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Wednesday, September 20, 2017

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Consulting Agreement For An Annual Fund Campaign
Tony Poderis

January, 2006

The following example of an annual fund development agreement between a non-profit organization and a fund-raising consultant is suggested as a guideline for:

A. Organizations having little or no experience in drafting such documents.
B. Experienced development professionals beginning a new career as development consultants.

There may be occasions when a contract more formal in its nature, intricate in its wording, and legalistic in its phraseology is needed. However, my experience has been that simpler is better

This sample annual fund agreement can be easily adapted for capital, endowment, sponsorship, and underwriting campaigns. The purpose of the fund-raising campaign and some of its jargon might be different, but for the most part, the steps in the fund-raising process are the same. That can be confirmed by reviewing my website's articles and plan outlines for those respective fund-raising campaigns.

A good campaign plan must layout what is to be done, when it will be done, and who will do it. The same is true of an agreement between an organization and a consultant. Clearly defined and agreed-upon expectations are at the heart of any successful contract.

Contract Between Fund-raising Consultant And Non-Profit Organization For Counsel For An Annual Fund Campaign

Introduction

Annual fund campaign gifts to the Non-Profit Organization (NPO) provide the entry point of support for most of its donors. Annual funds comprise the foundation of the NPO's overall operating support, and they are the steppingstones to special and major gifts. As personal contacts by NPO volunteers with donors continue, those donors are made more and more a part of the NPO family through a process of cultivation. As a result, the NPO will better be able to secure future sponsorship, underwriting, endowment, and capital gifts. In addition, certain individuals will be capable of making provisions for the NPO in their estate plans.

Thus, it is axiomatic that the NPO's sound future relies upon a strong annual fund program that builds a predictable base of support to help meet current and growing operating needs year after year. Such an achievement will provide a pool of proven donors for other fund-raising efforts. It will also encourage the opportunities for special individuals to engage in carrying out the mission of the NPO in volunteer governance roles.

Overview

Fund Raising Consultant (FRC) will assist NPO in the planning and implementation of a renewed and accelerated Annual Fund program for NPO's upcoming fiscal year.

FRC will work with NPO's campaign leaders, administrative staff and board of trustees to complete the campaign, which for the next fiscal year, will require contributed income to be raised in the amount of approximately $__________ to balance the operating budget.
Scope Of Work To Be Provided By FRC

1. Develop a campaign plan:
The plan will detail work and campaign structure needed to complete personal solicitations of NPO Board of Trustees; current and lapsed donors; and new individual, corporate, and foundation prospects. The plan will include timetables and campaign-related marketing and publicity plans.

2. Conduct prospect identification and review sessions:
Identify donor prospects and determine appropriate asking strategies and donation amounts.

3. Design prospect cultivation programs:
Prospects are to be engaged in and involved with the NPO so that they develop a sense of "ownership" of NPO and its mission.

4. Develop membership gift levels:
Incorporate benefits and privileges to donors for corresponding contributions. Those giving benchmarks will also relate to specific NPO programs and services made possible by donors' support.

5. Produce and ?package? certain NPO programs and services:
Ongoing programs and services and new and desired endeavors will be reviewed, summarized, and prioritized by need. Help to identify the most likely prospects for those underwriting and sponsorship opportunities based on past experience, prospect contribution guidelines, and the degree to which recognition and credit for support is desired. Assist in the development of full proposals for funding to the appropriate prospects.

6. Provide training and orientation for volunteer solicitors:
Personally work with solicitors to assist them in feeling comfortable with their role as a solicitor. Ensure they have the best and most complete tools possible. Train and advise solicitors on how they should ask for money.

7. Assist in preparing planning, organizational, and marketing documents:
These include a fund-raising budget, a case for support, funding proposals, letters, and newsletters. They are all required for successful implementation of any fund-raising program.

8. Provide ongoing counsel and direction:
Full and involved hands-on management of the campaign.

Explicit Duties And Responsibilities Of FRC

A key aspect of FRC's service will be personal involvement in working with NPO campaign management in the formulation of detailed and individualized strategies for all solicitations for major gifts. Major-gift prospects are valuable resources. Each solicitation must be planned with care. FRC will work closely with the NPO campaign leadership to maximize the chances for success in each major-gift solicitation instance.

1. Coordinate all aspects of the campaign working with the campaign chair. Provide the resources and guidance necessary for the chairperson to lead the solicitors in the most efficient and timely manner possible.

2. Attend all campaign-related meetings and actively participate in the proceedings.

3. Develop and prepare documents and exhibits required for all meetings, including agendas, time-lines, etc., with campaign leadership, committee, and staff.

