Habitat for Humanity Seeks to Build Bigger Donors

It took Habitat for Humanity International 26 years to build 100,000 houses for the poor, a goal the

charity’s founders set for themselves in 1976, when they gathered on an abandoned chicken farm near Americus, Ga., to develop the organization’s mission.

Now the charity is trying to build an additional 100,000, but in one-fifth the time it took to build the first. It has already raised more than half of the $500-million it estimates it needs for what it calls the “More Than Houses: Rebuilding Our Communities” campaign, which it announced in 1999 and plans to conclude by 2005. To date, it has built 33,641 of the next 100,000 houses.

The organization has far more resources to put to the current challenge than it did when it was founded: It has 1,028 employees, and last year the organization’s headquarters and 2,188 worldwide affiliates raised $399-million from private sources, more than all but 18 other organizations in the United States. Twenty-six years ago, the group had a handful of staff members, mostly volunteers, and a minimal budget.

Even so, the charity is retooling its fund-raising operations both to raise the money it needs to build the 100,000 houses and to meet the challenges Habitat anticipates in coming years. Its co-founder, Millard Fuller, 67, known as a charismatic fund raiser, has carried most of the load of soliciting major donors during the organization’s 26-year history, but he now hopes to slow down some of his personal fund-raising efforts so he can spend more time talking to the general public about Habitat and planning for its growth. What’s more, the organization has been heavily dependent on direct-mail appeals — its headquarters raised $64-million, or nearly half of the private donations it collected, from such solicitations — and as postage costs rise, Habitat, like many charities, has been seeking alternatives.

The charity is now mounting an ambitious effort to solicit big donations and last year recruited 10 fund raisers who specialize in asking for donations of $5,000 or more and estate gifts. By 2005, it hopes to add another 40 major-gifts fund raisers.

The organization is also trying to help its affiliates raise more of their budgets on their own so that the charity’s headquarters doesn’t have to take so much responsibility for financing the groups. It has hired five new fund raisers in the past year who focus on raising money from overseas sources, both for affiliates and the headquarters. Habitat for Humanity International, whose headquarters is in Americus, now takes a new approach when it gives advice on fund raising to Habitat chapters that are just getting started.

“For a long time, we essentially said, ‘You can concentrate on building houses, and we’ll concentrate on getting the resources,’” says David Williams, Habitat’s chief operating officer. “Now that has changed. Now we are saying, ‘If you are going to grow, you simply can’t rely on Habitat for Humanity International for the resources’” for more than a few years.

Staff Layoffs

While Habitat officials are optimistic that they can keep their fund-raising strong in the next few years and attract the resources the group needs to complete another 66,359 houses by 2005, the downturn in the economy has forced the organization’s officials to rethink its budget and staffing. Habitat’s staff grew rapidly as its revenue, including donations from private sources and government grants, regularly increased by double-digit percentages from 1995 through 2000.

As donations to Habitat for Humanity International, the parent entity, stopped growing at such a rapid clip — gifts rose only 4 percent in the 2001 fiscal year and then fell 3 percent in the 2002 fiscal year — Habitat decided that it no longer could afford the additions it had made to its staff. It laid off 64 people and eliminated another 97 positions last fall. However, it has also added the 10 major-gifts and five international fund-raising positions, with the idea that the new staff members will bring in enough to justify the expense of adding to the staff.

While senior officials acknowledge that last fall’s staff reductions were a painful chapter in Habitat’s history, Mr. Fuller thinks the organization is in a solid financial position now and that it has an appealing pitch to make to potential donors, particularly in a soft economy.

He says the charity tells potential donors that “it is the poorer people who get hit the hardest” in an economic downturn. “If middle- and upper-class people are feeling the pinch of the tight, difficult economy, what does it feel like if you are at the bottom?”

Moreover, he says, much of Habitat’s fund-raising success has come from the fact that the charity historically has been supported by people “of more moderate means,” who give smaller donations made through direct mail and are less affected by the ups and downs of the stock market.

