The Fundraiser’s Guide to Prospect Research

What is Prospect Research?

Prospect research is used by the fundraisers and development teams of nonprofit organizations to gather more data about their donors and prospects including past giving, wealth markers, business affiliations, and philanthropic tendencies. This information helps nonprofits determine a donor’s ability and desire to donate, which is helpful to know when making appeals to prospects.

Why is Prospect Research Important?

Without prospect research, your nonprofit has no idea if your donors have contributed to other organizations, supported political campaigns, or volunteered in the recent past. But with prospect research, you have access to that info plus much more. It’s critical to use a prospect screening to find out all you can about your donors and prospects.

How does Prospect Research Work?

Nonprofits can either perform in-house screenings, use a prospect research software, or hire a prospect research consultant to discover more information about their donors. There are numerous online tools that nonprofits can utilize and a large number of resources to help them decide how to use the information they obtain.

The Basics of Prospect Research

Definition of Prospect Research

What is Prospect Research?

Prospect research is a way for nonprofit organizations to find out more information about their donors and prospects.

This information can be:

  • Simple, like names, gender, and addresses.
  • Complex, like past giving to political campaigns, your organization, and other organizations.

Prospect research can help your organization determine a particular prospect’s ability to give as well as their likelihood to give to your nonprofit’s cause.

How Can You Conduct a Prospect Screening?

There are many ways to conduct a prospect screening.

You can:

  • Use a prospect research consultant.
  • Use the resources of a prospect screening company.
  • Manage the process internally with your development team.

Nonprofits of all shapes and sizes can benefit from using prospect research to give their fundraising efforts a boost and better tailor their appeals to prospects.

Comparing Wealth Screening and Prospect Research

Wealth Screening

Wealth screening often gets confused with prospect research.

It’s a common mistake, but wealth screening is actually only one component of prospect research.

It analyzes the financial aspects of a donor’s profile such as real estate ownership, stock ownership, and political giving.

Prospect Research

Prospect research takes more than wealth into account.

It looks at philanthropic indicators, like nonprofit involvement, alongside traditional wealth markers.

With a much more complete look at a donor’s willingness and capacity to give, nonprofits can make informed fundraising decisions.

Types of Organizations that Use Prospect Research

  • Colleges & Universities

  • Arts & Culture Nonprofits

  • Healthcare Organizations

  • Churches and Religious Organizations

  • Animal Nonprofits

  • International Nonprofits

  • Community Organizations

  • Environmental Organizations

How Does Prospect Research Actually Work?

Prospect research process Determine why you're researching

1. Determine Why You’re Researching

You shouldn’t wander into the world of prospect research without having some kind of plan of attack.

Do you need to find potential major gift donors? Are you looking to fill out your donor profiles? Are you trying to identify corporate connections between your donors?

Whatever the case is, make sure that you establish it well before you start your prospect research process. Having an end goal in mind will help you during your screening.

Prospect research process Pick your research avenue

2. Pick Your Research Avenue

Next, you’ll need to decide how you’re going to conduct your prospect screening.

If you’re a small nonprofit on a budget, we recommend you complete a DIY screening.

But if you have the money, go for a consultant or prospect screening company. The great thing about consultants is that they can don the research for you and analyze the data to help you see how to best use the information.

These last two solutions will compare your donors’ info against public and private databases to help you flesh out your donor profiles.

Whichever solution you choose, make sure that you understand the types of data that are revealed with each kind of service.

Prospect research process Prepare your data

3. Prepare Your Data

Here’s the thing: there’s no need to run all of your donor data through a prospect screening. If you have a ton of supporters with varying degrees of existing data paired with them, the results of a prospect screening will be overwhelming and, to be honest, not very helpful.

Instead, prepare your data prior to a screening so that you have the most optimized data at the end.

Get rid of duplicate entries, and don’t screen any donors who haven’t given recently. You only want to focus on those supporters who have the potential to continue to give to your organization in the future, and lapsed donors don’t fit that profile.

Prospect resaerch process Determine how to use the data from your screening

4. Determine How to Use the Data From Your Screening

Once you’ve completed a prospect screening and have a good handle on your donor base, it’s time to put that data to good use!

Aim to fulfill your goal back in step one. If you wanted to hone your major gift strategy, look at donors who have the potential and willingness to give a large sum and put a cultivation and solicitation plan in place. If you wanted to flesh out existing donor profiles, begin the data migration into your CRM software.

Prospect research can give your nonprofit a bird’s eye view when it comes to your supporters and their philanthropic patterns. Just make sure that you use all of that information for the betterment of your nonprofit and your mission!

For a list of CRM software solutions, check out Double the Donation’s top nonprofit CRMs.

Information Included in a Prospect Profile

A complete and comprehensive prospect profile is the result of prospect research done correctly.

