Fundraising Insights from India

Today is the 67th Independence Day of India. Such milestones are good time to reflect on the past and forecast the way forward. Hence I will focus on fundraising insights from India, one of the countries that are generating tremendous fundraising interest globally. These reflections are based on my ‘on-the-ground’ experiences working with non-profit leaders, fundraisers, corporate decision makers as well as donors and philanthropist in India and across Asia.

I will use Strength, Weakness, Opportunities and Challenges as the framework for these insights. I look forward to your input, so that we can further enhance the collective knowledge available about this domain.

Strengths:

• Indian generosity – comes more from affinity than from affluence. Most recently I saw this motivation in action at a focus group of urban homemakers, many of whom donated to a particular organisation. Their only motivation being, ‘back in school’ they had supported that organisation. Although they have never been asked since; they continue to contribute their savings from household expenses.

• Sheer numbers – of the 84% of the 836 million adults who donated at least once a year (2012), only 27% of people gave to an official charitable organisation. That’s a staggering 189 million donors.

• Rate of growth – I recently analysed the growth of local fundraising income of ten INGOs and twelve national NGOs in India. Almost all of these organisations saw between 9% – 40% increase in their local funds raised in 2012 compared to 2011, with 25% as the median growth. A couple of outliers saw 100% increase in local funds raised.

• Made for India methodologies – Indian ability to innovate cost-effectively and sustainably under resource constraints is the topic of many business case-studies and Harvard reviews on ‘frugal innovations’. In the fundraising world too there are creative ways of getting around the infrastructure and policy constraints. Here is just one such example – The ‘Missed Call’ phenomenon, where callers use their mobile phone to “ring once, hang up” to signal organisations and friends alike on the receiving end that they want to communicate with them. Through the Goonj- Johnsons India collaboration viewers of an advertisement could give a missed call at a specific number- for the charity to call back and give them an opportunity to make a difference. Hence rather than lament the lack of mailing or calling lists, Indian charities are building their own lead generation mechanisms to source warm-supporters. It also complies with the telemarketing policies.

Weakness:

• Inability to ask big gifts– most of the organisations reviewed in the above mentioned analysis have focused on donors at the ‘base of the giving pyramid’ with not much effort made to help them move up the donor ladder. A tactical effort of ‘mining’ a client’s database and encouraging them to contact mid-level donors in one of Delhi’s upmarket residential colony resulted in the organisation not only getting an exceptionally large contribution, but also a ‘chairperson’ for their fundraising campaign. The possibilities are immense if organisations are to strategically develop their Major Gifts effort.

• Recruitment – while there are some exceptional fundraisers in India, there is a general weakness within organisations in recruiting strategy leaders for fundraising, with the 3Ts that I see necessary :

1. Talent ( skills needed to work across regions in India)
2. Technique (broad based experience needed to develop a national/ regional fundraising strategy. The reason in many cases being that the organisational leadership and the fundraiser do not have experience in fundraising nor the exposure to fundraising training)
3. Tolerance ( given the highly competitive market for fundraisers, this group is very mobile, especially now, given the more lucrative CSR roles in the corporate sector)

• Data management & Analytics – a lack of attention to in-house systems and processes so that quality data and superior data management can be used for transformational fundraising. This entails having skills, training and experience in managing data for fundraising analytics.

Opportunities:

• A new legislation – passed in parliament last week makes it mandatory for profit making companies to spend at least 2% of their profits on Corporate Social Responsibility (CSR) initiatives. About 7,000-8,000 companies in India are eligible for the enforcement of Section 135 of this new Companies Act. Approximately US$5 billion worth of funds will become annually available that could be absorbed by charities and social enterprises, if they collaborate with the relevant companies to co-create social value.

• Growth of philanthropy – I recently co-authored a chapter on Revealing Indian Philanthropy which features sixteen philanthropists and their philosophy towards giving. The list includes Rohini Nilekani who recently raised about US$27 million, by selling her shares of her company, to resource her philanthropic work. A common thread being that these high net worth individuals want to address social needs and issues where government has not succeeded and where commerce cannot afford to go.

• 3rd party events – like the Airtel and Standard Chartered Marathons as well as online efforts like GiveIndia and Wishberry to provide non-profits with an ability to raise funding without major infrastructural expenses. Over the past five years Mumbai has been the best location to raise funds through the Marathon platform, outperforming Delhi and Bangalore by a large margin. The opportunity here is to use these events as acquisition channels, so that non-profit organisations can nurture the relationships with the individual and corporate supporters for further engagement.

Challenges:

• Delegation without clear responsibility – This observation is related to the dependency of many organisations on ‘out-sourced’ fundraising agencies. I see these organisations (especially funded through investments from INGO HQs) resting on the laurels of the acquisition made possible through face-to-face and telemarketing recruitment companies, without clear in-house strategy for nurturing the donors. With the ‘HQ investors’ focused on short-term ROI, local capability building and donor care for long-term sustainability is being forfeited. The local fundraisers become mere ‘project coordinators’ for the assortment of vendors, thus lacking the 3Ts mentioned earlier, which is needed to build a robust and sustained in-house fundraising team. The lack of regulations around data ownership further aggravates the situation, with shocking examples of agencies shifting donors from one NGO to another as soon as they get new business, without informing the clients.

Indian fundraisers will amaze the world, when it builds on its strengths and negates its weaknesses, while addressing the opportunities and challenges. I hope this short list of ground realities in India provides some insight to help accelerate the process.

I close this commentary on India with a Chinese proverb: ‘To know the road ahead, ask those coming back’.