What Does a Capital Campaign Cost?
Budgeting for a capital campaign is always a challenge, but we’re here to help. 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 your consultant and your campaign. Larger campaigns can have a smaller percentage. For example, if your goal is $10,000,000 the cost of your campaign will likely be in the 6-8% range.
What are the costs of a nonprofit capital campaign?
Direct Costs of a Capital 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.
Indirect Costs of a Capital Campaign
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
Printing
Campaign Brochures and Prospectuses $6,000
Promotional
Campaign Video $8,000
Public Relations Expense $3,000
Newsletters $8,000
Data Processing and Mailing $3,000
Events/Receptions/Meals $3,000
Postage
In Addition to Current Budget $6,000
Contingency $2,000
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.
