 Welcome. We are so excited to have you for our first but not our last non-profit power week, and we are starting off strong on Monday with Jack Alotto. Jack is with Fundraising Academy, and Jack's going to share with us all through this episode about determining capacity, how to really prospect for donors. So, Jack, we are excited to have you here and thrilled to have Fundraising Academy helping us launch this non-profit power week. So, thanks again for that, and of course, thanks to all of our presenting sponsors that helped to continue the broadcasting, keep us on the airwaves, all that good stuff. We are so grateful to have the continued support. You see Fundraising Academy here again, as well as behind us, and so many of our very generous presenting sponsors. So, we are so grateful to have each and every one of you. I'm also grateful to have you, Julia. Julia Patrick is the CEO of the American Non-profit Academy. I'm Jarrett Ransom, also known as your non-profit nerd, and I am so honored to be joining you today and Jack to have you here. So, again, welcome. You know, Jack, it's a lot of fun to have you with us, and Jarrett and I are really excited about non-profit power week. We've been talking about this for months. We came up with the idea, I have to admit, our executive producer Kevin Pace is the one that came up with the idea, and the concept was, let's take a week, put all of the best minds in a particular topic, and really focus in on something for five days straight. And so, Fundraising Academy came to mind because we're moving into Q4, and this is it. We've had a rough two years, and we're trying to get back into some normal seat. We're not quite able to, but we still need to be fundraising. And so, we wanted to talk to you today specifically about prospecting and what that actually means to the whole process, because without successful prospecting, we really are kind of chasing our tails, aren't we? Yes. In fact, you know, the question I get most from people who either are attending classes that we do at the Fundraising Academy or webinars is, how do I find donors? How do I acquire more donors? So, this first topic is such a great one to kick off your week, because it's so important for fundraisers to be able to prospect. Well, okay. So then, dear and I've got to ask this question, because we're really curious, what is capacity and is it only money? No, it's not only money, but most people think, when they think of capacity of a dollar amount that you might be able to get from a donor. But capacity is so much more. We consider capacity a desire to make a gift, somebody who has an emotional connection to your cause. And one of the things that we use in cause selling, which I consider one of the most beautiful and elegant things that we have, is what we call the Madden test in cause selling. And what the Madden test is, it's a great way for us to qualify our prospects. So what is the Madden test? You're probably asking me, so let me go through that briefly. So Madden is M-A-D-D-E-N. The M stands for money. And that's what typical, what most people think of as capacity. But with Madden, the D stands for desire. Do you have a desire to make a gift? In other words, the question we ask with desire is that, do you have a philanthropic propensity to give to nonprofit organizations? The second D is decision maker. Do you have the authority to make a decision to give a gift to a nonprofit? And many of us, we hear from people when we ask them for a gift is, let me talk to my spouse, let me talk to my children, let me think about it and talk to others as it relates to me making a gift to your organization. E stands for emotion. Do we have an interest? Or does the prospect have an interest or connection to our cause? One of the examples I like to give is if you give to an animal welfare organization and you are the humane society in your community, then probably when you look at a prospect who is giving to that other animal welfare organization, they probably have an emotional connection to that cause. And they may fit in this E in the Madden test. Need. Need is the hardest thing for us to determine. And how do we determine need? We find out by asking the prospect questions. We ask them about their motives for giving. What propels them to make a gift? So this Madden test we use with any suspect or prospect we uncover. And then once we answer all these questions about that prospect, the test is completed. I love that approach because I cannot tell you, Jack, how often I've sat around a board table and someone will say we should ask so-and-so for money. They have tons of it. Okay? And what we also like to say here is really there are 1.8 million nonprofits in the U.S. alone, right? 1.8 million nonprofits. But if we have this name dropped at a board meeting that says we should ask so-and-so because they have a lot of money, then let's counter that and say great, let's do that. But first, let's put in the Madden test, right? Yes, they have money, but are they approachable? Do they have that desire? I'm looking at my cheat sheet because I don't know it quite as well as you do. Are they the decision maker? Do they have that emotional investment and what is the need? And then if we've qualified truly that prospect that has all the money in the world, right? Then yes, let's find out how might we approach this individual. So thank you for sharing the Madden test. I think that is probably one of the best tools and resources that I myself have learned through the cause selling education model. And I like to say it's beautiful and elegant because it is beautiful and elegant. You know, it's part and parcel to this concept of capacity, but I want to go back and kind of echo what Jared said and then get your response on this. And that is, there's this sense of people that roam our communities that have gobs of money, whether they do, whether they don't, we don't really know. But talk about the aspect in general of capacity. What does it mean beyond just that checkbook? Or is that even something