Information in this profile includes, but is not limited to:

  • Previous Donations to Your Nonprofit

    Past giving is the best indicator of future giving, and prospect research can uncover previous donations that a supporter has made to your organization.

  • Donations to Other Organizations

    If your donors are philanthropically minded, they probably aren’t giving to just your nonprofit. Let prospect research unveil past giving to organizations with causes that are similar to yours.

  • Political Contributions

    Supporters who give to political campaigns demonstrate that they donate when they care about a cause. You can use recent FEC filings to see which of your donors are giving to political candidates with passions that align with yours.

  • Nonprofit Involvement

    Giving isn’t the only indicator that an individual is philanthropically minded. With prospect research, you can identify other types of nonprofit involvement like advocacy work, volunteerism, and board membership.

  • Real Estate Ownership & Addresses

    Real estate value can give your nonprofit a ballpark estimate of giving potential. Plus, knowing a donor’s current address helps your nonprofit’s outreach.

  • Business Affiliations

    Prospect research can help you detect and capitalize on existing business connections between your donors. For instance, you can discover links between donors’ employers’ corporate giving programs.

  • SEC Insider Stock Transactions

    While it won’t tell you how likely a donor is to support your nonprofit, knowing about a contributor’s stock ownership can give you even more insight into their wealth and their capacity to donate to your organization.

  • Personal Info

    Knowing a donor’s preferred name, birthday, gender, and marital status can help when you go to send out donation appeals. Start things off on the right foot by letting prospect research fill in the gaps in your data.

Fundraising Areas That Prospect Research Can Help With

Annual Fund

The annual fund is what keeps your organization’s wheels turning. Without it, you wouldn’t be able to complete your day-to-day operations and tasks.

While you’re likely asking all of your existing supporters for donations for your annual fund, you can find new annual donors with the help of prospect research.

When you look into past giving to organizations and causes that align with yours, you might uncover potential supporters!

Major Giving

Prospect research is the perfect tool for finding hidden major gift prospects in your existing donor database.

It can help you uncover past giving and involvement and track giving patterns that predict major giving.

For instance, you might have a faithful donor whose donations have been steadily increasing over the past five years. With prospect research, you can examine that donor’s history and figure out the best strategy for asking for a major donation.

Capital Campaigns

A capital campaign is a long-term fundraising effort that is usually tied to a large project like the construction of a new building or the developing of an endowment.

Capital campaigns rely on a set number of major gifts during what’s called the “quiet phase” before fundraising is opened to everyone in what’s known as the “public phase.”

Prospect research can help nonprofits find ideal donors for the quiet phase and the public phase, donors who have substantially and regularly given over the years.

Planned Giving

Planned gifts are often the largest donations that a nonprofit will receive. They rival major gifts as the biggest contributions that a supporter is capable of making.

And while, sometimes, there is no way to anticipate how generous a donor will be in his or her will, prospect research can give you a pretty decent idea.

With prospect research, you can examine a particular donor’s interest in your nonprofit and their previous monetary support, making predicting who your planned giving donors are just a little bit easier.

Common Prospect Research Questions

Why is Prospect Research Useful?

  • Fills in the gaps in your existing donor database

  • Identifies your major gift donors

  • Helps find planned giving prospects

  • Analyzes donor giving patterns

  • Finds new donors

The benefits of prospect research cannot be understated!

Whether you just need to fill out the details in your existing database or you want to identify your next major gift or planned giving donor, prospect research can help!

What Determines the Cost of Prospect Research?

Once you’ve decided to go ahead with a prospect screening, you’ll need to take a look at the different services out there.

Many prospect research companies provide some combination of the following:

  • Support with database integration
  • Predictive modeling
  • Ability to query and sort results
  • Sorting of donors’ contributions to other nonprofits
  • Relationship score for each prospect
  • Analytics and rankings for each prospect
  • Editable and detailed profiles
  • Capacity estimates
  • Customer support
  • Training

It’s important to weigh the pros and cons when it comes to prospect research. If your organization is too small or doesn’t have the funds available, focus more on organic donor acquisition and research.

If your nonprofit fits these five criteria, you’re prepared for a prospect screening!

A database of at least 3,000 donors

The receiving of new prospects every year

Not completing a screening for 3-5 years

Wanting to convert annual fund donors into major gift prospects.

Having the money in your budget

What are the Factors that Predict Future Giving?

  • Past giving to your organization

  • Previous donations to similar nonprofits

  • Philanthropic involvement

  • Political giving

  • Real Estate Ownership

Prospect research can reveal all of these factors so that you have a firmer grasp on who will continue to give to your organization in the future.

Future giving depends on many factors. Let prospect research help you figure out what those are!

What are the Ethics Surrounding Prospect Research?

Restrict access to donor information

Not everyone in your organization needs to know every detail about every donor.

