Budget and Costs of a Capital Campaign
Budgeting for a capital campaign is always a challenge, in part because an organization doesn't want to foreclose on the possibility of a good idea just because it isn't in the budget. Therefore, the budgets and costs outlined in this article should be a guide only and careful thought should go into developing one for your specific situation.
There are generally two costs for a capital campaign – direct costs (fees, travel expenses) and the indirect costs of a campaign (video, brochure, mailing, etc.). Some organizations budget staff time as a way of getting a true cost of the capital campaign. The challenge with doing this, especially on smaller capital campaigns, is that the total cost as a percentage of the goal, may get to be outside acceptable limits.
As a general rule, total costs less than 15% of the campaign goal will be considered acceptable to most donors (less than 10% is considered very efficient). Organizations should also include the cost to conduct the campaign in their goals. For example, if you are raising $2,000,000 for a new building, you can make the goal $2,200,000 so that funds raised can pay for the cost of the campaign.
Consulting fees vary from a few hundred or thousand dollars a month up to $30,000 or more per month for full-service, on-site campaign management. Smaller campaigns ($2-5 million) generally take 12-16 months to conduct. Larger campaigns ($10 million plus) are 2-3-year investments.
If the consultant is traveling from another city, add $1,000 per month to the direct costs.
Below is a sample budget for a campaign’s indirect costs. These numbers can vary considerably based upon the city and the nonprofit’s desires. For example, a brochure with specialized graphics, die cuts and paper will be more expensive. Be aware that some of these expenses can be donated to the project via in-kind contributions.
Chart of Accounts Estimate
Campaign Brochures and Prospectuses $6,000
Campaign Video $8,000
Public Relations Expense $3,000
Data Processing and Mailing $3,000
In Addition to Current Budget $6,000
Make sure to also plan your cash-flow budget. Read more about our free cash-flow formula download to help you get started on the path to success.
Kevin Wallace is president of CampaignCounsel.org, specializing in capital campaign planning and management. Kevin has 20 years of fundraising experience, conducting more than 70 campaign planning studies and capital campaigns around the country that have raised more than $175 million. Reach him at firstname.lastname@example.org or visit www.campaigncounsel.org.