When Donors Make Demands

It’s one of those mistakes lots of nonprofits make without even realizing it. And it’s a huge deal.

A donor offers to give you a ton of money. A big fat check. You’re drooling at the prospect.

But there’s a catch. She wants you to use the money for something specific. A “special project.”

She tells you the details. You think, “Hmm, that sounds alright, actually. Surely this project would be useful for us.”

Without giving it another thought, you accept. You meet with your staff to celebrate your windfall.

Alas, you might have just made a HUGE mistake. A mistake that can cost you time, money, and reputation. That can seriously harm your mission.

I know. I’ve been there.

So I’ll tell you what to do when a donor pushes for a new program and implies the money depends on you saying yes. If you play your cards right, you can turn it into a huge win.

SHOULD YOU LET DONORS MAKE DEMANDS?

How can it be a mistake to take a large donation for a project that appears to align with your mission and, if successful, should help your organization?

Let me illustrate with a personal story.

A big donation for GLAAD was contingent on us starting a research program. A critical academic analysis of the effects of media on culture.

I could totally picture it and it seemed amazing. We would bring in the finest researchers in the country. We’d have a think tank backing up the work we do. White papers that could be marketed to the press. Other donors will love it and the money will flow. I said yes. The donor gave a huge check.

And so we built it. I put two staff members on it. We set up an advisory board made up of the top 15 researchers in the field. A quarterly magazine.

WHAT’S WRONG WITH A BRAND NEW PROGRAM?

Inherently nothing. But there were three things that made it a big fat mistake for our organization.

1) The decision took GLAAD off course. We had limited resources to begin with to do the core work we did. I could have hired three more staff members (that we really needed) to work with local community activists to monitor regional media, conduct editorial board meetings, train activists to speak to the media — the core work of GLAAD. This “special project” was a distraction and wasn’t part of our strategic plan.

2) This program was high profile and its success or lack thereof could impact our reputation. We brought in the finest researchers in the country (and I barely even paid enough attention to know this at the time – see #3) and introduced them to GLAAD. And they weren’t very impressed with what they saw.

3) I didn’t really believe in the program. There. I said it. I didn’t give staff the time or resources they needed for this program to thrive. I’m not a researcher and so hiring staff was a challenge for me. The program wasn’t in our wheelhouse.

WE SHUT IT DOWN

Three years later, I let McKinsey and Company do my dirty work for me. They offered pro bono strategic planning services and after a solid assessment, said what I knew all along. Know that Sesame Street tune? “One of these things is not like the other, one of these things just doesn’t belong.”

We closed the program, laid off staff and I had squirmy conversations with the best and brightest academics in the country looking at the impact of media on culture with real academic rigor. That was the biggest loss. GLAAD lost credibility with the cream of the academic crop.

AVOIDING DONOR DRIVEN PROGRAMS

I had coffee last week with Jeffrey Walker, my friend and author of The Generosity Network. He noted that there’s a glass wall between donors and nonprofits. One side has power and one side needs help. It’s unhealthy and full of opportunity for miscommunication and fear. It impedes real relationships and meaningful conversations. It’s why sometimes donors feel like they can make demands.

Exactly right. It’s why I was so quick to take the money and convince myself that the “special project” would be great.

So when a donor pushes for a new program and implies the money depends on you saying yes, what do you do?

Let me start with what you should not do. Do not say, “Great idea, but what we really need is a new staffer.” Your donor came to you with an idea and, since she’s willing to write a big check, she probably feels pretty invested in it. If you want her money, it’s about what she wants, not what you need. So you still need to honor her idea, even if you don’t think it’s right for you at that time. Or ever.

But how do you do that and still get what you want?

WHAT PROBLEM ARE YOU TRYING TO SOLVE FOR?

Such a simple question! I wish I had asked this. We all do it – we focus on AN answer rather than revisiting the question and figuring out if there are other ways to answer it.

Maybe the problem was, “GLAAD doesn’t have a relationship with the finest academic minds in the country who have been studying the fundamentals of your mission for decades.” Framed this way, the donor’s concern was absolutely spot on. And there was then a sixty minute conversation we (see? I said we) could have had about how to solve for that without driving right to a tactical answer by building a big old program that for reasons above was destined to fail from the start.

Sure there are donors that will be happy just writing a check. But a donor with a program idea is not your worst nightmare. A donor with a program idea has just extended an invitation to you – to have a meaningful conversation about gaps and opportunities.

That conversation could result in something that is more impactful than anything you could have each developed independently.

Whole. Greater. Sum of parts.