If a donor asks, tell the truth

Transparency is key in prospect research, and you don’t want to set off alarms in donors’ minds by lying to them from the get go.

Remember what you’re looking for

You’re attempting to evaluate your prospects’ desire and capability to give. This does not include looking into their driving records or criminal backgrounds.

Fact check

Make sure that all of the information you’ve obtained is up to date and correct. This will also help you when you’re filling in your prospect profiles.

How Should Your Nonprofit Perform a Screening?

Prospect Screening Companies

Your nonprofit might elect to bring in a prospect screening company for your prospect research needs.

Every prospect screening company is different, but most compare your donors against a variety of databases and create a comprehensive profile for each supporter.

When looking at which screening company to use, make sure that you check the types of info they provide against the data that you need to flesh out your donor profiles.

Prospect Research Consultants

Prospect research consultants are yet another prospect research resource at nonprofits’ disposal.

They’re extremely valuable resources for nonprofits, often completing screenings for nonprofits of all shapes and sizes and offering advice and other services.

If you decide to hire an outside consultant instead of a company, take a look at the types of information that their screenings reveal to determine if you should hire them.

Do-It-Yourself

For smaller or newer nonprofits with a tighter budget, a do-it-yourself prospect screening is a good option.

A do-it-yourself screening can help your organization get a better handle on your existing donor base and can be the motivator for cleaning up your database.

You can access free prospect research tools, but there are also some reasonably-priced tools that your nonprofit can use to look into your donors’ giving and philanthropic histories.

Additional Resources

Prospect Research Tools

Top Paid Tools

DonorSearch

With the world’s largest charitable giving database, DonorSearch is able to incorporate an individual’s history of philanthropic giving into its prospect screening results.

TouchPoints

TouchPoints ensures that all of the information you’ve obtained about donors is up-to-date and correct.

IntellectSpace

With the largest proprietary relationship database tracking over 64 billion relationships from around the world, IntellectSpace helps nonprofits “connect the dots” by mapping supporters’ connections with the prospects that a nonprofit wants to reach.

Top Free Tools

The Chronicle of Philanthropy

They have an interactive tool that allows users to investigate giving by location. You can look at giving at the state, city, county, and ZIP code levels.

The Foundation Center

The Foundation Center has accurate, up-to-date grantmaker data as well as prospect assessment and management tools.

The Million Dollar List

If you need to look for potential major gift prospects, the Million Dollar List is a great resource. The Million Dollar List is a collection of publicly-announced contributions that are at least a million dollars. Their data goes all the way back to 2000 and can be filtered by donor, recipient, or location.

Expert Advice

Jen Filla

Knowing when to use prospect research requires an understanding of what tools are available and how they enhance your fundraising.

Jen FillaPresidentAspire Research Group
Sarah Tedesco

While wealth matters, a history of philanthropy matters more, because the goal is to find a philanthropically-inclined prospect first and study their capacity to give second.

Sarah TedescoExecutive VPDonorSearch
Kanwei Li

Data is the key to allocating your limited resources such that you generate the largest ROI for your nonprofit organization.

Kanwei LiCTODouble the Donation

Top Prospect Research Statistics

(Source: DonorSearch)

17X

Donors that own $2+ million in real estate are 17 times more likely to give philanthropically than the average person.

5X

Donors that have given over $500 in FEC and charitable giving are 5 times more likely to give a philanthropic donation than the average person.

10X

Individuals who have made a gift of $10k – $25k to a nonprofit are 10 times more likely to make a charitable donation elsewhere than the average person.

2.7X

Charitable bequests exceeded donors’ total lifetime charitable giving by 2.74 times.

32X

Donors that made a gift of $100k or more to at least one nonprofit organization are 32 times more likely to make a charitable donation elsewhere than the average person.

3 Matching Gift Reminders for Prospect Research

We recently asked Jen Filla, prospect research expert, how matching gifts and prospect research can go together.

She wrote a whole article on the topic, but here are the three takeaways!

Help identify corporate and individual prospects from a list of those individuals who have made matching gifts to your nonprofit.

Matching gifts can encourage prospects to stretch to reach a new level of giving with your organization.

Prospect research and matching gifts can assist in your corporate engagement efforts.

Additional Prospect Research Resources

Prospect Research Tools

Prospect research tools

Now that you know all about prospect research, it’s time to learn more about your donors!

Before you do, though, take a look at these great prospect research tools for nonprofits just like yours!

Prospect Research Stats

prospect research and wealth screening statistics

Want even more information about prospect research? Looking for statistics?

DonorSearch, the leader in prospect research services, has compiled some stats for you. Take a look!

Info about Wealth Screening

More info about wealth screening

Wealth screening is very similar to prospect research, but there are a few differences.

Learn all about how your nonprofit can maximize the benefits of wealth screening to raise more money.

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