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  • Writer's pictureMitch Stein

Build Deeper Donor Relationships with an Active DAF Strategy

9 takeaways for your DAF fundraising & marketing strategy from the 2023 Nonprofit Marketing Summit


Trish Ellis, National Director of Major Gifts & Planned Giving for the Susan G. Komen Foundation, joined Chariot’s Mitch Stein at the annual Nonprofit Marketing Summit on August 23, 2023 for a conversation on nonprofit DAF strategy. There were over 25,000 registrants for this landmark annual virtual event for the nonprofit sector and interest in DAF fundraising remains high, with several sessions included in the 3 day schedule incorporating the topic.

There were so many great audience questions & discussions during Trish & Mitch’s session titled “Marketing Donor Advised Fund Giving to Increase Year End Fundraising,” they decided to coauthor the article below to share the key takeaways more broadly.

Thank you to Community Boost for putting this incredible event together and for anyone interested in all the great content you can still sign up and access it here.



Donor Advised Funds are the fastest growing vehicle in Philanthropy, with over $234 Billion ready to be donated to nonprofits. However, the vast majority of organizations are not making the most of this massive opportunity, and missing out on relationships with the most valuable donors out there.


Historically, organizations have only played a passive role in DAF fundraising. Sometimes large checks showed up from DAFs in the mail with little to no contact information or identifying details - and that was all there was to be done. But boy have times have changed - a lot!


That’s why we wanted to take the opportunity at this conference to point out the many ways nonprofits can now get actively engaged in a DAF strategy and tap into this massive, but largely misunderstood fundraising opportunity.


 

Here’s our 9 top takeaways from the discussion:


1. DAF familiarity is low & it’s time to get smart


We started our session off with a poll - rank your comfort & familiarity with Donor Advised Funds from 1-5. The vast majority of attendees put themselves at a 1-2 - totally or fairly unfamiliar with DAFs, even though they now make up 15% of total giving each year. The most important thing every fundraiser can do is learn more about Donor Advised Funds. That doesn’t stop with frontline fundraisers, it’s also important that broader teams, executives & boards understand the strategic importance and buy into the prioritization.


2. Discussing DAFs leads to deeper, more open conversations with donors and builds stronger relationships


When someone in the audience asked about if we should be discussing DAFs with donors, Trish shared “I actually just spoke with a donor this week and when I asked whether they utilized a DAF, it led to a much deeper discussion about their philanthropic planning and giving decisions. We had our most open & vulnerable conversation yet and it’s clear that my comfort with the topic allowed us to take that step and deepen our relationship.” As a fundraiser and an organization, being able to discuss DAFs is a real competitive advantage with your highest-value donors.


3. Make sure the ease of giving with DAFs is all over your communications


The easiest step you can take to level up your DAF fundraising is to just make sure you’re asking for DAF gifts! You get 2x as many DAF gifts when you ask for it and DAF gifts are 24x as large as credit card gifts - including language in your communications about Donor Advised Funds is relatively low effort for huge potential payoff.


4. There is brand new tech solutions that greatly improve the DAF giving experience


Most people are not aware that DAF giving can be incorporated into donation forms and fundraising platforms, just like a credit card. That’s what Chariot built that is so innovative - allowing for 3-click & 15 second DAF donations right at the moment of inspiration in your fundraising process. You can check out a demo of Chariot here and the list of all the fundraising platforms we are integrated with here.


5. DAF donors are your highest potential donors, so track & steward them accordingly


A donor having a DAF is your best indicator that they’ll be a high value donor. People with DAFs are savvy and intentional donors that make much larger gifts, support more charities per year with more gifts per charity and are twice as likely to give again next year. It’s critical to have a tracking system set up in your CRM to tag donors you know have a DAF, but the real difference will come in bringing it up in more conversations and letting DAF donors identify themselves by incorporating a DAF payment option in your donation forms (try one yourself here!)


Chariot’s solution also ensures when a DAF gift is made, you know immediately and have the person’s name and email to thank right away instead of waiting weeks for a check or wire to show up with just a mailing address.


6. The number of DAF donors already supporting your org is likely growing 30% per year!


The most common question that came up in this session and with nonprofits in general is “How do I find more DAF donors?” Finding DAF donors is first and foremost about knowing the people already supporting your org better. The number of DAF accounts is growing 30% per year - that means 300,000 new accounts in 2022. Every year there are donors supporting your organization that have a DAF and you’ll only find that out by following takeaways 3-5 above!


7. Don’t bring scarcity mindset into DAF strategy, please


Some people shy away from encouraging donors to start or use a DAF, because they are typically used to support multiple organizations and not fully dedicated to your org. The reality is that when people start DAFs, it massively increases the amount that they are giving to charity. Being part of that conversation means you’re more likely to get a larger slice of that greatly increased pie.


8. Q4 is critical - over half of DAF contributions happen in Q4


Most folks are making decisions around their DAF contributions around year end because they are doing so in coordination with their annual tax planning. In fact, 55% of DAF contributions happen in Q4 - so DAFs are top of mind for donors and a great opportunity to mention them in materials and conversations.


9. Know the limits


While Donor-Advised Funds are a tremendous opportunity, they do come with important limits and restrictions that every fundraiser should be familiar with. Two of the most important things to keep in mind are:

  1. DAFs can not be used for any purchases from a nonprofit organization. Gala tickets, auction items, etc. are off limits because DAF grants can not be deemed as creating any benefit for the donor.

  2. Fundraisers should not be playing the role of financial advisor or legal counsel when it comes to philanthropic planning. It’s important to be familiar with key topics that donors are thinking through, but when it comes to giving financial or legal advice - leave that to the licensed professionals and keep yourself out of trouble!

 

If you’d like to download our presentation from the conference, you can do so here and please reach out with any questions on DAFs or Chariot’s DAF payment option for fundraising: contact@givechariot.com


Presentation
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Download PDF • 9.12MB

About Trish

Trish Ellis, C.F.R.E is a combat veteran and lifelong volunteer who has dedicated 20+ years to serving the nonprofit sector. As the National Director, Major Gifts and Planned Giving at Susan G. Komen, she has created a mid-level program, a national stewardship program, and grown both major and planned giving. She is passionate about leveraging technology to create efficient processes, high-performing teams, and streamlined donor experiences.


About Mitch

Mitch Stein is a nonprofit technologist, entrepreneur and advisor to companies building innovation solutions to nonprofits’ greatest challenges. His first start up, Pond, was a marketplace connecting thousands of nonprofits with the best tools & services for their needs. He now works on all things growth & strategy for Chariot as they work to integrate easy DAF giving into every donation opportunity.

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