Getting Bigger Gifts

Now the charity hopes that it can turn at least some of those modest donors into more significant contributors. Habitat leaders believe that its pool of direct-mail donors includes people who have the potential to give much more, but have never been asked to do so. Habitat’s new major-gifts officers will focus on making personal contact with direct-mail donors who previously have given $100, $500, or $1,000 or more a year, to try to persuade them to increase their donations.

Nancy Martz, the major-gifts director handling California and Hawaii, says she works with about 750 donors, mostly people who have made annual gifts of $5,000 or more, or $10,000 over their lifetimes, as well as people who have designated Habitat as a beneficiary of a will or trust. She also works with another 500 people who have donated at least $1,000.

She says Habitat’s new senior vice president of development, Tony DeSpigno has helped her and her colleagues focus their messages to donors on the tangible things that their donations support.

She says he frequently reminds fund raisers that “‘we are not raising money, we are building houses, so when you go out there and talk to people, ask them how many houses they want to build and where.’ One house costs $2,500 in Guatemala, and $100,000 in California. So help them figure out where they want to buy in.”

She credits that message with helping her obtain seven gifts totaling $350,000 in the last two months, compared with previous months when she sometimes did not win a single large gift.

Habitat also recently hired five international fund raisers to strengthen overall overseas fund-raising efforts, both for affiliates and for Habitat for Humanity International. They are trying to persuade multinational corporations that support Habitat in at least one country to do so in any other countries where they do business. In addition, the new fund raisers are trying to help Habitat’s overseas affiliates recruit more board members and employees who are savvy about raising money.

Among the international entities that have been successful at identifying donors within their own country is the Guatemala affiliate, which raised $2.2-million for the “More Than Houses” campaign. Previously, the affiliate had raised practically nothing on its own, but it now raises about one-third of its revenue, with another third coming from payments made by people who move into the houses that Habitat builds and the rest from Habitat for Humanity International.

Focusing on Demographics

Habitat is also trying to grow by focusing on particular demographic niches. It aims to build interest in volunteering and giving money to Habitat among young people while they are still in college: More than 10,000 students in the United States and Canada raised $1-million for Habitat last year.

In addition, the charity hopes to capitalize on the boom in the number of healthy retired people in the United States, especially as more baby boomers reach the age when they want to leave their jobs and take on new, fulfilling challenges.

For instance, Habitat hopes to further expand on the rapid growth in its “Care-A-Vanner” program, which focuses on people who are retired, have access to a motor home, and like to travel.

The program, which was started 12 years ago by a handful of individuals and was operated out of a Habitat volunteer’s home, now has 1,000 Care-A-Vanner volunteers who help build about 100 homes each year.

Marge Kitterman, 65, who directs the program, is a former Care-A-Vanner who spent nine years building houses for Habitat across the country. Shortly after she and her husband, Bob, now 67, retired in 1992, they sold their house and began traveling around the country in their motor home. A few months into the journey, they discovered that they missed the satisfaction they used to get when they were involved in community affairs. “Our generation was brought up to give back,” she says, “and none of us are very happy sitting in our rocking chairs.”

After nine years on the road, the couple is taking a break, and both are working full time again for Habitat in the Americus headquarters.

Ms. Kitterman is working closely with groups like the Family Motor Coach Association, a group for motor-home enthusiasts that holds fund-raising events for Habitat at its annual conventions. In addition, Habitat this year became one of three charities that association members can check off on their annual dues bills to “round up” their $25 payments to some larger amount; the extra money goes directly to Habitat or the other two charities.

Much like the Care-A-Vanners, Mr. Fuller plans to stay active in Habitat for Humanity and says he does not expect to retire as its chief executive anytime soon.

Now that the charity’s new fund raisers are spending time with donors, he says he hopes he can devote more energy to talking to groups about Habitat’s work and its ties to Christianity.

“That is what I personally enjoy doing the most,” he says. “But I am very committed to this work, and committed to us having the resources to not only continue building, but to expand the work.”