that are fundraising successfully view donors and volunteers as one supporter group, he added. For example, on Give to the Max Day, Huge Improv Theater connected the organization’s mission and fundraising by having an “improvathon” and Second Harvest Heartland held a 24-hour food packing event.
Larger nonprofits are also focusing on “major gift” fundraising, trying to build relationships with a few big donors, said Jennifer Halcrow, a nonprofit consultant at Corvus North. That’s because corporate philanthropy has declined over time and individual wealth has risen, added Joan Grathwol Olson, a consultant with Creative Fundraising Advisors. Donors are also requesting more data and analytics to guide their giving.
Thank you for not coming
Candles glowed on tables inside a St. Paul event center as host Tane Danger took to the stage at Tech Dump’s gala without any guests.
The seven-minute video for the “Thank You For Not Coming” gala featured the typical gala format: thank sponsors, share a story of a training program graduate and plead for donations. But ticket-buyers just watched from home, posting on social media with photos of their pets or a glass of wine.
Holding an event no one would attend was initially met with some skepticism, LaGrange said, noting some asked, “You really think people are going to pay to not go to something?”
But they did, helping the nonprofit surpass its goal and draw in nearly $17,000. Like a lot of small nonprofits, Tech Dump has no dedicated fundraising staff among its 64 employees. It aims to double its revenue to $7 million by 2022.
The nonprofit saved money by not planning a typical $40,000 gala, instead spending $5,000 on an event planner, PR coordinator and videographer, LaGrange said.
Gillette, who attends about a dozen galas a year as a nonprofit real estate specialist and member of four nonprofit boards, said it’s hard to differentiate between the black-tie galas held in ballrooms with “fairly similar chicken” dishes. While some people are eager to attend formal events for networking, she said more nonprofits have ditched the black-tie format for informal breakfasts, lunches or fundraisers at breweries.
She paid $75 for a ticket for her and her husband to not attend Tech Dump’s gala, and instead spend the weekday night with their 1- and 4-year-olds, watching the video when they had a chance.
“I think it’s something that wouldn’t work for every organization. But for them it’s so perfect and authentic,” she said of Tech Dump’s gala. “I think it’s cool people are rethinking the gala and fundraising.”