What Is Fundraising? An Introduction for Nonprofits

Fundraising involves the process of gathering voluntary contributions of money or resources from individuals, businesses, or foundations to support a specific organization’s cause.

From nonprofit charities to healthcare institutions, organizations rely on fundraising to support their missions, sustain operations, and bolster programming activities.

Below, we cover everything from different types of fundraising to upcoming trends for 2025.

Table of Contents

• Types of Donations to Meet Fundraising Goals
• Consideration for Higher Education: Fundraising vs. Advancement
• What Makes Fundraising So Challenging?
• Fundraising Roles: How Organizations Structure Their Nonprofits
• Measuring Fundraising Efforts: Common KPIs
• What Software Helps Fundraising Efforts?
• How Blackbaud Can Help Your Fundraising Efforts

Types of Donations to Meet Fundraising Goals

Organizations rely on fundraising to earn financial support. Nonprofits secure donations to pay for things like operational costs, programs, projects, services, and overhead.

Each nonprofit has unique requirements to fulfill its mission, and therefore, should be mindful of how it connects with potential donors. Before launching a campaign, organizations should carefully evaluate their fundraising methods and messaging to ensure they align with their goals and available resources.

There is no one-size-fits-all approach to fundraising. A deep knowledge of your community, cause, budgetary needs, and supporters should guide the specific mix of fundraising approaches your organization employs. 

Before we look at the various fundraising options available to nonprofit organizations, let’s consider the range of donation or fund types that drive most fundraising operations. 

Annual Giving Fundraising

Annual giving fundraising is a strategy focused on raising money for an organization on a year-to-year basis.

Unlike capital campaigns, which are typically aimed at a specific purpose, annual giving fundraisers seek donations from a broad base of supporters to cover needs like program expansion. However, these gifts are usually unrestricted and can be applied to any area of need.

Annual giving fundraising can be as high or low an effort as an organization is able to give at a specific time, utilizing multiple channels for soliciting donations such as direct mail, email, phone calls, online, and in-person events.

Most importantly, annual giving helps build a pipeline of donors by nurturing relationships with small and mid-level contributors.

Online Fundraising 

Online fundraising uses digital platforms to collect donations from a wide audience, unrestricted by geographic boundaries.

Key channels include email, paid and organic search, display ads, and social media, which allow nonprofits to efficiently connect with potential donors.

Successful organizations often use custom donation forms. A well-designed, user-friendly donation form can significantly impact conversion rates and average gift sizes from online campaigns.

One of the major strengths of online fundraising is that it is “always on.” On any day, at any time, organizations are able to connect with potential supporters. Compared to traditional methods, its convenience, broad reach, and lower costs have made it a preferred way for donors to contribute.

Check out more tips for increasing online fundraising success!

Major Gifts  Fundraising

Major gift fundraising focuses on significant financial contributions from individuals, foundations, or corporations. These large donations can spark meaningful change, allowing organizations to expand key programs, fund important projects, or take on new initiatives.

Since the pool of donors with the capacity to give substantial contributions is less, major gift fundraising campaigns need to prioritize personalized outreach over high volume.

Efforts typically involve face-to-face meetings, phone calls, and customized proposals to build strong, lasting relationships. The goal is to align each donor’s personal interests with the organization’s goals, ensuring long-term engagement and significant impact.

Once involved, major donors are often heavily engaged, participating in advisory roles, attending exclusive events, and receiving recognition for their significant contributions.

Want tips on how to succeed at major gift fundraising? Read our guide on how to build out a major gifts program.

Planned Giving Fundraising 

Planned giving, also known as legacy gifts, involves donors committing future gifts, often after their passing, to benefit both the donor (through tax advantages) and the organization (by securing long-term resources).

These gifts provide crucial support for sustainability, often funding endowments, capital projects, or scholarships.