to think about? Yeah, no, I think it's incredibly important to think about. So for example, have you ever met with a prospective donor and talked to them about making a gift to your organization, and they say, oh, I need to go and talk to my spouse, or I need to go and talk to my children about this gift because it's such a large gift. That's the D, the second D in the Madden test. If you had sat down beforehand and said, okay, is Mr. Smith really the decision maker? Who else has to be in the room when I asked Mr. Smith for a gift? So if we had put Mr. Smith through that Madden test, then we would have said, oh, his spouse has to be there, or his children have to be there, or some other person in his life. So I think it's really important. And I think this is such a great test to determine, to qualify a prospect. And if you go through each one of these, some of these things you may not be able to determine. But if you have two or three of these, then you're going to be able to figure out an approach, an approach, and a presentation later on. Approach and presentation are two really important components of the cause selling fundraising cycle. And the Madden test helps you get on that path to designing your approach to this prospective donor, and then later to make a presentation to this prospective donor. I hope that answered your question, Julia. Yeah, it really does, because I think that as we have this amazing and historic transference of wealth, to your point, we're going to have wealth advisors, we're going to have fund advisors, we're going to have children, we're going to have spouses, we're going to have second or third spouses, and then their children. I mean, you're absolutely right. I don't want to use the word convoluted, but it has a lot more inputs, I think, now than just what we might traditionally think of is that that benefactor relationship. And you've brought up people who I didn't bring up, like wealth advisors, accountants, maybe estate planning attorneys who also may be part of that decision making process. The other thing that I love about this Madden test is need, determining need, determining the motivations for making a gift. When you say, when you guys said earlier, you know, they dropped the name of so and so is a bazillionaire, and we should be talking to them. We have to ask ourselves, do they have the motivation to give to our cause? Are they can really connected to our cause? And I have sat through in my consulting practice, board meeting after board meeting, and they would say to me, who can we ask in Silicon Valley? You know, here I'm here in California, who can we ask in Silicon Valley? And I always say, well, who knows that person? How do we know that? Will they talk to me? Or will they? Who will they talk to? They might not even talk to us. You know, it's so interesting because to going back to Jared's comment, that sense of sitting in a meeting and just and saying, you know, who has the fattest wallet? Well, why aren't they involved with us? It's, I think, Jared, I don't know what you think, but it seems to me that it's this mentality that makes us blow through our development directors. And the average 10 year of a development director, according to AFP, is about 18 months, which is horrific, 18 months. We're just burning these people out because we put these expectations of all you just need to talk to rich people, which is like, goes back to that dialing for dollars mentality. Yes, not, you know, and I literally was at a meeting once and and the person I was meeting said, well, we've, we better go. I know you got to get back to dialing for dollars. And I was like, wow, that was a great opportunity to mention that in test. I wish I knew it a couple of years ago. I wish you were that easy. I really wish you were that easy, but you know what? Fundraising, when you're doing prospecting, it takes work. It does take work. Well, talk to us about if we can move into, you know, how might we measure prospects? What is this all about? Are all prospects measured the same? No, they're not because when we go through the Madden test, some are going to be really high, for example, on emotion. They give to a lot of different causes that are similar to ours. They have an eat a need and a connection to the cause that we're like for animal welfare, people, they love animals. That's an emotional connection. They may also have a desire in the sense that they give to many nonprofit organizations. So they have that feelings, thropic propensity, one of the things that we do in cause. So when we get our list of prospects, and we've run them through the Madden test, we divide those prospects into three classes of prospects. Okay. The first class are those that we don't have enough information on to really pursue. We need to get more information. We need to get more information about their money, their capacity. Are they approachable? All those things we talked about Madden. The second group are people who maybe you have a positive response on two of those Madden parameters. Like they may have it. They may be the decision maker, and they may have a desire to give to causes similar to yours. That's great. And then the third categories are those people who have three or four of those Madden parameters that we really want to emphasize. So when we are putting together our desire to meet with prospects, we start with that last category, that last class of prospects, because they are most likely to one, give you a meeting and two, potentially get to yes on your ass. I like that. I'm interested in the concept too of the sustainability of the relationship. I've always thought that you could pretty much squeeze a dollar out of somebody once, but the cost associated with that and the costs are many. Not just financial, but reputation and relationship and all that is one aspect, but getting that person to link arms with you and move forward in a sustainable, continual way. Do you have a sense of that with these looking at this? Sure. So I think that last thing need, understanding