Non profit development often requires specific personnel who are experienced in various methods of raising funds for the organization. However, regardless of the personnel performing the fund raising tasks it is important to remember:
- Fund raising costs should be reasonable over time (on average, revenue should be at least three times the amount spent on conducting those activities)
- Solicitation and promotional materials should be accurate and truthful and should correctly identify the organization, its mission, and the intended use of the solicited funds.
- All statements made by the nonprofit in its fund-raising appeals about the use of a contribution should be honored.
- A nonprofit should have control of any persons soliciting contributions on behalf of the organization.
Non profit developers
Many non profits hire independent developers or consultants to manage their fundraising. However, many organizations are unsure of the proper way to compensate non profit developers. The cardinal rule is that non profit developers should not be compensated based on a percentage of the amount raised or other commission formula. Examples of acceptable compensation are a fee based on experience or a graduated fee based on reaching specified milestones in a fund-raising campaign (provided the fee is not a percentage of the charitable funds raised). Any form of compensation based on the percentage of funds raised, whether disguised as salary, bonus, or otherwise is unacceptable.
A popular alternative is incentive compensation, which is based on the accomplishment of mutually agreed-upon, pre-established, overall goals related to a non profit developer's responsibilities within the organization.
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