“be fearful when others are greedy and greedy when others are fearful.” – warren buffet

warren buffet’s timeless investing advice holds a powerful lesson for fundraising, according to this article from the Stanford Social Innovation Review (SSIR). a better way of looking at this is: when others are cutting back, invest in capacity building so you can bounce back stronger when the cost-of-living crisis eases.

easy to say, perhaps, when every dollar counts. so to reframe this for small nonprofits, the tough times can be an opportunity to step back, re-assess your priorities and be really strategic about how you come out the other side. some areas to explore include:

• coach your board. don’t listen to the nonsense that australian boards don’t fundraise. you need a board that is invested in your nonprofit, donating within their means, working as ambassadors and sharing their relationships and connections. and, if they won’t … well, plan for a transition to a board that will!
• take good care of your donors. a no-brainer. if donors pause their giving, keep them engaged and they will come back. in the meantime, plan engaging supporter journeys that will upgrade their giving. ask them why they donate and how you can improve.
• if your organisation doesn’t have a strategic plan, and a financing plan to resource it, spend your time now creating one. you will raise more money by being strategic about your mission, clarifying your case for support and diversifying your income streams.
• engage in scenario planning: in uncertain economic times, envisage various future scenarios and develop plans for each. this helps in being prepared for different outcomes and making informed decisions.
• reallocate resources: make sure all your programs are mission aligned, impactful, financially sustainable and aligned to your organisation’s core strengths. if some programs are losing money (make sure to include indirect costs), re-allocate your people and systems to optimise cost, profitability and impact. take a close look at how you are recovering non-program costs to ensure financial sustainability.
• go digital. invest in a donor database and fundraising staff. move your communications with supporters online and integrate fundraising in all your content. you will raise more money, save costs and help rescue the planet. your supporters will be more engaged and more interested in your work and the organisation.
• cut complexity. legacy systems, structures and work arounds drive organisational complexity and higher costs. the board may be resistant to change until you can show them how legacy ways of doing things are costing your nonprofit money that will be better spent elsewhere. a crisis is a great catalyst for change!

the cost-of-living crisis could be an opportunity not a threat. by being strategic, investing in capacity building, and leveraging your strengths, you can navigate the tough times and come out stronger on the other side.

the corollary to this is caution during the good times when others are aggressively pursuing opportunities. this is a time to grow sustainably, build reserves (yes, for a stormy day), focus on long-term impact and avoid mission-drift (not chasing every funding opportunity or trend). but that’s a post for another day …

if you’d like to discuss options to emerge faster and in better shape when this cost-of-living storm finally blows over, get in touch. together, we can chart a course for a resilient and sustainable future.