need, which is not always apparent. The only way we are going to understand need is by building a relationship with that prospect. Understanding their motivation to give, why they get to certain causes, and where we do that, how do we build that relationship? We do it by asking questions. Questions like, what informs your giving? What matters to you? Is it impact? Is it stories? What, how often do you want to hear from us? That kind of thing. Building that relationship with our prospective donors, and this happens before we even get to the ask, is such an important component of our cost selling relationship building model. And I think it's important to realize Jack, because I'm going back and channeling some previous cost selling education episodes we've had with Fundraising Academy, is that all donors and all prospective donors are different, right? And so you can't fill in the blank, rinse and repeat from this conversation into this conversation, because it really could be different. But the fact that you're saying you're identifying their need before you even make that solicitation. Right. And when you identify their need, you know, is when you identify their need, let me take the example. I worked in healthcare philanthropy for most of my career. If someone called me up and said, I'm interested in women's health, that's their need. That's their motivation to learn more about women's health. So what I would do is give them and communications around women's health. And I would build that relationship around that part of what the hospital does. If they called up for emergency room, and that was their interest, or oncology or cardiology, I would put them in those segmented groups. That's about need, what their motivation is. But it's also about their interest and connection. That's the emotional part of the Madden test. So I have two really important parts that I know about this prospect on my road to qualifying them. And I think that, again, is such a win-win situation in final reason. You know, I really, before we move on to our next question, and I have so many questions for you, but I'm really intrigued that you said right out the gate, hey, you might not know all of these pieces. So it's incumbent upon you to try and figure these things out as part of that journey to building a relationship. So is it accurate to say, don't let this Madden test, shut the door on you? I mean, understand that you're going to have a journey to follow. You said the three categories of what you know and what you don't. Exactly. The first category, class A, is where we have no connections on any of the Madden tests. And what do we say in cost selling? We don't stop. It means that we have to go further and find out more information about that prospect. That's part of the fun. Oh, I was going to say that. That's what we call it, fun raising. Yes, that's, I mean, it is. And you know, people who do prospect research for a living, you know, and some of the big institutions, like I think at UC Berkeley, they have like 18 people doing prospect research or Stanford or some of the, you know, some of the big medical centers. And the reason why they do that is that they are using so many data sources to find out these six, seven things around the Madden test. Yeah. Well, let's move into those data sources because I'm hoping we have so many viewers watching live. And I know for sure we will have many, many, many more tuning in to our recording, but talk to us about how we as a nonprofit professional could use data sources, you know, as soon as this episode's over, where do we go to next to help to identify some sources that will help us find that big wallet person that also qualifies in the Madden test? Yeah, that's a great question. And when I think of data sources, I think of two data sources, internal and external. Internal data sources is where you do data mining of your BlackBot or Salesforce or whatever database system you use. You go through that and you look for similarities in donors. So how would you do that? You would ask questions like, which programs do the majority of our donors give to? That uncovers emotion as part of the Madden test. Or you would ask, how often do they get? Do they give annually? Do they give monthly? Do they give, you know, every two years, every five years? So go inside and look at your database. Look at those six Madden parameters. And once you segment out your donors, then it's going to inform you about how to find other donors. The second source of data mining is external. And here is where we could look for information through public sources like Dunn and Bradstreet, Moody's. We could talk about, if we went through the Madden, we could look at that and say, okay, where do we find salary information? That's money in the Madden test. Where do we find real estate holdings or zip codes, stock holdings, etc? Do they give to other organizations? We could go out and look for similar organizations who publish annual reports, other nonprofits and look and do some prospect research in there. Do they volunteer for other organizations? All of this external data can be found. Do you know where you could find Dunn and Bradstreet and Moody's and all of annual reports of corporations in your public library's business section? It's not that you have to buy it. Some organizations definitely buy and have prospects done through external consulting firms who help them find prospects. But those two sources are really good, but start data mining in your own database. So I like to bring up the big elephant in the room. So a lot of people are listening to you and they're thinking, that seems really creepy. That seems like we're going to know a lot of information about this individual. Talk to us about that. Well, first of all, that's a great question. So we have an ethical responsibility as fundraisers. Ethics are one of what we talk about the donor bill of rights. We talk about ethical standards of behavior in fundraising. So I urge people to remember the confidentiality principle in