How to Build a Donor Pipeline for HNWIs and Legacy Donors

For financial sustainability, many nonprofit orgs rely on both grants and ongoing donations for a majority of their revenue. If your org receives individual donations, you already have a donor pipeline, but you might not be leveraging it as effectively as you could to court major donors.

In the most basic sense, a donor pipeline is a structured way for your org to turn potential donors into current donors, and then to secure more generous support from current donors. A strong donor pipeline also allows you to forecast donations, giving your organization a stronger base to work from to achieve your mission.

So what’s unique about building a donor pipeline for high networth individuals (HNWIs) and legacy donors? We’re so glad you asked.

These individuals have the potential to transform your organization with major and multi-year gifts. While they can bring major resources to your org, you’ll also need to invest resources to build the personal relationships required for this demographic.

Read on to get the full story on how to build a donor pipeline for HNWIs and legacy donors.

What is pipeline management in fundraising?

Pipeline management is the strategic process of identifying, engaging, and nurturing potential donors, ultimately converting them into supporters. It involves tracking their progress through different stages of the fundraising journey, from the first time they hear about or engage with your org, all the way to their final contribution.

Staying tuned in to where specific donors are located in the pipeline allows you to manage limited resources more effectively because it allows you to . focus your attention – at the right time – on those donors most likely to contribute.

What is unique about HNWI and legacy donors?

HNWIs often seek complex giving strategies like planned giving options or impact investments, and they often rely on wealth managers or advisors to manage their giving. As a result, before you begin prospecting HNWIs, make sure your org is ready to take on the specialized communications and collaborations often necessary for soliciting HNWIs.

Legacy donors are focused on a long-term perspective — they want to leave a lasting impact beyond their lifetime, often through bequests or endowment gifts. They may involve family members in their giving decisions, requiring multi-generational engagement and communication. Legacy donors often value naming opportunities to cement their legacy.

Both HNWIs and legacy donors often have busy schedules requiring sensitive, personal communications, have specific interests for giving, and have tax implications as part of their giving strategies. Both require a relationship built on trust and understanding with organizations they support with major gifts.

What are the stages of the HNWI donor pipeline?

The stages of the HNWI donor pipeline are similar to any major donor pipeline, but with some key considerations specific to this donor segment.

1. Identify

As with all donor prospecting, you’ll want to search within your network and associated networks for people who have a demonstrated affinity for your organization’s cause. When you are first identifying HNWIs, you’ll need to take an extra step to screen for wealth indicators as well.

Wealth screening tools can do this for you by pulling publicly available indicators of wealth (such as property deeds and vehicle/aircraft registrations) and compiling a database. You can compare this data with your own network to start to find connections and potential donors.

2. Qualify

Reaching out to every prospect you identify in step one is an option, but most nonprofits work with limited staff, budgets, and resources. Contacting every potential HNWI you’ve identified is not the most strategic use of your org’s limited resources, especially when you consider that many HNWIs have extremely limited time and attention themselves, making connecting a challenge.

So before you try to make contact, take some time to qualify your potential donors. You can think of this step as akin to sorting or ranking your initial prospects based on their potential affinity with your cause.

You’ll need to carefully analyze the data you used to identify prospects in step 1 as you qualify your prospect pool. Use publicly available information to determine donors’ philanthropic interests so that you can determine which prospects are most likely to become supporters of your org.

For instance, if you’re fundraising for a historical society and sourcing prospects who’ve given to a local university, donor prospects who support the history museum on campus are more likely to align with your mission than  prospects that give to STEM initiatives at the school.

At this step, use the work you’ve already done in creating donor personas to guide you as you zero in on the HNWI prospects most likely to resonate with your org’s mission. If you haven’t made donor personas for your nonprofit organization yet, now is a good time to create some to help guide your work in creating a strong donor pipeline.

Don’t forget, many major donors won’t begin with a significant gift, but like many people, start with smaller actions and donations as they get to know an organization.

As a result, you might already have HNWI donors amongst your existing donors. Identifying these individuals amongst your supporters is key — you already know they support your organization’s mission and care enough to make a donation. This means you can begin analyzing their existing giving history to learn their interests and understand how to deepen your relationship with this donor.

3. Nurture

With typical donors, many of your communications will occur online through email, social media, and your website. Your relationship with HNWIs should be different. Instead of taking place primarily online, you want to establish face-to-face, in person connections to create a deeper relationship.

Plan meet and greets, facility tours, and special events to begin establishing this in-person relationship with HNWIs. You will need to invest in this relationship with both time and resources before you make a large ask.