Nonprofits typically secure planned gifts through personalized outreach, estate planning seminars, and ongoing relationship-building, ensuring donors understand the lasting impact their contributions will make. Planned giving donors are often long-time supporters, individuals passionate about the cause, or those seeking to leave a lasting legacy that aligns with their values.

P2P Fundraising 

Peer-to-peer (P2P) fundraising is a cost-effective method that empowers individuals outside of an organization to raise money for a nonprofit by tapping into their personal networks.

Instead of relying solely on the organization’s outreach, P2P fundraising enables supporters to create personalized campaigns and seek donations from friends, family, and colleagues.

This approach creates a ripple effect, significantly expanding an organization’s reach by introducing the cause to new potential donors. It also strengthens donor engagement by involving supporters directly in the fundraising process and giving them an active role.

Learn some key takeaways from the 12th edition of Blackbaud’s Peer-to-Peer Benchmark Report.

Giving Days

Giving days are 24-hour fundraising events that create urgency and excitement around donating to an organization. These high-energy campaigns often incorporate gift matching, social media challenges, and real-time progress tracking to motivate donors and create a sense of community participation.

Most giving days coincide with recognized events like GivingTuesday or institutional anniversaries, allowing organizations to tap into existing awareness and enthusiasm while amplifying their reach through coordinated community efforts.

Matching Gift Campaigns

Matching gift campaigns use the power of doubled donations to motivate giving. In these campaigns, a donor, corporation, or foundation commits to matching other donors’ gifts at a predetermined ratio (often 1:1), effectively multiplying the contribution’s impact.

Matching campaigns can be integrated into various other fundraising types, from giving days to annual fund drives. They’re particularly effective when:

• Launching new programs or initiatives
• Meeting challenge grants from foundations
• Encouraging workplace giving through corporate matching programs
• Creating momentum during key fundraising periods

End-of-Year Campaigns

End-of-year campaigns capitalize on the increased charitable giving that occurs during the holiday season and tax year-end. These campaigns typically run from November through December, when donors are most motivated by both holiday generosity and tax deductions.

These campaigns often combine multiple channels to reach donors at various touchpoints. Organizations frequently share impact stories and year-end accomplishments to demonstrate their effectiveness and inspire giving.

End-of-year giving can represent a significant portion of an organization’s annual donations, making these campaigns crucial for meeting yearly fundraising goals and setting up success for the coming year.

Capital Campaigns

Capital campaigns are fundraising initiatives designed to raise substantial funds for specific, large-scale projects within a given timeframe, typically 3-5 years. Capital campaigns focus on goals like building new facilities, major renovations, or establishing endowments.

Capital campaigns start quietly, securing large donations that cover between 50%-75% of the goal before going public. Once announced, they invite everyone to contribute, offering flexible multi-year payment plans so donors can give more over time.

These campaigns help organizations achieve ambitious visions that wouldn’t be possible through regular fundraising channels.

Learn everything you want to know about annual giving here.

Fundraising Events

Fundraising events are organized activities designed to raise financial support and awareness for organizations. These events vary in form and scale but typically include common elements:

• Purpose-driven: Each event is centered around a clear goal, whether it’s raising funds, building awareness, or engaging donors.
• Engagement: Events allow donors to connect with the organization’s staff, beneficiaries, and mission.
• Revenue generation: Funds are often raised through ticket sales, participation fees, auction bids, or donations during the event.
• Sponsorships and partnerships: Collaborations with sponsors or corporate partners help cover costs or provide matching donations.

Common types of fundraising events include gala dinners, charity auctions, marathons, tournaments, live shows, and online campaigns like digital auctions, webinars, and specialized giving days. These events require significant planning and effort, but with thoughtful execution, they can offer a strong return on investment.

Beyond financial support, fundraising events help foster a sense of community, deepening supporters’ connection to the organization’s mission and enhancing the nonprofit’s impact.

