Congratulations on making the commitment to take the Major Gifts Challenge! You’re on your way to raising major gifts in a big way! If you’re unfamiliar with the Challenge, check out the introductory video here.
Now that you’re ready, let’s get set, so you can get going. The first step to “get set” is all about determining what a major gift is for your organization.
What is a Major Gift?
A major gift is different at every organization and to every donor.
My career in fundraising illustrates this point.
I started my career in fundraising at the battered women’s shelter. We rarely received gifts over $1,000. Our first $10,000 gift was cause for major celebration! That was a MAJOR Gift. Any personal gift over $1,000 was a major gift there.
Rutgers University was my next stop. There a major gift was $25,000 or more. Just down the road was Princeton University where Major Gifts didn’t start until $100,000 or more. I’m certain it’s $1 million or more now.
If you’re at a small organization, just getting started with personal giving and major gifts is enough of a challenge. It would be ridiculous to hold you to the standards of Princeton University.
Let’s set some parameters for determining the size of major gifts at your organization.
3 Reasons Why Size Matters
There are three important reasons for knowing how much a major gift is at your organization.
1. Donor Recognition
Special Donors get special recognition. Setting the Major Gift amount focuses your recognition efforts.
Knowing what a major gift is determines who gets recognition on things like Donor Walls.
Major Donors get personal recognition, like calls from a board member and a handwritten note from the executive director.
It’s nice to think that every single donor to your organization will receive a personal call and a handwritten note, but sometimes that’s simply not practical or even possible. Knowing your major gift levels will help you determine who must get the royal treatment.
You’ll want to acknowledge all donors, of course, but your major donors should always get VIP treatment.
2. Time Management
Setting a major gift size helps you manage your time.
If it makes sense to go meet with a donor to ask them for $1,000, then that’s a major gift at your organization.
If you’re thinking, “No way!” then how about $10,000?
It’s a matter of time management. I don’t know many development directors who wouldn’t make time to visit with a donor to ask for $10,000.
Leadership level gift managers spend their time focused on donors who could give $1M or more, but we’re not quite there yet.
3. Accountability
The third reason for setting a major gift size is for accountability and tracking metrics. If your major gift levels start at $10,000, then you will be able to easily track how many $10,000 plus gifts you received this year.
So How Big is a Major Gift for You?
Now that we know some benefits of setting a major gift size, let’s determine what works at your organization.
Remember, gifts don’t have to be over six figures to be considered major, and they aren’t only for capital campaigns. There’s no better way to skyrocket your annual fund than to infuse it with some major gift power.
This week’s action item will help you determine what constitutes a major gift at your organization.
Challenge Yourself Action Item
Step 1: Run a list of your top donors.
The simplest way to determine a major gift level is to run a list of your top 10 donors for the last 12 months. Exclude any foundations or corporations on the list. Let me say that again — you’ll want to eliminate any foundations or corporations from the list. (However, if you have donors who give from their family foundations without grant applications, it’s fine to include them.)
Also, exclude any extreme outliers or one-time gifts. In other words, if you received $100,000 from a bequest or in honor of someone, but it’s unlikely you’ll receive another gift of that level this year, don’t include it in your top 10.
Total up the donations from the top 10 donors (they may have given multiple times throughout the year – use their total giving in your calculation). Now divide by 10.
Step 2: Average your top 10.
Take the average of the top ten donor’s totals from last year. Now round up to the nearest $5,000. If your average major gift level is $8,500, then round up to $10,000.
Remember, fundraising is an art and a science. In this case, there are no hard rules to determining what you consider a major gift at your organization.
Be realistic yet optimistic when picking an amount. Be optimistic, because you’re growing your major gift program and you don’t want to play it too safe or small. Consider where you want to be 3 years from now, not simply where you are today. However, if you’ve never received a gift of over $1,000, then $25,000 is probably too high. Start with a more realistic number like $5,000.
Going Further with Major Gifts
Once you have the ideal major gift amount for your organization, it’s useful to have three different major gift levels. The high level should be an amount you only get a few times per year, or a stretch goal. The middle amount can fall somewhere in between.
If you’re ready to step up your major gift game in a much bigger way, Mastering Major Gifts could be a particularly worthwhile investment for you and your organization.
In the course, you’ll discover exactly how to set up your gift levels so your major gifts program can grow and expand in the years to come. You’ll also see several examples of what a proper gift range looks like, and learn precisely how to apply it to your organization.