4. Provide campaign orientation and training to volunteer solicitors.

5. Assist with the compilation and review of all viable NPO donor prospects.

  • Conduct rating programs to suggest asking amounts for each prospect
  • Recommend the top tier cutoff level of prospects having the best giving potential as those to be personally solicited by committee members

6. Work with solicitors to provide solicitation strategies for their prospects.

7. Assist in the development of other campaign-related materials, such as pledge cards, gift return envelopes, proposals, brochures, etc.

8. Develop and produce progress and tracking summaries for forecast and evaluation reports and meetings.

9. Provide opinions and counsel for all situations that directly or indirectly could affect the campaign's outcome.

Summary Of Responsibilities For NPO's Campaign Leadership

The volunteers and the administration of the NPO will comprise two-thirds of the team that will launch, implement, and manage a successful annual fund campaign as quickly and cost effectively as possible. The FRC will comprise the other third of the team. In order for the campaign to be successful, all must perform their assigned parts. Some of the key responsibilities of NPO volunteers and administration are:

Campaign Chairperson

1. Recruit a committee of solicitors sufficiently large enough to assign personal solicitors to all prime prospects. Each solicitor will be responsible to personally solicit five to six prospects.

2. Convene and lead all required prospect rating and assignment meetings and all tracking, progress, and final report meetings.

Campaign Solicitors

1. Endorse and articulate the mission and case for support of NPO.

2. Make personal gifts and secure contributions where personally connected.

3. Select and personally solicit five to six prospects.

4. Attend all report and progress meetings of the campaign team.

NPO Staff:

1. Compile applicable previous donor data, identify new and likely prospects, and provide all other related information required.

2. Print and help distribute campaign materials, including brochures, pledge cards, gift envelopes, etc.

3. Help arrange and schedule campaign meetings.

4. Type letters, proposals, listings, etc. as required by campaign leadership and solicitors

5. Receive and record, apprise appropriate solicitor of, and acknowledge to donors all gifts.

NPO and FRC enter into an agreement as outlined above to work together for a contract period of at least __(*)___, which is of a duration spanning the present time to approximately the end of the campaign and fiscal year. Either party may cancel the contract with 30 days written notice.

Based upon a mutually agreed-upon assessment and review of the proposed Annual Fund Campaign, NPO staff, NPO board, and FRC, estimate that on-site activities and meetings and FRC's in-office production of campaign resources on behalf of the annual fund campaign, will require an average of __(*)__ days per month of FRC's time to ensure the fulfillment of all established campaign premises and initiatives and to fully support NPO's campaign.

The fee for FRC's services to design, implement, and direct the annual fund program to help NPO meet its short-term and long-term fund-raising goals is $___(*)___ per month, plus travel costs, and all other prior agreed-upon expenses.

For the NPO:____________ Title____________ Date________

Consultant:_____________ Date________

-- Addendum --

Filling In The ____(*)___ Blanks? Of The Contract

The extent to which an organization must rely on consulting services for a campaign depends to a significant degree on how much of the planning and execution of the campaign can be accomplished by the NPO board and staff. The less able the organization is to handle the planning and management of the campaign, the greater will be the organization's need of and outlay for consulting services.

On a per-day (eight hours) basis, some consultants might charge $500, but the larger firms and the most sought after and experienced fund-raising consultants charge in the neighborhood of $1,000 per day. Some will be as high as $1,250. In most instances, it doesn't matter whether the consultant actually works a full day at a time. You just have to be sure the total hours-per-month requirement is met.

Some consultants will charge by the hour, and their hourly rates are likely to be in the neighborhood of $100 to $125. Based on an eight-hour day, that adds up to about $1,000 per day.

Focusing too strongly on fees for consulting services, in terms of cost per hour, per day, or per month can mislead. A stated hourly, daily, or monthly rate is relatively meaningless. It all comes down to the total time provided by a consultant to the consulting engagement.

Remember, the best consultant for your particular situation should not be considered solely based on what your organization can afford or what it has provided in the budget. I recognize the serious constraints under which most non-profits operate when it comes to having money available to pay for professional services. However, what really determines a consultant's value to any organization's fund-raising program is the consultant's mastery of the fund-raising process. Don't look at the dollars alone. Look for someone with:

  • Good decision-making ability
  • Proven and well-regarded professional experience
  • Proper temperament
  • Keen judgment

These attributes create a value that will help you move forward more rapidly and aggressively. Especially when it comes to fund-raising consultants, you really do get what you pay for. The lowest bid is not necessarily the best bid.

Take note as well that these are fees for professional services only. All fair and applicable expenses must also be factored into the total budget for fund-raising counsel.

Tony Poderis was for 20 years to 1993 Director of Development for The Cleveland Orchestra and its Summer Home, Blossom Music Center. He was responsible for Cleveland's largest annual institutional fund-raising campaign. Since 1993, Tony has been a fund-raising consultant serving all non-profit institutions' needs to develop and to maximize their potential to raise Annual, Endowment, Capital, and Sponsorship & Underwriting funds.



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