Fundraising Feasibility Studies: A Comprehensive Guide

Planning is an important part of any nonprofit fundraising endeavor, but it’s especially critical for large campaigns, like capital campaigns.

A successful capital campaign is no small feat. Before you can dive into crafting your fundraising strategy, you must determine whether or not your organization is ready to invest significant time, work, and resources into the campaign by conducting a fundraising feasibility study. 

Put simply, a fundraising feasibility study can help you gauge how much support you have for your campaign and decide whether you’re ready to pull the trigger on your initiative. 

Since nonprofit feasibility studies are critical to helping you grow your organization, we’ve put together this comprehensive guide to help you successfully conduct one. Here’s what we’ll cover:

As you learn about the ins and outs of successful fundraising feasibility studies, you’ll gain the insights you need to move forward with your capital campaign. Let’s dive in by taking a closer look at what a fundraising feasibility study is.

What is a Fundraising Feasibility Study?

Conducting a formal nonprofit feasibility study helps you assess your organization’s capacity and readiness for starting a large project. As mentioned above, fundraising feasibility studies are typically needed before your nonprofit dives into a long-term capital campaign. In a capital campaign, organizations are typically aiming to do one of the following:

  • Build or expand a facility

  • Acquire land

  • Invest in an endowment fund

  • Purchase equipment or supplies

Because of the sheer scale of projects like these, a capital campaign could take multiple years for your nonprofit to see through to completion, which is why you need a nonprofit feasibility study to help you determine if you’re ready to take the plunge.

One of the most important aspects of a feasibility study is touching base with your nonprofit’s key supporters and interviewing them to gauge their attitudes toward your organization and the project in question. The best way to conduct these interviews is to hire a fundraising consultant to do them for you. We’ll explain why in the next section.

Why You Should Hire a Consultant for Your Fundraising Feasibility Study

Fundraising consultants are experts in the nonprofit sector who have the experience and resources to help your organization start fundraising beyond its size. They can be especially helpful for capital campaign feasibility studies for these reasons:

  • Even before you start conducting a feasibility study, consultants can help you with prospect research. They’ll help you identify who has the affinity and capacity to be a major donor of your organization, which can translate into support for a future capital campaign.

  • It’s helpful to have an objective third party conduct interviews with your key supporters. Interviewees may be more honest with a third-party interviewer, giving you real and useful insights.

  • Your capital campaign consultant can help you strategize and determine your next steps after your feasibility study is complete. No matter the results of the feasibility study, you’ll have insights to work with, and a consultant can guide you on what you need to do next.

To find the right consultant for your organization, you’ll need to follow these five steps:

  1. Work with your team to define your fundraising goals and needs. This is the point at which you’ll determine if you need help with a feasibility study for a capital campaign.

  2. Develop a request for proposal (RFP). An RFP is a document that communicates your needs and goals to the consultants you’re considering hiring.

  3. Start looking for potential consultants to work with. Conduct an online search and ask for recommendations from colleagues in the nonprofit sector or from organizations like the Association of Fundraising Professionals (AFP). Also, make sure you’re looking for consultants whose fundraising values align with yours and who can successfully support your organization remotely (if they don’t live in your area).

  4. Reach out to consultants you’re interested in and submit your RFP. Give the consultant two weeks to get back to you with a completed proposal.

  5. Work with your team to see which proposal and consultant stand out. Determine which proposal has actionable plans you can use to achieve your goals, and don’t be afraid to ask the consultant to amend their proposal—this will show you how flexible they are and what it’s like to work with them. Once you’re ready, you can sign a contract with your consultant and get to work!

After you’ve selected the right consultant for your organization, it’s time to start working with them on your fundraising feasibility study. There are five major steps for conducting a successful feasibility study—let’s start with step number one.

The first step of conducting a fundraising feasibility study is to identify key supporters.

Fundraising Feasibility Study Step 1: Identify Key Supporters

Before you dive into creating a case for support and conducting interviews, you need to first do some prospect research to identify the major supporters that can help back your campaign. After all, you don’t want to spend too much time stewarding a supporter if they don’t have the funds or the interest to get involved with your project.

