#141 Understanding Collaborative Campaign Budgets with Dedee Wilner, Campaign Advisor at Capital Campaign Pro

Aug 14, 2023

Dedee Wilner–Nugent joins Sybil today to share with us the dos and don’ts of financial planning for nonprofits.  She shares her knowledge and experience in funding capital campaigns and how to fund collaborative campaigns that involve many different organizations. This means it can be tricky to know exactly how to get a budget to take charge of this type of collaborative budget. She also talks about capital campaigns and how to ask for what you need in a financial plan related to this very special kind of campaign work.


Episode Highlights:


  • Funding collaborative campaigns
  • The tips to use when you are interested in funding multiple organizations that working on one key issue and problem to solve


Dedee Wilner-Nugent Bio:

Dedee Wilner-Nugent began her career as a fundraising professional as the Executive Director of a small arts organization and then as a Development Director for a non-profit emergency animal hospital. Her experience managing capital campaigns began in 2001, when she joined The Collins Group, a consulting firm serving organizations in Oregon, Washington, Alaska, Idaho, Montana, and California.

After a decade of successful, high-paced campaign work, Dedee took a 7-year break from consulting to serve as Director of Public Affairs for Central City Concern, one of the largest social service, healthcare, and housing agencies in Oregon.

In 2018 Dedee returned to capital campaign management as a capital campaign advisor with The Varga Group, a highly regarded boutique fundraising firm in Oregon. Five years later, Dedee was excited to join Capital Campaign Pro as a campaign advisor and to begin offering campaign expertise to nonprofit organizations across the USA.


If you enjoyed this episode, listen to these as well:

·        https://www.doyourgood.com/blog/104-fred-ackerman-munson

·        https://www.doyourgood.com/blog/71-sybil-speaks

·        https://www.doyourgood.com/blog/70-shakira-releford

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Full Transcript: 


I'm so glad that you agreed to be on my podcast. You're a dear, dear friend. How many years have we known? Each other 30.

I think that's about right, yeah more than 25.

I know we've had so many adventures together, so many, so many, and you're awesome. And one thing that you've done in your professional life for so long helps nonprofits with fundraising, as well as a lot of other things you do.

So, I'm excited for my listeners to hear about your experience and your journey. But the reason I wanted you specifically on my podcast this month is because we're focusing on finances for nonprofits. What are the most important things that they should be showing donors? What are the most important things that donors should be asking for? Looking for pitfalls to avoid, you know a lot of stuff about this. You have a lot of ideas, and we were over at our friend's house the other day and we were talking about this, and I'm just so happy that you're willing to jump on and that we can talk about these pieces.

Yes, I'm excited too. It's one of my favorite topics. So, thank you for inviting me. It's a pleasure.

So, before we get into the dos and don’ts of financial planning for nonprofits, Dedee, talk to me a little bit about your professional journey and what things inspire you.

My story begins as a young person who was interested in being an artist, and I entered the nonprofit sector through that doorway, I founded a theater, and that theater ended up moving on without me, and I was trying to figure out what to do with life after founding a theater, I realized that the piece I had enjoyed the most actually, was the running of the nonprofit business.

And so, I decided that with that skill set, I had a lot to offer the world of people who are very mission-focused in their work. And what I had in my back pocket was a series of really fantastic mentors who helped guide me in my profession and taught me everything I knew. And now, as you know, 30 years later, I've been advising nonprofits in fundraising capacity building, financial management, leadership development, and capital campaigns for several decades.

That's great. Who are some of your mentors that you appreciate in terms of the guidance they've given you? I've had some really important mentors in my life. I don't know. I don't think we could be where we are without the support of people like that. Give us their wisdom.

Right, right. Well, here locally in Portland, Oregon, where I live, for at least part of the year, I have been inspired by Martha Richards, who is the former head of the Miller Foundation. And before that, she ran the Collins Group, which is a consulting firm that has many clients in the Portland area and statewide nonprofits will also be familiar with George Thorne, who was another big mentor of mine. George has made a career out of advising arts organizations on their financial systems. I've also been influenced and inspired by the work being done at Stanford University, and I've made several pilgrimages to Stanford to attend workshops offered by their faculty and follow a lot of the books written by their faculty, including people like Chippies.

And just taking a data-driven and research-based approach to the work that I do and not just anecdotal, learned experience through mentors has been really important to me currently. Meeting with Amy Eisenstein, who is the President of Capital Campaign, Pro, and National Company, which is changing the way that we think about capital and campaign fundraising and making it more accessible to nonprofit organizations with smaller budgets, Campaign counsel at a price point that is within reach. So those are kind of the big ones for me.

