How to Discover How Many Donors You Need to Reach Your Annual Revenue Goal

By Alan Sharpe, CFREDoes your charity need to double or triple or quadruple its income over the next five or ten years? Are you trying to figure out how to do that? Follow these simple steps to discover how many donors you’ll likely need to reach your goal.

Let’s assume you need to raise $1 million annually.

Step 1: List your giving methods.
Open a new spreadsheet. In Column A, list the methods you’ll use to raise funds from donors. Your column will look something like this:

INDIVIDUALS
Direct Mail
Email
Major Gifts
Monthly Giving
Online

INSTITUTIONS
Corporations
Foundations
Government

Step 2: Assign a percentage of your total revenue goal to each fundraising method.
Most charities raise 80% of their annual income from individuals and the remaining 20% from institutions. In Column B, assign a percentage to each method to show the percentage of your annual revenue goal you’ll raise from each method. Your column will look like this:

INDIVIDUALS: PORTION OF ANNUAL REVENUE GOAL, %
Direct Mail: 30%
Email: 10%
Major Gifts: 20%
Monthly Giving: 10%
Online: 10%
SUB-TOTAL: 80%

INSTITUTIONS: PORTION OF ANNUAL REVENUE GOAL, %
Corporations: 5%
Foundations: 10%
Government: 5%
SUB-TOTAL: 20%
GRAND TOTAL: 100%

Step 3: Calculate how much revenue will come from each fundraising method.
In Column C, multiply your annual revenue goal (in this case, $1 million), by the percentage revenue goal for each method. Your results will look like this:

INDIVIDUALS: PORTION OF ANNUAL REVENUE GOAL, $
Direct Mail: $300,000
Email: $100,000
Major Gifts: $200,000
Monthly Giving: $100,000
Online: $100,000
SUB-TOTAL: $800,000

INSTITUTIONS: PORTION OF ANNUAL REVENUE GOAL, $
Corporations: $50,000
Foundations: $100,000
Government: $50,000
SUB-TOTAL: $200,000
GRAND TOTAL: $1,000,000

Step 4: Calculate your average annual revenue per donor, per fundraising method.
Based on your experience with donors from each fundraising method, calculate in Column D how much each donor will donate each year, on average. Your column will look like this:

INDIVIDUALS: AVERAGE ANNUAL REVENUE PER DONOR TYPE
Direct Mail Donor: $80
Email Donor: $80
Major Donor: $10,000
Monthly Donor: $360 ($30/mo.)
Online Donor: $150

INSTITUTIONS: AVERAGE ANNUAL REVENUE PER DONOR TYPE
Corporation: $10,000
Foundation: $20,000
Government: $50,000

Step 5: Calculate how many donors you’ll need per fundraising method to reach your annual revenue goal.
In Column E, divide your revenue goal per method (Step 3) by the average annual revenue per donor type (Step 4). Your column will look like this:

INDIVIDUALS: DONORS NEEDED TO REACH $1 MILLION ANNUAL GOAL
Direct Mail Donors: 3,750
Email Donors: 1,250
Major Donors: 20
Monthly Donors: 278
Online Donors: 667
SUB-TOTAL: 5,964

INSTITUTIONS: DONORS NEEDED TO REACH $1 MILLION ANNUAL GOAL
Corporations: 5
Foundations: 5
Government: 1
SUB-TOTAL: 11
GRAND TOTAL: 5,975

Thus, to reach this hypothetical annual fundraising goal of $1 million, you’ll need to acquire 5,975 donors. Your results will vary, of course, depending on the fundraising methods you use, the percentage of your annual revenue goal you aim to generate with each method, and your average annual revenue per donor type. But the same principles apply.