Consideration for Higher Education: Fundraising vs. Advancement

While often used interchangeably, fundraising and advancement have distinct nuances, particularly in higher education. Advancement encompasses a broader institutional strategy that includes fundraising alongside other relationship-building activities. Advancement usually includes traditional fundraising activities, but also:

• Alumni relations and engagement
• Institutional communications and marketing
• Community and corporate partnerships
• Strategic planning for long-term institutional growth

In higher education institutions, advancement professionals focus on building lasting relationships that advance the institution’s mission beyond just securing donations. This comprehensive approach helps create a sustainable ecosystem of support through engaged alumni, corporate partnerships, and community connections.

What Makes Fundraising So Challenging?

Fundraising involves navigating a range of challenges. Organizations must capture attention in a crowded space while building trust with donors, often with limited resources and in uncertain economic conditions. Here is a quick summary of common challenges nonprofits face:

• Competition for donors: Many organizations aim to connect with the same pool of donors, making it hard to stand out and secure contributions.
• Building trust and credibility: Donors need assurance that their money will be used effectively, a challenge for newer or lesser-known organizations.
• Economic conditions: Financial uncertainty can lead to reduced charitable giving, as donors prioritize their own financial stability.
• Limited resources: Small nonprofits often lack the staff, time, and funds to develop effective fundraising strategies, competing against larger organizations with more resources.
• Engaging donors: Attracting new donors is difficult without familiarity, and maintaining relationships requires ongoing effort and resources.
• Balancing short-term and long-term needs: Organizations must raise funds for immediate and future needs without overwhelming donors.
• Regulatory requirements: Navigating tax laws and fundraising regulations is complex, especially for smaller organizations.

To avoid these hurdles and improve fundraising outcomes, check out these 10 simple tips to boost your effectiveness.

Fundraising Roles: How Organizations Structure Their Nonprofits

Fundraising roles have evolved significantly, with familiar titles adapting to meet new demands in philanthropy. Defining how these roles operate helps nonprofits align staffing with fundraising goals, ensuring financial health.

Development or Advancement Assistant

Development assistants provide administrative support by coordinating events, managing donor databases, and processing donations. They handle some communications with donors, assist with grant applications, and contribute to overall team efficiency.

Annual Giving Coordinator

Annual giving coordinators oversee smaller, recurring donations, planning year-round campaigns via direct mail, email, and phone. They maintain donor databases and ensure timely communication, playing a key role in donor retention.

Digital Fundraising Manager

Digital fundraising managers lead online fundraising efforts, managing campaigns across websites, social media, and email. They optimize digital marketing strategies and ensure a smooth online donation experience.

Major Gifts Officer

Major gifts officers focus on securing large donations by building long-term, personalized relationships with donors. They handle prospect research, personalized proposals, and ongoing stewardship to encourage significant contributions.

Planned Giving Officer

Planned giving officers manage long-term contributions through estate planning, bequests, and trusts. They educate donors on options and build relationships to secure future gifts that align with the organization’s mission.

Gift Operations Manager or Advancement Operations Manager

Gift operations managers oversee the technical and administrative infrastructure of fundraising operations, ensuring accurate gift processing, database management, and reporting systems. They develop and maintain policies for gift acceptance, establish data entry protocols, and manage the integration of various fundraising technologies.

Corporate Relations Manager

Corporate relations managers develop partnerships with businesses to secure financial support or in-kind donations. They cultivate relationships with corporate sponsors, aligning their contributions with the nonprofit’s needs.

Director of Development (or Advancement or Philanthropy)

Development directors oversee a nonprofit’s overall fundraising strategy, setting goals, managing the team, and building relationships with major donors and partners. They ensure alignment between fundraising efforts and organizational objectives.

Specialist Fundraising Roles

Specialized roles like grant writers, event coordinators, and database specialists are increasingly important as nonprofits expand their development teams. These roles evolve to meet the growing demands of fundraising.

