6 Steps to Get Ready for a Capital Campaign (Part 2)

By Rhen Hoehn, Petrus Director of Marketing

Welcome back!  In part one of this two-part series, we discussed three steps that must be taken to position an organization for undertaking a capital campaign.   In this article, we look at three more steps to kick off the process of a campaign.

These steps include a strategic plan, case for support, and feasibility study.

4.  Strategic Plan

For a nonprofit to carry out a successful capital campaign, it must start with a realistic picture of where the organization is with regard to its mission right now, and where it wants to be in five and ten and twenty years.

Key stakeholders should spend time refining the organization’s mission, vision, and values. They should discuss strengths and weaknesses and the opportunities and threats facing the organization.  As each of these elements becomes more clear, leadership will be able to discern and set goals for measures of success as they relate to the organization’s vision.

All of these items can be discussed in a visioning session. These visioning sessions are typically overseen by a neutral third-party moderator who can help the group come to the most thorough conclusions through use of proven processes and exercises.

A strategic plan will clarify the top issues that the organization faces, and the plan will naturally lead to the potential focal points of a capital campaign.

5.  Case for Support

After clarifying the top issues facing the organization, it's now possible to start laying out potential solutions and their costs. This list of solutions will eventually inform the selection of projects to be included in a capital campaign.

Common campaign components include projects such as:

• Renovation of physical plant
• Expansion of physical plant
• Expansion of staff
• Endowment building

A campaign case for support, which lays out the campaign and why it should be supported, may include just one of these projects, but sometimes more. As your organization moves toward a campaign, it must determine which projects are the highest priority, and what their cost will be. 

For example, a school may assess that to meet future needs, it is necessary to renovate existing classroom space, build a new gymnasium, add a soccer field, and start an endowment to support future building upkeep. The total cost of these four projects will be $10 million.

With this list of potential projects the school will create a preliminary campaign case for support. They will test the preliminary case for support with a select audience from among their stakeholders. This process is known as a feasibility study.

6.  Feasibility Study

A feasibility study is essential to successful campaigns. In this process, a neutral third party, such as a consulting firm, brings the preliminary campaign case for support to key stakeholders, donors, and prospects to help determine how much the organization is actually capable of raising in a campaign. 

These interviews are done confidentially by the third party. They gather the interviewee’s insights about which projects from the preliminary case for support are popular and which are not. The interviews also gauge the potential level of support from top prospects, and they can help identify reasons why there might be difficulties completing the campaign.

When interviews are complete, the results are compiled into a final report. The report will give a sense of the total dollar amount that is feasible for the organization to raise, and it shares insight into which projects from the preliminary case for support are likely to motivate donors. This will inform the final makeup of the campaign case for support.

In our example from above with the school that hoped to raise $10 million, it could happen that a feasibility study found an upper limit of $7 million to be a reasonable campaign goal. In this case, the school would have to decide which projects to drop or scale back from among their preliminary case for support. 

Beginning the Campaign

With a feasibility study behind you and a campaign case for support clarified, it is time to move forward with carrying out the process of a capital campaign.

Campaigns are large projects with many moving pieces. Executing a successful campaign involves creating individual donor strategies, overseeing the production of campaign collateral pieces like letterhead, pledge forms, and pledge reminders; and coordinating a communications campaign to engage your full audience.

It is advisable for all nonprofits to engage campaign counsel from an experienced fundraising consultant to keep your organization oriented and focused through each step of the campaign process.

With careful planning and hard work, your school can use a capital campaign to take its impact to the next level.

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Is your organization considering a capital campaign?  Are you interested in learning more?  

Don't enter the process blind. You will waste a lot of time, and a lot of money.

Get a roadmap for the process from people who have been through it before on the Petrus Development “Preparing for a Capital Campaign” Virtual Summit, including:

• Is my organization ready for a campaign effort? 
• How do I approach the planning of my campaign projects? 
• What should I expect once I start a campaign? What can I do to maximize campaign ROI?