I've also had a mentor in a DEIJ equity and inclusion, Kenya Bud, who has helped me get my head wrapped around the idea of donors or community-centric fundraising, which is sort of the updated version of the donor-centric fundraising. That was the model when I first joined the field.

Oh, I love that I love them all. That I just, yeah. That's great. And you sound like you have some wonder. Have some wonderful mentors.

So, let's get into it now Dedee let's talk a little bit about it. When you advise nonprofits on their finances and suggest to them what kind of financial information is most important for the donor world to think about, what are some of your thoughts there? 

And I know you work; you're working on capital campaigns, which are different. You know that's one piece of what you're working on. And then you're also just working generally, with nonprofits, let's just remind our audience of the similarities and differences between what are you thinking about when you're thinking about financial, you know, budgets and other things for a capital campaign versus funding for an organization generally, and what are the most important financial instruments that you think donors should be asking for?

 Right. Well, so it's an interesting question. For me, even before understanding an organization's financial picture, I want to understand their logic, model, or theory of change first. Oftentimes, organizations don't have those instruments. Therefore, go on the Internet, look up those words, and you'll find out that there are kind of templates for creating those, but they're an expression of your strategic plan and a way of helping a donor see how your mission is being fulfilled programmatically. 

I love that. I love that. Sorry to interrupt, but it's really interesting. Like with the finances, one of the most important things I talked about with other interviewees was that the group itself has to be crystal clear on its focus and its goal. So, thanks for that. I want to underline that.

Thanks, Sybil. Yeah, it's interesting how many organizations keep those two areas of planning siloed, but they are interrelated and iterative. And I think, you know, fundraising is borne out of good strategic planning and financial management, and fundraising sort of emerges out of those two pieces.

So, I always start at the very beginning, what is the big picture of what we want to do, and when do we understand? If we're trying to accomplish something programmatically, then we have to ask ourselves a really important question: how am I going to finance this activity? 

Another thing that's important to keep in mind if you're a donor thinking about a nonprofit organization is that nonprofit organizations are corporations. They have a special tax designation, but they are not different from other corporations on a fundamental level; they have the same basic requirements as any business. In other words, we have to have enough income to be able to. Operate whatever program it is that we're trying to deliver, and we need to match the kinds of income that we are generating to the purposes of that income.

So, one of the things that I like to look at when I'm looking at a nonprofit's financial picture and just its business model, in general, is what your sources and uses are. So that's different than your financial statements, right? Your financial statements tell me, OK, if we liquidated this organization today, do you know what the balance sheet would tell us? Are the assets that would be there of better value at the end of the day, that's important to know that an organization doesn't have more debt than they have. Assets—that's an important piece to look at. You know another thing on the important balance sheet—not the balance sheet, but the financial statements—that's important to look at in addition to cash reserves and that sort of thing. All of Those lines of business are articulated in those financial statements. But sometimes it's hard to tell, and that's where I like to look at sources and uses, and sometimes you have to ask someone special for this because it's not necessarily something people have on hand.

I love that, Dedee, because, I mean, let's talk more about sources and uses. Where my mind goes when you talk about whether the organization is working on an interesting project that you, as a donor, care about a lot. I'm looking at something that I call a project budget, which is focused on that particular plan and that particular issue, and there's an organizational budget and all the general information. 

But when I'm working on a particular project, I feel like that's the most important. Can you talk to me a little bit about sources, uses, and how that fits into the narrative that I'm thinking about in terms of What I'm asking folks? 

What are the similarities and differences there?

Yeah, absolutely. So, when you're looking at a project budget, that's a great way to think about it. Usually, in a project budget, what's carved out of the general budget of an organization are just the revenue streams that are needed, the income, and the expenses for that project. 

And when you look at the expenses, you might see that some of those expenses are one-time expenses, and some of those expenses are going to be ongoing operating expenses. So that's the first thing to notice. 

And then the next thing is, what are those sources of revenue that are being projected for the project, set aside, earmarked, etc.? An old colleague of mine used to say you are what you eat when it comes to revenue.

And so, if your sources are primarily government funding, that's going to have a certain cadence to it in terms of how often you can seek that funding, and also, how reliable that funding will come after the biennium. Ends from whatever budget government source that you got that money from. 

