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This is an archive of CharityVillage NewsWeek.
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Motivating the moneygivers -- what encourages entrepreneurs to donate
November 13, 2000New research by two of Canada's more prominent fundraisers, and sponsored in part by CharityVillage, has unearthed some significant new data on the motivations of donors, particularly about donors who are entrepreneurs. This week, Tony Myers and Guy Mallabone are releasing the results of their national survey on "Philanthropic Giving by Entrepreneurs in Canada". Among their critical findings, they discovered a direct relationship between a donor's degree of entrepreneurialism and their propensity to give. This week and next, we offer a CharityVillage exclusive report on this and other key findings.
As part of a Masters in Philanthropy program that both are taking at Saint Mary's University of Minnesota, Myers, from the University of Alberta, Edmonton, and Mallabone, from the Southern Alberta Institute of Technology, set out to better understand the factors that motivate/de-motivate giving among Canadians, and entrepreneurs specifically. Qualitative research included a literature review, interviews with key experts in the subject around North America, and focus groups in Calgary, Winnipeg, and Toronto. The quantitative research culminated in a national baseline telephone survey of 1,203 people.
What makes an entrepreneur?
Before trying to quantify the motivators and de-motivators to entrepreneurial giving, Myers and Mallabone had to define what they meant by "entrepreneur". They identified five key characteristics of an entrepreneur and, contrary to what you might expect, they do not include making money or owning a business. Rather, most are qualities of personality. According to their definition, an entrepreneur:
- Identifies new and unique opportunities
- Pursues those opportunities (innovative)
- Finds or levers resources for organizations or enterprises
- Makes decisions that provide direction to organizations or enterprises
- Assumes and takes risk in the process
Of the survey group, a full one third of respondents self-identified themselves as entrepreneurs. According to Myers "That is huge, and that means anyone serious about fundraising, should be mining their database for donors who are entrepreneurs."
Key motivators are still vision and mission
After segmenting entrepreneurs and non-entrepreneurs, Myers and Mallabone asked each respondent to respond to five key questions which specified:
- Motivators for the next gift
- Motivators to increased giving
- Reasons for refusing to give a gift
- Reasons to stop giving
- Motivators to giving ultimate gift
For motivators for the next gift, they found that entrepreneurial donors rank higher across all categories, signalling that they are more motivated to give in general. Specifically, they are motivated by an organization's vision and mission, the chance to give back to the community, and the organization's accountability.
By contrast, non-entrepreneurs tend to be more motivated to help those in need, by the organization's vision and mission, and by the idea that their gifts make a difference.
According to Myers and Mallabone, these top motivators are consistent with existing research in the United States with the Statistics Canada National Survey in 1997 on volunteerism.
Despite early research findings which suggested that entrepreneurs might be more prone to be motivated by tax considerations, the bottom three motivators were consistent among both segments of the research. The least motivating factors to give a next gift were recommendation or support of peers, tax, and a direct or indirect benefit.
If you want more, be good
Next, Myers and Mallabone looked at motivators that would move donors up to the next giving level. This time, the responses were consistent among entrepreneurs and non-entrepreneurs. However, once again, entrepreneurs ranked higher on every level.Top considerations for both: financial ability, the cause matches the donor's values, and the quality and reputation of the organization. Again, tax and personal benefits were at the bottom of the list for both groups.
It doesn't matter how you turn them off...
After looking at what motivates donors to give, the researchers wanted to learn more about why donors refuse to give and why they stop giving. Again, they found little difference between entrepreneurs and non-entrepreneurs. As well, there was little variance in the degree to which donors were inhibited from giving. In general, it seems that it doesn't matter how you irritate a donor, they generally respond to the same degree.Among the top reasons for refusing to make a gift: donor fatigue, the donor doesn't agree with the cause, the donor is in a poor financial position, the method of asking, and poor information about the organization or ask.
As to why people stop giving to an organization, Myers and Mallabone found that the primary reasons have to do with the organization, especially for entrepreneurs. The top reasons why entrepreneurs stop giving: reliability of the organization, lack of credibility, and shifts in mission. Non-entrepreneurs also stopped because of reliability and lack of credibility. However, a change in financial position was also an important reason for them to stop. Just as entrepreneurial donors are slightly more motivated to give for positive reasons, likewise, they are more likely to stop giving for their stated reasons.
What triggers the ultimate gift?
After looking at what motivates or hinders general gift giving and larger gifts, Myers and Mallabone wanted to learn what motivates donors to give the largest gift they are capable of giving at a given moment in time. They found, again, that entrepreneurial donors were motivated to a greater degree than non-entrepreneurs, and that ultimate gifts relate to both a desire to make a difference and accountability issues.For both entrepreneurs and non-entrepreneurs, the top motivators for an ultimate gift were: belief and trust in the organization, demonstrated results, and the desire to make a difference. Again, tax considerations were on the lowest end of the motivating factor list for both groups.
Next week's cover story will look at the other key findings of this new research, including new knowledge about planned gifts, frequency of donations, and the degree to which donors know where they will give their next gift.
For more information about the study, contact Guy Mallabone, CFRE at (403) 284-8468 or e-mail guy.mallabone@sait.ab.ca, or Tony Myers at (780) 492-2436 or e-mail tony.myers@ualberta.ca.
Motivators and Barriers to Giving by Entrepreneurs in Canada Links:
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