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CSP undertakes research on “Strategic Fundraising: How & Why People Give”

Team discusses report.

Fundraising from individual or institutional donors is a surprisingly under-researched topic given how critical it is to the financial sustainability of third sector organisations. Fundraising strategies are too often based on gut instinct, received wisdom, historical relationships and assumptions about what prompts givers to give, rather than hard evidence and facts. The CSP is planning to undertake a research project to try to better understand the behaviour of donors in order to help fundraising organisations raise capital more efficiently and more cost effectively.

Third sector organisations spend a significant amount of time building databases, arranging meetings and engaging potential donors only to find that sometimes even after multiple discussions the donor has been wrongly targeted and has no interest in investing in a particular asset. Equally fundraisers often face conundrums about whether to offer up specific programmes for support (e.g. restricted funding) or encourage donors to give unconditional (unrestricted) funding.

Conventional wisdom may suggest that fundraising is best done by aligning specific opportunities with the donor’s personal or professional interests. However, in many cases, notably where the donor is already very familiar with and has confidence in the institution, they may happily offer unrestricted capital. Existing research suggests there may be a “paradox of choice” or a choice overload hypothesis but still relatively little is understood about how or why donors give.

The CSP will study the behavioural dynamics of donors with a view to providing practical recommendations on how to best raise philanthropic capital. It may lead to specific recommendations on how to increase the amount of capital donated, how to improve the efficiency of how donor funds are disbursed, how to ensure that donor-imposed restrictions are limited and how to encourage donors to renew their funding commitments. The CSP is hiring a dedicated Postdoctoral Research Associate to undertake this piece of work over a two-year timeframe using funds contributed by an anonymous long-term benefactor of the University of Cambridge.