So often, you see organizations that are heavily government-funded that follow the money in terms of what is in that logic model theory of change; they're thinking, OK, well, this is the kind of money I can get. So how do I align my project with the requirements of whatever government entity is giving me this money? So, there are a lot of strings attached to that kind of money. 

Individual and corporate giving has much fewer strings attached to it, and Grant Foundation Grant funding is sort of in between, right? And then finally, there's earned income, and earned income has the least strings of all because once you've earned it through some sort of revenue-generating strategy, that money can be used any way you want, so that's the first thing.

Thank you, Dedee, because that's what I'm thinking about when I'm looking at a project budget. Sometimes nonprofits make the mistake of not showing me their income… their sources. I don't want to just look at their expenses on a project; I want to see where all that's coming from. And so that's a really important element for if you're a donor and you're funding a project to ask that nonprofit, can you please make sure you have your sources because it does help me, too? I always say look, Oh, where there, this is the government income, this is the foundation's income This is how much they're putting into the project from their general pot of money that's more unrestricted. It's really important. So, I wanted to underline that.

You know, the other thing I look at is what the plan is to do. You know, I've already talked about one-time expenses and ongoing expenses. If there's a plan for an expense to be ongoing beyond the period in which I would be making my donation, I want to see that there's some sort of plan to sustain the project. After my investment has been paid. 

The other thing I want to look for is: who else is investing in this besides me? Is it just me, or are there others who are going to be making these investments? Has anybody already gone first? Has that money been secured, or is it planned for? I'd like to attend at least a little bit to feel confident about a project.

Right, and I find that the list I ask a lot of times asks for a list of other donors, and in other income, you know, it's specific donors because then I'll call up those donors. Usually, I know them because that's my job, right? And then we can compare notes and sort of see how things are going. The other thing You're mentioning to some folks is that they do want to spend out, like when they want to invest in a project, and then they spend out if you're a donor there.

And I call those kinds of donors mainly like launcher donors, where they're trying to fill a gap but they're not going to be there forever. And that's important. Then those launcher donors, if you're a donor that wants to fill gaps and be like venture capital, it’s just critically important that you're looking into what other funding streams the nonprofits are thinking about. 

I love that. Dedee, I don't want to forget. Also, I asked you about capital campaigns. Can we pull that out of the conversation a little more? And talk about what kind of financial information you think is most important to understand and know about. If you're a donor and a nonprofit comes to you with a very specific capital campaign, can you explain to my listeners what a capital campaign is?

So, I think this is a nice segue from talking about a project budget because both capital campaigns and project appeals are extremely similar in how they're structured, and that's different. I'm talking to an organization about supporting them with unrestricted dollars and general operating support, so I wouldn't draw a bright line between those two kinds of support or ways of thinking about finance when it comes to nonprofits.

I love it, Dedee.

I love it because, in my teachings, I talk about how there's a sustainer kind of donor. If you want to fund organizations year after year, an organization you love more generally, I think that's what you're talking about. The thing about with a more general kind of thing. And then there are campaigners and launcher donors. They're funding projects to solve a problem. And so that's that. I just wanted to underline that also Dedee, I'm saying underline a lot today, but I wanted to underline that too because I love that you're thinking similarly to me. 

It's been all these years of hanging out with each other. Sybil!

I know. Totally!

So capital campaigns—let's just start with what? Is a capital campaign. Many people think a capital campaign is a fundraising appeal, but it's not true, regular day-to-day fundraising is generally something that is a little more like marketing. It's transactional. You know, you told me you needed money. I give you money. Then you tell me it went well. We're all happy, right? That's the regular year. 

Annual capital campaign fundraising is usually combined with some sort of capacity-building goal, and so the idea is that. It just says that with a for-profit corporation seeking venture capital, an influx of capital to a nonprofit organization will help it achieve a specific goal that will allow the organization to be more impactful in fulfilling its mission. 

That capital campaign can include, it always includes some sort of fundraising campaign from individual foundation corporate sources, but it may also include revenue from government sources as well. Financing, getting a bank loan, or using cash reserves at the organization all together fund the project, but the capital campaign is a piece of that that is a philanthropic goal.

Hey, Dedee, Dedee with capital campaigns. I know it's more than this, but I tend to think of capital campaigns as, like, when a nonprofit wants to build a building or create a structure. Things like that. Can you say that? Just say it more in terms of how it looks? Like with a nonprofit. When the nonprofit wants to make a capital claim and pay a little.

