Prospect Research

Dear Kim,

What are some efficient and effective ways to do prospect research?
—Scanning the horizon

Dear Scanning,

There are many ways to do prospect research and there are people who are professional prospect researchers. You may want to talk with them about the ways they use the internet, public records, newspaper articles and so on. To learn more about this field, you will want to visit your local Foundation Center Collection or go to http://www.foundationctr.org or contact your local chapter of the Association of Fundraising Professionals (http://www.nsfre.org/) and ask them for references.

However, I have always found the most effective method of prospect research is talking to donors. People who give away money (of any amount) are friends with people who give away money, and people tend to hang out with people who are in their same broad income bracket. Therefore, someone who gives your group $1000 will know five people who could give $1000, five who could give $100-999, and 2-3 people who could give $2,000 or more. Everyone who already gives you money is a prospect for the same or bigger gift.

My prospect research method is called the “Grapevine Approach.” What you want to do is start with someone who has given you whatever is a large amount of money for your group, and who you are friendly with. Ask that person if she knows anyone who might be willing to help your group with a gift similar in size to hers. Your donor may at first demur that she doesn’t know, so help her out with some questions, “Do you know other people who care about our cause? Do you know if they give money to any similar cause? Do you know if they give money to any group?” You are looking for three things in a prospect: first and foremost CONTACT– someone has to know this person well enough to be able to call them and reasonably expect they would take the call. Second, BELIEF. You have to have reason to think the prospect believes in your cause or something similar or that you have some kind of values in common. Lastly, look for ABILITY. What does this person give to other groups? What kind of money does the person seem to have or have access to? What would be an appropriate amount to start with for your group?

Keep track of this information. Try to verify it. If someone tells you that Jane Smith is “the heir to the Smith fortune,” find out what Smith fortune and what kind of money is that. But most important, remember that if Jane Smith is not a person who gives away money, it won’t matter if she is a billionaire. What a person has and what they will give are almost unrelated. Once you have established Ability, Belief and Contact, you can then do more research if you want. But once you know the above, your best bet is to decide who should ask this person and for what. Good luck.
—Kim