Every fundraiser has experienced it. The Sunday Times Rich List is released, and suddenly everyone is suggesting you reach out to the hottest name on the list for a donation. That might work. If they’re not inundated with similar requests, have an affinity for your cause and are somehow already connected to your organisation. But overall, the chances are very slim.
A wealthy individual doesn’t always translate into a hot prospect for your cause. Sometimes organisations label someone as hot because they’re very wealthy and you think they should give, despite having no meaningful connection to them. If they haven’t heard of you yet, they’re not a hot prospect.
Wealth gives you insight into someone’s capacity, but there’s a bigger picture
Someone who appears on the Sunday Times Rich List might be capable of giving a £100,000 gift, but that doesn’t mean they care about your cause, have heard of your organisation or that you can connect with them.
Without additional research, it’s impossible to know their philanthropic inclinations or if they’d consider supporting your organisation. Even if they are a perfect fit, a cold ask will likely do more harm than good to what could have been a long-term partnership. Luckily, there’s a better way,
What really makes someone a strong prospect?
For us, the perfect prospect has three key ingredients: capacity, affinity and proximity.
Capacity refers to a person’s ability to give. Knowing their estimated wealth means you can tailor your fundraising approach and ask for an appropriate gift amount. Wealth screening helps identify the people who are connected to you and have capacity to give at a high level.
Affinity is a person’s interest in, or connection to, your cause. Desk research can reveal an individual’s known philanthropy, so you can personalise your approach and build stronger relationships with potential donors.
Proximity refers to how easy it is to reach a person. If they are identified through screening, you know you can reach them as they are already your supporter.
Without affinity and proximity, a high-capacity prospect is unlikely to give a major gift. Someone with lower capacity but very strong affinity may be a much better prospect.
Hot should describe your relationship, not their position on the rich list
A hot prospect is one you’ve met, have a relationship with and who understands that giving your organisation a large gift is part of the conversation. A red hot prospect is one whose behaviour indicates they are likely to make a major gift soon.
So the next time your board suggests adding someone from the rich list to your hot prospect list, you can tell them that without affinity and connection, they’re not hot enough for you.
Misclassifying prospects rarely ends well
If your organisation classifies aspirational prospects as hot, your pipeline will look a lot healthier than it actually is. If what looks like 30 hot prospects are actually five warm relationships and 25 wealthy names, your pipeline won’t deliver against your fundraising target.
Our rule of thumb is that it takes 12 warm prospects to convert to three hot prospects that eventually lead to one donation.
So while wealth matters enormously in major gift fundraising, it isn’t the only metric to measure your prospects by.
Want to learn more about developing and managing your major gift pipeline?
In our last webinar, we looked at prospect pipelines in particular
- Understanding your fundraising target
- How many prospects do you need for your major gift pipeline?
- Hot, warm and cold prospects – how can you tell which is which?
- Generating and managing new prospects
If you missed it, you can always watch the recording, which is available on our website, along with webinars on a range of other topics.