Funding or donations of good and services you receive through a corporation.
The four primary types of support are:
- Philanthropic Gifts
Tax-deductible as charitable deductions, these come out of the “contributions†budget and sometimes involve a separate corporate foundation. - Sponsorships and Advertising
These are often, but not always, considered marketing expenses and can come out of budgets other than for contributions. They are sought though the marketing, community relations, or public relations departments.
see sample Benefits for Underwriters (PDF)
- Employee Matching Gifts
Some corporations offer programs to match the gifts their employees make to non-profits. Others have a restricted matching gift program. Such funds come out of the contributions budget. - In-kind Contributions
These are gifts of goods and services such as paper, printing, mailing your newsletter, office furniture and equipment, graphic design work, computer help, accounting services, space, office supplies, loaned services and employees, food, lumber, hotel rooms, or rental cars for visiting artists. The expenses associated with these gifts are tax-deductible as part of the normal course of doing business, and this is often the easiest type of corporate support to attract. In-kind gifts can often lead to future cash gifts. (For information on calculating in-kind, go back to Individual Giving)
What are the differences between approaching local businesses and major corporations?
Motivation. Cultivation and solicitation of locally owned businesses is similar in approach to raising money from individuals. These people tend to be well rooted in the community and want to show their support, within their means. The approach for national corporations with plants or branches in your area will be different because the motives for giving will be different. You may find that the managers or decision makers are new to your community. They will be considering whether your project will make them look good to the community, to their corporate headquarters, and if it falls within the guidelines.
Corporate giving and decision powers are segmented with each corporation.
The structure will typically mirror the internal organizational structure, which isn’t readily apparent to people outside of the corporation. There are pockets of money designated to different divisions, communities, and stores. Most corporations will have:
- Store managers who can make small donations to non-profits in the community; sometimes they are restricted to giving products or gift certificates. These decisions are usually made on a monthly or bi-monthly basis and will be between $50 and $2,000.
- Corporate offices who will have pots of money assigned to various divisions, often by city. These are bigger dollars and typically are slated for a particular purpose (encouraging the Hispanic population to buy their service). In order to get these dollars, you will have to prove to them, for instance, that you can provide them with entrée to that audience. You will need strong and convincing demographic data on those people and your ability to sway them. The process for receiving major gifts within this structure can be prolonged because several divisions will have to contribute to your one proposal. Be ready to do your sales pitch multiple times and to wait a little longer.
An insider is the best approach to finding your corporate funding.
The key to a successful corporate fundraising campaign is identifying, cultivating, and involving the key decision makers so that they will want to help you get money from the corporations that they work for. Enable them to help you determine the best strategy for approaching the corporation and deciding what the appropriate request should be.
The days of corporate philanthropy are largely gone; now you have to sell something.
Corporations don\’t have large amounts of discretionary dollars these days. Most of the funding they give non-profits is essentially marketing and/or public relations money. So, you will have to provide demographic data on your audience in order to secure those funds. In most instances, you are providing them with either:
- access to an audience they are targeting, or
- a way to elevate their public image by associating with your organization.
Some corporations have foundations. Is there a difference between them and the branches?
Yes. Corporate foundations are patterned after private foundations and will typically publish guidelines, application forms, preferred form of contact, etc. The foundation gifts are usually restricted to specific geographic areas and focus on a couple of issue areas. Proposals outside of the scope of giving are nearly always a waste of time. The decisions are made by the board, usually on a quarterly basis. Corporations that donate larger quantities of product often distribute those goods through the foundation. Again, these donations tend to be restricted to specific geographic areas and focus on a couple of issue areas, so read the guidelines.
How do sponsorships work?
Corporations sponsor events for calculated reasons. They are looking to enhance their image, increase their visibility, connect their product or service with a positive image or a new audience, showcase their product in a high profile way, or sell their product. Less often, corporations will sponsor events as a means of entertaining high-profile clients or retaining talented staff.
Why do so many sponsorships with non-profits fail or not recur?
Sponsorships are paid for from marketing budgets. Those people are trained to look for the ROI (return on investment). They track the effectiveness of what they are buying and how it is impacting their sales. Non-profits don\’t think in this way. The most important aspect of maintaining these relationships is to determine what the non-profit can implement beforehand to help the corporation monitor their success. Be ready to survey the audience, track zip codes, and more to ensure the corporation feels their participation was a good value. Establish who will do what beforehand and then follow through.
Adapted from
Arts Extension Service Fundamentals of Local Arts Management
