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For Impact | The Suddes Group

Daily Nuggets: A For Impact Blog

Do the math to simplify your funding story.


To me ‘doing the math’ means owning and internalizing an understanding of your numbers. It also means taking the time to simplify the numbers in a way that others (board, prospects, staff) can understand. Numbers tell stories.

DO THE MATH to determine:

  • Your gap. Sell your gap.

    Private schools have a simple gap between the tuition and the cost per student. Schools should ask funders to fund that gap. Example: $1016 per child. Sponsor one child for one year.

    We also do work with a lot of performing arts centers. For round numbers, let’s say box office support makes up 50% of the annual budget. This is a 50% gap. You can package any program and ask someone to fund the gap in that program 50%.

  • The true cost of programs.

    This is a big one. Organizations frequently under-estimate the true cost to deliver a program. Worse, many don’t know, they just pick a number out of the air. The cost to deliver the program (impact) is essential to your funding rationale. Knowing the real numbers boosts confidence in the ask and helps the funder buy into a funding rationale. You can ask someone to underwrite part or all of the program.

  • A funding rationale around impact.

    Along with the previous point, you can do the math to tie programming monies to impact. Clean and simple example to illustrate the concept: Let’s say you have a program that impacts 4th-6th graders at (80 classrooms @ 20 students per class) at 40 schools. You can do the math to create a simple funding rationale:

    • $80,000 to underwrite the program for one year
    • $2,000 per school
    • $1,000 per class
    • $50 per child

    Funders will appreciate your creative packaging to communicate the impact value so long as you’re simplifying (not changing) the math to tell your story.

  • A funding plan (this assumes you have a funding goal).

    I’m still amazed every time I walk into an organization and no one can agree on a funding goal. Without a goal how can you do the math to get to the goal?

    When you’re selling a vision you can also sell ‘the plan’. If it helps, think of a ‘mega-project’ that will require the participation and support of 32 funders. To get one funder on board you will need intelligent and believable math illustrating the funding plan for all 32 funders.

In practice:

For some organizations the math will be clean (like the examples above). Other times it takes a lot of work to make it simple. In writing this piece I quickly reviewed the math for 80 past clients – organizations of every shade and shape – sometimes the math took minutes and sometimes days. However, in EVERY case we were able to get some simple math around a gap, a program, the impact or a plan. It can be done.

Elevator Pitch vs. Elevator Engagement


“What’s your elevator pitch?”

You have 60 seconds with someone on an elevator. How do you pitch your company, product or organization? What do you say in that short time? Presumably the goal is to get the other person to say, “Hey, this sounds interesting. Let’s keep talking.”

If that’s the goal, and if you only have a short time frame, let’s change the question to: “What’s the best way to engage in a short time frame?”

Instead of spewing for 20-60 seconds… even if succinct… think about one great question you can ask of the other person to get them ENGAGED in a conversation.

I would ask one question then tell a quick story (10 seconds) based on the answer to that question. You engage more in a short time frame by asking questions.

The elevator pitch may be one of the most powerful framing devices ever. I’m not throwing out the concept… I just want to draw your attention to the difference between a one-way communication and a two-way communication. Focus on the two-way (engagement) and not the one-way (pitch). Think about the difference between SAYING and ENGAGING.

When you’re with a prospect on a visit, by phone, leading a tour or on an elevator are you SAYING or ENGAGING?

You need funds “For What?”


Nick and I were brainstorming yesterday about a coaching client. Talked about trying to get them to stop begging for money… and start answering the question:

“FOR WHAT?”

Neither of us can figure out why this ends up being so powerful, but it just is.

In the start-up/entrepreneurial world, we call this USE OF FUNDS. It answers the question: “Where does the money go?”

It’s tied directly to packaging your Priorities and Projects and Programs (obviously around your IMPACT) vs. ASKING FOR MONEY!

Stop begging for money. Start talking about the WHAT and the USE OF FUNDS!

Is your story awesome? If not, make it awesome.


Last week I was with an organization (to remain nameless) that had a super simple message but a really bad story.

In talking with the group it was instantly apparent that the message was trumped by a really bad story. While the org had a powerful, simple message on paper, the story I heard from several staff and board members was one about a long history of ‘not fundraising’, ‘yeah buts’ and program stigmas. “We are still very much a little charity that deals with something most people are uncomfortable talking about. Donors aren’t used to giving to us and they think we have all the money we need.”

I heard this again and again.

Let me tell you a different story about the same organization… all true.

  • This ‘little charity’ generates $15M/year through several funding streams – including fundraising.
  • It impacts over 8,000 families each year and completely changes… even saves the lives of scores of children who have been subjected to some of the worst atrocities imaginable.
  • People come from all over the world to work with this team of inspired and innovative leaders, counselors and program managers.

Your story is what you are. YOU tell your story. It can be eyyore-ish or awesome.

Action:
Write down, in bullet-point-form, the things that get you REALLY FIRED UP about your organization. Connect the dots (literally) and you have the start of a pretty good story.

We did this exercise with the organization mentioned above. They were the ones to generate the compelling storylines. The process illustrated that they already owned both stories. We didn’t come in from the outside, for instance, and try to write a new story.

Cause and Case. Get those that already get your CAUSE, then sell your CASE.


Cause: Your reason for existence. The big problem you’re trying to solve or change.

Case: Your approach. Your model. The way in which you impact the CAUSE.

