4 Strategies Fundraisers Can Use to Boost DAF Donations

As the number of donors keeps declining and cuts to federal funding continue, donor-advised funds are in the spotlight more than ever. Many nonprofits are targeting DAF donors in their appeals because they’ve already set aside that money for charities.

According to the most recent data, there is more than $250 billion in DAFs. However, DAFs donors can be hard to find. A new report, “Reinventing the Cycle: Adapting Relationship Fundraising for Donors Who Use DAFs,” looks at fundraisers’ role in cultivating relationships with DAF donors.

Researchers interviewed 46 fundraisers about how they interact with DAF donors, what the challenges are, and what’s working well.

“It was a gift to have these conversations with so many and so many different kinds of organizations,” said Genevieve Shaker, one of the report’s authors and a professor of philanthropic studies at the Lilly Family School of Philanthropy at Indiana University. “We talked to people in teeny tiny organizations, founders who had a staff of maybe one, and then we also talked to the people in very large fundraising operations, at hospitals and universities.”

Shaker co-authored the report with Dan Heist, an assistant professor of nonprofit management at Brigham Young University, and Rachel M. Sumsion, a graduate research associate at BYU. The report goes in-depth into the challenges and opportunities to raise money from DAFs. Here are four key insights that can help fundraisers raise money from DAFs, based on the report, interviews with Shaker and Heist, and a conference panel they led.

Become an investigator.

The report says that a common challenge for nonprofits is figuring out who made DAF donations. The information submitted with a gift is often incomplete and doesn’t consistently include the donor’s name or contact information. While some donors name their DAF after their family — something like the Smith Family Fund — others name it after their family dog, Heist says.

This means fundraisers often must tap into their inner Nancy Drew to piece together where the donations came from, Heist and Shaker say.

This often happens by looking at the intake process for DAF gifts and ensuring the team that inputs data knows where to look for the fund name and the donor name. Sometimes they miss the information on the intake form, and fundraisers need to take a second look. Other times, Shaker says, donors ask at an event whether you received their gift, and you, in turn, need to ask how they sent it. Then the fundraiser has to go in and match up that information in the system.

Asking questions can help fundraisers get ahead of the challenge of incomplete information. Ask donors if they have a DAF. And if donors say they will be making a gift, ask them if it will be coming from a DAF. Doing this allows fundraisers “to really then embrace the opportunities” associated with DAFs, Shaker says.

Have deeper conversations.

Fundraisers who are successful winning DAF donations are having deeper conversations with their DAF donors. “The thing that we heard from professional fundraisers all around the country was, ‘I actually really like working with DAF donors,’” Heist says.

This is because they’re really open to having conversations about the DAF and their charitable goals. Heist says fundraisers get great results simply by having open-ended conversations and saying to the donor, “Oh, you set up a DAF. Tell me about that.”

“They’ll say things like, ‘Well, we sold a business,’ and the fundraiser is like, ‘I didn’t know you sold your business,’” Heist said. “You start talking about the DAF, and all of a sudden you’re talking about their wealth and their assets and their philanthropic intention.”

Shaker said it’s important to “talk to them and have conversations about their giving practices and their goals for their DAF.”

Strategize and make a plan.

After engaging in deeper conversations, fundraisers should use that information to come up with smart strategies to better connect with those DAF donors.

Heist said to think of it as almost “co-creating” a strategy with the donor. “If they are saying, ‘I want to leave this in there for a while and grow; I want my grandkids involved,’ then you should think about a grandkid giving strategy,” he said.

For donors who are interested in leaving a philanthropic legacy, look at the options your organization has. The strategy should be based on what the fundraisers’ conversations with the donor revealed.

Make an appeal when necessary.

The best news from the research is that DAF donors are willing to pitch in when organizations they support are in need — even if they’ve already donated earlier in the year. This is especially true now with an uncertain economy and rapid changes coming out of Washington.

Said Shaker: “Fundraisers in this study felt that they could approach DAF donors in times of difficulty, like COVID or other difficult times, … more frequently or with more confidence than other donors because they knew that the DAF donors had put money aside for philanthropy.”