Measuring Fundraising Efforts: Common KPIs

Without measuring a nonprofit’s performance, fundraising teams won’t be able to identify its success or determine areas that require more attention for future improvement.

Below are just a few key performance indicators (KPIs) to help measure your team’s effectiveness. 

• Annual revenue: Measures total funds raised over a year. Good for tracking overall financial success and identifying growth trends.
• Average revenue per usable email: Calculates the revenue generated per valid email address in your database. Essential for evaluating email campaign effectiveness and list quality.
• Fundraising ROI (Return on Investment): Calculates how much revenue was generated for every dollar spent on fundraising. Helps evaluate the efficiency of fundraising efforts.
• Donor retention rate: Tracks the percentage of donors who give again. Vital for assessing the long-term health of donor relationships.
• Sustainer revenue percentage: Measures recurring donor revenue as a percentage of total donations. Critical for understanding the stability and predictability of your funding stream.
• Average gift size: The average amount donated per gift. Useful for understanding donor capacity and tailoring future appeals.
• Conversion rate: Measures the percentage of potential donors who complete a donation after being asked. Useful for assessing the effectiveness of a marketing outreach campaign.
• Cost per dollar raised (CPDR): Similar to ROI, CPDR calculates the cost involved in raising each dollar. Important for understanding fundraising efficiency and managing expenses.
• Marketing engagement: Monitors likes, shares, comments, and interactions on nonprofit social media platforms. Indicates supporter interest and helps refine online campaigns.
• New donors acquired: Tracks the number of new donors gained during a specific time frame. Shows the effectiveness of donor acquisition strategies.
• Donor Lifetime Value (DLV): Estimates the total amount a donor will give over their relationship with the organization. Helpful for long-term planning and targeting high-value donors.

Need help understanding which KPIs are right for your organization? Learn more helpful ways to measure and optimize your nonprofit’s performance.

What Software Helps Fundraising Efforts?

Incorporating the right fundraising software is essential for boosting donations and improving nonprofit operations. Below are some key types of software that can make a big difference:

1. Constituent Relationship Management Software (CRM)

• Purpose: Tracks and manages donor data, donation history, and communications.
• Examples: Blackbaud Raiser’s Edge NXT, Bloomerang, DonorPerfect, Salesforce 
• Why it’s useful: Helps nonprofits streamline donor relationships and manage data efficiently, improving donor retention and engagement.

2. Marketing Automation Platforms

• Purpose: Assists in enhancing marketing strategies by automating processes and delivering valuable insights.
• Examples: Blackbaud’s Luminate Online, HubStop, MailChimp, Constant Contact
• Why it’s useful: Streamlines outreach and increases communication and donor engagement. 

3. Prospect Research Database and Insights

• Purpose: Helps categorize valuable insight on donor giving habits
• Examples: Blackbaud ResearchPoint, DonorSearch, Donorly, ProspectVisual
• Why it’s useful: Identifies hidden donor prospects by accessing and analyzing large volumes of data by interfacing with other programs. 

Need more help identifying which software is right for you? Download our resource, How a Fundraising and Advancement Leader Evaluates Technology.

4. Custom Donation Forms

• Purpose: Facilitates easy online giving through websites and social media while providing customizable options for different campaign needs,
• Examples: Blackbaud Donation Forms, GoFundMe Charity, Classy, Givebutter
• Why it’s useful: These platforms make donating simple and accessible, with user-friendly interfaces that allow nonprofits to integrate donations seamlessly into websites and social media campaigns.

How Blackbaud Can Help Your Fundraising Efforts

Investing in the right fundraising software can change the game for your nonprofit and Blackbaud is here to help. As a leader in fundraising software, Blackbaud can integrate all of the tools organizations need to roll out efficient, effective, and successful fundraising strategies.

Discover how Blackbaud is enabling customers to succeed, or if you’re ready, request a demo today to see if we are the right fit for your organization!