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Capital vs. Capacity vs. Comprehensive Campaigns: What’s the Difference? — Transcript

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0:00comprehensive campaigns, capital
0:02campaigns, capacity campaigns. Oh my,
0:07there's a lot of language and
0:09terminology around campaigns and it can
0:12be confusing.
0:17[music]
0:22Hi, I'm Amy Eisenstein. I'm here with my
0:24colleague and co-founder, Andrea
0:26Kilstead. And today we're going to talk
0:29about the confusing terminology around
0:32campaigns.
0:34Andrea, we're going to talk about
0:36capacity campaigns and comprehensive
0:39campaigns and capital campaigns and
0:41endowment campaigns. Get us started.
0:45Yes. All right, Amy. This is, you know,
0:47this is a topic that it has taken me
0:50years to sort through and figure out.
0:52So, I'm not surprised that other people
0:54are confused by it. Right. when this
0:56language gets bandied around. But let's
0:59start right at the top. What do we mean
1:01by the phrase capital campaign?
1:04Now, even that's not so simple because
1:08generally we speak about capital
1:10campaigns as an umbrella. It's an
1:13umbrella term that covers a wide variety
1:16of campaigns that all follow a
1:20particular kind of fundraising that is
1:23leadership fundraising, topheavy
1:25fundraising, where the bulk of the money
1:28comes from a fairly small group of
1:31wealthy people.
1:33Now, okay, then you might say, well,
1:36don't you mean building campaign when
1:39you talk about capital campaigns? Well,
1:41one way to think about that is that the
1:43word capital might mean building, but it
1:47also might mean money,
1:50>> right? Assets.
1:51>> Assets, right? So, it's a matter of
1:54which side of th those you're you're
1:56thinking about. But but understand that
1:59when we talk about are you going to have
2:01a capital campaign, just the general
2:04question, we are using an umbrella term
2:07that covers all different kinds of
2:09campaigns. and we're going to dive into
2:11those now.
2:12>> All right. So, let me just add
2:15all kinds of campaigns that are once in
2:18a while transformational transformative.
2:22I was going to say transformational and
2:24transformative for organizations
2:27and it's not usually or always and we're
2:31going to talk about when it is and when
2:33it isn't inclusive of your annual
2:36operating funds. So let you I'm sure you
2:41have much more to say on that topic, but
2:43I just want to put out there that it's
2:45for a special project. It's for over and
2:48above usually your annual operating
2:50funds. It's once in a while.
2:53>> Go ahead.
2:54>> It's that kind of fundraising, right?
2:56Capital the the the general phrase
2:59capital campaigns refers to a particular
3:01kind of fundraising
3:04where the money raised can be used for a
3:07variety of topics and what's included is
3:11what determines the subg genre what kind
3:14of a campaign it is. So let's just run
3:17run those through. The simplest is and
3:20the most common perhaps is when an
3:22organization is going to build a new
3:25building [music] or expand their
3:27building. That's using the word capital
3:29in the sense of expanding your capital
3:32for your
3:33>> infrastructure.
3:34>> Your infrastructure that kind of that
3:37kind of capital. And very often
3:40organizations decide they're going to do
3:42a campaign because they've run out of
3:45space because their building has been
3:47knocked over by a tornado because their
3:51building no longer suits their needs. So
3:54they do a strategic plan and the and
3:56this plan says yes, we need a new
3:58facility. And then someone says, "Well,
4:00okay, let's do a capital campaign."
4:02Meaning, let's do a building campaign.
4:05And and let's just add that cap capital
4:08campaigns when they include a building
4:11also include program startup and often
4:14endowment and maintenance funds and
4:18rainy day funds and all sorts of other
4:20things. So it's not to the exclusion of
4:22other kind uh pots of money. It's not
4:26just the building itself that you're
4:28raising money for in a capital campaign.
4:30Lots of things are often included. I get
4:32that question a lot.
4:34Yeah. Well, and I what I was going to
4:36say is that is that often
4:39it it starts by people thinking that
4:41they need a new building and then they
4:45say, "Well, what else might we tuck into
4:48this campaign, right? What else might we
4:50include?" So, the the kinds of things
4:54that are put in into this campaign
4:57generally grows and in and increases and
5:00that's when we start using the
5:02terminology differently. So when we have
5:04a building campaign
5:07and a uh combined with program funds,
5:12let's say for a grow growth in your
5:15program over the next three years,
5:18combined with um with maybe money for
5:22your endowment. We often call those
5:25combined campaigns, right? It is a
5:28capital campaign in the broad sense, but
5:31it is a combined campaign in the sense
5:33that you have put together several
5:35things that are all going to be counted
5:37in [music] your campaign goal. And
5:40that's in some sense if you were to look
5:42for the right language for this, you
5:44would say this this is all stuff that
5:47increases your capacity. So, if we were
5:50trying to be accurate, we would say,
5:52well, overall, all of these campaigns
5:55are capacity building campaigns. They're
5:58capacity campaigns. And if I were to
6:00create the language from scratch, that's
6:02probably the language I'd use. But I I
6:06didn't create the language from scratch,
6:07nor did Amy. So we're stuck with this
6:10with the terminology we have which is
6:12capital campaigns in the umbrella sense
6:15then capital campaign in the sense that
6:17it is a building just a building
6:19campaign and then a combined campaign
6:22which puts various things together under
6:26one rubric and you're raising money for
6:29all for all of that. What we haven't yet
6:32talked about is where your annual
6:35fundraising lives, where the money you
6:38raise annually during your campaign
6:41period, how that fits into your campaign
6:44or if it does. And honestly, this is
6:47where there is the most confusion.
