UPCOMING: THRIVE IMPACT 101  | February 2nd, 2023 9:00am - 11:00am MST

Creating a Generosity Experience with Tim Sarrantonio

December 15, 2022

Show Notes

Did you know that 8 / 10 first time donors never come back? 

This is a brutal stat when you think about the amount of effort we put into getting new donors. Perhaps there’s another way that makes the process more human and more efficient. 

That’s where the “generosity experience” comes in. 

A generosity experience is more than just a one-time transaction. It is the end-to-end relationship that you build with an individual donor that encourages them to give in a sustainable way (for both you and for the donor). 

In this episode, Tucker is joined by Tim Sarrantonio, the Director of Corporate Brand for Neon One, to discuss the secret to unlocking donor generosity by creating a generosity experience that focuses on the person behind the donation.  You learn about:

  • three different types of giving
  • main factors involved in a donor giving at their highest level
  • how to create a generosity experience that has the most impact on both the donor and on your organization

Plus… a shout out to an insightful new book that just came out - The Generosity Crisis by Nathan Chappell, Brian Crimmins, and Michael Ashley.

*Resources*
The Generosity Crisis
Gallup Poll Article

Want to get notified of new episodes?

Share this episode

Transcript

Tucker: Hey there, and welcome to Thrivers: Nonprofit Leadership for the Next Normal. I'm your host, Tucker Wannamaker, the CEO of THRIVE IMPACT. Our mission is to solve nonprofit leader burnout, because burnout is the enemy of creating positive change, and we want to connect you with impactful mission-driven leaders and ideas so that you can learn to thrive in today's nonprofit landscape.
And today I have a most wonderful guest, somebody I've been looking forward to connecting to all of you on this Thrivers podcast. He's been a gentleman that some of you may have seen on LinkedIn. He writes a ton, has a lot of great content around fundraising and generosity. Tim Sarrantonio, it is great to be with you sir, on this podcast today
Tim Sarrantonio: Tucker, thank you for having me. I am excited to be here.
Tucker: I am excited to…Well and so for those of you who don't know Tim, he’s the Director of Corporate Brand for Neon One, but he's also an internationally renowned speaker on generosity, on technology, and some of the trends around this in the social good sector. He's helped a variety of causes raise over $3 million.
He also moved into providing support for thousands of nonprofits with his work at Neon One, and he has spoken at multiple conferences. AFP Icon as an example, NTC, TEDx. He also holds a certificate of Philanthropic Psychology—that sounds awesome, Tim—from the Institute of Sustainable Philanthropy. He lives in—I'm gonna get this right, Tim—Niskayuna, New York.
Did I nail it? Did I nail it?

Tim: You nailed it. You nailed it.

Tucker: He’s got a lovely wife, three lovely daughters, and two perfectly fine cats. For those of you who may not like cats, these are perfectly fine ones, apparently.
Tim: I like cats, but they're fine at this point.
Tucker: Well, Tim, I have so appreciated our multiple conversations, and just appreciating your leadership around the thinking in this space of the next normal.
I know that one of the topics that we wanted to hit on today is generosity experiences. And even when you shared that with me a couple weeks ago and we were talking about it, I was like, “Oh, this is a next normal topic. This is a topic—we're trying, so many are trying to go back to the old normal, or the way it used to be in some ways. But we're not in that space anymore. We're leading in the next normal, hence the title of this podcast. And so around this topic, Tim, let's just dive right in.