So capital campaigns always start with some sort of project, and there are many. Cases are a traditional kind of textbook. A capital campaign is what we call a brick-and-mortar capital campaign. You're buying stuff with a big chunk of money, and that stuff will allow you to do more programming more effectively once you have the stuff. It's a building; it's a vehicle. The piece of equipment, whatever it is.

Capital campaigns can also be in the format of what we call a comprehensive campaign. So not just bricks and mortar alone, but also raising funds for some of the additional new operating costs to launch or expand the programming that will go into the bricks and mortar thing that you're raising money for, and you can also have a third piece to a capital campaign, which is a legacy campaign, which is securing planned grants, that sort of thing that will be used to sustain the project long term because there's going to be money that's coming in the future to help maintain either a building maintenance fund if you're just doing bricks and mortar or if you're doing a comprehensive campaign, ongoing funding to endow a staff position or something like that.

Yeah, that's helpful. So, we were talking about project budgets and looking at why you know where the finances are going and streams of income.

So, we talked about that a lot with capital campaigns. You said something before about the financial information as a donor, you might want to ask for something sort of similar to this project kind of budget. What are some differences? What should we be looking out for or making sure we ask for if we hear a nonprofit is coming to us for a specific capital campaign? Are there any specific things we should be thinking about as donors?

So yeah, that's an interesting question. You know the thing about capital campaigns: there are three-lane highways. There's the project lane. You're operating, your nonprofit continues to happen while you're planning this project, and you've got your fundraising lane for the capital campaign. 

It's really important to notice, what's going on in each of these three lanes when you're being spoken to as a donor about a capital campaign: how far along is the project planning, and how confident are we in those expenses?

Has the operation of the nonprofit been able to be stable and robust right now, or are there things that need attending to on the operating side before or after a capital campaign to help make that project successful? And then, you know, where are we at with the fundraising? For the capital campaign, what I observe is that the best capital campaigns are ones where the donors get to be involved very early in the process and throughout the process.

By the time you're asked to make your gift, it is well-known what's going on in all three lanes, and you have a fairly high degree of confidence that the project is well-planned and that if there are going to be operational implications, they have been considered. There's been some feasibility testing on the capital campaign goal to make sure that the donors that are going to be needed other sources of income that are going to be needed include government funding, grants from foundations, and individual giving. Have you had the tires kicked on them a little bit? So that we know that if I make my gift to this, at least you know if I can stretch, give the biggest gift I possibly can to this, that it's going to work out.

This is also helpful, Dedee. So, let's before we go, I would love - now that we've talked a little bit about all this - Can you offer us just your high-level words of wisdom? You know, if you were talking to a donor about the best way that they could engage with nonprofits by asking them for their financials, what do you think we should be doing? 

I just really think I have two thoughts for you. One is that if you're not an accountant, CPA, or financial nerd like I am, that's OK, and it is not critical that you have a lot of technical knowledge about finance to still ask questions. You know, a well-prepared nonprofit leader should be able to talk to you in simple terms that are easy to understand about what the sources are, and what the uses are. If you can understand those fundamental things, OK, where is the money going to come from for this project? How do you know that that's the right cost for the project? 

And how do you know that these donors or other kinds of investors or financial institutions—you know, maybe you're going to get tax credits or bond funding or that sort of thing? You need to know that that's likely to happen in the way it has been planned.

And then if they can explain that to you in terms of kind of passing your intuitive sniff test, then I think it's OK to trust that. If you are a nerd and you want to see the numbers, that can also be beneficial because then you can compare what you're hearing to what you're seeing. But at the very least, it's worth asking the questions. 

The second thing I would say is: When you're thinking about investing in a for-profit outside of a special project, ask, or outside of a capital campaign, I think it's important to remember that as donors it takes a lot of an organization's time and resources to meet all our needs, and so really being judicious about asking for a lot of printed material, financial statements, and all the other things when you don't necessarily feel like you're qualified to review those things is more important to be in regular communication with leaders and building a sense of trust between you through good communication because I feel like that alone can tell you a lot about whether an organization is worth investing in.

Yeah, I see why we're such good friends. I feel the same way. 

Let's focus on the finances that we need as donors and let the nonprofits do the rest. Work to create that trusting relationship. I love those words of wisdom, Dedee. This has been so much fun, and I can't wait to talk more about this talking over the fire and hanging out. And I love how we are both geeks on this issue. This is awesome. My fellow geeks unite.

Thanks, Sybil

Thanks, Dedee It's been so much fun.