Organizations
engaging in fundraising
Fundraising is the primary way that
non-profit organizations obtain the money for their operations. These
operations can involve a very broad array of concerns such as religious or philanthropic
groups such as research organizations, public broadcasters, and political
campaigns. A Capital Campaign is when fundraising is conducted to raise major
sums for a building or endowment. Special events are another method of raising
funds. These range from formal dinners to walkathons.
Some examples of charitable
organizations include student scholarship merit awards for athletic or academic
achievement, humanitarian concerns, disaster relief, human rights, research,
and other social issues.
Professional
fundraisers
Many non-profit organizations take
advantage of the services of professional Fundraisers. These may be paid for
their services either through fees unrelated to the amounts of money to be
raised, or by retaining a percentage of raised funds (percentage-based
compensation). The latter approach is expressly forbidden under the Code of
Ethics of the Association of Fundraising Professionals (AFP), a professional
membership body.
Many non-profit organizations
nonetheless engage fundraisers who are paid a percentage of the funds they
raise. In the United States, this ratio of funds retained to funds passed on to
the non-profit is subject to reporting to a number of state's Attorneys General.
This ratio is highly variable and subject to change over time and place, and it
is a point of contention between a segment of the general public and the
non-profit organizations.
Religious
organizations
Equally important are fundraising
efforts by virtually every recognized religious group throughout the world.
These efforts are organized on a local, national, and global level. Sometimes,
such funds will go exclusively toward assisting the basic needs of others,
while money may at other times be used only for evangelism. Usually, religious
organizations mix the two, which can sometimes cause tension.
Political
campaigns
Fundraising also plays a major role
in political campaigns which, despite numerous campaign finance reform laws,
continues to be a highly controversial topic in American politics. Political
action committees (PACs) are the best-known organizations that back candidates
and political parties, though others such as 527 groups also have an impact.
Some advocacy organizations conduct fundraising for or against policy issues in
an attempt to influence legislation.
Public
broadcasting
While public broadcasters are
completely government-funded in much of the world, there are many countries
where some funds must come from donations from the public. Pledge drives commonly
occur about three times each year, usually lasting one to two weeks each time.
Viewership and listenership often declines significantly during funding
periods, so special programming may be aired in order to keep regular viewers
and listeners interested.
Taxation
Organizations in the United States
established for charitable purposes are allowed to raise funds from many
sources. They are given a specific designation by the IRS, commonly noted as 501©(3)organizations.
Other nonprofits such as fraternal associations have different IRS
designations, and may or may not be eligible to fundraise. Financial
information on many nonprofits, including all nonprofits that file annual IRS
990 forms is available from GuideStar.
Types
of fundraising
Many non-profit organizations receive
some annual funding from a financial endowment, which is a sum of money that is
invested to generate an annual return. Although endowments may be created when
a sizable gift is received from an individual or family, often as directed in a
will upon the death of a family member, they more typically are the result of
many gifts over time from a variety of sources.
While fundraising often involves the
donation of money as an out-right gift, money may also be generated by selling
a product of some kind, also known as product fundraising. When goods are
donated to an organization rather than cash, this is called an in-kind gift. Girl
Scout are well-known for selling cookies in order to generate funds. It is also
common to see on-line impulse sales links to be accompanied by statements that
a proportion of proceeds will be directed to a particular charitable
foundation.
A number of charities and non-profit
organisations are increasing using the internet as a means to raise funds, this
practice is referred to as online fundraising For example the NSPCC operates a
search engine which generates funds via Pay per click links.
Some of the most substantial
fundraising efforts in the United States are conducted by colleges and
universities. Commonly the fundraising, or 'development,' program, makes a
distinction between annual fund appeals and major campaigns. In recent years
major capital campaigns have followed one another with little breathing space
between.
The donor base for higher education
includes alumni, parents, friends, private foundations, and corporations. Gifts
of appreciated property are important components of such efforts because of the
tax advantage they confer on the donor encourages larger gifts.
The classic development program at
institutions of higher learning include prospect identification, research and
verification of the prospect's viability, cultivation, solicitation, and
finally stewardship, the latter the process of keeping donors informed about
how past support has been used. | 