First of all, help us understand a little bit. What exactly is a generosity experience?
Just to give a little definition to that, and then I want to dive into some of the pains or the issues that nonprofit leaders are experiencing regarding creating those types of experiences.
Tim: A generosity experience is not—let's just start with what it's not—a generosity experience is not when somebody gives you money. It is not signing up for a newsletter. Those types of things. A generosity experience is the end-to-end relationship that you build with an individual. From the moment that they become aware of your organization to the ultimate end of the relationship. That is the full generosity experience. And so that means that giving money is only a fraction of what somebody should be thinking about when it comes to their revenue creation, the ways that they're gonna chart out and project when money's coming in, how money's coming in. That's just one piece of the puzzle.
Tucker: I appreciate that you're unpacking that this is a journey that you and this relationship that you have is going on.
And how do you create that journey and that experience that unpacks and unlocks their generosity and the joy around that potentially, so that it becomes something? I'm thinking about one of my favorite fundraisers. Her name is Serena, and she talks so much about measuring the impact for the donor. Literally. Like the impact that that brings to them. And thinking about it how we do on the programmatic side. Why don't we think about that in terms of impact evaluation on the donor side in a sense?
Tim: Professor Jen Chang at the Institute for Sustainable Philanthropy in the UK where, where I got my certificate in Philanthropic Psychology.
She's done research into what exactly is Philanthropic Psychology—and this is getting into the mind of the donor and their mindset—and there's three stages and three types of giving that people engage in. And the generosity experience is activated best at the last one. So let's start with the kind of the basic. It's a situational gift.
Tucker: Mm-hmm.

Tim: So that means that somebody gave, because you asked. Somebody gave because something happened. It's not intentional. It's very reactive. So it's giving Tuesday, that's a situational gift. Somehow, you stood out in somebody's inbox on that type of message. They clicked it. They gave. There you go. That's very transactional.

A relational gift sounds good, but it's in many ways a one-to-one, not sustainable situation. It means that if a variable in the relationship changes then the donor doesn't feel as supported. And so an example, this is somebody who's been giving to a nonprofit for many, many years and then the founder retires or passes away or in the worst case scenario, is ousted. And those gifts stop coming. That's a relational gift. It means that there was something that affected the bedrock of the relationship between the donor and the organization.

Board member giving. You see this in peer-to-peer fundraising in a little bit less drastic framing where it's like, “I gave because my friend is doing this race.” That's a relational gift. But if that person stops fundraising for the organization, they're probably gonna not opt into your newsletter and stuff like that. They're like, “Why? I don't even remember giving to this nonprofit.”
Tucker: Well, it kinda reminds me, Tim, of almost like quid pro quo fundraising, meaning like, “Hey, I'll, I'll scratch your back and pay for that table at your gala and you'll scratch my back and I'll pay for that table.”
That is only based there and becomes—I don't know if you've seen this in that, to your point—that it leads to donor and fundraiser fatigue. Like if you're a board member and you're scratching the back of somebody else and vice versa. It sounds like that relationship becomes a struggle.
Tim: So one thing I wanna flag on the topic of donor fatigue real quick is that from a transactional standpoint, it doesn't exist. Meaning that people will continue to give in the right circumstances. There is really no threshold on a person's capacity to be generous. And as a sector, there's a lot of generosity happening. And so I am being nitpicky Tucker. I understand that.

Tucker: No, that's good.

Tim: But then going back further, what does exist is crappy appeal fatigue, crappy communications fatigue. That is widespread and that's gonna get into the generosity crisis that we'll talk about, which is the name of a new book that came out that I wanna make sure that we touch on.
Tucker: I'd love to.

Tim: And that's a big thing that Nathan and Brian, the authors of this book, flag is poor communication, poor personalization, things like that. That's one element here that leads to it. So relational giving. There's always a kind of process. It's a continuum that people can be on one side or the other, and you kind of need that balance. And the balance is where… You can't have a situational gift typically if somebody's going to give you 5,000 bucks, right? That very rarely happens. Even the larger donors start out with a small gift. A lot of people have to remember that the MacKenzie Scott situation of somebody blessing your organization with $3 million is an outlier. And so…
Tucker: That's a note to all board members out there as well.

Tim: Please stop asking how you can get…
Tucker: These are all outliers.
Tim: MacKenzie Scott will be giving people money who are telling a good story regardless of whether she gives the money or not. I digress. So how do we get to the ultimate? What is the form of giving, in terms of the donor's psychology and mindset, that would be identity-based giving?

Identity-based giving means that the donor themselves can look in the mirror and basically see the cause replicated.

Tucker: Hmm. Wow.

Tim: And so people activate in a self-actualized way. Psychologically, when they feel competent, they feel connected and they feel that they made the decision on their own. Autonomous. So competent. I gave to this organization and they're not going to misuse my money. I see the candid bronze seal on their website and that's fine to me.

