Reviewed by Ric Kolenda, Assoc. Chair, Public Administration Department
U.S. charitable giving surpassed $600 billion for the first time in 2025, reaching an estimated $617.20 billion, according to Giving USA’s 2026 report. The headline is encouraging, but the underlying picture is more complicated. Individual giving declined even as total dollars rose, leaving many nonprofits increasingly dependent on a narrower base of larger donors.
The ability to win donors and retain them long term rewards strategy over improvisation. In this article, we’ll walk through a sequential framework for building a fundraising strategy, covering the decisions that shape a fundable plan rather than a catalog of tactics you can copy overnight.
Nonprofit Fundraising Basics: How to Design an Effective Strategy
A fundraising strategy for nonprofit organizations is a written plan that ties mission priorities to specific revenue targets and the donor relationships needed to hit them. Effective plans need to define what the organization is raising money for and who is realistically positioned to fund that work. Nearly everything else in fundraising, including campaign timing and stewardship cadence, follows from those two anchors.
Understand the Core Elements of Resource Development
First things first: nonprofit fundraising professionals need to know the exact purpose of their work, who might fund it, and how they can get the work funded.
Define Your Purpose Before Asking for Funding
Mission clarity functions as the filter that decides which programs get funded and which asks get made. Donors, whether writing a $50 first-time gift or a $250,000 foundation check, are evaluating how much your work matters and whether your organization is the right vehicle for it. Without confidence from donors, revenue planning collapses into chasing whoever will fund next.
In order to achieve that, you should ensure that you create a templatized case for support: a written articulation of purpose that anchors both individual appeals and institutional grant narratives. As CCS Fundraising notes, organizations that don’t prioritize strategically often try to do too much and end up narrowing focus too late.
A strong case for support typically includes:
- The problem your organization exists to solve and why it matters now
- Evidence that your programs produce measurable results
- Specific funding priorities with cost estimates
- A clear ask tied to what donors will make possible
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Learn Who Your Supporters Are
Many professionals know who their donors are, but don’t connect the dots between them to discover their target audience. That unclear picture leads to appeals sent to the wrong people and major gift potential going unrecognized.
Using your own database, segment your audiences. Most nonprofits benefit from tracking these groups separately:
- Individual donors making annual gifts
- Recurring or monthly donors
- Major and mid-level prospects
- Institutional funders, including foundations, corporations, and government agencies
Prospect research tools can help identify capacity and affinity without a premium wealth screening subscription. According to Giving USA 2025, nearly three-quarters of all U.S. giving came from individuals in 2024, counting current gifts and bequests, making donor relationships with individual supporters the single largest opportunity for most organizations.
Create a Simple Calendar for Grant Applications
A grant calendar is a low-effort, high-impact way for fundraising teams of any size to track their goals and progress. A shared spreadsheet works fine for most organizations under $5 million in revenue. The goal is visibility: anyone who touches grants should be able to see upcoming deadlines, status, and requirements.
At a minimum, each entry should track:
- Funder name and program
- Application deadline and reporting deadlines
- Requested amount and the funder’s typical grant range
- Mission alignment notes
- Primary contact at the funder
- Current status
Review the calendar monthly with program staff, then refresh it fully each quarter to add newly identified funders and retire poor fits.
Manage Relationships and Measure Outcomes
Consider what the Fundraising Effectiveness Project documented across its 2024 panel: overall donor retention sat at roughly 43%, and first-time donor retention at roughly 19%. Four of every five new donors never gave a second gift. Acquisition can’t be the full picture: you have to maintain consistency, nurture meaningful relationships, and make consistent projects.
Show Thankfulness to Keep Supporters Involved
Thanking donors is basic courtesy, but given the retention gap already noted, it’s also a strategic intervention. An analysis from the Fundraising Effectiveness Project notes that converting a first gift into a second is the most consequential unsolved problem in the donor pipeline, and the first 48 hours after a gift is when the intervention matters most.
Effective stewardship at any scale includes:
- An automated tax receipt within hours of the gift
- A personalized thank you (a call or handwritten note is best, but personalized emails work in a pinch) within seven days
- An impact update 30 to 90 days later showing what the gift funded
- At least one no-ask communication contact each year (a “happy new year” email is a great option that works at scale)
Find and Apply for Institutional Grants
Institutional funders benefit from the same level of discipline as individual donors, from cultivation through post-award reporting. Foundation giving grew to $117.15 billion in 2025, or 19% of total charitable giving, according to Giving USA’s 2026 report, and donor-advised funds are driving a growing share of individual giving as donors look for new ways to give.
Start by qualifying prospects rather than chasing every open RFP. There are tools available that let a fundraiser filter opportunities by giving priorities and typical grant size, which is enough to build a shortlist of realistic fits.
From there, the grant lifecycle is fairly predictable:
- Prospect research and initial qualification
- Alignment check against your case for support
- Letter of inquiry and funder conversation
- Full proposal submission
- Stewardship during the award period
- Reporting and renewal cultivation
Treat reporting as a cultivation opportunity rather than a compliance chore. Program officers move between funders, and a well-written report may do the work of your next proposal.
Build Your Funding Toolkit
No single revenue stream is sufficient. A durable fundraising strategy pairs unrestricted individual dollars with restricted institutional support and diversified partnership income, so that any one shortfall doesn’t jeopardize programs.
