How the Pyramid of Giving Can Help High Schools and Colleges Achieve Their Fundraising Goals

Overview

Fundraising for a High School, College, or University is not an easy task, and it requires a lot of effort and planning to be successful. In this article, we will discuss how the Pyramid of Giving, also known as the Donor Pyramid, is a philosophical and strategic model proven to guide schools in building a strong foundation for their fundraising efforts. We’ll also talk about how Advancement Directors can use digital fundraising tools to improve their ability to raise money for their school.

What is the Pyramid of Giving?

The Pyramid of Giving is a fundraising model that has been around for a long time. It is based on the principle that there are different levels of giving, and each level represents a different degree of commitment.

Annual Giving

This level represents the foundation of the Pyramid of Giving. It is the most basic level of giving, and it is where most donors start. Annual giving typically involves small donations that are made on a regular basis, such as monthly or yearly. Many schools have successfully increased the number of annual donors by establishing a “Giving Day” event. Here at eTeamSponsor we recommend holding a Giving Day once every 12-6 months or so. ROBERTO DOMINGUEZ, Director of Advancement at Clarke University (IA) says “We consistently engage our donors and alumni to stay top of mind, which leads to better results”.

Major Gifts

This level represents a higher degree of commitment than annual giving. Major gifts are larger donations that are usually given over a period of time, such as a few years. Donors at this level are typically more invested in a particular cause, like STEM or athletics, and have a deeper understanding of the school’s mission.

Planned Giving

This level represents a long-term commitment to the school. Planned giving typically involves a request or other form of planned gift that is given to the organization after the donor’s lifetime. In some cases these gifts can be used to offset estate and other taxes at the time of the donor’s death. 

Endowment Giving

This level represents the highest degree of commitment. Endowment giving involves a substantial gift that is invested in the organization’s endowment fund. The endowment fund provides a permanent source of income for the organization, ensuring its long-term sustainability.

How can the Pyramid of Giving help schools with their fundraising efforts?

The Pyramid of Giving provides a framework for schools to build a strong foundation for their fundraising efforts. By focusing on each level of the pyramid, schools can create a sustainable fundraising program that will support their mission for years to come.

Annual Giving: Build a habit of giving

Annual giving provides a regular source of income for schools and helps to build a strong donor base. By encouraging small donations on a regular basis, schools can build a habit of giving that will help to sustain their fundraising efforts over time.

Major Gifts: Building a culture of philanthropy

Major gifts are an important part of the Pyramid of Giving because they help to build a culture of philanthropy within the school community. By cultivating relationships with major donors, schools can create a network of supporters who are invested in the school’s mission and willing to give generously to support it.

Planned Giving: Ensuring long-term sustainability

Planned giving is an important part of the Pyramid of Giving because it ensures the long-term sustainability of the school. By encouraging planned giving, schools can create a permanent source of income that will support their mission for years to come.

Endowment Giving: Creating a legacy

Endowment giving is the highest level of giving in the Pyramid of Giving. It represents a substantial investment in the school’s future and creates a lasting legacy that will benefit generations of students. By encouraging endowment giving, schools can ensure that their mission will continue to thrive for years to come.

How digital fundraising tools enable the Pyramid of Giving.

One way to unlock the power of the Pyramid of Giving is to use a digital fundraising tool to help manage the process of managing donor requests, the processing and accounting of the donations themselves. These systems work best with an Annual Giving request like a Giving Day event. How do you engage donors virtually? Many use the power of email, texts, and social media to publicize the event and process the donations too. A few digital fundraising tools, like eTeamSponsor’s FundRaker tool, solicit and collect the donations and deposit collected funds directly to the school on a daily basis. Judy Sanchez, Chief Development Officer at Maricopa Community Colleges Foundation (AZ) says “FundRaker by eTeamSponsor has been a real game changer for the Foundation and our 10 Colleges. It gives us complete control of all our sports fundraising efforts while making it easy to collect the funds raised all in one place. We plan to expand our fundraising to include other college departments such as art, music and dance as well as student clubs and organizations. All possible through the FundRaker tool and our valuable partnership with eTeamSponsor.” To learn more about FundRaker from eTeamSponsor click HERE.

The Pyramid of Giving is a powerful fundraising model that can help schools to build a strong foundation for their fundraising efforts. By focusing on each level of the pyramid, schools can create a sustainable fundraising program that will support their mission for years to come. Whether it’s annual giving, major gifts, planned giving, or endowment giving, every level of the Pyramid of Giving plays an important role in ensuring the long-term sustainability of the school. By embracing the Pyramid of Giving, schools can create a culture of philanthropy that will benefit their community.

The Potential Tax Benefits Of Giving

While there is a potential tax benefit from all donations made to a qualified educational institution, the importance of tax deductions grows as you move up the Pyramid of Giving. For donors considering a legacy donation it is important to understand the potential tax savings the gift could create. While IRS rules are ever changing, and it’s always important to check with a tax accountant, here are some resources that could be helpful for your advancement team:

• A great overview on the tax deductability of donations to educational institutions by Charity Navigator.
• The IRS tax guidelines for donations.
• Estate planning advice about charitable giving from Fidelity Investments.