UPDATE

KOA Endowment – A Feasibility Analysis

Project Managar: Anjali Kaul, Zone 5

December 16, 2007

The following report is based on informal conversations with a number of members, and from some research on non-profits that are based in the US, engaged in similar work and are sending funds for specific programs/activities in India.

Executive Summary: The overall consensus was that KOA, in its current status, is not equipped to successfully run and complete a major endowment campaign. While board members and volunteers are raising funds for specific programs and projects in limited amounts, a $1 million endowment campaign would require donors to make commitments of significantly larger amounts (between $10K- $100 K). KOA’s current organizational, financial, and program management does not foster the level of trust and comfort donors need to commit the larger gifts required to establish a $1 million endowment. 

The following are deemed to be the necessary conditions for us to move forward on an Endowment:

1. KOA needs a clearly defined strategic direction: 

a. What is the overall mission of the organization – why does KOA exist? (there seems to disagreement on this issue within the community)

b. Overall mission translated into strategic goals for the next 3-5 years.

c. Need annual measurable objectives that will allow the organization to review its performance on a yearly basis and present the information to donors and supporters.

d. Need to ensure that KOA programs are streamlined to align with the strategic goals.

e. Need to ensure that KOA (i.e., the board) “owns” all the programs. The board (and not program managers) has to be the final authority on how the programs are structured and run.

2. KOA needs clear and consistent “auditability” of funds (philosophy of “trust and verify”)

a. We need to run a professional non-profit organization, where donors are not taken for granted and are treated with the respect and appreciation they deserve.

b. Clear controls must be established and implemented to allow for transparency in the management of programs and associated (restricted and unrestricted) funds

c. Clear and transparent records of where the funds come from (donors, membership, etc.)

d. Clearly defined and officially adopted giving guidelines for all programs

e. Clear and transparent records of disbursement of funds – who are the funds awarded to, for what purpose, and how is the completion of the purpose verified.

f. Board oversight (perhaps through program managers/directors) of ALL giving

3. KOA needs organizational infrastructure in place for effective fundraising:

a. A “Chief Fundraising Officer”, accountable to the Board, who manages all aspects of the endowment and associated campaigns.

b. Reviewed and updates bylaws (includes election reforms) that will allow for a sustainable management of the organization in the future.

c. A clearly structured, consistent and transparent financial/accounting infrastructure needed to be in place

d. Audited finances (balance sheets and financial statements) for the organization, that can be provided to any donor upon request

e. An annual budgeting process (very critical to building the credibility of the organization).

i. Board, volunteers and membership should be fully aware and conversant with the annual budget as well as the annual fundraising goals.

ii. It is imperative that the board (every member) be involved in reviewing the budget and approving the goals for the year. 

f. Fund development/ fundraising infrastructure required:

i. A database that is owned by organization and is managed to track and record gifts/donations

ii. A clearly defined financial management policies adopted as a continuing resolution (in place for subsequent boards), that will address issues related to gift processing, banking, etc.

4. An endowment is not built overnight - KOA has to build up to an “endowment campaign”: 

a. Endowment campaigns are successful only if organizations invest time and resources in building a sustainable donor base

b. Successful Endowment campaigns require at least two to three years of sustained annual fundraising campaigns aimed at achieving specific and increasing $ goals. 

c. These campaigns also require the expansion of the donor base each year, to include new donors, while retaining existing donor base at a 75-80% rate (aggressive but necessary).

d. Endowment needs a “case” for giving: 

i. What is the need that we are trying to address in the community?

ii. Why is this need critical?

iii. What are the external factors (public image and the overall fundraising environment) that impact fundraising for KOA?

iv. How will the funds raised impact this need?

e. Successful campaigns – both annual and an endowment campaign – require an accurate and timely reporting back to donors on the use of their funds.

f. We also need to engage our membership and donors in KOA programs.

Report on KOA Endowment Feasibility Assessment

Anjali Kaul, Zone 5

One major goal of the KOA board and leadership this year has been to explore the possibility of a $1 million KAO Endowment Campaign.  The goal of this endowment is to support, in a more sustainable manner, KOA’s programs, projects and mission.

Before KOA launches a major fundraising campaign, it is necessary to assess the viability of such a campaign.  This will be done through a “feasibility assessment” – a process that, through a series of interviews and review of programs, historical fundraising, and financial information, will provide a set of recommendations for the campaign process.  The assessment will answer the following broad questions:

a)     Is KOA placed well, as an established organization, to run a successful major fundraising campaign?

b)     Does KOA have the requisite donor base for a major campaign?

c)     Based on current status, what is a realistic goal for the organization?

d)     What improvements in programs, projects and other fiscal and administrative functions are needed in order for donors to feel comfortable making major gifts to the organization?

As a first step, a draft "goals document” and a draft questionnaire has been prepared for the feasibility assessment.  This questionnaire will be used to conduct one-on-one interviews (in person or on the phone) with current and former board members, current and “lapsed” donors and volunteers.  Subsequent to the interviews, a report will be prepared that will address the above listed broad questions in detail.  The report will also provide recommendations on any changes in administrative policies, fiscal management, donor management and communications, and broader marketing and outreach strategies.

Our goal is to complete the interviews and present the report to the board and the interviewees soon thereafter.  For additional information please feel free to call Anjali Kaul Zutshi at 512-306-8213, or e-mail at AnjaliHKaul@gmail.com