6:50the um pretty much every organization
6:53that is going into a capital campaign
6:55has an annual operating budget and
6:59raises philanthropic money every year
7:02towards that budget, right? Your annual
7:06operating fund, right? And you probably
7:09every year have a have a standard set of
7:12things you do to to raise to raise that
7:15money. Everyone is nervous about whether
7:18their campaign is going to with
7:20cannibalize that that fund. So some
7:23people decide what they're going to do
7:25is they're just going to include that
7:27annual fundraising right into their
7:30campaign and they're going to increase
7:32the goal of their campaign
7:34by the amount they anticipate bringing
7:37in through annual fundraising during the
7:40period of the campaign.
7:42>> And most universities do that.
7:45>> Yes. So a university might say for
7:48example, we're going to have a campaign
7:51for big red, right? Big red, right?
7:55They're going to ask all of their alumni
7:58to give the campaign is going
8:00universities tend to have long
8:02campaigns. So let's say the campaign's
8:03going to take 10 years, which is long,
8:05but
8:06>> a billion dollar campaign
8:08billion dollar, right? Over 10 years.
8:11And what they do is that they add all of
8:13the money that they're going to bring in
8:15over those 10 years, including annual
8:18fund, which is going to go up year by
8:19year by year. And they add all of that
8:22money, and then they add it to their
8:23campaign goal, which also includes some
8:26buildings and some new program support
8:28and some endowment,
8:30>> scholarships, right? Named faculty
8:32positions. I mean, all kinds of things.
8:35They lump it all together and they have
8:37what is called a comprehensive campaign.
8:41right now. That works quite well for
8:43universities
8:45and that's why that's why they do it.
8:49When you are not a university and you're
8:52an organization that has a specific
8:54mission, the mission is to save the
8:58wildlife, to feed the children, to
9:02make sick people healthier, to to put on
9:06theater, to right, whatever your mission
9:09is, it may make a little less sense to
9:14lump everything together, right? because
9:17you don't have the kind of alumni
9:20loyalty that Big Red does,
9:23>> right? When Big Red alumni give to their
9:27campaign, they're not giving really to a
9:31to this or to that. They're giving to
9:34their institution
9:36to which they feel loyalty and identity
9:40and they want the institution to do well
9:42and to do better and they want to be
9:44part of it. So, so the ability to
9:48actually articulate
9:50the specifics of a campaign are less
9:53important than they are in these smaller
9:56organizations that have targeted
9:58missions.
10:00Right now, what that says is that okay,
10:02let's say let's stick with one of these.
10:04Let's talk about feed the hungry, feed
10:07the, you know, a soup kitchen in your
10:09community for the sake of discussion.
10:11>> Yeah. And you're and you need a new new
10:15expanded kitchen. I mean, we all know
10:16that soup kitchens are in fact going to
10:19be more important coming up because
10:21funding has been cut um for for people
10:25>> and the need has risen.
10:26>> The need has risen. So, you need an
10:29expanded kitchen. You need better
10:31equipment. You need
10:33>> Right. You there
10:34>> more space,
10:35>> more freezers, more refrigerators,
10:38everything.
10:38>> That's right. and and you need that
10:41because you want to be able to
10:43accommodate twice the number of people
10:45in your community that than you can
10:47currently accommodate.
10:49Right now, you too have an annual fund.
10:52Let's say you raise $100,000 a year
10:54regularly and you have a group of of
10:58loyal donors who give you year after
11:00year, but you want to go back in your
11:03campaign, you're going to go back to
11:04those donors and you're going to ask
11:06them for for significantly higher gifts
11:09to expand your facilities so that they
11:12can do more.
11:14for you, it probably doesn't make sense
11:17to lump the annual fund into
11:21your campaign. You want to still keep
11:24going back to those donors year after
11:26year after year, and you want to be
11:28asking them for a special gift to do
11:31something that is going to make a big
11:32difference, a big specific difference in
11:36their community.
11:38You are probably going to want to do a
11:40combined campaign that's going to
11:42include the renovations to your kitchen,
11:45new equipment, perhaps new programming,
11:48perhaps additional staff for your couple
11:51two or three years of growth, perhaps
11:54endowment so you can support the the
11:57facility for the future. But your annual
12:01fundraising is going to be separate. So
12:03you're not going to have a com have a
12:05comprehensive campaign. You're going to
12:07have a combined campaign and you're
12:09going to keep your annual funding going
12:12year after year just like you always do.
