Mon 17 Mar 2008
Thanks to Neil for pointing out this New York Times article.
Despite the economic downturn and fears of recession, major charities say their fund-raising has not fallen off.
“We’re doing fine,” said Christina Walker, director of development at the Cleveland Orchestra. “We haven’t seen any effect yet.”
In fact, some 64 percent of the organizations that have responded so far to the Association of Fundraising Professionals’ annual survey on fund-raising have reported bringing in more money in 2007 than the year before.
…
Some fund-raisers already see what could be signs of a downturn. Stephen R. Birrell, vice president for alumni relations and development at Williams College, said that the college’s annual fund-raising effort was doing well but that the number of donors was down somewhat.
“I hesitate to single this out,” Mr. Birrell said, “because I don’t know what to make of it.”
The reason for his uncertainty is that a plan that Williams adopted in 2003 to raise $400 million through a special campaign by the end of this year has so far exceeded the goal by more than $50 million, he said, and may have drawn donors away from the annual fund.
One donor to the special campaign, Paul Neely, said he would look at his seven-figure gift differently today, because the value of the stock he donated had since dropped by roughly a third.
“If I wanted to give the same dollar amount today, I would have to give more shares and then worry that they might go back up,” said Mr. Neely, a Williams trustee. “That’s the kind of calculation that I think people are turning over in their minds, which hasn’t noticeably impacted us yet but it may very well by the end of the year.”
Comments:
1) Kudos to Birrell and Neely for getting Williams into the Times in this context. The more people know about Williams, the better. But what is the backstory? I assume that Times reporter Stephanie Strom did not call them up randomly. One guess would be that Strom knows Neely via Neely’s former job as publisher of The Chattanooga Times. I had an interesting chat with Neely at the Road Scholars event a few weeks ago. There are few Ephs who know more about the behind-the-scenes discussions and debates that have shaped the College for the last 15 years. The Record ought to do a big interview/profile.
2) Are the number of donors down a meaningful amount? Not in the class of 1988! We are, I think, hitting a record this year. I think that the details will be made public soon. To the extent that he overall participation rate is down, I am pretty sure that it is not down a meaningul amount.
3) Even if it is down a non-trivial amount — and every percentage point matters for those US News rankings — it is highly unlikely that the capital campaign has anything to do with that. Or am I misinformed. Only very rich Ephs are approached to give directly to the capital campaign. We mere mortals contribute via the alumni fund. It is hard to tell a story whereby capital campaign giving plays a role in alumni fund participation. And note that the campaign has beenn going on for several years, so why would this year see an impact?
4) You can certainly tell a story whereby the current downturn is impacting big ticket gifts. But, lucky for Williams, we are at the end of the capital campaign. In fact, for Ephs, 2008-2010 is the perfect timing for a recession.
5) I wonder what stock Neely gave to the College. His distinguished career in the news business is not the sort of thing that generates significant wealth. Or am I underestimating how much publishers get paid? Maybe this is Times stock. That seven figure gift is probably connected to his generosity here. Alas, I am travelling for the next two weeks and don’t have Bloomberg access. Perhaps one of our finance readers could note Neely’s holdings in the comments. My guess is that this is family money. Hey, Dad! Where’s my trust fund?
6) My take is that Stephanie Strom knew what story she wanted to write before she even called Neely/Birrell. Then, she misunderstood what Birrell was saying and/or kept asking him questions until she got a quote that she liked. It seems highly unlikely that the capital campaign has any causal effect on participation rates in the annual alumni fund.
Corrections from our friends in the Alumni Office are welcome!
March 17th, 2008 at 10:21 am
Funny…we have found similar results in our local fund-raising efforts (for public education); fewer donors, but enough significantly higher ’single’ donations that the overall amount was up by about 30 percent. Granted, we anticipated a lesser year and so put a little more effort into a good PR angle, but were surprised nonetheless.
I would love to hear from experts, what this bodes…
March 17th, 2008 at 11:47 am
Let’s be glad Williams seems already to have in hands the megabucks it needs for the coming major projects. Slowing down their rates of using funds and being more cost conscious could be a good thing for the top schools. The facilities seem to be so “luxe” and I get a feeling that there is a “keeping up with the Joneses” amenities race going on (and surely all the new buildings everywhere aren’t good for the environment; retrofitting, reusing, making do, and reimagining could be better ways to go).
March 17th, 2008 at 12:50 pm
Too bad that both Congress and administrators seem to agree that massive increases in expenditure at the height of a bull market are a good idea. As I blogged about here, people have a tendency to become too complacent about the future health of college endowments.
April 26th, 2008 at 9:41 am
Williams didn’t run a “capital campaign” - it ran a consolidated campaign, which included credit for the alumni and parent funds over the five year period and money given to the college before the consolidated campaign began.
April 26th, 2008 at 11:31 am
As far as only the big donor/really rich people getting approached about the capital campaign, I’d have to disagree. I didn’t get phone calls, but I certainly received a variety of giant brochures and updates that included ways to give directly to it.
The typical small-dollar donor in many fundraising situations (in my experience w/ nonprofits) is reminded about giving somewhat randomly by whatever piece of mail or email is received at the right moment. That donor will just send in the donation, not necessarily thinking about which campaign or fund the money it is.
I’d also be willing to give Birrell some benefit of the doubt on why this is happening. He has the numbers and names for both funds and is likely able to see that some folks gave to one and not the other. I doubt he’d be willing to put this info in the Times without some basis for it.