While you can conduct prospect research on your own, it’s best to work with your fundraising consultant, who will have the tools and experience to help you identify and begin stewarding your prospects. Those prospects might come from the following groups:

  • Major donors

  • Board members

  • Longtime volunteers

  • Community stakeholders

  • Business owners

To conduct prospect research, your consultant will use the following prospect research tools to learn more about these prospective supporters:

  • Donor data in your CRM

  • Search engines

  • Social media platforms

  • Gift matching eligibility

  • Government records like investment records and political contribution information

  • Prospect generator tools that give you lists of donors that contribute to organizations like yours

  • Prospect research databases

With tools like these, you can start taking a look at the data that is available for each prospect. You’ll need to look at both wealth (capacity) and warmth (affinity) markers. Check out this graphic to learn the difference between the two:

Knowing the difference between capacity and affinity markers can help you find key supporters in the fundraising feasibility study process.

Checking for these markers will help you know who could realistically help push your capital campaign project along. Here are some capacity and affinity markers to look for while using your prospect research tools:

Capacity Markers:

  • Real estate ownership

  • Stock holdings

  • Business affiliations

Affinity Markers:

  • Donation and involvement history with your organization (and similar nonprofits)

  • Political contributions

  • Professional and personal connections with other donors in your database

In addition to identifying these markers, you’ll need to learn about your prospects’ backgrounds, because it isn’t enough to just figure out someone has the wealth and warmth needed to be considered a key supporter. You’ll also need to cultivate a genuine relationship with your prospects.

Building these relationships will likely include face-to-face meetings, phone calls, invitations to events, and, eventually, donation appeals and feasibility study interviews. This means solid prospect research will take some time, but don’t be discouraged. With the help of a well-trained fundraising consultant, you’ll be able to find the right prospects for your capital campaign instead of taking a shot in the dark, which in the end will be much more efficient for your organization.

The second step in creating a fundraising feasibility study is developing a case for support.

Fundraising Feasibility Study Step 2: Develop a Case Statement

A case statement (or case for support) is a well-crafted, persuasive document that helps you articulate the purpose of your campaign and why your supporters should help you push it forward. While this document will be written primarily by your organization, your fundraising consultant can help polish it. Also, keep in mind that your case statement is an evolving document—it will develop and change as you conduct your feasibility study so you can use it for the public-facing portions of your campaign later on.

Follow this checklist to create your case for support, a critical part of your fundraising feasibility study.

Here are some key things you should include in your case statement:

  • Your nonprofit’s mission, story, and goals

  • Why the project/campaign is needed and what benefits it will provide to you and your beneficiaries

  • Projected costs and timelines

  • Reasons why your key supporters should back the project

It’s also a good idea to take your case statement to the next level by including graphics, logos, relevant photos, and testimonials that match your organization’s brand. This will make your case statement look more professional and official, as well as help your supporters feel more connected to your cause.

Once you’ve written your case statement, send it to your key supporters before the interview phase of your feasibility study. This will give them the chance to go into the interview process informed about your project and prepared to provide feedback on it.

The third step of a fundraising feasibility study is conducting interviews and data analysis.

Fundraising Feasibility Study Step 3: Conduct Interviews and Data Analysis

Interviewing and data analysis are the core parts of conducting a feasibility study. This is where you learn how your key supporters perceive your organization and proposed project as well as how viable it is for your organization to jump into your campaign. What comes out of this stage of the nonprofit feasibility study will determine whether your organization is ready for the campaign or not.

Let’s first examine the interview process. Here’s how you (or, more likely, your fundraising consultant) should prepare for the interviews with the key supporters you’ve found through prospect research:

  • Prepare thoughtful interview questions. Here are a few you might try.

    • What excites you about our organization’s vision for the future?

    • What do you see as our organization’s greatest strengths and challenges?

    • Do you think now is the right time to move forward with a capital campaign?

    • What are your philanthropic priorities, and where does our organization fall in that list?

  • Personalize the experience for the supporter. Make sure you come prepared not only with interview questions and information about the project in question, but also with talking points based on your supporter’s background and values. This will show them you took the time to get to know them instead of viewing them as a blank check.