By the way, don't bother going past bronze. You don't need to go after silver or gold for candid, by the way. Little pro tip there from a finance thing. If you have a board member telling you to focus on that, don't. Just get the bronze and move on.

But the thing is, that makes a donor feel okay. These are little indicators in our sector that could be up for debate, Tucker.
But people want to feel like they’re not giving to the next terrible thing that's gonna be sucking money out of it and funneling it. Whatever happened with the weird crypto stuff and effective altruism and they're all giving to each other's charities, right? People don't want that.
So the connectedness is that this is actually where it gets different than something like an e-commerce situation. In e-commerce, you make the decision and it's like the payoff is in an individual way. I bought the arcade machine, and then the payoff happens when I get the arcade machine.
In a generosity experience flow, the payoff is already there. When somebody gives, they're already primed. They're excited. The trick is to make them feel connected to a larger community. If you get them to give, if you then can demonstrate you are not alone. People really love that. We're individuals, but we're not.
Tucker: Love that.

Tim: And this is some really… I've been reading an interesting book on crowds in power about this type of thing. Where it's kind of that needing to be part of the herd type situation. So then to wrap it up, because I'm being rambly right now, Tucker, so,
Tucker: This is great. No, keep going, keep going.

Tim: Well the autonomous one is a fun one because that's where you get into the ethics of your storytelling. Because ultimately every generosity experience design has to come from an understanding that you're a brand. And a brand is a story that makes people feel something.
It's not your logo or anything like that. Again, I'm Director of Corporate Brands, so this is…

Tucker: You think about this stuff too.

Tim: I think about this a lot. But where the autonomy comes in is that the donor didn't feel guilted into giving. So if you're using the Sarah McLaughlin music playing over sad dogs, is that sustainable?
Is that something that's playing to a person's guilt versus their want to actually make a difference? We talked a lot about—during the certificate course—the differences between guilt, shame, things like that. There's a difference if you feel guilty versus I have shame versus even more deeper things where it's attacking your very soul.
From an identity standpoint, everybody wants to think that they're a good person. So if you do something that violates somebody's inner thinking, that’s like you're implying, “No, you are a bad person” versus “You did a bad thing.”
And that's the opposite where it gets to the positive side is giving. And this is where the generosity experience really comes alive, is when you get into, it's a person who gave, not that they gave a gift. Everybody out there, go and check your donation receipts right now for your online donation. If you have something where you can edit the copy, I'm gonna bet most people have one that says, “Thank you for your gift of X dollars, made on Y date.”

Okay? It's gonna start out like, “Thank you for donating to the blah, blah, blah fund. Thank you for da, da, da.” It's that you're starting with, “Thank you for this.”

But an identity-based copy change is, “You are a generous person because you gave X dollars on Y date.” So even changing the flow of the… English is fascinating, folks. It's an infuriating language. I have three young children.
Tucker: Yes, yes. I totally get that too.
Tim: To teach it is whackadoodle, but it's still… The order of things matter. And so if you start with the person first as a basic principle when you're doing your design. You start with the person, not the money. You can go a really long way with that principle.
Tucker: Well, so Tim, you're getting into what are the pains or the issues, I think. I really appreciate you framing this up around the three different types of gifts and under identity giving. What are the three components? Really helpful framing. And in creating a generosity experience around, particularly, identity giving, I'm assuming, is where that's going. So where—as you already started getting into a little bit, like the copy as an example—where are folks struggling in creating generosity experiences? Where are the pains of the issues within this?
Tim: So I had the pleasure of… At the time of this taping, I had just gotten back from New York, and there was an event for a new book called The Generosity Crisis. It's by Nathan Chappell and Brian Crimmins. I think… I'm excited to read the book, but the gist of it is—because I've known Nathan for a long time and I know kind of the basic things because we've talked about it a lot. He's very much on the forefront, very much a futurist in terms of where the technology can be. One of the most fascinating and smartest people around artificial intelligence in the sector. So I pay attention to what he does a lot—He and his partner looked at all the data—and I've been looking at similar data—and when you get down to it, the average new donor to an organization on an individual level and most giving is individual gifts.
Tucker: Yep.

