484.85 billion dollars. That’s how much Americans gave to charitable organizations in 2021, according to Giving USA.1 And this amount is growing year by year. For comparison: the charitable market in the Netherlands is €5.6 billion.2 It is not surprising that more and more organizations are becoming interested in this market. Imagine being able to get a piece of this huge pie?! But is it really that easy for Dutch organizations?
There are really many success stories to tell. According to Candid, nearly 400 Dutch organizations have successfully raised funds in the US since 2017.3 Donations come from individuals, government, corporations, and equity funds. And the bandwidth is also diverse: from a few hundred dollars a year to several million. There are even several organizations that have raised more than a hundred million from the US market in the past five years, including the KNCV Tuberculosis Fund and the European Climate Foundation.
- Giving USA: Philanthropy Annual Report 2021 (2022). Chicago: American Giving Foundation.
- Giving in the Netherlands 2022, edited by Prof. Dr. Rene Beckers, Dr. Barbara Guenberg, Dr. Stephanie Colin Maas, and Prof. Dr. Theo Schuete. Amsterdam University Press, Amsterdam.
- More information about funders and beneficiaries can be found at https://candid.org/. In the paid database (Foundation Directory: Funds can be searched systematically. Enterprise Directory.
The largest market growth can be seen in private equity funds, whose share has tripled from six to nineteen percent over the past forty years. Thus this US$90 billion market (excluding corporate funds) is the most popular among Dutch institutions. On the other hand, the private channel has fallen sharply (minus twelve percent). Corporate contributions and legacies have remained fairly stable.
Don’t invest time and energy in something that isn’t working right
Another positive trend of US equity funds is that they make their role more supportive of recipients. This trend has been going on for some time, but it has accelerated during COVID-19. It is expected to continue for the time being. As a result, donations are increasing on average, application procedures are simplified, and a larger percentage of donations are “unearmarked”.
What makes many Dutch institutions successful in the US money market? What makes at least so many organizations fail hopelessly? Some tips that can make a difference:
International character: Maybe an open door, but: make sure your offer is international. Fundraising in America for a stadium in Utrecht is almost impossible. There are many opportunities for culture, environment or development cooperation, for example. But activities in the Netherlands can also be well funded. Like funding research in the Netherlands in specific diseases, its results can also be applied in other countries. or Dutch museums that buy internationally acclaimed works of art or display their work in other countries. So find an “international hook” in your activities.
Long term approach: It takes time to build a new fundraising channel on the other side of the ocean. It takes about two years to go from cold relations to large donations. Sometimes it takes longer! Create a five-year plan to invest in for the first two years. In the third year, you start to make the investment again, and from then on you can expect to be able to harvest. Organizations that expect immediate results are often disappointed.
Get to know the fund: Try to understand the motivation behind the box so you can respond to that in your communication. Why does the fund invest, for example, in nature and the environment? The causes are often different in the United States than in the Netherlands. For example, also find out: What recent developments in legislation are having an impact?
People give to people: Whether you want money from a fund or a private individual, it ultimately comes down to the relationship between people. So invest sincerely in the relationship with the donor. Plan a number of visits to the US to visit the funder and don’t forget to keep in touch in the meantime. Invite the donor to visit the project or send them information related to your work.
Focus and structure: The US market is huge, so it’s easy to get caught up in it. Don’t go after every opportunity, but tick a limited number of boxes (say ten) that you try to build a relationship with. It is better to use a limited number as you can do well than to spread your resources over many opportunities. Plan this systematically. Plan your actions in advance and measure progress (do we see the relationship improving?).
American wayAbsorbing the American language and culture (or using a local insider) and improving your communication is crucial. With a good knowledge of specific American customs, topics of conversation, and language, you can make the difference between whether or not you stand a chance of getting funded.
do not delay: There is a lot that can scare you. The size of the market, the huge sums raised by other organizations, but also how the fund operates. There are requirements that may be new or seem impossible. In our experience, there are really no insurmountable obstacles if both the fund and the Dutch organization have the same objective. So focus on the relationship and the goal first.
Checklist: Are there opportunities for my organization?
The American Dream is great. But dollar signs in the eyes can sometimes overshadow the look.
- Can your organization be successful?
- Is there enough capacity to implement the plan?
- Is there a department to manage (large) donations from the US?
- Is the approach unique enough to get a new donor?
Find out ahead of time, because there’s nothing worse than spending time and energy on something that isn’t working right.
Experience shows that there is a possibility for almost every organization. And with a realistic plan, that potential can actually be turned into donations.
About the authors
Hans Falk He is a director of HVFC USA and HVFC International and has been active in the international fund market for fifteen years. HVFC helps impact-driven organizations around the world diversify their revenues and increase their impact.
Emily Fockelmann He is a Senior Consultant at HVFC USA. She is American and Dutch and has been working in Washington DC for twelve years, before starting at HVFC USA she worked for eight years at the World Bank.
This article was previously published in Vakblad Fundraising Volume 24 Number 6, which appeared December 2022.