  • Ask about your supporter’s perception of your organization. This is where an objective third party like a fundraising consultant comes in handy. You don’t want your supporter to feel like they can’t be honest in the interview because they feel the need to protect someone’s feelings. Understanding how your key supporters view your organization will also give you a good idea of how the public might perceive your nonprofit. Make sure to look for patterns in multiple supporters’ responses—don’t just fixate on one opinion.

  • Find out how your supporter feels about the proposed project. Ask your supporter how relevant they feel this project is to your nonprofit’s larger mission and how achievable they think the goal is based on the tentative timeline in your case statement.

  • Get feedback on your case statement. Since your case statement is meant to be an evolving document that can eventually be used to give information to the public about your campaign, take the opportunity to find out what it was like for an outside party to read it. Ask questions like, “What is your overall reaction to the case statement?” and “What elements of the case statement excite you the most and might inspire you to give?” Note any changes you should make to strengthen it.

  • Ask your supporter how they could see themselves being involved in the campaign. Get your supporter excited about the campaign and ask them to picture how they could imagine themself personally contributing to the project. Maybe their contribution will be a financial one, but they could also be willing to work in an official volunteer capacity or help you market the campaign. Make sure to focus on them, not your organization, for this portion of the interview.

  • Tap into your supporter’s personal and professional networks. Ask your supporter if they know anyone else who might have an interest in supporting your campaign. This will help you know who you can target for fundraising and involvement if the campaign moves forward.

  • Thank your supporter for their time and participation. No matter what they say about your proposed project or what opinions they have about your organization, make sure you thank your supporter for their time and willingness to be candid in the interview.

The interview process is an opportunity not only for you to collect information about your proposed capital campaign, but also to deepen your relationship with your key supporters. Even if a consultant will be conducting the interviews for you, well-thought-out questions and a focus on the supporter can help them feel more connected to your organization, particularly as you demonstrate how much you value their input and contributions to your mission.

The data analysis process will come next. Your fundraising consultant will analyze the interview results and your donor data to help you assess how feasible your capital campaign project is. This is where you’ll take an even more in-depth look at donor capacity and prospects you can prioritize during the campaign. From there, your consultant will typically draft a final, written report your team can use in conversations with board members and leadership staff to determine whether you should push your capital campaign forward.

The fourth step of a fundraising feasibility study is to evaluate your results.

Fundraising Feasibility Study Step 4: Evaluate Results

Once you have all of the information gathered from your prospect research, interviews, and data analysis into the final written report provided by your fundraising consultant, it’s time to work together as an organization to decide how you’re going to move forward with the proposed campaign. You’ll typically have two options.

Option #1: You determine your nonprofit is ready to move forward with the campaign.

If your supporters are on board and your consultant, board members, and leaders feel confident about your timeline and fundraising goals, it’s time to start your capital campaign! You’ll move into the planning phase and the quiet phase of your campaign next. Read our guide to capital campaigns for more information about these campaign stages.

Option #2: You determine your nonprofit isn’t quite there yet.

It can be disappointing, especially after a thorough feasibility study, to find out your organization isn’t currently in a position to pursue a capital campaign. However, remember that you’ve just worked for months to get valuable feedback on your proposed project and your organization’s direction. Plus, you’ve likely been working with a consultant who now understands your organization’s strengths and weaknesses. Take this as an opportunity to re-evaluate, enact positive change, and plan so you can lead a successful campaign in the future.

When you evaluate the results of your fundraising feasibility study, you’ll typically have two options.
The fifth step of a fundraising feasibility study is to determine your organization’s next steps for your capital campaign.

Fundraising Feasibility Study Step 5: Determine Next Steps for Your Capital Campaign

If you determine that you’re ready to move forward with your campaign, it’s time to make the needed adjustments to your fundraising plans. Then, you’ll need to present the details of the next steps for your campaign to your nonprofit leadership and board members. Make sure you are focused on the budget when preparing your presentation!

Wrapping Up

A fundraising feasibility study involves a lot of work on the part of your team and your chosen fundraising consultant, but it can provide a wealth of insights into how your organization is perceived by your major supporters and how well prepared you are for a large-scale project like a capital campaign.

As you follow each of these steps, remember to look for patterns and trends in your data and interview results that can inform your organization’s actions going forward. And if you’re looking for additional information about how to get your fundraising off the ground, check out these additional resources:

The Donorly Team