Tim: You might hear about grants and you might hear about corporate giving. Folks, the money's in individual giving. Unless you're a service grant from the government. That's about the only thing that's dwarfing all of this. But the things you can really control, where your destiny can be your own, is individual giving individuals.
And so when you get down to it, eight out of 10 people who donate to your organization for the first time this year will not be back next year.

Tucker: Wow.

Tim: Let that sink in and then compound that by the money that you spent to acquire those folks, which is typically more than the money you initially bring in.
Tucker: 8 out of 10, so 80%. Based on the data from The Generosity Crisis?
Tim: The Fundraising Effectiveness Project. The Fundraising Effectiveness Project actually analyzes the individual retention rates. The Generosity Crisis folks are looking at a bunch of different data sets and they're kind of talking about these different data trends. FEP, I imagine, is one of the primary ones that they're citing there.

And so the crisis comes down to, one, a large centralization of focus on major donors only. I'm gonna get the six, seven figure gift. And what's happening is that it's killing the potential for any other type of small dollar gifts.
I literally, for our company, we give out donations as part of corporate social responsibility and give back programs and things like that. I reached out to a nonprofit who somebody had recommended, “Please donate in my honor to this organization.” I reached out to them and I said, how do I donate to you?
Because I couldn't find it on their website. And they said—they're climate organization—“Well, unless you're giving a hundred thousand dollars, we're not gonna accept your money.” They didn't even have a mechanism. They said, “Go give it to one of these organizations.” It's like, go away Plebe, your money is no good here.
Tucker: Don't give us your dirty money.
Tim: So I emailed it to the guy who made the recommendation. I'm like, “What do you want me to do?” And it's like, “Go Rainforest Trust.” I was like, “All right I know I can give to them.”

Tucker: Yeah, wow.

Tim: So that's the thing. If we internalize that portion, then it leads to the other side of what the generosity crisis, I believe, is flagging. And again, I still need to read the book, folks. I've read enough on it.

And the other piece is that we're losing that personalized touch. We're being overtaken by Amazon knowing that we need to reorder diapers, you know? Because my Fitbit shows that I'm not sleeping enough, or some like weird crap, with all the data. And it used to be that we were the vanguards—and I love how they framed this last night at the event. That nonprofits are the vanguards of generosity—we are at the forefront of what the best of humanity should be.
That’s what we should aspire to be. And where we're losing that is we're communicating with people in ways that are transactional and turn them into the money. They don't focus on the person. And so where the concern is, is that for-profit companies are gonna outpace that and have more trust put in them where somebody feels that they can do better for climate change by buying Patagonia. Than actually helping, you know, like a polar bear conservation organization.
Tucker: Yeah. People that are deep in the trenches of that work.
Tim: It's not that people aren't generous. Whenever we hear that household giving is down, it's referencing 501c3 money, but the giving keeps going up. The issue is that the formal investments are being driven by increasingly more rich people. And so folks who want to do more of an entry level support because that's what they can afford—Because the data's clear that it doesn't matter what someone's class is, what someone's race is. Gender, sexual identity, household configuration, doesn't matter. Everyone is generous. The data's very clear about that—It's where they want to put that. Generation Z is one of the most generous generations in terms of their affinity and knowledge of social causes than we've ever seen. It's like everyone… When I did my TEDx talk—at my old high school, that was weird—and so I was next to two high schoolers and one of them had started a nonprofit already.
And we might bristle at that folks. We might say, “Well the young should go and search for an existing nonprofits.” I mean, that's a decent debate about efficiency, but when you get down to it, you gotta tap into that passion. They're starting it because they feel that they're not being heard. And that's where the real crisis is.
Tucker: Well, I think in going back to your situational relational and identity, that there's almost a more blatant hunger for identity giving. And if it's not there, then they're out. Or people might continue to be out. To your point around 8 out of 10, 80% of first time donors don't come back.
There's a clear gap here and it sounds like one of the pains that you're getting into here is that if you're not focusing around creating a generosity experience around identity-based giving, then you're probably sitting in that 80% in a sense. Or the donors that are giving to you are in that 80%.
Because the desire to be an identity giving is like if you're not creating that space, then I'm out. I'm not gonna like go along with it just because of my friend or another situation. It's like, no, I just don't want that.
Tim: Remember that I talk about it as a generosity experience from beginning to end. Because every relationship has an end. Life is transient, right? And so, the relationship ends ultimately, either because the donor no longer wants to give, or they have passed away, and then they have left a bequest. Okay, so let's be very real about that. Death is a part of this. In terms of there's always an end to the relationship. And that can be scary to think about it holistically from an existential standpoint, but let's talk about brass tacks of actual money when it comes to this.
And so the reality is, if we look at the data, Dr. Adrian Sergeant flagged that the reasons people stop giving are basically all communications related. All of them. And that includes death. I didn't leave a bequest to this nonprofit because I either didn't know about it or I wasn't asked, or I was asked, and this isn't something that I really identify with.
I've already been asked to leave things in my will. 40! I was like, I'm not, no, I'm not ready to think about that yet. I'm not there yet. So that's the thing. It's about that stuff compounds and so even memory is fluid. People can say all the time… Have you ever gotten a reply to a newsletter and somebody replies, and that's part of your response rate in terms of marketing.
Reply rate is an actual thing, which is how many emails do you send out and how many people actually reply? That's a real thing because it's qualitative data as opposed to quantitative. You can see somebody going, “I have a question” or “Unsubscribe, I never got on this list.”

