You can believe in holiday magic, Santa Claus and miracles. But there are some myths in the fundraising and development world that have just got to go.

And we’re just the ones to send them away.

This week, we're debunking some enduring misconceptions that constrain nonprofit potential. What a great time to toss out the old and embrace a more effective and nuanced approach to your work.

Debunking Nonprofit Myths

The nonprofit world is rife with myths that, while once perhaps useful (or not?), now serve more as shackles to the potential growth and effectiveness of both individual organizations and the sector as a whole. Lets tackle three of them today:

1. Nonprofits should have low cost infrastructure and almost all revenue should go directly to the cause. Now, unless you’re handing cash to the cause you serve, this doesn’t even make sense. Are organizations expected to pass on monies donated directly to abandoned dogs, children in underfunded neighborhoods, endangered rainforests, cancer patients? You get the point - the whole narrative is misguided and damaging.

2. Nonprofits should spend the bulk of their time, resources and attention on major donors. All others should get lumped into categories and can get automated, standard communications. So, who defines major donor? And what happens when that major donor pool becomes such a large proportion of the annual giving that losing even a small percentage of them would cripple the organization (a scenario playing itself out in many nonprofits)?

3. Tell only positive stories so people don’t think you have issues or associate your nonprofit with negative thoughts. Assume that your supporters can’t handle the truth, or at least you don’t trust them enough to do so. Sugarcoat everything to keep the positive energy flowing. Is this really the way to gain trust and generate long-term partnerships?

Actionable Strategies to Blow These Myths to Pieces:

1. Refuse to Talk About Overhead Costs: Why? Because the word itself conjures up thoughts of wasted funds. Instead, change the narrative to investment, infrastructure and impact. Get transparent and crystal clear on what you’ve built, what you plan to build, and how it will have compounded impact on your mission. Train your staff to describe it to others and walk them through examples. Create stories around the support and systems that have delivered results for the communities and causes you serve. Don’t focus on the internal things you need money for (talent, tech, marketing, logistics, etc.). Focus on the external results those things produce.

2. Value All Contributions: Develop a donor stewardship program that celebrates small and large contributions alike (and everything in between). Create donor personas that showcase different donor journeys and the impact of various levels of giving. Understand what motivates ALL of your donors, not just the major ones. Find ways for supporters to get involved beyond financial giving to immerse them in your mission and increase the chance they’ll be around for the long haul and may eventually become a ‘major’ financial contributor as well. Build a community so that your donors can interact with people who share similar values and dreams, regardless of their financial position. Look at every single donor interaction as a chance to build a movement, not as a transaction to cover a cost.

3. Share Failures and Lessons: The key to an effective story is that it should generate emotion and increase trust. Painting a rosy picture of everything going on in your nonprofit and your mission will have the opposite effect and invoke skepticism instead. People want to be involved in something bigger than themselves. They want to be immersed in something real. Real isn’t perfect and neat. It’s messy and full of roadblocks. So get raw. Talk about the challenges. Lay out scenarios where the mission could fail. Share how your organization is preparing for these challenges. Don’t be afraid to point out projects that did fail and what was learned and changed as a result. That authenticity will drive empathy, trust and sharing, all keys to building relationships that last.

Make A New Year’s Resolution (not one that’s impossible to keep, like ‘no chocolate’):

Let’s all commit to a 2025 where we operate under a more realistic and transparent understanding of what it means to run a nonprofit. Challenge your team to identify and question assumptions that may limit your organization. Most importantly, we need to create an environment where nonprofit staff aren’t continually walking on eggshells and fearful of saying or doing the wrong thing if they talk about challenges, investments needed or different ways to nurture all donor relationships.

It’s Gonna Be OK - Here’s Proof

This Week’s Quote of the Week

I addressed three myths today that I believe are hurting the nonprofit sector. There are many, many more. I would love to hear your thoughts on what some of those are. So take a few seconds and shoot me a message so we can continue to build on this conversation and change the world, one busted myth at a time.

Thanks for reading and wishing you all a restful, peaceful and joyful holiday!

Dan

P.S. I’d love to speak with you about how I can help in 2025. Let me know if you’re open for a chat, or just book a time on my calendar below for us to talk.