Capital Campaign Rising Goals for Raising Money

The time between capital fundraising campaigns at colleges and universities is shrinking. Instead of organizing a major themed campaign every five to 10 years to supplement annual giving programs, institutions appear to roll directly through one campaign and into the next, allowing less and less time in between. As a result, annual giving programs have begun in some cases to play supporting roles in major campaigns.

New York’s Columbia University, for example, has operated a single major campaign for the past seven years and recently announced revised goals, adding five years to the campaign’s term. By 2005, Columbia will have been operating a major capital fundraising drive for 12 consecutive years.

The Fundraising Landscape

The proliferation of capital fundraising campaigns has two causes. First, as the cost of undergraduate and graduate education has risen through the past 20 years, schools have struggled to raise ever more money to preserve their ability to attract students and faculty with excellent programs and modern facilities. The wealth created by the economic boom of the 1990s has also created a sense of urgency among institutions to strike while the fundraising iron is hot.

At the same time, capital campaigns for individual institutions have begun to look more and more like each other in strategic framework and tactical execution.

Large schools with large dollar goals do not experiment. They move from one major program to the next using time-tested strategies that have always worked. Smaller schools, seeking a place at the fundraising table, will occasionally take a few chances with strategies that look quite different from those of conventional campaigns.

The strategic similarities among so many campaigns stem from a common cause. A capital fundraising campaign must, without doubt, succeed and succeed wildly. “No one would ever want to be even a dollar under the goal set for the campaign,” says Paul Hartman, vice president for development and alumni relations at DePauw University in Greencastle, Ind.

On the other hand, capital fundraisers must never set goals that are too low. As a result, campaigns that achieve their goals early often set new goals to finish out the original campaign schedule.

DePauw’s Decision

DePauw offers an example of this. In 1993, the university faced a clear need to improve its scholarship endowment as rising budgets required more and more support from unrestricted fundraising income. “We had to underwrite our scholarships or begin robbing academic programs to cover scholarships,” Hartman says.

The recognition of such a need often sparks a capital fundraising program. But moving from the spark to the public phase of a campaign can take years of hard work. Creating a campaign involves setting financial goals, creating a case or rationale in support of those goals, revising the case in cooperation with potential givers, conducting a silent phase of fundraising to kick-start the public campaign, and, finally, announcing the campaign.

Between 1993 and 1996, DePauw developed a campaign designed to raise a total of $153 million, of which $90 million would go to scholarship endowment. The remainder of the money would endow faculty and academic programs and support campus and facility projects.

Eighteen focus groups with alumni across the country helped to refine the campaign’s goals and fine-tune the language used to make the case. Case language carries enormous importance for donors. For example, the original case statement spoke of DePauw as an institution that supports midwestern values, thanks to suggestions from a Chicago focus group. But a New York City focus group objected, insisting that eastern values were just as good as midwestern values. The final case includes a geographically neutral statement about values.

“While we developed the rationale, we also began the silent phase of fundraising by soliciting a core of gifts from and through our trustees,” says Hartman. “As a rule, you would like to know that you are close to halfway to the goal before going public.”

The trustees performed, committing $31 million of the $153-million goal before the campaign’s October 1996 public launch.

A year into the public campaign, good fortune struck, when the estate of a wealthy alumni made a $30-million gift. Twelve months later, the estate gave another $40 million. Two years into the four-year campaign, DePauw had raised $200 million, well above the $153-million goal.

“At that point, something magical happened,” Hartman says. “Instead of celebrating the achievement, the trustees raised the campaign goal to $300 million and pledged another $27.8 million, demonstrating to alumni and friends that we believed there was more work to do and that we ought to do it right away.

“By the end of the four-year campaign, we had raised $374 million, including another $58 million from the estate.”

DePauw’s classic campaign achieved its original goal through good fortune, but the trustees’ refusal to rest on good fortune enabled the university to collect much more than double the original goal. The need that began the campaign -- a flagging scholarship endowment -- received an infusion of $161 million.

Defining Needs and Goals

Twenty years ago, a capital campaign seeking more than $100 million was considered huge. Today, however, fundraisers consider that figure small. Columbia and Harvard in Cambridge, Mass., are currently in the midst of campaigns that aim to raise more than $2 billion each. Cornell in Ithaca, N.Y.; Stanford in Calif.; University of Michigan in Ann Arbor; University of Pennsylvania in Philadelphia; and Yale in New Haven, Conn., have all recently completed campaigns that raised more than $1 billion each.

While any campaign requires close analysis in the formative stages to ensure that requests for gifts match the institution’s needs as well as the donors’ perceptions of those needs, a large campaign requires even more analysis to define needs and goals.

It may, for example, have been relatively easy for DePauw to see that its need lay in the area of scholarship endowment. On the other hand, larger private institutions, such as Washington University in St. Louis, find the process of defining needs more demanding.

In 1993, the Chancellor of Washington University, Dr. William Danforth, asked the university’s seven colleges and several operating units to develop long-range plans in light of current strengths and weaknesses, emerging opportunities and financial need.

Department heads, faculty and staff worked for 18 months to develop these plans. Each school and operating unit at Washington University receives advice from a national council made up of alumni, corporate leaders, educational leaders from other institutions and a trustee who chairs the council. The national councils reviewed the long-range plans developed by each of the schools and operating units, offering suggestions for revision.

