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Friday, 20 April 2012 10:52

Business by the Good Book: Best practices for funding faith-based work

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WEST MICHIGAN — In some ways, the fact that churches and other faith-based nonprofits are able to raise sufficient funds to keep their doors open is nothing short of miraculous.

Though their administrators may tout the old adage “God will provide,” the bottom line is that religious groups typically count on individual donors for at least 75 percent of their operating expenses.

And securing those donations isn’t getting any easier, according to the Giving USA Foundation, a Chicago-based research group. Its most recent annual study, which monitors trends in philanthropy, revealed that charitable giving to religious groups is on the decline, while support for education, public services, the arts and international aid has increased.

Fortunately the faithful tend to be consistent donors, especially evangelical Christians who take literally the Bible’s call to “tithe” 10 percent of their household income.

“It’s being obedient to what the word tells you to do,” said Mary Gozdziewicz, a member of the Assemblies of God — an international Pentecostal denomination known for strongly (and effectively) promoting the doctrine of tithing.

The spirit may move in mysterious ways, but operating expenses do not — which is why Gozdziewicz gives as much out of practicality as spiritual conviction.

“When you think of finances, they’re the foundation that keeps the building running,” said Gozdziewicz, who has been tithing for over 25 years. “It’s amazing how many people, even when they belong to a church, aren’t tithers.”

But even if every parishioner gave, churches would still face the primary challenge they have now: How do you motivate people to increase their giving over time?

Elaine Watkins, a director at Mission India, a Grandville-based nonprofit that works with indigenous Indian churches, has a few ideas. First, she advises churches and faith-based organizations to start having real and honest conversations with their supporters.

“You can’t convince people to give more,” Watkins said. “You have to have a dialogue with them.”

These conversations with donors yield more than just financial gains. For Watkins, they also afford insight into the changing world of faith-based philanthropy — a world where buzzwords like “stewardship” and “return on investment” have replaced “charity” and “blessing.”

Watkins says: “Now churches are taking hints from the business world and asking ‘what is the ROI here?’”

To ramp up its return on investment, Mars Hill Bible Church, also located in Grandville, put its faith in branding, product diversification and multimedia storytelling.

Popular products like the NOOMA film series and former Pastor Rob Bell’s books on faith exemplify and perpetuate Mars Hill’s hip brand. And starting at $11 a pop, they’re money-makers too. The church’s eye-catching website, download-on-demand podcasts and a social media presence are three more cogs in the Mars Hill marketing machine.

Mars Hill presents a Digital Age model for faith-based nonprofits looking to diversify revenue streams and expand market share — something that has not been without criticism. Naysayers have accused founder Rob Bell of “dumbing down” theology and sacrificing Biblical truth for cardigan cool.

Fortunately there is another best practice that even the most traditional churchgoer can get behind: evangelism. Considered by some to be an early form of marketing, evangelism is basically using your best communicators to share their experiences with new people, usually their peers.

“Churches grow when people invite people that they know,” Watkins said. “It’s the same with growing a ministry or fundraising.”

To test this theory, Mission India has been experimenting with “peer-to-peer” gatherings — micro-events where existing donors introduce a small group of people in their professional and social networks to the nonprofit’s work.

“The peer-to-peers are forming in an entirely different way than we thought they would,” Watkins said. “Donors bring like-minded people to us.”

Hosting a peer-to-peer event also presents a benefit to donors who, according to Watkins, are looking for more hands-on involvement with the groups they support — especially those that work overseas.

“People want to see firsthand, not just give money,” said Watkins, a member of the Association of Fundraising Professionals. “We’re constantly hearing, ‘How can we get involved?’”

Watkins said she appreciates that people want to help, but it really is not feasible for a faith-based group working in India. Plugging donors into “on field” activities could have disastrous ramifications for safety and security — for volunteers themselves and the Indian nationals they are trying to help.

It would also compromise Mission India’s return on investment and, consequently, its commitment to steward the financial resources donors entrust to the organization, Watkins said. Sending American volunteers overseas is not nearly as effective — in terms of time, money and results — as working through local, indigenous partners, which is why so many churches and nonprofits have adopted this model of program delivery.

This is the kind of integrity and transparency that church members and nonprofit donors expect more than ever before. To meet this rising demand, institutional support entities like the Evangelical Council for Financial Accountability and the National Association of Church Business Administration help church and nonprofit leaders learn best practices in finance, fund development and reporting, and then hold their members accountable for implementing them.

“This is a way for nonprofits to be graded so people can find out whether they are successful,” said Watkins, who gives generously to her local church as well as other nonprofit groups. “People use consumer reports before buying things. It’s important for us to have these organizations around so people aren’t just giving their money away.”

Though Watkins admits ECFA’s member guidelines sometimes create more work for her in the office — “The hard thing is that not everyone fits into their cookie-cutter guidelines” — she is happy to comply with them.

“I want people to feel comfortable giving to us and knowing that we’re doing what we say we are,” Watkins said. “It’s a good thing.”

Ruth Terry is a freelance writer and consultant who curates content for magazines and corporate clients. Find her at

Read 1421 times Last modified on Thursday, 09 August 2012 16:08

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