Act, Comment and Participate
This week, you’ll calculate the amount of a major gift at your organization. The number doesn’t need to be set in stone — you can always raise it once you start to see some success.
After determining your amount, please share it in the comments. Stating your number in public will solidify it for you, as well as help us celebrate you when get your first (or tenth) gift of that size this year!
A major gift for us is $10,000.00.
Thank you for the great video. I have a regular large donor. That donor is sufficiently large that it skews my results. If I include this top donor, my Major Gift amount is $10,000. Without it, it drops to $5,000 and last year only one donor hit that level. I’m feeling that maybe my stretch goal is $10,000, but my realistic middle goal is $5K. Does that sound right?
That sounds right. The post mentioned to exclude outliers. You know your data and your donors better than I do.
$20,000
I ran my top donor report and average and was surprised that we are at $10,000. I had thought it to be lower – around $5,000.
Great exercise to do annually – hopefully it will go up each year!
Hi Amy.
Are you recommending that $5000 be the minimum level we set? For example, if my average is $1500, should I still roundup to $5000 or is something like $2500 more appropriate?
One more question: Does the size of my donor base matter? I’ve heard that you should calculate your major gift “cutoff” (for lack of a better word) by looking at the top 10% of your donors, and drawing a line below the smallest gift.
Thanks for hosting this challenge!
Hi Alison – Great questions. Remember – fundraising is part art, part science. Use the 3 criteria to determine whether $5,000 is your bottom or mid gift level… recognition, time, and accountability.
Our major gift amount is $5,000. We had been working on the assumption it was $1,000, which means we aren’t stretching high enough.
This is exactly what I’ve discovered with this exercise as well. We have about 100 individual donors who consistently give $1,000-$2,000, and while time is spent attempting to give all 100 special attention, I’m guessing we’re losing focus to bring a smaller group of people up to the $5,000 or $10,000 levels, of which we have only 8 and 5 respectively.
Then the challenge I see is 1. making sure to give enough time and energy to building up the higher levels of major gifts; and 2. how to make sure the donors who are no longer “major” don’t fall through the dreaded mid-level cracks.
Yes, yes, yes!
While we do get one or two gifts above $5,000, our average major gift is $2,600 and the median major gfit is $1900. While I do treat a gift of $1,000 as special, I now see that our major gift is more like $2,500 to $5,000.
We did some specific major gift work last year and asked some of our loyal and most generous donors for larger gifts which I consider outliers. But these people normally would give a smaller gift and they aren’t included in the top 10 when they usually would be. If I eliminate those, plus bequests, and memorial donations the average of the top 10 is $2238. We had set a major gift amount for our organization as $3000 based on eyeballing the figures rather than doing the math, so I guess we aren’t far out and that would be a good amount for our lowest major gift. $5000 would be the mid-level and $10,000 the top (although we are meeting with someone soon who has suggested they might give a $25,000 gift this year). We have also had a donor promise $50,000 if we can raise $200,000 but I don’t have a clue how to raise that amount. Any suggestions–or will that come up in future sessions?
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Would you suggest using summary giving? We don’t have many donors who give a single individual gift regularly, but we have a good number of donors who give sizable gifts several times throughout the year totaling as much as $5k-$10k.
Yes, absolutely! Use cumulative (total) donor giving.
I believe that major gifts levels vary for different campaigns depending on the size of your non profit. While size matters- size is also relevant to our donor outreach and size of your non profit agency. For example – capital campaigns can range from annual pledges of $1k to large gift of $100k.
I think ultimately every donor must be treated as a major gift donor because the longevity of the relationship and their support of the mission is what is the potential for a major gift at any time – expected or not.
Thanks Amy! Love your advice
Question – is there any relationship between the size of a major gift and the size of your organization? For us, the amount of $$ coming from giving is much smaller than we would like, the majority of our money comes from program fees. We are extremely interested in increasing our major gifts program.
Because we have historically had so low giving, we had set the lowest level of a major gift to be $1,000 (we get less than 10 of those a year). But our overall organization is about $750,000 a year in top line revenue, so $1,000 still feels small in terms of time and effort needed to secure it. So – would you take into account the size of the organization? Or just look at historical giving levels?