Next, a trustee steering committee organized the information in each of the reports into priorities. At the same time, an academic committee composed of deans reviewed the plans and assigned priorities to the issues.

“The process culminated in a retreat of our Board of Trustees, who reviewed the work and established goals for the institution as it moved into the 21st century,” says David Blasingame, the university’s vice chancellor for alumni and development programs.

Setting Achievable Goals

Balancing financial needs with achievable goals brings out the art in fundraisers. According to Blasingame, the financial requests developed from the preliminary studies totaled $1.5 billion.

Comparing that number with past fundraising history and the experiences of peer institutions led to a revised number considered more achievable: $750 million.

“We started with that number, but decided to allow ourselves to revisit the goal before taking the campaign public,” Blasingame says. “And that’s what happened. By the end of the leadership (silent) phase of the campaign, we had raised $500 million. So we raised the goal to $1 billion.”

The revised individual goals for the campaign aim for the following:

- $275 million to attract and retain outstanding faculty;

- $175 million to attract and engage outstanding students;

- $300 million to support academic and student programs and libraries;

- $150 million to construct and renovate facilities; and

- $100 million to generate annual unrestricted and scholarship support.

The campaign went public in 1998 and will run through 2004. Through September of this year, Washington University had raised an additional $410 million, raising the running total to $910 million, with a little more than four years to go.

Blasingame attributes the success of the campaign to alumni, who have so far accounted for 36 percent of the giving. “We have a strong local population of alumni,” Blasingame says. “But through the past few years, we’ve seen more and more alumni move away from St. Louis. So we’ve built regional organizations to work with them.”

Billion-dollar campaigns no longer seem unusual, especially at larger institutions. The University of Minnesota in Minneapolis, for example, opened the public phase of a $1.3 billion campaign in October of 1999. Thanks to a powerful boost from the silent or leadership phase of the campaign, the effort had reached $902 million by September of 2000.

To reach such large numbers, billion-dollar campaigns often count fundraising proceeds differently than in the past. “It’s standard procedure to count everything that comes in during the campaign period, even gifts related to other giving programs,” says Judy Kirk, executive vice president of the University of Minnesota Foundation.

Making a Difference

On the other hand, generating substantial financial support requires clear statements of goals, particularly at public institutions. “One thing that distinguishes our campaign from others is the need to define the role of private support for a public university,” Kirk says. “We’ve been in the fundraising business for 40 years now, and this is something we must articulate continually. Private donors want to make a difference; they want to support efforts near and dear to their hearts; and they do not believe that their support should ever take the place of public support.

“Take faculty salaries, for example. Basic funding comes from the public side. In our campaign, we make the point that we want to recruit the best and brightest faculty. To do that we ask for gifts to create endowed chairs, which provide the incremental difference between public support and private support. In other words, private gifts help us create a margin of excellence.”

Opportunity Seeking

Pondering what comes next in the fundraising world yields a couple of questions. As financial needs and fundraising goals continue to rise, how will educational institutions manage to broaden their appeal to more and more alumni and friends?

Juniata College, a small liberal arts school in Huntington, Pa., has been wrestling with this question. In 1996, Juniata completed a $35-million program. While that program reached its stated goal, it failed to meet the full range of Juniata’s needs, and another program got underway almost immediately.

“That campaign reached our dollar goals, but didn’t meet all of the needs identified during the campaign development cycle,” says Juniata vice president John Hille. “So we immediately began planning to raise money for a major deferred piece of work: a new science facility.”

While planning the new campaign, Hille’s group sought out opportunities that might work to the advantage of fundraising. One opportunity existed at Raystown Lake, a nearby recreational area that also housed a U.S. Army Corps of Engineers research facility staffed by Juniata researchers. Congress had recently allocated $5 million to expand the facility’s field station. By viewing the allocation as a gift, the field station could become a goal for the next campaign.

“A third piece of a possible campaign entered the picture when one of our trustees sold his computer corporation,” Hille says. “He had been a professor here early in his career, and he and his wife decided to endow an Information Technology Department.”

Starting with these three pieces, Hille’s group decided to take some chances with the new campaign. They set a goal double the most recent campaign: $70 million.

Then they decided to pursue that goal with six campaigns instead of one. The op-portunities discovered in the planning stages formed the core of two of the campaigns. A Campaign for Excellence in Science would seek approximately $31 million. A Campaign for Entrepreneurial Leadership would ask for just more than $12 million.

Four more campaigns -- The Juniata Fund, a 125th-anniversary campaign, a Campaign for the Arts, and a Campaign for the Future -- would pursue goals ranging from $3 million to $9 million.

In addition, Hille, whose background lies in building and managing volunteer work, hopes to build the campaign on the shoulders of a large group of volunteers.

Many campaigns use volunteers, but Hille’s idea takes the idea to the extreme. In the Juniata campaign, no staff fundraiser ever asks for gifts. Staffers may accompany volunteers to meetings, but the volunteers raise the money. The idea is to create a large, committed network of volunteers who will attract other volunteers -- and who will compete with each other in fully subscribing their assignment among the six campaigns.

Juniata’s six volunteer-led campaigns went public in April of this year, touting silent phase giving of $49 million, with 100 percent of the trustees making substantial gifts. The campaign will run until the middle of 2005. Totals currently stand at $52 million.

With $18 million to go, Juniata’s volunteers hope not only to reach their goals, but to create a new model for fundraising strategy.

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