Are Fundraising Events a Losing Proposition for Your Nonprofit?

"There is nothing so useless as doing efficiently that which should not be done at all." - Peter Drucker

Say the word “fundraising” to anyone unfamiliar with the field and what’s the first thing to come to mind? You guessed it—events. Everyone seems to buy into that old Andy Hardy mantra of “let’s put on a show!” and many people view events as the be-all, end-all of fundraising.

Well I’m here to tell you a little story. Bear with me, and I’ll tell you how my experience relates to events.

It happened several years ago. I was working with a small organization as its 20-hour-a-week development director when I came up with the idea to sell donated goods on eBay to raise money. Its board agreed to give it a try, we publicized it in the newsletter, and I began hauling donated items home in my car every week to photograph and list.

Selling on eBay is much more time-consuming than you might imagine—researching the items; writing up the listing; designing the HTML for the website; taking countless photographs of the goods; and, lastly, packaging, addressing and shipping—especially when you’re doing it all yourself. At the end of three months, we had raised slightly more than $8,000 for the organization—after PayPal fees—and the organization was delighted with the outcome.

I, however, was not. When I factored in the amount of time that I had lost—time that would have been better spent writing grant proposals, researching foundations, or calling or meeting with donors—I realized that selling on eBay was a losing proposition.

Why am I telling you this?

My story illustrates two points:

1. I was blessed with a wonderful board that supported my idea wholeheartedly. More boards should give their development staff the freedom to do their jobs—even at the risk of sometimes failing.
2. My eBay selling experience was very similar to many smaller nonprofit organizations’ experiences with events. My friend, Jen, who works for a moderately large nonprofit in New Jersey that shall remain nameless, refers to events as “crack.” For many small organizations they are addictive, despite the often relatively low return on investment.

Oh sure, events can and do raise money. Yet it’s rare that event ROI analysis methods factor in the enormous—and I do mean enormous—amount of time devoted by staff to the planning of events.

You know exactly what I’m talking about.

As an example, I once worked as a grant writer for an organization where I was repeatedly called off task to tie goody bags, pick up donated goods for events, hostess at golf outings—you name it. Do I need to tell you that my grant-writing efforts brought in 70 percent more money than the events?

You probably have your own event horror stories. Unless your organization already has a prominent signature event, or a committed bunch of talented volunteers willing to do the grunt work for you, events are generally a losing proposition.

I liked how Norm Olshansky, in his article “Fundraising Return on Investment,” described the purpose of events: “This may seem like blasphemy to some, but events should primarily be utilized to attract new donors, cultivate existing donors and volunteers, say thank you to your donors, volunteers and staff, or to provide community education.”

It’s been my experience that a smaller nonprofit is much better off focusing on “Benevon” style events. Benevon is the organization formerly known as Raising More Money. Its program solely focuses on growing an organization’s individual giving, and a major component is the small, informal cocktail party or gathering at board members' homes, designed for the sole purpose of introducing friends and neighbors to your mission in an informal, engaging manner. These events require minimal staff involvement and result in greater long-term gain.

Focus, too, on your follow-up. What systems do you have in place to transition ticket buyers into donors? How are you turning event attendees into long-term supporters?

You’ve got limited time, money and resources. And I’m all about keeping it simple, which means building your donor base—and, eventually major gifts—in a wholly systematized way.