Definition Of Fundraising
Fundraising is the act of gathering funds in order to support socially impactful activities. Charities, non profits and NGOs, for example, use this method as a way to sustain their operations.
Behind The Concept
Concretely, this phenomenon refers to a wide variety of activities. Nevertheless, it’s mostly known as the method of gathering money from individuals, foundations, government agencies and so on. It’s a very common technique for non profit charities that seek funds to support their activities. At the same time, companies who need resources for R&D and other social initiatives use the same strategy. Also, it’s important to highlight that it differs from financing, which is the technique many for-profit companies use to gather capital in order to pursue their core business (through the allotment of shares or bonds, for instance).
One of the most profitable methods of organizing fundraising is through an event (event fundraising). Usually the goal is to raise enough money to fund a non profit’s project. Events can be really effective because they allow organizations to gain visibility, raise awareness and generate engagement. Also, it’a way to gain publicity and grow loyalty in order for donors to keep supporting the cause in the future.
Relationship building represents another fundraising technique. This is the case of large organizations which receive individual donations of different financial weight. In this case, it’s essential to have a database where you can track (and rank) your donors’ contributions so that you can address them with different communication tactics that reflect their level of support.
In the age of digitalization and social media, fundraising driven by communities (community-driven fundraising) is getting more and more relevant. Inspired by posts about their activities in social media, people become supporters of fund seeking organizations. Often times, supporters are willing to contribute to the charity cause. Thus, they become fundraisers and act by themselves to help raising funds for non profit organizations (peer-to-peer fundraising). Heavily relying on trust and loyalty, organizations have to be transparent and responsive to retain a good relationship with their supporter base.