I subscribe to "Movie Mondays" (see Christopher Davenport <chris@501videos.com>). Chris is consistent, dependable and delivers great content. I'm an experienced and some people say an expert in fundraising. I learn something every time I watch Chris' movies.
Today the topic was about endowments. Here are my two cents...
One, if you currently don't fund raise for them, start! Endowments are indicative of the financial health of a non-profit. There are some "watch its" for endowments.
Today the topic was about endowments. Here are my two cents...
One, if you currently don't fund raise for them, start! Endowments are indicative of the financial health of a non-profit. There are some "watch its" for endowments.
- There is always someone who says,"we need current, operating money" that squelches the enthusiasm for building endowments. Endowments are seen as a luxury or something for the future. What to do? Set a "fee" on the endowment that will go toward operating expenses. Most successful and well run non-profits observe this practice. (Examples: .5% fee on earnings for larger endowments to support the development office; 8-10 % fee on new endowments for same purpose).
- Have clear parameters. How large do they have to be to become "completed" endowments and begin their payout to their specific purpose?
- Do simple (SIMPLE) gift agreements to insure that your donors have stated the express purpose and that both parties agree to the purpose.
- Have a "changed conditions" clause in your gift agreement. Endowments are a "forever" gift. What happens if the purpose for the endowment no longer exists? Write in your agreements that the endowment will be used for "related" or "like" purposes in that instance, as voted on by the Board.
