Relentless Irrational Optimism The role of the Board

Relentless, Irrational Optimism: The role of the Board in Fundraising for the Arts CHRISTINE O’CONNOR – ALBERT HALL & ASSOCIATES

Successful Arts Communities Require Engaged Civic Leadership AMBASSADORS – advocating, evangelizing, connecting SHARED EXPERTISE - guidance, perspective, brainstorming PHILANTHROPIC LEADERSHIP - financial support, community care & stewardship WATCHDOGS – tax & regulatory compliance, transparency, ethics CHRISTINE O'CONNOR / ALBERTHALL&ASSOCIATES 2

The Broader Context Total charitable giving by individuals, corporations, foundations in 2014 $358. 38 Billion Total giving overall + 7. 1% by individuals + 5. 7% by foundations + 8. 2% by bequests + 15. 5% by corporations + 13. 7% Source: Giving USA CHRISTINE O'CONNOR / ALBERTHALL&ASSOCIATES 3

Donors of $358 Billion in 2014 Bequests; 8% source: Giving USA Corporations; 5% Foundations; 15% Individuals; 72% CHRISTINE O'CONNOR / ALBERTHALL&ASSOCIATES 4

Religion Education Human Services Gifts to Foundations Health Public Society Benefit ARTS, CULTURE, HUMANITIES International Affairs Environment/Animals Gifts to Individuals 0% 5% 10% 15% 20% CHRISTINE O'CONNOR / ALBERTHALL&ASSOCIATES 25% 30% 35% 5

Individuals – Giving to Capacity? Overall, people making $200, 000+ give 4. 2% of discretionary income $200 K+ in wealthy zip codes give 2. 8% to charity People making $50 K-$75 K give 7. 6% of discretionary income Why don’t individuals give more? 1. Lack of faith in nonprofits 2. Lack of knowledge/connection to charity 3. Fear of increased requests from others CHRISTINE O'CONNOR / ALBERTHALL&ASSOCIATES 6

Key Leadership Partners: Artistic + Management + Board Recession Impact ◦ Problems created ◦ Problems revealed Reminders ◦ Artistic excellence ◦ Audience engagement ◦ Customer service = patron loyalty Rethink models • Community engagement & active partnership • New kinds of competitors Advocate, engage, renew: every day • Internal stakeholders • Audience • Community CHRISTINE O'CONNOR / ALBERTHALL&ASSOCIATES 7

Know Before You Join A Board 1. Specific expectations of time and money 2. Major fundraising and programming goals for the next 3 years 3. Exactly why the organization wants you to serve at this moment in time CHRISTINE O'CONNOR / ALBERTHALL&ASSOCIATES 8

Why we need your involvement in fund development 1. Labor intensive 2. Staff vs. volunteer solicitors – influence & credibility 3. Contacts & connections 4. Diversity of ideas, expertise, points of view CHRISTINE O’CONNOR • ALBERTHALL&ASSOCIATES

Why you should want to be involved 1. Legal responsibilities of board 2. Passion for the art form 3. Caring for the community & its future 4. Transforming donors and board 5. Rewarding impact & fun CHRISTINE O'CONNOR / ALBERTHALL&ASSOCIATES 10

What do we want from you? 1. Financial support 2. Knowledge & vocal, pro-active advocacy 3. Participation & partnership 4. Contacts, suggestions, strategy advice CHRISTINE O'CONNOR / ALBERTHALL&ASSOCIATES 11

Board Skills Inventory 1. Committee service – policy, goals, strategy 2. Identify prospects 3. Cultivate 4. Solicit 5. Thank 6. Continually engage & develop relationships CHRISTINE O'CONNOR / ALBERTHALL&ASSOCIATES 12

Staff Expectations of Board • Get to know organization • Understand needs, priorities • Be clear about your needs, schedule • Help identify a role that is meaningful for you • Move beyond comfort zone • Partner with staff and peers • Do what you say you’re going to do • Replace yourself CHRISTINE O'CONNOR / ALBERTHALL&ASSOCIATES 13

Board Expectations of Staff • Clarity & dialogue • Communicate effectively • Use time effectively • Draft strategies, materials • Brief, train, expand skills • “Expert witness” assistance • Follow up and tracking • Recognition • Ongoing cultivation, development of leadership CHRISTINE O'CONNOR / ALBERTHALL&ASSOCIATES 14

Annual Operating Campaigns Gifts from Individuals ◦ Trustees First! ◦ Other Individuals ◦ Grassroots: ticket orders, mail, phone, website, crowdfunding ◦ Major Gifts: for general operations or special projects ◦ Crossover with special events, foundations, corporate, capital ◦ Estate planning CHRISTINE O'CONNOR / ALBERTHALL&ASSOCIATES 15

