Fundraising Opportunities in the Trump Era
Regardless of your personal feelings about President Donald J. Trump, the new administration means great opportunities for proactive fundraising professionals:
- Giving to some individual charities will grow greatly. Many years ago, Richard Viguerie, a pioneer of conservative direct-response fundraising and chairman of ConservativeHQ.com, said that people would rather fight against something than for something.
We have seen it before. We are seeing it now. For example, Kari Paul, of MarketWatch, reports that the Sierra Club, Planned Parenthood, the NAACP and the ACLU have experienced a significant uptick in philanthropic support following Trump’s election, as donors seek to oppose the anticipated policies of the new administration.
- Stock values are predicted to climb. Stock values are expected to continue their rise in 2017, though not necessarily at the rapid pace we saw in the closing weeks of 2016, according to the Goldman Sachs 2017 Macroeconomic Outlook. A majority of Americans own stock in some form, according to Gallup. With the growth in stock values, many of these individual stockholders can donate shares to their favorite charities. When they do, they may avoid capital gains tax and receive the charitable-gift deduction. Furthermore, foundations will have more funds with which to donate.
Tax reform is likely. Congress will likely approve some sort of tax reform proposal in 2017. While the federal government will look at changes to both personal and corporate tax policies, mega-brokerage firm Goldman Sachs believes changes to corporate policy are more possible in 2017, with changes to personal taxes to follow. If corporate tax reform results in increased business profits, the nonprofit sector could experience an uptick in corporate giving. Likewise, if Congress reduces personal tax rates, individuals could have more money with which to contribute.
Stock values are expected to continue their rise in 2017, though not necessarily at the rapid pace we saw in the closing weeks of 2016, according to the Goldman Sachs 2017 Macroeconomic Outlook.
Rep. Kevin Brady (R-TX), chairman of the Ways and Means Committee, has said that House Republicans remain interested in preserving or enhancing charitable-giving incentives during tax reform negotiations. A downside could occur if the charitable deduction is drastically changed—for example, replaced with a tax credit.
- The overall philanthropic pie will grow. For years, philanthropy has correlated to approximately two percent of GDP. Goldman Sachs believes that, in the U.S., 2017 GDP growth will be 2.4 percent, compared with 1.6 percent in 2016. While this is a modest improvement, it represents growth that is likely to further fuel charitable giving.
Amir Pasic, Ph.D., the Eugene R. Tempel Dean of the Indiana University Lilly Family School of Philanthropy, says, “Our research indicates that all types of donors—individuals, foundations, corporations and estates—are likely to increase their giving in each of the next two years.”
Overall, inflation-adjusted philanthropy is forecast to grow by 3.6 percent in 2017 and 3.8 percent in 2018, according to The Philanthropy Outlook 2017 & 2018. The report was researched by the School of Philanthropy and presented by Marts & Lundy.
Donor retention rates in the U.S. remain shamefully low. If donors are important to your organization, make sure they feel important.
To capitalize on the potential opportunities, here are six things you should do:
- Avoid sounding defeatist. I am not talking about the election outcome. I am talking about an appeal that goes something like, “We haven’t made our goal yet. So, please help us reach our goal before the end of the fiscal year.” Instead, keep the focus on your beneficiaries and your donors.
- Establish a great case for support of a solid mission. People want to know that their donations will make a difference. They want to know how your organization will use their contributions. So, tell them!
- Build strong relationships with donors. Donor retention rates in the U.S. remain shamefully low. If donors are important to your organization, make sure they feel important.
- Ask for support. The organizations that will suffer the most are those that become complacent in their fundraising efforts. If you want more donations, if you want donors to upgrade their support, if you want more planned gifts, ask for them.
- Get to know the other side. Diversity and inclusiveness means we need to be open to all, not just those who agree with us. If you do not know a Hillary Clinton voter, or if you do not know a Trump voter, find one and talk with him or her over a cup of coffee. Why? Because your organization’s supporters have voted for both candidates. Even Planned Parenthood has donors who voted for Trump. As fundraisers, we need to understand the fears, concerns, interests and passions of all of our donors if we are going to be successful when it comes to seeking their support.
- Avoid engaging donors in a political debate. No one ever wins an argument with a donor. Even if you technically win, you lose. Remember, when meeting with prospects and donors, you are representing your organization, not your own personal views. Stay professional, and focus on the organizational mission.
Any number of factors could change the philanthropic outlook: inflation, rising oil prices, major terrorist attack, war, etc. However, for now, the philanthropic forecast is positive. To succeed, fundraising professionals will need to remain vigilant, plan their work, stay flexible and boldly seek philanthropic support from diverse sources.
mrMichael J. Rosen, a past recipient of the AFP Skystone Partners Prize for Research on Fundraising and Philanthropy, is president of the fundraising consulting firm ML Innovations. He is also publisher of the nonprofit blog MichaelRosenSays.wordpress.com. He can be reached at email@example.com.