Trust, Human Connection, and Infrastructure: A guide to building donor and investor relationships

Originally Published in Philanthropy News Digest

Trust, relationships, and funding from investors or donors are based on (gasp) emotions. Humans have emotional attachments to their money and trust is woven into all strategies and decisions. Even people who base their decisions on the numbers, the facts, the balance sheets, and datasets have narratives.

Yet, in this time of artificial intelligence (AI), social media, and so many virtual realities, human connection has been consistently de-prioritized. Given the growing potential for bias, polarization, and isolation, nonprofits increasingly will need to rely on the science and art of trust to diversify revenue streams, retain existing relationships, and grow impact. As your organization looks to appeal to donors and investors, remember that transactional fundraising is limited, yet relationship fundraising is limitless.

Put simply, your organization will raise more capital if you value human connection, understand the speed of trust, and build the infrastructure conducive for trust fundraising. Developing these three verticals will enable your teams to develop authentic and long-lasting relationships,  seamlessly through a dedicated structure.

Human connection

At its core, human connection is a feeling of belonging and acceptance. It is a place to be seen, accepted, and when possible celebrated for differences in thought, action, talent, and experiences. When people feel like they belong, they engage and care; when donors feel engaged, giving goes up.

Human connection does not depend on shared backgrounds and experiences but instead on the ability to recognize similarities and differences, appreciating and accepting them. It relies on the ability to listen and acknowledge the big attributes and small nuances that make up a human being. It may be a slow build over many interactions, or it may be instantaneous. Time and opportunity for repeated connection determine whether the connection continues, as do the acceptance of humanity in others, authenticity, and non-judgment.

Developing this level of connection with potential and current donors will help fundraisers listen to and understand their donors. Over time, this practice will help maintain trust—and rebuild trust when inevitable mistakes are made.

Speed of trust

Many executives recognize the need to build or rebuild trust in their organizations, but they often want to fast forward the time it takes to build and foster it. They also struggle to understand how trust can be built and managed.

Research shows that trust is a 3x performance multiplier, that facilitates progress, innovation, and growth.

How do you develop trust? There are eight factors:

1. Self-confidence and respect. Trust starts with you. 

2. Tone and curiosity. When you’re meeting with prospective donors, relax the muscles in your face, and check your tone. Bring curiosity and listen. 

3. Integrity and intention. Do what you say you’ll do and respect boundaries. When someone says “No,” respect it. 

4. Capability and capacity. You are likely doing three peoples’ jobs. Determine what you can commit to following up with and doing well—and stick to it. 

5. Prioritize impact and stewardship activities. Listen to and notice the small things about people—how they take their coffee or hate coffee and want sparkling water. Is their cat  or their mother sick? Remembering and caring about the small details are huge. 

6. What we measure counts. The impact of your work matters. Acknowledge and be accountable to share successes and mistakes. 

7. Value privacy and confidential information. Your donors’ data and privacy are not your currency to spend.

8. Time. Every trust equation is multiplied by time. Time to make mistakes, be accountable, show your integrity, authentic apologies. Trust is not a one-time activity. The key to unlocking it is to understand that you can’t skip the time.

Building infrastructure

Every fundraising program should be centered around stewardship and impact reporting. How will building infrastructure help raise funds?

Infrastructure is necessary to run any business. Nonprofits are businesses—they don’t and can’t run on “we do good work” unless they have the systems in place to do the work. Staff and systems are necessary to manage donor relationships and money raised and to raise more money. You need systems to process gifts, acknowledge them, share impact stories, visit donors, bring pieces of the mission to your donors, connect them with the community of program participants, ensure that the programs are run well, course correct and more.

Infrastructure planning should start with clear conversations about budget—it takes money to raise money. Depending on your infrastructure and staff capacity, you should expect to pay 10 percent to 25 percent of what you want to raise on infrastructure. Underpaying, under-resourcing, or expecting free work means you’ll waste time and money, and you’ll inevitably end up paying at least $2 to raise $1.

According to a study by the Association of Fundraising Professionals, donor retention rates for organizations with strong relationships were 43 percent higher than those without. In addition, organizations that invest in donor retention strategies have a 150 percent higher return on investment (ROI) than those that do not. Furthermore, professionals with a high emotional quotient (EQ) and who connect on human level are sure to win.

The “ask” isn’t the best metric or driver of your fundraising program. Trust and stewardship are the best drivers. Yes, asking is a significant part of fundraising relationships, hence many people, corporations, and foundations will give a smaller “test gift” to an organization. If you steward the gift properly, prioritize building trust, and understand that donor trust should be tangible and strategic, you will have built a critical asset.

Kerrie Mitchell is managing partner at FSO Partners, a philanthropic advising consultancy.