Think about the the difference between CAUSE and CASE.

The goal is to be with people that already understand the CAUSE. Then you can spend time engaging them with the CASE.

Granted, some of you have a very niche cause… or a ‘not pretty cause’. There are people out there who get it. THESE are your prospects.

I watch a lot of organizations try to build case statements and the bulk of the message is about the CAUSE. If someone already gets the CAUSE then you’re wasting your message. If someone doesn’t get the CAUSE then you’re wasting your focus.

What’s In A Message?


I believe 90% of the funding challenges organizations have are a function of

    1. Not asking

    2. Not being with the right prospects

    3. Not having the right message (which usually makes number 1 much easier and makes number 2 much more apparent).

Message should be simple, fit on a napkin, clear, concise, compelling. That being said, I’m not sure I (Nick) have my own crystal clear napkin definition of MESSAGE is. In fact, when someone says they need help with their message I first ask them to define what they mean.

For the past year I’ve been referring to message as:

That, and only that, which a prospect needs to UNDERSTAND in order to say, “I totally get it!”

*And, if a qualified prospect, to also say, “I’m IN!”

Think about it. UNDERSTAND. Not:

    • What you SAY
    • What you PRINT
    • What you put in a 10 page case statement.

If you can work with that definition then 99.9999% of those reading this can resolve their message (ultimately) to one of the following:

    CHANGE LIVES
    SAVE LIVES
    IMPACT LIVES

If I, as your potential investor, could understand that I can SAVE LIVES then it’s game over. No longer about ‘fundraising’, no longer about ‘cultivation’, no longer about ‘asking for money’.

Common response from those too close to the issue: “It can’t be that simple.”

Yes it can.

Sometimes the ‘message derivative’ could be:

    – ECONOMIC DEVELOPMENT
    – TRANSFORMING EDUCATION
    – ENDING CANCER

Again… all SIMPLE. These are all applications of SAVE LIVES. CHANGE LIVES. IMPACTING LIVES.

I don’t want to lose a very important word in the definition – UNDERSTAND.

So how do you make me UNDERSTAND?

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9 Types of Funding Pitches


Made a reference list this AM of some of the framing devices or pitch types I/we often use to rationalize the ASK. In an abridged form:

The Gap: Using a gap number to justify the ASK.

    o Tuition: Tuition is $6K, cost per student is $8K. Gap is $2K. Could ask someone to underwrite THE GAP for five students.

    o Project: Receive federal grants to the tune of $45K/year for $60K/year program. Ask someone to fund the gap for three years = $15K/year or $45K ASK.

Leverage: We need to raise X to generate 10X.

    Note: Yesterday I was on the phone with an organization that needs to raise $5M to generate $1Billion. To make my point. They need to raise $5M to generate $1,000,000,000,000.

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The Vision Can Be The Project


Everything’s a Project! If you’ve been to Boot Camp you’ve probably heard us use that mantra.

You should be able to package literally EVERYTHING as a project, priority or program.

No such thing as ‘unrestricted’ – it all goes toward SOMETHING… Some IMPACT.

See:

Well, take up yet ANOTHER level. If you’re really CASTING A CLEAR AND COMPELLING VISION then THE VISION can be THE PROJECT. It’s a 30,000’ sale. It’s saying, “Nick, I need ten people to get behind this vision… to underwrite this vision.”

Where does the money go? To the VISION. To the CONCEPT. To the great VISIONARIES you’re entrusting to make this happen.

You talk about the Vision, the funding priorities and the plan and then literally go back up to 30,000′ for the ask. It’s Steve Jobs asking John Scully, “Do you want to sell sugar water all your life? Or, do you want to change the world?”

Rationalizing the Ask


I’ve written in the past about the importance of the funding plan as part of your case-for-support. I think there is a broader and more fundamental concept which is simply to be able to rationalize the number or rationalize the ask.

The simple concept: Rationalize the Number.

  • Don’t just pull numbers out of the air.
  • Tie the number to a project, priority or overall funding plan for the vision.

The difference between rationalizing the number and not rationalizing the number is the difference between asking for money and presenting the opportunity (a BIG DIFFERENCE.)

Reminder: Don’t make decisions for the prospect. Let the project/priority drive the ask. Focus on the impact and not on trying to make decisions about ‘what funding level to ask for’ – present the opportunity around the rationale and let the prospect decide!

I’ve attached a simple framework (PDF DOWNLOAD) with some self-coaching questions you can use to help you rationalize the number and ask.

Nobody wants to fund ‘case management’


Two years ago an ED said to me, “Nobody funds case management.” That’s because nobody understands case management – and neither do I. Case management is like ‘management’, ‘overhead’, ‘operations’, etc.

We spend the better part of 30 minutes talking about all the things that a case manager enabled clients to do/achieve. For this org, it was helping women (w/ children) deal with obstacles to permanent housing and family issues such as getting kids to school, domestic violence, nutrition, etc.

We re-branded our case management as a ‘Healthy Families Initiative.’ Allowed us to focus on the IMPACT of the program. Much easier to talk about, sell and share.

Test yourself, if you’re doing something that’s hard for others to understand then work on the MESSAGE. Start with the IMPACT or OUTCOME or WHY of the program and go from there.

This came up again last week. I was with an organization that helps homeless men and women. We asked the same questions and realized that it was not case management but building a Life Track. We are going to get our Life Track Program funded (and they can spend that money on case managers).