5 Steps to Conduct a Successful Nonprofit Feasibility Study
The time has come. Your executive team is excited about your newest initiative, and you’ve decided that the best way to accomplish it is via a capital campaign.
But the question lingers: can you pull off such an ambitious project?
Instead of just forging ahead blindly, conduct a nonprofit feasibility study to get the answers you need about which fundraising strategies you should implement, who should lead the way, and how your constituents will react to your campaign.
To find out if your organization is ready to tackle its most demanding project to date, take these five smart steps:
- Set clear goals.
- Bring on professional assistance.
- Complete background research.
- Conduct interviews.
- Review and implement findings.
Ready to complete a successful capital campaign? Set yourself up for success before you even begin. Let’s get to the tips!
1. Set clear goals.
The primary outcome of a successful feasibility study is to determine if your organization’s capital campaign can raise a stated amount of money in a reasonable period of time.
To find the answer, you need to get specific with your numbers and include them in your feasibility study.
This step might seem obvious, but there’s more to goal-setting than choosing a number out of the air. What sets capital campaigns apart from annual fund campaigns are their concrete goals, which means that you need to be more specific with your goals.
Let’s say you’re a hospital launching a healthcare fundraising campaign to build a new wing of your building. You can get very close to the true cost by calculating contractor’s fees, building materials and specialized equipment costs, and other costs.
If you’ve completed similar projects before, you’re already ahead of the game! If you haven’t, look to other nonprofits similar to yours in size and mission for their plans, and consult with members of your board or executive staff who have been involved in big campaigns before.
You might also be working toward some secondary goals apart from a total amount of donations, such as:
- A certain engagement rate.
- A certain percentage of major gifts.
- A certain percentage of new contributors.
- A certain amount of publicity.
- A certain degree of board engagement.
Make sure that you can measure your success in reaching these goals. You need software and staff to keep track of important metrics and time built into your schedule during and after the campaign to crunch the numbers.
The takeaway: The only way to meet your capital campaign goals is to clearly state them, then work them explicitly into your feasibility study process.
2. Bring on professional assistance.
Once you know what you want to accomplish, it’s time to strategize. And for that, you need a professional: a fundraising consultant.
In general, these consultants provide guidance to your fundraising team, filling in gaps of knowledge with their own experience and research. Fundraising consultants can also specialize in a variety of areas of philanthropy. Depending on what your organization in particular needs, you might be looking for a specific area of expertise.
To find the right fundraising consultant for your team, you’ll need to consider:
- Their background working with organizations similar to yours in size and mission.
- Their portfolio with projects like the one you’re about to undertake.
- Other organizations’ experiences with this consultant.
If you need recommendations for the top fundraising consultants, check out this guide from Double the Donation. You can’t go wrong with any on the list!
A fundraising consultant can bring a wealth of experience with capital campaign direction, but that’s not all they bring. Don’t underestimate the value of an objective, third-party perspective.
When conducting interviews and research, consultants don’t bring to the table the same biases as members of your staff. They are also likely to get more honest answers from interviewees who might not want to hurt the feelings of nonprofit staff.
The takeaway: A fundraising consultant is your nonprofit’s guide to objective, accurate feasibility study results.
3. Complete background research.
Now that you have a fundraising consultant to support your nonprofit feasibility study, you’ll need to start building a 360-degree picture of your nonprofit. You’ll need to provide financial records, organizational structure trees, and profiles of your leadership for your consultant to parse through.
After understanding the basics of the way your nonprofit operates, your fundraising consultant will need to get a clear idea of where your fundraising strategy stands.
The only way you know if you have the ability to meet your stated goals is by digging into your past campaigns to find what worked and what didn’t.
You should already have some basic data on file, like retention and top contributors, but your fundraising consultant will likely also gather:
- Historical information about your nonprofit’s organizational changes.
- Patterns in past donations, both annual and one-time spikes and dips.
- Timelines of past fundraising campaigns.
- Analysis of your successes and the successes of other similar nonprofits.
- Detailed information, including timelines and leadership trees, of your anticipated campaign.
This step is especially important to undertake alongside a fundraising consultant. They will ask questions about areas you never would have thought to include in your considerations, all because they’re coming from the outside.
Fundraising consultants are also experienced in crafting case statements, which is what yours will create at this point in the campaign. As this guide from Averill Fundraising Solutions explains, a great case statement will feature the following elements:
- Strong opening to get the reader’s attention.
- Overview of your nonprofit’s history and mission.
- Specific information about your campaign.
- Your mission statement.
This case statement will prove invaluable for the rest of the feasibility study process!
The takeaway: Your fundraising consultant will need historical and organizational information about your nonprofit to determine your chances of meeting ambitious capital campaign goals.
4. Conduct interviews.
Historical data about campaigns can’t tell you everything you need to know.
Think about it: just because a similar campaign was successful five years ago doesn’t mean the same strategy will work this time around. Leadership, technology, and community receptiveness all change year to year and season to season.
To fill in the gaps that a pure statistical analysis of your past campaigns can’t account for, your fundraising consultant will need to conduct interviews with some key individuals, such as:
- Board members
- Executive leadership
- Staff members
- Major contributors
- Prospective supporters
- Influential community members
Your consultant will bring along the draft of the case statement, or parts of it, to these interviews to ask for specific feedback at this point.
It’s important for your fundraising consultant to hear input from within and without your organization to get a well-rounded picture of your current standing.
External voices will focus on their perceptions of your organization and their likelihood of giving to your particular campaign. A campaign isn’t feasible if donors aren’t willing to support it.
Internal voices can give your team a better idea of who should take which leadership roles in your upcoming campaign.
Fundraising consultants make sure interviewees know that their privacy will be respected. Of course, opinions and feedback shared in interviews will make their way into reports and decision-making conversations with the consultant. But unless they wish their name to be associated with their comments, your interviewees should rest assured that they can speak freely and candidly.
The takeaway: Interviews with key stakeholders help your fundraising consultant round out their picture of your nonprofit’s fundraising stature.
5. Review and implement findings.
Gathering all this information is only worthwhile if you can use it to make decisions about your campaign.
Your fundraising consultant should be able to tell at this point whether your nonprofit is ready to undertake the capital campaign, as well as provide some additional information.
For instance, if it turns out that your nonprofit isn’t ready to tackle the campaign the way you wanted to, then you can take the feedback you received to guide the initiative in a different direction.
You might need to adjust your monetary goals, your expectations, the scope of the project you’re hoping to undertake with the funds you raise, the fundraising methods you’re using to reach your goals, or your marketing and communication strategies.
If, on the other hand, you get the green light on your campaign, your fundraising consultant can take the data from interviews to revise the case statement for your campaign. This revised case statement can be sent to your current constituents, prospective contributors, board members, corporate partners and sponsors, and community, modified for different formats and audiences.
The takeaway: Whether your nonprofit feasibility study recommends following, modifying, or postponing your current capital campaign plan, your fundraising consultant can provide more nuanced information than just those three options.
Capital campaigns are as stressful as they are exciting. After all, your beneficiaries and community rely on you.
Make sure your organization can support your ambitious capital campaign promises by conducting a useful feasibility study first, with the help of an experienced fundraising professional!
About the Author
Chad Peddicord’s experience includes more than 15 years collaborating, assisting, directing, and providing strategic guidance to not for profits. Having worked both as a consultant and a chief development officer, Chad brings a unique perspective to his role as Executive Vice President of Averill Fundraising Solutions. This point of view informs his collaborative approach in empowering clients to maximize opportunities and produces optimal results.