Annual Operating Campaigns Corporate Gifts ◦ Philanthropic grants ◦ Marketing sponsorships ◦ In-Kind ◦ Matching Gifts (individuals) Corporate Donors’ Top Goals • Supporting company’s mission & values • Giving back to communities where we operate • Building & enhancing corporate reputation Source: Global Impact & Lilly IU study CHRISTINE O'CONNOR / ALBERTHALL&ASSOCIATES 16

Annual Operating Campaigns Foundation Facts Foundations ◦ Local & Regional ◦ Family & Community ◦ National In 2012, Arts & Culture organizations received 14% of total grants from foundations – behind Health and Education, and tied with Human Services Foundation support is stable but growth is slow CHRISTINE O'CONNOR / ALBERTHALL&ASSOCIATES 17

Annual Operating Campaigns Government Advocacy required to ◦ City of Seattle ◦ 4 Culture ◦ Arts. WA ◦ National Endowment for the Arts • ensure continued support • maintain relationships with legislators Imprimatur, not a growth area CHRISTINE O'CONNOR / ALBERTHALL&ASSOCIATES 18

Annual Operating Campaigns Special Events ◦ Tables: Corporate, Individuals ◦ Point of entry for new audiences, donors Other Impact via “friend-raising” as much as fundraising Advances institutional profile Cultivation, relationship building Avenues for community engagement ◦ Arts. Fund ◦ Guilds / Volunteer Groups Opportunity to ignite interest from new audiences and philanthropists High cost for events CHRISTINE O'CONNOR / ALBERTHALL&ASSOCIATES 19

Capital and Endowment Campaigns Nature of the core project ◦ Permanent endowment ◦ Building or renovation Time Frame • Multi year, but with a specific end date Magnitude of gifts • Much larger than annual fund CHRISTINE O'CONNOR / ALBERTHALL&ASSOCIATES 20

When is an organization ready? • Balanced budgets annually • Working capital reserves • Strategic plan for the future • Sufficient staff & systems • Robust pool of prospective donors ready to hear the story CHRISTINE O'CONNOR / ALBERTHALL&ASSOCIATES 21

When is an organization ready? • Board leadership for campaign • Campaign financing determined • Realistic financial projections • Good case for the “So What? ” question CHRISTINE O'CONNOR / ALBERTHALL&ASSOCIATES 22

Stages of a Capital Campaign 1. CAMPAIGN PREPARATION Feasibility study: internal & external assessments Results will shape ◦ Goals ◦ Campaign leadership structure ◦ Case, strategies, gift policies, recognition opportunities ◦ Coordinated institutional messaging & PR ◦ Campaign expense budget CHRISTINE O'CONNOR / ALBERTHALL&ASSOCIATES 23

Stages of a Capital Campaign 2. CAMPAIGN IMPLEMENTATION • Leadership role of Board • Traditional & flexible “phasing” : Quiet + Public • Engaging donors, stakeholders in campaign • Entrepreneurial models CHRISTINE O'CONNOR / ALBERTHALL&ASSOCIATES 24

Gift Range # Needed Prospects $3, 000 1 $2, 000 1 $1, 000 3 $500, 000 6 $250, 000 10 $100, 000 25 $50, 000 30 $25, 000 50 $10, 000 100 < $10, 000 Many 3 3 9 18 30 75 90 150 300 Many Total Income $3, 000 $2, 000, 000 $3, 000 $2, 500, 000 $1, 250, 000 $1, 000 $250, 000 Total Raised $3, 000 $5, 000 $8, 000 $11, 000 $13, 500, 000 $16, 000 $17, 500, 000 $18, 750, 000 $19, 750, 000 $20, 000 CHRISTINE O'CONNOR / ALBERTHALL&ASSOCIATES % Goal 15% 25% 40% 55% 68% 80% 88% 94% 99% 100% 25

Stages of a Capital Campaign 3. POST CAMPAIGN PHASE • Declaring victory • Continuing to collect pledges • Reporting, thanking, cultivating, preparing for the next campaign CHRISTINE O'CONNOR / ALBERTHALL&ASSOCIATES 26

Critical Questions 1. Will this project support our mission? 2. Are we building the capacity to manage this new project when we are finished? 3. Will we have the money we need - when we need it - for the entire project? 4. Do we have a broad community that will be served by the facility, now and in the future? From Set In Stone – Cultural Policy Center, University of Chicago CHRISTINE O'CONNOR / ALBERTHALL&ASSOCIATES 27

Why join an Arts Board? Inspire… Connect… Engage… Make a Difference to a Favorite Art Form and to the Community CHRISTINE O'CONNOR / ALBERTHALL&ASSOCIATES 28