What if you could pinpoint specific donors and prospective donors in your file who want to engage with your organization and who tend to give 50% more than other donors?
A recent study released by Fidelity Charitable shows the median annual gift for entrepreneurs is 50% higher than non-entrepreneurs, and entrepreneurs place more emphasis on being personally involved in their giving.
Entrepreneurs give more because they want to be engaged with the organizations they give to and they are better informed about philanthropy than non-entrepreneurs.
Entrepreneurs give and volunteer more than peers of similar economic circumstances.
- On average, the median annual gift for entrepreneurs is 50% higher than non-entrepreneurs.
- Two-thirds of entrepreneurs volunteer two or more hours a month, compared with just more than half of non-entrepreneurs.
Entrepreneurs are significantly more likely than non-entrepreneur peers to self-identify as a philanthropist and to rate charitable giving as very important. They are also far more likely to have family traditions around giving and to see a link between their volunteer activity and their professional success.
- Nearly half of entrepreneurs consider themselves philanthropists, compared with less than a third of non-entrepreneurs.
- Six in 10 see giving as important relative to other financial priorities, compared with nearly half of non-entrepreneurs.
- Three-quarters believe volunteering has an impact on their professional success, compared with only three in five non-entrepreneurs.
Entrepreneurs’ approach to philanthropy reflects the hands-on approach they have used in building their businesses; they place more emphasis on being personally involved in giving, deciding how funds are used, and the ability to demonstrate leadership through their volunteering.
- 59% of entrepreneurs say their business approach influences their giving.
- 61% of entrepreneurs want to be personally involved in charities, as opposed to just making financial contributions.
Entrepreneurs are more likely to have had a discussion about philanthropy with a financial advisor and to have engaged with more sophisticated approaches to charitable giving, including direct donation of appreciated stock. They’re also more likely to plan for legacy giving.
- Nearly three-quarters have had a conversation with an advisor about giving, compared with just half of non-entrepreneurs.
- Nearly half are planning to leave a charitable legacy gift, compared with just a third of non-entrepreneurs.
Forty percent of entrepreneurs with businesses of $1 million or more in revenues plan to exit within the next 5 years, and charitable giving is on the minds of many considering the sale of their business.
- 69% of these entrepreneurs have a desire to incorporate charitable giving into their exit plans:
- Make a donation to charity with the proceeds following the sale of the business (32%)
- Set up an ongoing way to make charitable donations, such as a foundation or donor-advised fund (27%)
- Donate shares of the business prior to the sale (26%)
What This Means for You
You should be identifying the entrepreneurs in your donor and prospect files and developing relationships with them in specific ways.
- Are you actively identifying entrepreneurs?
- Do you have ways to engage entrepreneurs that are appealing to them?
- Are you speaking your entrepreneurs’ “language?”
- Do you know how to tell if your current entrepreneur donors are giving at or near their capacity?
Insights for Westfall Gold Clients
Having served over 20,000 major donors in our history, we would affirm that entrepreneurs are extraordinarily generous and engaged philanthropists. And our major donor retreat has proven time and again to be an effective strategy for accelerating and deepening an organization's bond with entrepreneurs. As you build the invitation list for your major donor weekend, we'll work with you to identify high-capacity entrepreneurs - owners of small and large enterprises, founders of family businesses, serial entrepreneurs, hands-on investors, etc.