Fundraising, Part 11: Peer-to-peer strategy fuels medical research

By Todd Cohen

[This article, the last in a series, was written for Blackbaud.]

Smaller nonprofits increasingly are using readily available technology to engage peer networks to raise money through athletic events, says David Hessekiel, president of The Run Walk Ride Fundraising Council.

In 2012, the top 30 peer-to-peer fundraising programs raised a total of $1.68 billion for nonprofits, with the overwhelming majority of those groups involved in health and medical research, he says.

Peer-to-peer fundraising events generally fall into three categories, he says, including “proprietary,” “endurance” and “independent” programs.

Proprietary programs are those that are created and managed by nonprofits. The top three are the American Cancer Society’s Relay for Life, Susan G. Komen Race for the Cure, and March of Dimes’ March for Babies.

“They have created their own entity, a walk or a run, that they invite supporters to participate in,” Hessekiel says, “and those supporters, whether participating as individuals or members of a team, ask their friends and acquaintances to give money in honor of the effort they are supporting.”

Endurance fundraising focuses on engaging supporters to participate in “third-party” programs, such as the Team in Training program of the Leukemia & Lymphoma Society.

“Thousands of people each year run in marathons and half-marathons, and do triathalons,” Hessekiel says. “They’re participating in events that nonprofits do not own.”

But Team in Training and other endurance programs “provide various forms of support for participants to train for endurance events and fundraise,” he says. “They leverage the popularity of events like the Rock ‘n’ Roll Marathon and the New York Marathon to get people involved.”

Independent fundraising consists of supporters “approaching charities and saying, ‘We want to support you, but we want to do it in our own way,'” Hessekiel says.

That could involve anything from staging a walk, run, climb, swim, dance marathon or other type of physical event to throwing a party and inviting people to come and make a contribution.

“More and more of this is taking place, thanks to technology that makes it easy for those people to raise money online, and for organizations to communicate with those fundraisers,” Hessekiel says.

The last five years have seen a flowering of smaller peer-to-peer fundraising programs, he says.

“Because of the democratization of peer-to-peer fundraising — the lowering of fundraising and communications barriers for nonprofits and individuals — the number of programs has been increasing,” he says.

Still, while the number of new peer-to-peer programs has grown, fundraising revenue that big proprietary programs generate has remained flat, he says.

Nonprofits considering peer-to-peer programs should set realistic goals and recognize the costs that will required, Hessekiel says.

“I run The Run Walk Ride Council, but  I’m a big proponent of ‘crawl, walk and then run,'” he says.

Organizations that create their own proprietary programs “are responsible for everything, from making sure there are porta-potties on site, to getting permits to  take over streets, and it’s a major investment,” he says. “Those programs usually take several years to actually be profitable for the organization.”

And while they can be highly successful for an organization, he says, “the marketplace for traditional walks is quite crowded.”

Technology, however, now makes it easy to create “a structure for your most passionate supporters to be able to run their own events,” he says.

“If you have passionate supporters, you can also give them the tools they need to do endurance fundraising on your behalf,” he says. “The startup costs and risk involved with those programs are far smaller than creating your own proprietary programs. It’s a lower-risk way of getting a feel for this form of fundraising.”

Increasingly for smaller organizations, he says, “experimenting with and benefiting from peer-to-peer fundraising is another tool in their development chest.”

The series:

Part 1: Growth tied to capacity, cultivation, communication.

Part 2: Healthcare groups invest in capacity.

Part 3: Higher education cultivates major gifts.

Part 4: Data key for independent schools.

Part 5: International affairs groups refine message.

Part 6: Religion focuses on fundamentals.

Part 7: Arts and culture groups focus on donors.

Part 8: United Way diversifies.

Part 9: Conservation groups connect with donors.

Part 10: Communication, planning key for human services.

Part 11: Peer-to-peer strategy fuels medical research.

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