And so somebody does that. You can go back to something like your CRM and say, “But they did give, they gave $13 to a peer-to-peer campaign five years ago.How do they not remember us?”

People forget all the time. Daniel Kahneman is a psychologist that did experiments on what people remember. Thinking Fast and Slow is the book that he cites this.
Tucker: I like that book.

Tim: Love that book. And Francesco Ambrogetti also wrote about this and Hooked on a Feeling from a charitable lens.
And so that's the one that got me really hooked on Daniel's thing—And Francesco's book is a lot more accessible. I can barely actually get through Daniel Kahneman’s book itself—but I've read this part and understand this part very deeply, which is that people have memory that basically doesn't remember the average of an experience.
Like in this podcast. Many of you might be like, this dude is rambling and I need to like, get to the too long, didn't read. Like, let's say that's something that you're gonna have a memory of. I want you to remember this, this one thing out of this entire podcast, people remember a high or a low of an experience and how it ends.
That's it. You can have the worst beginning of a relationship with a donor where it—the average time it takes to make a donation online is four minutes in our sector, that means people are like, they could be, they could have blown through a Starbucks order and signed up for three streaming services by the time that they finish one donation in our sector.
That's what we mean by the businesses are overtaking the experience side. So if people still convert—this is classy data, I believe on the conversion rate—that means that there's a lot of people who, yes, bounce off, but the people who convert, they sit through and suffer through for four minutes.
So it means that we're all there. And if you start the relationship poorly. If you somehow then go, “You know what? I'm gonna make the rest of this generosity experience wonderful for them. I'm gonna send them a video, I'm gonna do a handwritten note.” All these different things that make them feel like a person, that's where it really clicks.
That's where, that's how we can actually start to address all of these different things.
Tucker: That's great. I mean, a lot of this…
Tim: So if you remember one thing folks, end on a high, have a high note during the relationship. That's basically it. It all flows from that. This is how everything matters
Tucker: Yeah. We see this in our.. I mean a lot of our work around facilitating and experience design is very similar. As an example, we always “close with heart” is what we call it, coming out of the neuroscience from Dr. Daniel Friedland. We don't end with tasks and surveys and tactical strategic things, we end with a space of reflection and belonging.
Which partly gets back into some of your, what you were talking about too, around that connectedness. Help people feel… They feel connected, and then they may not remember the details of the experience, but they remember feeling something.
Tim: I feel that, one, at our heart, what we should be training people to be is generosity experience designers.
That they're not fundraisers, they're not marketers. I mean, a glorious world in the future the titles actually on resumes are “generosity experience designer.” Or you're certified in that type of thing. And what that means is that you're thinking about the holistic potential of generosity that somebody can have from indicating a passion for the cause on which newsletter that is tailored to their impact.
Down to volunteering all the way to peer-to-peer fundraising or Giving Day participation or you know, buying tickets for the gala. All these different things rolled up into an understanding that entire experience. And if we think of ourselves as designers, then you also need that space for reflection, experimentation, you need to have that buy-in from your leadership to allow you to fail.

