I have noticed an increasing number of arts organizations planning capital campaigns. This may simply be one result of a recovering economy -- few arts organizations felt capable of raising large sums in the years immediately following the stock market crash of 2008. Now that the market is back at record levels, more boards, and staffs, feel confident that their donors will be generous.
But I fear that with this increase in capital fundraising will come a concomitant increase in disappointed arts organizations. Too many institutions are planning capital campaigns that far exceed their abilities.
These organizations have not built a family of donors sufficient in size and potency to earn the number of large contributions required to complete successfully a capital campaign.
I have watched as arts organizations set campaign targets that are ten, twenty and even thirty times the amounts they raise annually. These ventures almost always end in failure; and the repercussions can be severe. Not only will the building go uncompleted or the endowment fund be undernourished, but also the sense of failure can pervade the board room, the staff offices and the minds of the donors. This cannot help the organization present the image of accomplishment that is required to grow an institution. And, of course, annual operating fundraising typically suffers during a capital campaign, often retarding the amount or level of work attempted just as the organization needs to present a picture of vitality to justify capital gifts.
Why do so many organizations fall into this trap?
I think they confuse prospects who are able to give with those who are likely to give.
Anyone can create a list of prospects that are able to give large sums to a capital campaign -- there is no shortage of incredibly wealthy people in every state of the union.
But will these prospects be interested in your campaign?
Have they ever demonstrated any significant interest in your organization?
The fact that people once came to a gala, made a modest contribution or attended a performance -- and happen to have a great deal of discretionary funds -- does not make them strong prospects for a capital campaign.
It does make them strong prospects for cultivation; we must invest the time and energy to build a large core of potent, engaged donors before we can attempt any capital campaign that stretches the institution.
This requires organizational focus and commitment: we must be willing to select a group of prospects and then commit to working diligently over an extended period of time to engage them with our work.
Only when we can easily identify enough prospects who have demonstrated their excitement in our work and who can collectively (and easily) contribute at least 75 percent of our campaign goal, are we in position to mount the campaign.
Unfortunately, just having a good idea for a new building, new project or expanded endowment fund is not enough for success.
We must have that group of likely donors - ready, willing and able to help us achieve our target.