Capital Campaigns

A capital campaign is a fundraising campaign that usually raises a large amount of money for purposes such as constructing a building or purchasing major equipment. Think of it as a campaign for raising money to fund the acquisition of anything that would be capitalized on a balance sheet.

These days just about any fundraising campaign that will rely on large gifts for the bulk of funds raise and is in support of a single purpose is referred to as a capital campaign.


Articles about Capital Campaigns

In Search of the Elusive Major Giver

What a Major Giver is How to find them What you need to have in place before conducting a Major Gifts Campaign Your organization needs money. Big money. The kind of money you can’t raise by going out and asking for donations of $10, $20, $100, or perhaps even $1,000. Maybe you need the money to expand your services. Maybe you need it to build a new wing. Maybe you need it to match the largest grant you’ve ever been awarded. Maybe you need it just to stay alive. Raising big money is a different proposition from chasing down contributions to the annual fund. Let me draw an analogy. Money is the sustenance that nourishes an organization. Just as food nourishes our bodies, money keeps the organization alive, healthy, and growing. It is the lifeblood. The great majority of us get our food in restaurants a meal at a time and from grocery stores a bag or two at a time. That’s not unlike what we do in most of our fund-raising efforts. We go after small money—enough to keep us going for a cycle. That cycle can be measured in time—a few months or a year. Often it is measured conceptually—a specific project or program. Raising big money is more like growing our own food and then preparing every meal from scratch. That means we’d have to clear the land, plow the ground, plant the seeds, cultivate the crops, harvest the yield, and store it. And that’s if we’re vegetarians. I don’t even want to think about what I’d have to do for a steak. The point I’m... read more

Capital Campaigns: Building for Now

A capital campaign raises money that will be spent to acquire or improve a physical asset. The most common use of a capital campaign is for the purchase, construction, or renovation of a building (commonly referred to as “bricks and mortar”). However, an organization can conduct a capital campaign to purchase machinery, equipment, furniture, fixtures, or any physical asset that can be reflected on its balance sheet. The purpose of a capital campaign differs from that of an endowment campaign in that the money raised will not be used to cover ongoing, operational expenses, or to fund special projects. Capital funds are spent on one-time or seldom recurring expenditures. The primary difference between capital and endowment funds is that capital funds are not retained and invested to yield income. However, capital and endowment campaigns are very similar in their planning and management. “One-Time Only” Campaigns Somehow They Keep Coming Back! Like endowment campaigns, capital campaigns should be rare. The answer to the question of how frequently to conduct a capital campaign should lie within the organization’s strategic plan. If an organization has successfully mapped out its growth, it can anticipate the points at which capital expenses will be incurred. In other words, need and planned strategy will determine when an organization should conduct a capital campaign. Frequent capital campaigns can sap the strength of an organization’s annual fund campaign program. Keep going back to supporters with one special campaign on the heels of another, and sooner or later it will affect giving to the annual campaign. It is usually best if a number of years pass between the execution... read more

12 Things You Should Know About
Setting A Capital Campaign Goal

A capital campaign raises money that will be spent to acquire or improve a physical asset. The most common use of a capital campaign is for the purchase, construction, or renovation of a building (commonly referred to as “bricks and mortar”). However, an organization can conduct a capital campaign to purchase machinery, equipment, furniture, fixtures, or any physical asset that can be reflected on its balance sheet. The amount needed (the goal), can be readily translated into printed specifications, drawings, slides, photographs, models, etc. These explicit and physical “goals” are fixed and unyielding. Success or failure of fund-raising campaigns is measured incrementally by how far above or below goal a campaign finishes. Annual fund and endowment campaigns, while having visible and public goals, can fail to meet their objectives, but are able to absorb the losses or diffuse the failures. The annual fund campaign can fall short of its goal and incur a deficit in the current year, but can make up the deficit in the following year. Endowment campaign goals are established in rather uncertain ways. The goals are based upon long-term, not always clearly defined needs and are related to forecasts of investment income which generally are unreliable. Thus, an endowment campaign’s goal can be raised or lowered at almost any time during the drive, and most often without serious notice or concern. However, the failure to meet a capital campaign goal is a serious matter and is of great concern. If a capital campaign fails to meet its goal, the loss is clearly visible. A building will not be completed, a renovation will be curtailed and... read more

The Name Is the Game:
Memberships and Named Gift Opportunities

In the nonprofit world, when it comes to “memberships,” we seem to be of two minds. On the one hand are memberships that convey benefits in exchange for a fee, and on the other, those that recognize donors for gifts made. Fee-Based Memberships In fee-based memberships, a patron of The Metropolis Museum can “join” that institution and become a member by paying a fee of $25 or $50 and receive a monthly magazine, free admission, a discount at the museum shop, special event invitations, etc. To my way of thinking, this type of membership is actually an earned income opportunity and is better left to the museum’s marketing department. Those fee-paying members have more in common with a performing arts organization’s season ticket holders than its donors, and their real value to a development effort lies in their potential to contribute to fund-raising campaigns, rather than the fee they pay for their membership. Philanthropy-Driven Memberships Recognition-based membership programs are tools used to convert prospects into donors and to increase the size of gift. They are one of the most useful tools fund-raisers have. Donors giving at a certain level to the annual fund become Friends of the organization. If they give at increasingly higher levels they have the opportunity to be recognized as Contributing Friend, Supporting Friend, or Sustaining Friend. Then there are those who give more that one could ever expect from a friend and enter the rarefied air of Benefactor or even Founder. Perhaps they become members of the President’s Circle. What matters is the concept, not the name. The idea is to tastefully and properly recognize... read more