Great question. As you know from your experience, major gift size does not correlate to organization size. Your organization’s revenue is primarily fee for service (program fees) and doesn’t have a culture of philanthropy. You will want to grow your major gifts program just like any other organization – with dedication and time.
Great blog, incredibly helpful advice, thanks for sharing! It is very important to be precise about your major gift amount and have a framework for categorising them, as it enables you to engage with major donors more effectively in the future. Lisa makes a good point, every donor should be treated specially as you never know how that relationship will develop, every major donor has to start at some point, but you also want to take the time to focus on and form stronger relationships with major donors who show a strong interest in giving more. It is all about balance and effective planning.
We’re at $10,000
When considering a donor’s total giving to determine what our major gift amount should be, should I include matching donations from their employer?
Do not include matching gifts from an employer. What happens when they switch jobs?
I am starting a major gifts programme pretty much from scratch with little previous individual giving programme – though we do have a pool of events donors and some personal / family trusts that I hope to engage further…realistically, after doing this exercise I am going to set the entry bar at £1,000, though hope to focus more time on £2500-£5000+ as programme develops.
Currently, our major gift size is 5.000 €, so our strech goal is 10.000 €, the ideal would be around 20.000 €. A couple of years back, we already received gifts of up to 125.000 € – however, those donors “migrated” as our CEO started his own foundation and took “his” contacts along. My goal is to reach this gift level as soon as possible, so thank you for all the knowledge you are sharing!
Should we include tables purchased at events? If we include events our number would be $25,000. If we exclude events, it is $10,000 if you exclude an outlier (an annual donor who gives $40,000 more than the next highest donor) and $15,00 if you include that outlier.
Thank you for the clear steps and formulas. We got average of $4000 among our top 10. So our stretch amount would be $5000.
We are a relatively new nonprofit and so far have had one main funder. This is our first year with a major gifts campaign so our general major gift will be $1,000, the middle level is $2,500 and the stretch is $5,000.
Our average large gift amount is $2500. This has been accomplished through word of mouth and family of the group. I’d like to aim for $5,000 being our major gift goal and am hoping this starts moving us down the right path. I’m new to the organization and stepping into this role as a complete newby.
I look forward to your additional videos and the information they contain.
Because of one large (MAJOR) donation of $50,00 that will be annual, that brought my average up, but I think there are more that can do that in our community, or at least somwhere in between that and our $1,000 or $5,000 annual giving levels. So, our major gift amount is $10,000 or more!
Hooray!
Thank you Amy! I think this challenge will lead me in the right direction! A major gift for our organization is $25k based on your criteria listed in the video. Also, based on this information I think our 3 major gifts levels would be High – $40k, Middle – $25k and Low – $15k. I am a little hesitant to leave the low so high as we have more $10k gifts. I am not as clear on setting the 3 major gift levels but hopefully as I progress through the challenge it will become more clear. My gut is telling me it is more like Low – $10k, Middle – $20k and High $40k. Maybe you could offer more insight on how to set the 3 different major gift levels. Thanks again and I look forward to the challenge!
Go with your gut. I think you’re on the right track. You could simply round up (you’re in the right ballpark) to $10,000, $25,000 and $50,000. Aim high!
Thank you!!
Our average is $4080. I’m setting our levels at
High: $7500
Medium: $5000
Low: $2500
Am I being too conservative?
Yes. Aim high!
Our ED recently increased our level for major giving to $10,000 which is consistent with the data from top donors last year.
$250K
So do you go back – Once a donor has give at the threshold of $1500 (that’s the range that classifies them as a Major Donor, do you go back and subsequently reallocate all their gifts to the major donor line or do you move forward with this.
Just move forward. No reason to make your job any harder than it already is.
Amy – is the major gift amount a cumulative giving for one year OR does it represent an amount someone would give pledged over 3-5 years?
Using the technique of “drawing a line” under the top 20% of donors and what they give, our major gift is actually $400 and we have just shy of 200 of those. Our plan to roll out a major donor program is to recruit from our existing current donor base (some 32,000 donors) more $400+ donors and also more $1,000+ donors who will get more personalized attention. We currently have 4 donors of $2,500+ and would like to build on that as well, once we hold a recognition/recruitment event for the $1,000+ donors. With such a large donor base, I can’t help but think there’s a lot of potential here that we’ve been ignoring by not having a major gift program all these years. I’d also like to secure a special major gift restricted to paying for a wealth screening, which might really set the project on fire. In less than 5 years, I’d like to make $1,000 the floor for major gifts and just grandfather in the people who joined the club at $400, re: more attention.
