High Tech Prospect Research Worth the Investment

Click on the photograph to reach WealthEngine.

I wanted to discuss in greater detail a capital campaign research tool mentioned in some of my prior public presentations, WealthEngine. You will find several revealing client testimonials and other helpful information, on the company’s WealthWorks Blog.

One nonprofit noted a few years ago,

“When you compare that to direct mail, web maintenance and design, special events and other fundraising costs, prospect research is a small investment that yields greater returns and one that we’ve seen contribute to our fundraising growth …. Overall, our ROI from prospect research these past three years in 2,766%. It may seem like an incredible number, but it’s one that shows the power of prospect research and the true potential that exists when coupled with a well-functioning, aggressive fundraising program” (Houston Grand Opera).

I have used WealthEngine in three prior capital campaigns. In each case it took time to “sell” the idea of investing in this kind of “high tech” prospect research to the organization’s leadership and to members of the Board. Some were reluctant. They felt this kind of information-gathering might constitute an invasion of privacy. But the fact is, the information WealthEngine draws upon is all publicly-available. WealthEngine abides by strict ethical guidelines.

In the case of each nonprofit with which I worked, it was eye-opening how WealthEngine showed us we were focusing on the wrong prospects. For instance, those who get a lot of attention in the media may not be your best prospects, nor the most capable, in the end.

Wealth research systems take time to learn, but can yield significant results.

Wealth research systems take time to learn, but can yield significant results.

It does take time to learn how to interpret the data uncovered, and to research and evaluate each prospect in even greater detail. WealthEngine provides its data by running your list of donor and prospective donor names and addresses through their sophisticated system. But it is up to each organization to learn on its own how to use/evaluate the data (Microsoft Access is a software program that can help you there). Be prepared for that.

In the end, WealthEngine’s services turned our major gift campaigns on their heads. For those of us who struggle with “donor burnout,” seemingly no prospects at all (never say never), and a lack of knowledge about the backgrounds and interests of our donors and prospects, this might just be the service for you.

Having said this, nonprofits must be prepared for another possibility. If you have spent a great deal of time nurturing relationships with a select few, it will take time to incorporate your newly-discovered WealthEngine prospects into your “major gift” cultivation plans. Balance your excitement at identifying the new potential donors with careful consideration as to how you will bring them “up to speed” about your good work.

Be careful not to leap into making a significant request for financial support until the proper groundwork has been laid. As Robert L. Thornton III, an outstanding Dallas volunteer with whom I worked in the 1990s once said, this is when you need to be doing, “the slow dance.”

Additional Considerations

Security is a critical issue when one works with sensitive information such as that provided by WealthEngine. Be careful when you produce print-outs of donor data; don’t leave them lying around, and when you are done using them, be sure to invest in and use a shredder, or delete them in the “cloud.”

For those among us who work with WealthEngine data as consultants, or only for a prescribed time frame, I recommend once your assignment is complete, ask WealthEngine to delete your online account access, and delete the master file completely from your computer.

In truth, after a certain length of time (a year or more, for example), the data culled becomes outdated. This is one reason you may want to consider having your prospect lists run again through WealthEngine after a year has transpired. Regardless, you should protect yourself – as well as the nonprofit and the confidential data you have been privy to – once you are no longer associated with the project for which the data was originally requested.

An article that points out concerns regarding “big data” and donors well is by Naomi Schaefer Riley wrote for Philanthropy Daily, “Does the Over-researched Donor Spell the End of Spontaneous Philanthropy?” (September, 2014). “We have all become immune in some ways to the loss of privacy that living in the twenty-first century seems to require.”

I would argue that publicly-available data is essential to properly developing a request for financial support and to focusing on the right prospective donors. But handling that information carefully is key – as is realizing that development professionals cannot (and should not attempt to) control every aspect of giving. See my article, “Listening to Donors and ‘Serendipity’ Happens.”

Last but not least, I know in Texas we have a lot of privately held companies. The wealth of some potential supporters will therefore not appear in a system like WealthEngine. In fact, I have seen prospects with more than $300 million in net worth show up as owning an automobile and they are valued  by wealth screening systems at, say, $25,000. Hence, WealthEngine and other platforms like it cannot do all the work for you. Traditional methods of online research and confidential inquiry among colleagues may yield better information in the end.

More

  • Although primary promoting its own services, Donor Search shares a great deal of helpful information about wealth screening.

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