12:15And one of the important reasons to keep
12:17it separate is because it really helps
12:21clarify things for donors. You can
12:23explain to them that you need first and
12:26foremost them to continue their ongoing
12:29annual support to feed the community,
12:32the people in the community as they
12:34always have, as you always have. And
12:37you're asking for a one-time special
12:40gift over and above that annual amount
12:43to support this one-time growth need.
12:47And so it's very clear to you at the
12:50organization and to your donors and the
12:53community what you're doing with the
12:55money, what you're asking for, what the
12:57ongoing needs are. Um, and it's just
13:01it's really clear to people. And I think
13:03it's important certainly when we're
13:05working with clients, we
13:08try to make sure that everybody can
13:10articulate the difference between the
13:13ongoing needs and the onetime special
13:16campaign effort so that donors
13:19understand and you know being able to
13:22explain that if donors just simply
13:25transfer their annual support to the
13:27campaign that doesn't work for an
13:29organization. You know, we often use an
13:32analogy of the house, right? You know,
13:34when you need a new roof, you can't stop
13:37buying groceries or paying the electric
13:39bill or paying, you know, your
13:41sanitation. Those are the annual
13:43operating needs of your house. And you
13:46still need to put a roof on. And so,
13:48that's sort of a good analogy to use
13:50with board members or donors who are
13:53questioning, you [clears throat] know,
13:55why can't they just switch their their
13:58giving from one to the other? It doesn't
14:00work that way.
14:02>> Yeah. You know, and people, as I said,
14:05people do worry about losing their
14:07annual operating funds, their their
14:10philanthropic funds during a campaign,
14:13we we actually see just the opposite. We
14:16see that when an organization is in
14:18campaign mode and they're doing a great
14:20job of communicating with their donors
14:22and they are talking to their donors
14:24about both their annual gift and their
14:27campaign gift that the donors are
14:30perfectly happy to continue and even
14:33increase their annual gift during the
14:35campaign. That we see that again and
14:37again that annual fundraising actually
14:39goes up during the campaign period and
14:41not down. And the very same donors give
14:45two gifts
14:47often at great multiples of what they
14:49usually give with an annual in their
14:52annual fundraising.
14:54>> And and here's why. Here's one of one of
14:56many reasons why. Um you're clarifying
15:00your outreach, you're increasing your
15:02communication, you're articulating
15:05better, you're there's more activity,
15:08there's better branding and and
15:10outreach. um there's just more
15:12communication, more events, more
15:14activities during various stages and
15:17parts of a campaign. And so people are
15:20often confused about why the annual fund
15:22would go up during a campaign when
15:25you're already asking your donors to
15:27give significantly increased gifts. But
15:30but that's why you're there's buzz.
15:33People are talking about your
15:34organization. You're you know you're out
15:37in the community more. You're talking to
15:39more people. So, um, that's why we often
15:43see an increase in the annual fund in
15:45addition to the campaign dollars that
15:47come in. You know, Amy, let me see if I
15:50can clarify where people usually get
15:53confused. The question is not whether
15:56you can talk to your donors about both
15:59annual and capital gifts. You do and can
16:04and should be talking to those donors
16:06about both kinds of gifts. The question
16:09is whether you include the amount of
16:13money you're going to raise in your
16:15annual fund in your campaign goal
16:19or whether you keep the goals separate.
16:23>> And that's what confuses people.
16:25>> In a university style comprehensive
16:28campaign, everything is included in
16:30these great big campaign goals. in a
16:34local campaign at a more targeted
16:36campaign. While we talk to our donors
16:39about both kinds of giving and wanting
16:41both giving both gifts from them, we
16:44keep the goals separate, the capital
16:46campaign goal and the annual goal,
16:50right? And that's so those are not
16:52comprehensive campaigns because we're
16:54not lumping the goals together. It's not
16:57that we're not talking about them,
16:59[clears throat]
16:59it's that just we're not including the
17:02annual fundraising in our campaign goal.
17:06Excellent. Important differences because
17:08[music]
17:09when you're talking about a campaign
17:11with your board members early on with
17:13your leadership team, there is a lot of
17:16confusion around capacity campaigns. Are
17:18we doing a capital campaign? Are we
17:20doing a comprehensive campaign? And so
17:23clarifying the language um establishing
17:27what you're doing and how you're going
17:29to be talking about it I think is
17:31important upfront. So feel free to share
17:34this podcast with your team. Send it to
17:36your board chair, your leadership team,
17:38your executive director. Um, Andrea, I
17:42think putting you're putting a clear
17:44framework around how [music] to think
17:46about these massive fundraising efforts
17:50[music] is so important and I appreciate
17:53once again you sharing your wisdom with
17:56us. So,
17:57>> thanks Amy.
17:58>> All right, thanks for listening and
18:00we'll see you next time. Bye for now.
18:06>> [music]

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