So I feel that if the folks who kind of embrace the fact that they're designing this journey specific to their cause and that core why. The ones who then actually can click on the tech side. I think it's gonna be these really interesting hybrid experiences.
If I had a crystal ball in five years in the future, like tap your watch and you're giving wallet automatically matches you with the cause during the giving day. And then from there they're building out this different communications flow to make sure that you know what's up.
But it's a small community organization. It might be $750,000 in Colorado. But they have the tech that's helped automate all of this. And it all starts from the fact that there was like a festival. Outside. And there was an interface that had all of this.
And it's done securely. So people feel that, that they can trust it. Because there's transparency in the reporting. All of this stuff is interconnected. All of it's interconnected. I see that as a possible world.
Tucker: So you're getting into the next normal. What are a couple quick pieces around what is this next normal then?
I mean, we've hit on people not focusing on the person. They focus on the money. I love the copy example that you used earlier. They're not thinking about this like an experience. They're thinking about it, whether they like it or many fundraisers like it or not, They're thinking about it more like a transaction.
And again, that then translates into things like the copy as an example. What is the next normal if I'm a fundraiser of a small shop, of a small organization in a community, and what do I need to be thinking about in order to actually lead in this next normal as a fundraiser?
Tim: Four things, four things.
So they align with the principles with an underlying focus on data-driven success. Okay? So that's the kind of the foundation here. I work for a data company. A platform that provides multiple things for pretty much every element of the generosity experience, website, CRM events, peer-to-peer, yada, yada, yada, right?
Not a commercial folks. Don't worry about that. But the reality is that we look at different metrics and are even going through a pretty rigorous assessment of what are the key—like if we said three things—what are the three main things that people need to understand? You gotta be data driven in your approach.
So looking at things like growth in giving, which is basically net gains and losses in both donors and revenue. Different buckets. Are you losing a lot of small donors that might have a later impact for your major donor pipeline? You gotta be data driven. So that's item number one. But you start with—your small organization—you start with who do you know? Who's in your database? And ask why ? Why are they there? And can you bucket that out into, let's just say three different groups. Let's say you're an animal organization, you have people who are passionate about conservation, people who are passionate about the literal animal. And then you maybe have people who are kind of potpourri.
It's, you know, less affinity. Lower affinity. High affinity down to lower affinity. Just bucket it into three, like mid affinity two. So what happens is if you start to understand that, then you can understand why they start giving and you can do simple things that transition into the second thing, which is the actual giving experience. Generosity experiences, of course, we want friction at certain points. Friction to challenge the donor, to have them think about the problem and say, “How can I be a part of this solution?” That's good friction. Bad friction is they get to the form then they have no way to know how they're supposed to give to you.
I need to go to a contact us page that then routes me to a PayPal button eventually. So frictionless giving comes in when you actually want to hit the button or send the check. So thinking about that experience and making it as smooth as possible is then the next big thing to focus on.
But you can add a field on your donation form that says, “What drove you to give today?” And have it as open text field. And you can get some interesting information. And going back to the animal example a consultant friend of mine, Michael Buckley, was telling me a story how he works with animal organizations and one of his clients served a particular type of animal and somebody on a very similar question answered that they love a completely different animal, and that's why they gave. And it's like, well, whoopsie, somebody doesn't understand what they gave to. But that's kind of the affinity thing. It's like, well, they were driven for some reason. Right? So you have to then decide are those outliers or are those trends to pay attention to. And that's where the data comes in.
And then the final thing is, how do you continue the story? A lot of people, they design a campaign, they end the campaign and there's no narrative tie to the next chapter. Keep telling the story. You're storytellers, this is what designing is. It's ultimately just a big story.
And so from there it's like, where can I use technology to automate some of the story? And then that frees up time for me to come in and personalize it even further. Okay, I'm gonna pick up the phone now. I'm gonna leave a thing. Stuff like that.
Tucker: Well, you know, Tim, you're reminding me too of—from our world of experience design—the primary methodology we use is something called appreciative inquiry.
And appreciative inquiry based fundraising is incredibly powerful and it gets into some of those questions that you're asking, but where you literally ask people these questions like, “You gave to us last year and I just wanna reach out. Why was it important that you gave to us? You could give to so many different nonprofits, but why is it important that you gave to us?”