ethics. When we do data mining, whether external or internal, remember it's confidential. And the second thing, and there are many points and I don't have them all at the top of my head, don't be too invasive. We don't have to know everything about every prospect. We only have to know those things that are relevant to that madden test and things that matter that we should know about. We don't have to know about divorces, for example, or children who have issues of our prospects or our donors. So don't be too invasive. Remember confidentiality. People who see your database or any information you collect, whether it's public or in your own database, remember that it's only a small group of people who should know this information and not maybe the whole organization. Thank you for that. I love that you brought up Code of Ethics, the donor bill of rights, really this confidentiality, because many of us in this space are really privy to a lot of sensitive information. And it's really important that we treat our people right. We treat them well. And I think that even goes further into what you were saying, that goes into their data. Let's treat their data right. Let's treat their data well. So I just thank you for acknowledging that. Remember any prospect, any donor, anybody in your database has the right to say to you, show me what you have about me. That's one of the key components of the donor bill of rights. They have the right to see what information you have collected about them. So I always like to say to people who collect information, remember this could be public to that donor at any time when they ask you. So make sure you have some care in what you're putting in. That's right. And if you wouldn't want them to see that or know that you've documented that, certainly don't put it in that donor database. Exactly. Hold that close to your leather fringe best. I will do that. You know, we have to love our donors. We have to love our prospects and we have to respect them. Love and respect. And when we do that and we build those relationships based on those two fundamental principles, we're going to get to yes, guys. We're going to get to yes. And I think, Jack, to your point, we're going to get to a long term yes. It's not just going to be here's a check, get off my back. That's the ability you were talking about. Yeah. I mean, I think that's just such a big, big part of this. I mean, you know, the concept of recurring donations and how we navigate, you know, this digital payment, processing and donation world that is really going to consume. And I think for a good, in a good way, you know, our sector, we need to be thinking about this. Right. You're talking donor retention. You know, if we think that once we get the gift, our job is over, we're finished. Right. That's true. You're right. Well, this has been amazing. I mean, Jared, aren't you excited that I have to admit, Jared, I was, I've been like a little nervous all weekend. And I don't get nervous for this, but you know, Nonprofit Power Week is a big deal for us. And so, Jared, what do you think? Oh, I am ecstatic. You know, I worked Saturday, so I didn't really have a full weekend. I'm exhausted. And I knew that I could not miss this conversation because I knew that all of the work that Fundraising Academy does is so powerful. It's so like revitalizing, I want to say. So starting our day off with Jack has been a true pleasure. We are so excited to have you here, Jack. Thanks for sharing your insight, your expertise and your time with us when it comes to determining capacity and how to really prospect for donors. That Madden Tess, for those of you, like make sure you write that down. Check that out. That is by far probably one of the biggest nuggets of information that will change the trajectory of your prospecting. Yeah, I agree. I think it's just gold. And I think it's just a really logical way to go about this. You know, part of our relationship and a collaboration with Fundraising Academy is we've had other courses, I wouldn't say courses, but we've had other episodes where a lot of these things have been discussed. So you can go on to the non-profitshow.com site and you'll be able to go back through the archives and see all this. I should have counted the hours, but we have a lot of hours where we have engaged with different experts from Fundraising Academy. So don't miss that series if you want to really get into the cause-selling path and concept. I think Jared and I have said this, you know, for 30 years of doing this, if I had had this in the beginning, I would have been probably a lot more successful with some of my big asks. We've been asking our sponsors and our viewers to support one another. And so again, we want to thank all of our presenting sponsors for being here with us daily. Jared, we're at 360-ish? I'm not quite sure, but that's the roundup. So yes. Okay. So for 360 episodes, these folks have been with us and we are incredibly, incredibly appreciative. As we are, we want to make sure that we acknowledge Fundraising Academy for being our very first investor in non-profit Power Week. It's really an exciting thing. And we have a lot of really interesting content coming up this week. We're going to be talking about how you look inside your database, getting the gatekeepers key. I mean, how do you actually get that appointment? We're going to be talking about mindset and how you can navigate some of the challenges when you think, oh my gosh, nobody loves me. Nobody wants to talk to me. How do I get this job done when I can't even move forward? And then we will wrap it up with our traditional Friday ask and answer. But it will really be those questions that have come in this week that really wrap their arms around the work that Fundraising Academy is doing with cause selling. So an exciting week, lots to do. Again, I'm Julia Patrick been joined by the non-profit nurse herself, Jared Ransom. And we are so excited to have shared this time with you. And as we like to remind everyone to stay well so you can do well.