With reports that donor numbers are falling in many parts of Europe, high value philanthropy is becoming even more important to non-profits. Fundraising Europe asks experts from across Europe what today’s philanthropists are looking for from the organisations they support.
Major gifts and legacy giving have long been a mainstay of voluntary income for many non-profits across Europe, but the world is changing and so too are the needs and expectations of today’s philanthropists.
Reports of a decline in the number of donors in some of the more developed fundraising markets (including Germany, France, Italy and the UK), coupled with the introduction of GDPR limiting outreach to new supporters, suggest that future giving levels may indeed be increasingly dependent on higher value donors. This places greater emphasis on the importance of successfully engaging philanthropists; both potential legators and major donors.
And this is where the good news lies for Europe’s fundraising community: high value giving appears to be on the rise. Certainly within the UK marketplace, the latest studies show that legacies and major gifts are growing and offer far greater potential. Just this year, top British universities Oxford and Cambridge received their largest single donations of £150m and £100m respectively, while annual income from legacy giving topped £3 billion for the first time.
Similarly, studies report legacy growth in Finland and greater propensity for legacies in Switzerland too, with the Philanthropy in the Netherlands report highlighting that major donors often want to give more than non-profits expect.
But what are today’s philanthropists looking for from the organisations they choose to support? We ask six European philanthropy experts their views.
Philanthropists want to do more
The prevailing view is that today’s philanthropists want to do more than fundraisers might expect.
Jan Rachels, founder and president of Testament.be and senior consultant of Emolife Belgium, says: “The need for funding from high value donors is growing more than ever as public funding diminishes. But philanthropists don’t just want to give money anymore. They want to feel that they are part of the solution, that they have been involved in the decision-making.”
Vera Peerdeman, senior consultant at the relationship and major gift fundraising consultancy Nassau, agrees: “By nature, the Dutch are entrepreneurial. Major donors want to do more than just donate; they want to invest by sharing their expertise, time and/or network as well. They really want to participate in realising NGOs’ dreams.”
“There’s still a large group of major donors that doesn’t have the time (or need) to do more than just a financial transaction. But, the number of proactive major donors is growing. And once NGOs can find a way to meet the needs of major donors, to succeed in building reciprocal relationships around these needs, you see an enormous increase in individual donations.
“It’s not always easy and this can mean that major donors lose patience or even set up their own foundation, because NGOs don’t meet their wishes, needs or expectations.”
Director of the independent research agency and consultancy Factary and author of How Philanthropy is Changing in Europe Chris Carnie says: “Philanthropists need a lot more love. They don’t want just to hand over the money and let the charities do their work. They want to be become real experts in the causes they support.”
Carnie cites the example of a philanthropist who recently spent three weeks working with an NGO in Africa. Giving financially was not enough; she wanted to do more.
He adds: “Philanthropists are looking to learn and gain from the experience of giving, exploring what they can achieve with their wealth and where they can have most impact. They might well invest in a social enterprise or fund, just as much as they might a non-profit. There are no hard borders between them.”
Philanthropists’ needs are changing through the generations. Carnie says: “This new generation of philanthropists, those that have made their own money in their lifetime or inherited businesses or wealth, often have a dramatically different attitude to money and philanthropy from their predecessors.
“Particularly in Spain and parts of Southern Europe, where philanthropy was so closely linked to religion, there used to be a great deal of modesty or silence around giving. For this new generation, major giving is seen as an investment and they want to know that there will be returns on that investment, whether it’s financial, social or more to do with the experience itself.”
Jana Havlenova, director of fundraising at Sue Ryder in the Czech Republic, adds: “In the Czech Republic, philanthropy is still relatively young and evolving in many different ways in the post communist era. But we are seeing a slight difference between what millennials and the older generations want.
“For the latter, they are often selling up businesses and looking around for what to do with their wealth; it’s an emotional decision and the relationship is important to them. Millennials are still growing their wealth and tend to concentrate more on impact and social change.
“For major donor giving, personal contact is essential. It gives people – particularly older generations – a chance to feel valued for their insights and to integrate with others who have similar thoughts and feelings, and to be part of the resolution. This is what they want to share, not just their money.
“Younger givers are often entrepreneurial in their approach and are inspired by innovation. They want to see that the charity is really open and prepared to adapt to find the best solutions. They are happy to invest and test new programmes, liking the sense of being social incubators.”
While philanthropy draws together both hearts and minds, major donors are becoming increasingly strategic in their approach. The recent Philanthropy in the Netherlands study found that a third of philanthropists have a strategy in place for their giving. But this is by no means unique to Dutch philanthropy.
“Potential major donors need to fully understand how their resources can help to tackle problems that they care about,” says Dr Beth Breeze, director of the Centre for Philanthropy at the University of Kent. “They want to easily access credible information about the need and the proposed solution, as well as evidence that the charity seeking their funds can be trusted to spend their money well.”
Tony Myers, principal and senior fundraising counsel at Myers & Associates, and a major donor fundraising and leadership specialist working internationally, believes that many people with wealth have been successful because they knew what they wanted to achieve and were deliberate in how they went about it and that the same goes for major donor fundraisers.
Myers says: “If we want to appeal to philanthropists, we need to think strategically and follow a deliberate process, with a clear idea of the results we want to get. We can’t just cast the net wide and hope for the best.
“In my view, the problem is often that NGOs and fundraisers don’t always think big enough. Big ideas, and big plans are what attracts big money. Money flows by connecting values with those who have wealth. Our job as major donor fundraisers is to look for the people whose values we share and take that as our starting point, encouraging them to participate in our big plans, and in our efforts to make an impact, to make a difference.”
He reinforces the view that philanthropists have high expectations from non-profits, looking for sustainability of their investment, accountability, professionalism and good leadership, as well as a higher degree of imagination.
Myers says: “Ultimately, philanthropists want to know what the big hairy audacious goal is and to feel confident that the charity has the courage to really go for it.”
Creating unique experiences
Philanthropy experts agree that high value donors not only want to make an impact and be part of the solution, but to feel more deeply connected to the organisation and its mission. They emphasise the importance of offering a personalised supporter experience.
“To benefit from this new generation of strategic philanthropists, non-profits will have to act fast, offering opportunities for philanthropists to get more involved through unique experiences or investable products,” says Carnie.
“This has strong implications for major donor fundraisers, who now need to help to devise these investment vehicles and plan how the organisation will evolve to meet philanthropists’ needs.”
Breeze agrees: “There is a growing demand for ‘meaningful experiences’, where people want to spend money on creating memories rather than further consumption. So, creative fundraisers need to provide ‘magical moments’ for their major donors like meeting the artists and scientists they fund, seeing ‘behind the scenes’ of a beloved institution, or visiting a project overseas.
“The number one thing philanthropists want is to be treated well. Rich people are just those who have more surplus money than the average. Like us, they want to be liked, respected and thought well of. Unsurprisingly, they don’t respond well to being treated like a walking bag of money.”
Today’s philanthropists need to feel that they have something special to offer, that their help is needed and will make a real difference. They want a deeper connection to the cause, the organisation and its beneficiaries, and they are often prepared to give their support in other ways too.
This will undoubtedly require a change of mindset for some non-profits, more creativity and new skills in developing tailored giving opportunities for each supporter, and certainly support from senior management, but the potential returns are exponential.