And literally ask them. One of my favorite questions to ask any form of an experience that we're doing with a board or whomever, is literally the why question. And it's one of the greatest gifts that somebody who gave to you can give to you, which is not their money, but actually is why they're giving in the first place.
That is an incredible gift that they're giving to you. And to your point, Tim, if you don't know why somebody is there, you may literally just reach out, “Hey, can I take 15-20 minutes of your time? I just wanted to ask you a couple questions.” And have nothing ask oriented, in terms of asking for money, but just digging into being curious about their specific life and why this matters to them. So I love where you're going with that, Tim.
Tim: Audience design starts nearly everything because if you know who you're talking to, then you can understand what you're trying to say. And for me especially, where I think there's a gap in the market is around design for small shop organizations who are overworked.
They're trying to do a hundred things, and they only have time for 10. You got a lot of folks out there that easily cover the 3% of nonprofits that make 5 million or more. What about the 97% that make under 5 million? So that's where I focus because the rest of the market's pretty well covered.
And you can get… For me, I think there's a lot of great things out there. We're, proud, for instance, to partner with Bloomerang, DonorPerfect, and Kela on the Fundraising effectiveness project. Those are all great systems to look at. If you are working with an Excel spreadsheet, look at any of those, please. Get data driven, and from there you can start to take a mix of that qualitative feedback in the conversations that you have. And validate that against the larger data trend itself. Does the money bear it out? And so designers understand both leading and lagging indicators.
Everybody looks at lagging right now. Lagging is the money came in. Leading is, I think the money will come in because. And that's the part that we are really bad at in our sector. So where to get to the new normal. We gotta look at that part cuz we're too focused on the lagging right now, ultimately.
Tucker: So l last question, Tim. This is one of my favorite questions.You know, I'm a fundraiser. I'm at an organization under 5 million, to your point. I love that. That's a lot of the area that we focus too, is the smaller organizations. But I've got, as you said, a hundred things to do, and I only have time for 10, and I really need to do three.
And hitting on gathering the data. I'm behind. It's year end fundraising right now. And there's too many things. I was just talking to a fundraiser literally yesterday about this. The question is, what's made possible in my life as a fundraiser, if I'm able to—sometimes I think about the idea of the joy set before us. Where do we want our pain? Do we want it later on, or do we want it now? Like to just choose to say no to certain things. To say yes to that we let our nos create deeper meaning for our bigger yeses—but what's made possible if I'm a fundraiser and I actually lean into creating generosity experiences. What's really made possible for me, for the organization, for the donor, from your perspective?
Tim: Well, one, I'm gonna give a shout out to Robin from Peloton, who has the no is my yes framing .

Tucker: Oh, I love that.

