Fundraising and Development: Understanding the Difference (2024)

“Development” is, by definition, the process of creating and enhancing relationships with (potential) donors to ensure current and future funding; “Fundraising” is only about income generation.

With “Development,” with the relationships you create, you take a major step toward ensuring future income; with “Fundraising,” income generation focuses on “now,” with no provision, no assurance, and little or potential for the future.

If people are giving provides the opportunity for them to feel good about helping to advance the organization’s mission and services, if they give because they want to please the person who is “asking,” because they want to see their name alongside the names of recognizable personalities, or if they want to see their name on (a floor, a wing, or on the outside of) a building, those reasons, for the most part, have to do with satisfying the needs of the donor.

If you create/maintain relationships with donors, you increase the likelihood that they will continue to give — that’s “Development.” If all you do is “Fundraising,” you make it that much harder to ensure your organization’s future.

Fundraising is like a band-aid, Development is closer to a cure.

“Development” is more about people “giving” to an organization than it is buying a product, a recognition opportunity, or a ticket to an event. “Giving” implies not expecting anything in return … except for that “good feeling.”

“Development” is also about understanding who your (prospective) (long-term) donors are, and what you have to do to get them to want to support your organization.

Whether it’s a Corporation, a Foundation, a prospective Major Donor, or the recipient of a mass solicitation, they’re not going to write you a check if you don’t show them that doing so will satisfy their needs.

Getting a Corporation to want to give to a non-profit is a simple matter of learning, understanding, and acting on the needs of the corporation and those of its decision-makers. Will supporting your NPO help the corporation’s marketing efforts and increase its revenue? Will supporting your NPO and espousing your cause make the corporate leaders look good? … feel good ??

Foundations give based on their mission and the needs of the foundation leadership. Do you try to create relationships with foundations whose leaders feel strongly about your programs and activities and about the people you serve? Do you know who those leaders are and what is important to them?

To get individual (potential) major donors to want to give, you have to know them well enough to know what’s important to them. You have to know/understand their priorities and what will make them feel good.

Just because a nonprofit does wonderful things in a cost-effective manner doesn’t mean that potential donors will want to support it.

Getting people to want to give, and corporations and foundations are run by people, is about learning, understanding, and appealing to their various needs.

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Fundraising and Development: Understanding the Difference (2024)

FAQs

What's the difference between development and fundraising? ›

Fundraising asks tend to happen on a timeline determined by the organization. Development is relational. It is the process of developing relationships with donors for long-term, organizational benefit.

What are the four C's of fundraising? ›

The 4 C's of Fundraising Success

Clear, compelling vision. Consistent communication. Competent follow-up, Champions.

What is your understanding of fundraising? ›

Fundraising is the process of gathering voluntary contributions of money or other resources carried out by non-profit making organisations — NGOs, foundations, associations, collectives, etc. — in order to be able to implement their projects.

What are the stages of fundraising development? ›

The 6 Key Stages of Major Donor Development
  • Discovery. Capacity and affinity have been verified in this stage, but no personal visit has occurred.
  • Early Cultivation. This is the stage in which an initial visit has occurred but not much else.
  • Mid-Cultivation. ...
  • Ready to Solicit. ...
  • Proposal Pending. ...
  • Stewardship.

What are the main 4 categories of fundraising? ›

The four main categories of fundraising are: (1) Individual Giving, which includes one-time donations, recurring gifts, and major gifts from private donors; (2) Corporate Sponsorship, involving financial support from businesses; (3) Grantmaking, which includes funds received from governmental bodies and private ...

What does development mean in nonprofits? ›

In the nonprofit world, especially among nonprofits who actively seek charitable gifts, “development” is often shorthand for fundraising. But why? Because “development” refers to the act of building relationships that lead to charitable gifts. It's really referring to “relationship development.”

What are the 5 T's of fundraising? ›

Charitable giving and philanthropy are often associated with three levels of engagement: time, treasure, and talent. However, there are two more T's that are equally important: ties and testimony.

What is the 3 to 1 rule for fundraising? ›

When planning the year's activities, PTAs should use the 3-to-1 Rule: There should be at least three non-fundraising programs aimed at helping parents or children or advocating for school improvements, for every one fundraiser. Fundraising should involve as many members as possible and be fun.

What are the 3 P's in fundraising? ›

While most people are fearful or anxious about fundraising, it's actually easier than you think. You need three things to be successful: Product, Persistence and Positioning. Product. In order to be able to raise money, you need to have a product you believe in that's bold and beneficial.

What is the main purpose of fundraising? ›

Raise a specific amount of money

This is usually the primary goal for both a nonprofit organization and individuals when fundraising. While all of the other goals are important, the main focus of any fundraising initiative is to do just that, want to raise funds.

What motivates you to fundraise? ›

Altruism or a genuine desire to make change, give back, alleviate suffering and campaign for equity drives many people to support causes that address these issues. Supporting a charity gives people some sense of empowerment and fulfilment, knowing that they are doing what they can to effect change.

What is the rule of 7 in fundraising? ›

Simply put, the Rule of Seven recommends seven contacts with a donor within one year after that person makes a gift. In other words, for every one request you make for a gift, you need seven other meaningful contacts.

What is the difference between fundraising and development? ›

Understanding the Difference Between Fundraising and Development. “Development” is, by definition, the process of creating and enhancing relationships with (potential) donors to ensure current and future funding; “Fundraising” is only about income generation.

What are the 4 P's of fundraising? ›

A GiveGab blog provided four P's of being a great fundraiser. Their P's are passion, persistence, philanthropy and people-focused.

Is business development the same as fundraising? ›

“Development” is, by definition, the process of creating and enhancing relationships with (potential) donors to ensure current and future funding; “Fundraising” is only about income generation.

What is considered a fundraiser? ›

A fundraising event is an event designed to raise awareness and donations for an organization's mission. A fundraising event can be a concert, silent auction, half marathon, neighborhood cookout, and more.

What is a development plan fundraising? ›

An annual nonprofit development plan (or fundraising plan) is simply a document that includes your fundraising goals for the year and how you plan to reach them.

What is the difference between fundraising and funding? ›

Funding does not need to be paid back. Financing requires repayment of the loan amount and interest within a specified timeframe. Fundraising does not involve any interest charges, as it is usually provided by government or charitable organisations.

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