Rebalancing a Top-Heavy Annual Giving Program

Dear Kim, 

Our fundraising team has worked hard to build a strong major gifts program. We receive 80% of our revenue from just 9% of our donors. But I’m not sure if this is healthy either. I’ve heard that an annual giving program ideally generates about 80% of revenue from 20% of donors. Should I be joyful . . . or worried? If the latter, do you have recommendations to rebalance a top-heavy annual giving plan? 

Too much of a good thing?  

Dear Good Thing,

You should be joyful and thankful for all the work your team has done.  Note my answer to the first question in this column!  Worrying isn’t that useful so I don’t advise it in any circumstance.  However, every silver lining has a cloud and you do need to spread your risk a little more. Just put on your “to-do” list “upgrade next layer of donors” and, over the next two years, seek to raise 80% of your money from 15-20% of your donors. 

I get worried when I see organizations that raise 95% of their money from 5% of their donors or, as in the case of someone I talked with recently, 95% of their money from 2 donors!  The latter is an accident waiting to happen.  You are in very good shape and you have room for improvement.  Fortunately it sounds like you should just do more of what you have been doing, particularly with more people.

~Kim Klein