Tim: So that I love. What's made possible is that we can start to, on an individual organization level, you could start to properly project out where sustainability is gonna be.
Not everybody has to be a $3 million, $5 million, $10 million nonprofit. You can have it where you're serving your community and reflecting that your community and partnering with other organizations toward a larger initiative and be fine with that. And also we need to be fine with ending the story.
Not every nonprofit needs to exist. And if you can do more good by putting your energy into collaboration, we're gonna see more mergers and acquisitions of different nonprofits. I've seen some really interesting things where for instance, Alman Foundation, they're a teen cancer organization. Been using us and working with us for a long time.
And, and what they've been able to do is actually identify smaller youth charity runs and events and they acquired those as assets. And you could do this, folks, this is not only legal, it's really innovative stuff. And they acquired the assets of those races and simply rebranded them as dedicated programs.
And not just fundraising programs. Everything's centered around building that community around youth cancer patients. And so when you can think about that in a sustainable and an abundance way and not worry about if you're gonna be able to keep the lights on, generosity experiences, help unlock that because people stick around. People start to give in recurring donations. We did massive recurring donation research. On small to mid-sized organizations, that's who mainly uses our software, and we found that the smaller nonprofits perform better at recurring donation programs than the larger nonprofits in our dataset.
And it was the largest analysis of recurring giving that has ever been performed. Wow. A University of Dallas professor looked at it and when she looked at it, professor Searing, she found that people were given on average $64 a month. You compound that out 12 months per donor, that's a big deal.
So this is very, very, achievable where we can really start to solve some larger problems.
Tucker: Well, and and it sounds like too, what's made possible for the fundraiser itself, this person who's sitting there in that seat. It sounds like they're able to, makes their jobs easier overall, right? It's not going back to your eight out of ten first time donors don't come back. And the cost to acquire that and the headache to acquire that and the… Everybody's in year end giving right now. And based on your data, eight out of the 10 of those first time givers that are coming into year end giving right now aren't gonna come back. None of us want that.
Tim: And we had to take it a step further. The unfortunate thing is that our sector ends up focusing only on the donor data. And so let's take and join that with another data set, which is that the average tenure of a fundraiser in our sector is 18 months. I wonder if those two things are connected. And so we have to keep investing into…

Tucker: Mm-hmm. Oh yeah, massive turnover, burnout.

Tim: The burnout. We have to address the mental health of people and the wellness of people and the equitable treatment of people. For pay equity or representation of folks of color and LGBTQ organizations. There's so many things, man. And that's not enough time. We don't have enough time for that. So I'm gonna gonna dial it back right now.

Tucker: Well, we actually did—just as a brief piece here—we did a podcast the other day on the case for leadership development. And the data is definitely suggesting, and clear. It's both our primary data around our THRIVER community program, as well as the secondary data around this, is that if we are not investing in leadership development around this work, it is literally a bad investment.
One of the stats that we use is from, I think it's from Gallup, and it said, $3,400, 34% of any nonprofit employee's salary is essentially lost due to disengagement if they're in a burnout state, it's completely lost. Might as well throw it away. And so if we think about this…

Tim: Put that in the show notes, man. Put that in the show notes.

Tucker: It's a massive issue. And the lack of investment in leadership development. I could definitely go on and on about that. But it's a podcast that we talked about a little bit ago around the case for leadership development that it's literally a bad investment. But totally with you, like what's made possible is people not getting burned out. Enjoying their jobs, staying around a lot longer. Not having that turnover that you were talking about. Alright, last thing. This is like rapid round, like quick fire. If they—to your no is my yes—if they needed to say no to everything and yes to two things, what would you suggest if I'm a fundraiser to create a generosity experience?
What are the two things that people need to do?
Tim: Accurately assess your tech readiness and your organizational buy-in for tech implementation to design the experience and automate the experience. So being ready for things like a good website, a connected CRM, a financial integration. Being ready for that, and then executing on that. Where the tech accelerates the core story that at its core, if you stripped all the technology out of it, would still be stellar, just not scalable.
Tech will scale it. And so join those two things and we're cooking, we're cooking with gas.
Tucker: Hey, Tim, it's so good to be here with you my friend. I appreciate your wisdom, your authenticity, the way you… I love your newsletters on LinkedIn and they're just insightful. And so thank you.
I'm just really grateful to have you on this podcast and to share. I took a lot out of this myself. I fundraise myself. And you know, even as the CEO of THRIVE IMPACT, I'm fundraising, I'm thinking, I've noticed I need to shift into identity-based giving. I have a little too much relational, a little bit of situational. I need to make some shifts myself. So this is insightful for me.
Tim: And I mean, I didn't even get on my high horse about financial reconciliation. But that's another day. That's another day.
Tucker: Another podcast too!
Tim: One day, another podcast. And I have, there's smarter people than me on that. Awesome. This was such a pleasure. Thank you for having me.
Tucker: Oh, thank you, Tim. Have a wonderful day, my friend.
Tim: Okay, you too.

Read Full Transcript