$5,000…but my data has issues. Has anyone else faced database challenges as they try to work the major gifts pipeline?
Our average is $4400, but only 4 of our 10 are close to that or higher.
I’m thinking: $10k+ is stretch, $5k is mid and $2500 is low range.
We are a major health organization but are just starting a formal fundraising program. We really have no donor base so what would be a realistic target for us?
Over average is just over $10k, with 8 of the ten giving at that level. So, I am thinking $10k is the low level, $15k is mid with $25 being stretch
Amy,
My #1 is $78K
#2 is $11K
#3 is $8K
And the next ten are in the $5-7K range
I’m thinking my major gift levels are at $10K, $25K, $40K, and $100K, and the next hill to climb is $250K.
Is that about right?
Thanks,
John.
PS, I’m finally in a place where people want me to move on this! Thanks for the encouragement over the years.
We consider major gifts $5,000 and above. Per your calculation it should be $30,000 and up. I believe our $5000 and above have a lot more potential hence why we start there. Depending on their size of gift is where they are in terms of stewardship activities etc…
We consider major gifts to be between $500 – $1,000 as a grassroots organization that just started up a few years ago. But, after doing the calculation on the high end a major gift would be $5,000. Cool!
This was a great exercise. I learned that in 2019 0ur average major gift level is $20K.
I couldn’t help but go back and compare to when I started as an MGO with my org. in 2017. Before I started the Major gift level was $10K. It’s great to feel and SEE that my work is making a positive difference to a charity I care so much about.
Thanks Amy!
We have a major donor who gives 5 times as much as the next donor. With him our major gift is $50,000. Without him our major gift is $25,000. However, when I look at the data, I only have 5 people who are giving at that level or above (including the major donor). I also only have 15 people giving above $10,000. How would you advise to approach this when trying to determine what a major gift is?
Following the data, our major giving level is $5,000. In addition are going to prioritize growing current major gifts to one level above that $10,000 gifts this year. A lower priority but something we will work on is also growing some smaller gifts to the $2,500 level so the cultivation is there for the future.
Stretch goal: $100,000.
Medium goal: $50,000.
Low goal: $25,000.
$2,500, $5,000, and $10,000
We have not yet secured any doner.so can’t work on that formula.
Avg. Top 10 Donations: $280
Stretch Goal: $5k
Medium Goal: $2.5k
Low Goal: $1k
We have 2 donors that give $400 which us the highest,
Low level: $1,ooo
Medium level: $2,500
High Level: $5,000
I really feel like with training and working hard that it can increase over time. This is new for me and I really want to be realistic!
I looked at our Top 30 and dropped a few outliers. What I then did was have three tiers, at roughly 10 per, at amount breaks. I ended up with what I fee are the low, medium, and high goals to move forward with. One trend I found was that a large portion of our top donors are either current or former board members. Which is great! But I would love to work on incorporating more community members into the upper giving tiers.
Giving Level Goals:
— Low: $5k
— Medium: $15k
— High: $40k
And does anyone else use DonorPerfect? I inherited it from prior development leadership and the system is set to indicate a donor as “major” at $1k and I would like to fix it. Does anyone else experience this issue? I’ll follow up with DP directly in the meantime, but would love to get others thoughts on this. Thank you!
Our major gift is $5,000
A major gift for us is $15,000. I sorted our donors out by their lifetime giving amounts from highest to lowest and pulled out the top 10 donors that were not foundations or grants. I recorded their average gift amount on a spreadsheet and ran the average of the top 10 donors’ average gift amounts. I got a total of $12,334, rounded up to the nearest $5,000 and voila! $15,000!
TOTAL: $137,726 / 10 = $13,772. Round up to $15K. So, lets say our 3 levels are $5k, $10K and $15K
Based on May 2021 thru May 2022, our top 10 individual donors totaled $74,000. Divided by 10, that equals $7,400 – so rounding up, we get $10,000.
That feels right, considering our spread in that range covers gifts of $2,500 – $15,000.
I’m setting our 3 levels at
$5,000
$10,000
$15,000
Avg from FY23 Season $10,000
Three levels would be:
$25,000
$10,000
$5000
We wound up pretty close to $7500 so I am going with $5,000 and $10,000 as a stretch goal!