Having a few select staff in charge of developing this relationship will allow you to track meetings and communications. Have staff keep notes on each interaction in your CRM to avoid duplicate check-ins — remember, as you nurture your growing relationship with a major donor prospect, you want each interaction to create a positive feeling. As your relationship evolves, you will learn more about the potential donor’s interests, communications preferences, and other ways to tailor your work with them.

4. Solicitation

With your general donor pool, solicitations will likely occur through impactful, story-driven email appeals. This is a terrific strategy for many donors, but you want to make your ask for major gifts a lot more personal.

Most organizations must make a direct solicitation to receive a major gift. This can feel awkward at first, especially when the ask is large. It can be helpful to treat the solicitation like a business meeting — create an agenda and stick to it. Leave time for your donor to ask questions and go over the information carefully about where their money will go.

Preparation is obviously key — you won’t want to make the solicitation until you’ve built a solid relationship with the prospect. Use the information you’ve learned about their affinity for your mission and specific interests to build your ask. For instance, if you know the donor is most interested in supporting a specific population with scholarship opportunities, you might create a named-scholarship for them to fund.

But remember, even while you court and solicit major donations at personal meetings, your fundraising efforts will always be more successful at every level if donating to your nonprofit online is fast, secure, and easy.

5. Stewardship

Donor stewardship is how you keep donors connected to your organization, mission, and community. While it is true that donor retention is key to your org’s long term success, stewardship is about more than maintaining your giving cycle.

You’ve put in a lot of time, effort, and resources to cultivate a relationship with a major donor — you don’t want to throw away all that hard work by failing to steward the relationship after a major gift is made. Instead, keep up your personal communications and in-person check-ins. Give your major donors personalized reports on how the projects they funded are progressing. Celebrate and recognize them publicly at year-end events or other special occasions.

What does a fundraising pipeline look like for legacy donors?

Legacy donors support organizations that they have built trust with over time. Most legacy donors begin with smaller or midsize donations to an organization – in other words, don’t expect the named wing of the library to be the very first donation!

As a result, the basic steps for creating a pipeline for legacy donors is similar to the steps for HNWIs listed above. As you cultivate your HNWI pipeline, though, you can begin identifying the donors within that pool that have the highest affinity for your organization and who demonstrate an interest in opportunities for lasting impact and recognition.

When a donor indicates that kind of interest, be sure to increase your efforts at building a personal relationship with them by reaching out directly for in-person opportunities and personalized meetings and events.

How do you build a successful pipeline for major donors?

Major donors generally prefer individualized, personal communications, and to see their preferences and interests reflected in your mission and strategy.

Personalized marketing & connection

Major donors are often cultivated into longstanding and legacy donors through personal relationships with an organization. Once you’ve identified a potential major donor in your CRM, you’ll want to begin reaching out with personal communications and unique content.

As soon as you can, shift some of your communications to in-person events and meetings — this is a surefire way to deepen your relationship and make your org stand out in the donor’s mind.

Including messaging for major donors in your strategy

While you want to have personal communications with major donors, keep in mind that they will likely see your social posts and email newsletters and personal communications. So keep the interests of major donors in mind when you create impact reports and social posts — if you have a major donor as one of the personas you write for, this can happen as a natural part of your marketing efforts.

Market your legacy options

If your organization is committed to courting legacy donations, it is time to build a content marketing strategy for legacy donations. This should include a special page on your website that describes some options and recognition/naming opportunities for legacy donations. You can build content campaigns to drive traffic to your legacy page from other channels.

Stewardship is key for this demographic

Stewardship of general donors can occur via email newsletter, thank you’s, impact reports, and perhaps an occasional mailing. With major donors, however, stewardship should always occur at the individual level. Keep track of which staff members have spoken with each major donor, and try to maintain those relationships over the long term.

Have staff keep careful notes of each interaction in your CRM so that you don’t accidentally “repeat” communications or worse — miss out on connecting with a major donor for a lengthy period of time.

Follow the rule of 7

Nonprofit marketing trends may come and go, but the rule of seven seems to stick through it all! The rule of seven says you should make contact seven times within one year after the donor’s contribution. These seven communications should be meaningful efforts to steward your donors and demonstrate their impact, and not include direct solicitations or appeals.

Let us help you build your donor pipeline

Whether you’re a small non-profit or a large organization, effective pipeline management is crucial for sustainable fundraising success. Navigate the specific nuances of building a major donor pipeline with a marketing agency that knows (and loves!) our nonprofit clients. Contact us today.