Lessons Learned

So, what are the lessons learned thus far from our shared experiences philanthropically over the past months of the COVID-19 outbreak and its impact on charities around the nation like yours?

1.       Diversify your funding sources to include a wide range of fundraising tools that can generate both short- and long-term income for your charity of choice.  In addition to raising money traditionally through programs like annual funds, special events, grants, grateful patients, and planned gifts, find a means for soliciting and obtaining more lucrative principal gifts along with major gifts and program related investments where practical.

2.       Keep your expenses under control, preferably below ten percent in today’s philanthropic world. Outsource expertise if you need to and enter into collaborations where you can so that you might share expenses with other like-minded charities, community foundations, donor advised funds, trusts, family offices, private family foundations and so on.  Remember, too, those collaborations come with legal and moral obligations, like those we have already seen with some charitable organization’s efforts to navigate the coronavirus crisis and the federal government’s bailout of companies and individuals harmed by the pandemic through no direct fault of their own. Tread carefully.

3.       Don’t get too aggressive with your managed funds.  Lean to the conservative side but maintain your balance at all times.  Avoid the recommendation to go for a better return by adopting a too-risky portfolio mix.  Avoid the temptation to make quick cost saving decisions that might just cost you more in the long run.

4.       Continue to cultivate your prospective donor pool and work to establish longer-term, sustaining relationships with both donors and their trusted advisors.  Avoid being a just a transaction to your donor and you just might find the return on investment in that relationship built with integrity very gratifying as together you pursue your charitable mission.

5.       Seek to adopt and incorporate the best industry practices that you can.  Your donors and their trusted advisors will respect you for the effort and attention to stewardship. Use the most available enterprise excellence protocols you can muster, borrowed from Lean Six Sigma or Baldrige Quality Standards, for example, to keep your charity operating at the highest, most efficient level possible. Share the skills with your staff, volunteers, and other stakeholders so that the entire operation benefits from your attention to detail.

6.       Innovate, innovate, innovate.  If you are going to fund that open-heart center, then make it the safest open-heart center in the nation. If you are going to offer that arts program, knock your patrons’ socks off when you take the stage.  Be transformative, compelling and share with other groups in other markets and your donors will trust you to be the market leader and will most likely invest in you as you also invest in your market.

7.       Don’t be one of those stories in the media about what went wrong.  If you find yourself in that position, be transparent in what you have found and learned, answer as many questions as you can until the other party stops asking, and seek expert advice from those who can help you navigate what you find to be a painful experience.  But with pain can come progress and with progress can come success.  Take the journey and be honest about the lessons learned, especially as you correct your mistakes or missteps.

8.       Realize that markets happen.  What is good today will not be necessarily good tomorrow.  Pandemics occur and so do market crashes, most often than not, without your active participation.  Have a plan. Don’t just freeze in place. Consider what is the proper use of any endowed funds you might have at your disposal.  Be prudent with those funds and that fiduciary responsibility.  Execute and you will survive the downturn.  Ignore the warning signs and you will experience the result.

9.       Work with community foundations every chance you get. We are really big fans of community foundations and their benefit to charity. Please understand that these foundations are community jewels in your own neighborhood. They can help you with compliance, viability, vetting opportunities, and so much more.

10.   Work, too, with trusted advisors – tax attorneys, trust officers, registered investment advisors, estate planners, certified public accountants – the tested professionals who are out there able to work on your behalf to make certain that a donation is made properly and used ethically at every step of the process.  Their counsel will make your job, your mission, so much easier to accomplish.

If you keep these principles in mind as you navigate the post-COVID-19 world you might have a better chance at both surviving and thriving. You will also learn that there is a better way to give, a better way to get, and a better way to manage philanthropy preeminently if you do.