That resilience matters more than ever. According to the Blackbaud Institute’s 2025 Trends in Giving report, large organizations finished 2025 with approximately 11.7% revenue growth year-over-year, while small organizations ended the year down approximately 6.4%, a widening gap driven largely by unequal access to major-gift pipelines.
Here’s a comparison of the main streams most nonprofits evaluate:
| Revenue Stream | Typical Effort | Best For | Long-Term Value |
|---|---|---|---|
| Individual Giving (Annual) | Moderate | Broad-based support and unrestricted funds | High when retention is strong |
| Recurring/Monthly Giving | Low after initial setup | Predictable cash flow | Very high; churn stays low once established |
| Major Gifts | High per donor | Transformational funding for strategic priorities | Very high; often multi-year commitments |
| Institutional Grants | High per proposal | Program-specific and capacity funding | Moderate to high; renewal-dependent |
| Events | Very high staff and volunteer effort | Community engagement and new donor acquisition | Low relative to cost |
| Corporate Partnerships | Moderate to high | Sponsorships and employee giving programs | Moderate; strongest when mission-aligned |
A functional fundraising strategy usually depends on three or four of these streams working in combination rather than on picking a single best one or trying to make all of them work 24/7.
The Art of Donor Care and Long-Term Engagement
The distinction between transaction and relationship matters financially: retention costs a fraction of acquisition, yet the Fundraising Effectiveness Project has documented multiple consecutive years of declining donor retention, with 2024 marking the fifth. Organizations that reverse that trend tend to understand a set of core principles:
- Personalized gratitude reaches donors quickly
- The first 30 days after a gift determine whether a donor stays or drifts
- Retaining a donor costs a fraction of replacing one
- Monthly donors deliver disproportionate lifetime value
- Most lapsed donors leave because they felt unseen rather than because their capacity changed
These principles show up in named cases and sector-wide data alike. According to a March 2026 Candid insights article by Melissa Wetzel, CFRE, the Master Chorale of South Florida grew individual giving by 120% between 2022 and 2025 after replacing its default appeal cycle with a stewardship program grounded in personalized communication and active listening, with recognition tailored to each donor. The gains came without a large new investment in acquisition.
Aggregate data from the M+R Benchmarks 2026 study, drawn from 180 nonprofits, tells the same story at scale. After one year, 71% of monthly donors remained active, compared with 24% of new one-time donors. Monthly donors also gave beyond their recurring commitment, generating an average of $21 in additional one-time revenue per donor in 2025. Revenue from monthly giving accounted for 27% of all online revenue in 2025.
Neither the Master Chorale’s 120% growth nor the sector-wide retention gap comes from a single-campaign win. Both come from investing in the connection over time. Donors may give to causes, but they stay with organizations because of relationships.
Track Progress Using Simple Data and Clean Records
A nonprofit fundraising strategy is only as informed as the data behind it. A handful of consistently tracked metrics tells development leaders whether the plan is working and where donors are leaking out of the pipeline.
At minimum, most nonprofits benefit from tracking:
- Donor retention rate (overall and first-time)
- New donor acquisition
- Average gift size
- Recurring donor count and total recurring revenue
- Cost to raise a dollar
- Revenue by source
The metrics only work if the data underneath them does. That means keeping records accurate and segmentation consistent. Duplicate entries need cleaning up so a single donor doesn’t get counted as three. Development teams that skip database hygiene end up making strategic decisions on numbers that don’t reconcile.
What gets measured gets funded. Priorities that show up in the dashboard are the ones that show up in the revenue.
Frequently Asked Questions
Start with the mission: Identify the programs your organization is committed to funding over the next three years, then work backward to figure out which donor segments and revenue streams can realistically support them. A strategy without that alignment tends to chase whichever funder is easiest to reach in a given quarter, which is how organizations end up with restricted grants that don’t cover core operations.
Treat stewardship as a system. Thank donors quickly and personally, report back on what their gift accomplished, and create at least one meaningful touchpoint each year that doesn’t include an ask. The donors who stay are the ones who feel like insiders in the work, not names on a solicitation list.
A well-designed fundraising strategy stabilizes cash flow, gives program staff room to plan beyond the current fiscal year, and builds an unrestricted revenue base that lets leadership respond to opportunities as they emerge. Sustained fundraising performance is what turns a mission statement into programs that reach the people the organization was built to serve.
About the Online MPA Program at Pace University
The 100% online Master of Public Administration (MPA) program from Pace University Dyson College of Arts and Sciences prepares working professionals and aspiring administrators to lead in public service. Students can choose from one of three tracks: government management, healthcare management, or nonprofit management. MPA graduates find a wide range of opportunities within federal, state, and local governments as well as advocacy and community organizations. Through flexible, hybrid, and cutting-edge learning environments, our students get the quality education they want and the upskilling they need to be successful in the changing world. Pace University also offers an on-campus option for the MPA.
Sources
- Giving USA’s 2026 report
- CCS Fundraising
- Giving USA 2025
- Fundraising Effectiveness Project
- An analysis from the Fundraising Effectiveness Project
- Giving USA’s 2026 report
- Article on donor-advised funds
- Blackbaud Institute’s 2025 Trends in Giving report
- Candid insights article by Melissa Wetzel, CFRE
- Master Chorale of South Florida
- M+R Benchmarks 2026
- Legal Services Miami donation page
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