Before committing resources, time, and energy to a major campaign, you have to be sure your nonprofit is ready. This is where feasibility studies come in. However, feasibility studies are an investment in and of themselves, and there’s some debate in the nonprofit world about how necessary these assessments are.
While many experts insist that feasibility studies are vital for understanding both the fundraising environment and your nonprofit’s capabilities for running a capital campaign, others think they may not be worth the costs.
To help your nonprofit determine if now is the right time to launch a feasibility study, this guide will explore five considerations related to these assessments.
1. Internal Readiness and Capacity
Feasibility studies should not be an obstacle in the way of starting a capital campaign, but rather a fact-finding assessment that provides vital information about your nonprofit’s capabilities.
With this in mind, ensure your nonprofit is ready for a feasibility study by:
- Solidifying your study’s goals. Feasibility studies tend to provide more actionable results if your nonprofit has a clear goal. Are you looking to learn more about a specific aspect of your nonprofit, discover your stakeholders’ thoughts about your organization, or get suggestions about how to improve your overall campaign strategy?
- Ensuring you have the capacity to host a study. If launching a feasibility study would be a strain on your nonprofit’s resources, chances are you might not be ready to launch a major campaign. Ensure your nonprofit has the staff time, funding, and other resources available to devote to your feasibility study. For instance, during the year-end giving season, your nonprofit’s staff and major donors alike might be heavily focused on fundraising and have little time for your study.
- Establishing your project goals. In addition to goals for the study, you should have a clear vision for your project before launching a feasibility study. After all, if you aren’t sure how much funding you need to raise, your efforts to assess major donor willingness will be severely hampered.
If you lack internal readiness at this time, devote your energy to researching what goes into a feasibility study, deciding what exactly your major project will entail, and determining when your calendar has space for it.
2. Stakeholder Alignment and Support
Stakeholder feedback is essential for any successful feasibility study. Major donors can inform you about their ability to give, community leaders may indicate their level of support, and staff can express their confidence in or worries about their capabilities.
Another essential group of stakeholders to consider is your board. Along with providing valuable donations and fundraising support, you may need their approval to launch a feasibility study in the first place.
To get your board’s buy-in, ensure you can explain:
- The pros and cons of a feasibility study. Provide a list of considerations similar to the content in this article. For instance, you might list ways you expect the study will help campaign preparations, alongside several capital campaign consultants’ fees for a feasibility study.
- Your timeline. How long will your feasibility study take, and how will it impact your ability to launch your project? Provide a rough estimate for both your feasibility study and your upcoming campaign. However, be conscious of the fact that your study might result in recommendations your nonprofit needs to implement first before it can begin its capital campaign, extending your timeline.
When your stakeholders understand the purpose of your feasibility study, they’re far more likely to agree to interviews, provide vital information, and get invested in your future capital campaign’s success.
3. Fundraising Environment and Timing
Even if your organization feels ready, external factors may impact your ability to launch a capital campaign. With a feasibility study, you can assess the current fundraising environment to make informed decisions about your future capital campaign’s potential.
Specifically, when considering whether to launch a feasibility study, consider:
- Your donor base. What is the general state of your donor base? Is your nonprofit currently growing, or have you reached a plateau? Do you have a stable major giving program, or are you still researching your first few major giving prospects? Knowing the general state of your donor base can give insight into your fundraising potential and might provide answers you don’t need a feasibility study to find.
- Proposed timeline. Capital campaigns often take multiple years, meaning you will need to balance running a campaign with your regular duties. When deciding when to conduct your feasibility study, consider what other major efforts you will host at the same time. For instance, you might need to prep for the year-end giving season or plan your annual gala.
Capital campaigns are long-term commitments, and a feasibility study is meant to assess your overall ability to earn the necessary funding and maintain your campaign’s momentum over multiple years. If you are struggling to raise funds now or predict challenges in the near future, you may not need a feasibility study to come to conclusions about your capital campaign potential.
4. Potential Return on Investment
Feasibility studies are an investment of your nonprofit’s time and resources. After all, to conduct an objective analysis of your nonprofit, you will need to hire a consultant and pay their fees.
Before deciding that now is the time to conduct your feasibility study, weigh the potential return on investment against upfront costs. Are you likely to gain high-value insights and strategic help preparing for your campaign? Conduct a mini pre-assessment of your nonprofit before bringing in a professional. Take a hard look at your fundraising potential, donor base, and staff capabilities.
Additionally, evaluate multiple consulting services before hiring one to conduct your study. Valuable consultants will not just stop at the feasibility study but actively provide you with advice and preparations for your capital campaign. If you intend to hire a consultant for the duration of your campaign as well, consider whether your feasibility study consultant could be a good fit.
5. Organizational Risk and Complexity
Ultimately, forgoing a feasibility study and launching a capital campaign anyway is possible, but it is a risk. Many nonprofits are familiar with running campaigns that did not achieve their goals, whether due to unexpectedly low donor turnout, lack of planning, or external factors. While these scenarios can set your nonprofit back, few organizations shutter their donors because of one lackluster campaign.
Failed capital campaigns, however, can significantly harm your nonprofit’s credibility, and feasibility studies are designed to minimize the potential of that happening. The more complex and expensive your campaign, the more vital a feasibility study is for not just assessing your readiness but also protecting your nonprofit.
Feasibility studies can provide valuable insight not just into whether your nonprofit is ready to launch a capital campaign right now, but also into your fundraising and operational strategies as a whole. Ultimately, it’s your choice about whether to conduct a feasibility study or head straight into your capital campaign, but be aware that these studies are here to ensure your campaign is as successful as possible.
