EP 81: Scaling Nonprofit Revenue with Sherry Quam Taylor

Positioning review: No adjustments needed. All content reflects the guest's firsthand consulting experience in nonprofit revenue scaling. Discussion is naturally observational and experiential, drawn from the guest's 13 years of client work. References to Handbid software are naturally conversational and not prescriptive.

Jeff: Welcome to Elevate Your Event, your favorite podcast for transforming fundraising events. Join us weekly for expert tips and creative ideas to make your next event a standout success. On today's episode of Elevate Your Event, we're joined by Sherry Quam Taylor. She's here to transform the way nonprofits think about fundraising. From building authentic donor relationships to shifting the focus beyond events, Sherry shares practical strategies to attract investment-level donors, engage boards in fundraising, and drive sustainable growth. Get ready for actionable insights to elevate your fundraising game. Let's dive in.

Jeff: Welcome back to the Elevate Your Event podcast. We talk about all the various ways you can make your next fundraising event better. Or we also talk about amazing ways that you can drive more revenue for your nonprofit. And so we've got a special guest today. We have got Sherry Quam Taylor, hails from Chicago from the Evanston area. So you Northwestern fans out there, you can give yourself a little silent cheer. And if you're not a Northwestern fan, you can still cheer for our new guest here. And then in the studio with me, we have the lovely Inga Weiss, one and only.

Inga: So happy to be here.

Jeff: Inga brings star power to the Handbid team. So we're glad to have her in the studio with us. Sherry, thanks for coming. Why don't you introduce yourself and tell us a little bit about what you do to help nonprofits.

Sherry: Sure. Well, thanks for having me. So in short, I help organizations scale their general operating revenue. And I am yet to meet an organization who doesn't need more flexibility in their revenue model, and that kind of comes down to general operating revenue. And so I work with orgs who either need to really diversify their funding because they can't maybe do what's in their strategic plans because of that flexibility issue, or they have huge plans to scale. And so they might want a 2x, 3x, 5x -- I even have a 10x organization. And so I really help them solidify that funding model, get that hours-to-dollars mentality going, and pivot into the activities that fully fund their organization.

Jeff: That's awesome. And so are there certain sizes of organizations that you start with?

Sherry: Right now I probably have clients who have $2 million annual budgets and one that has over $100 million annual budget. But what's kind of crazy is the pain points are the same, because even that large client, like 90% of the revenue is from government reimbursements. And so it's almost like they're functioning like a smaller nonprofit in this big behemoth company. And so that commonality is the same. It's how do we attract investment-level donors that really are mission aligned, and how do we help them understand our financial need and really give their best gift to that financial need.

Jeff: That's awesome. And so let's talk about the $2 million one. And I'm sure we have some listeners that are thinking, oh my God, I'm not even there. But you will one day get there. So at that level, what do you tend to see? Are these organizations that have kind of a rudimentary development program in place, or -- like I'd say outside of events -- are they doing some other things and you're just helping them improve that in general, or what typically are you doing at that level?

Sherry: And I'll answer this really -- I mean, this could be a $1 million organization or maybe you're hoping to get to that one million dollar mark. And 97% of nonprofits are under the $5 million mark. So it's like, how do we actually kind of scale up above that? But to answer your question, I wouldn't say it's rudimentary, but what I would say is it's highly focused on transactional fundraising. So a lot of organizations come to me and I find them doing some level of transactional fundraising -- events, appeals, campaigns, all the fun things. But oftentimes I find that they're kind of trying to grind harder on those activities when the struggle really exists to pivot into, well, how would I grow a relationship with a major donor? How do I track that donor? And then let's say I'm in the room with them -- what would I say to them? And so it's really like, we know we have people giving. We know people love us. They love our mission. But we don't think they're giving their best gift, and they're certainly not giving that gift every year. And so that's where I feel like the opportunity really exists -- to say, why aren't they giving their best gift?

Sherry: But it's that, or the other thing I would say is when I say transactional, it could be highly dependent on foundations. And so we are on the application spin cycle of trying to send out 50 applications and hopefully we get half of them. And so even with foundations and institutions, there's a way to build that relationship so that you are sitting down and really just securing a greater gift from these funders.

Jeff: I would imagine you've got to have the staff to do that and then the staff has to have the expertise. I mean, I've worked with, and we have a lot of clients like this too, but I sit on some boards that are kind of in that range -- like say they're raising a million dollars. And it's very transactional. It's two or three events. It might be some grants that they're trying to go out there and get. It might be some other types of appeals or campaigns. But there's nothing really around the development side of it. Like the conversation past that. So I honestly don't think they have the wherewithal or the knowledge on how to even do that. So is that what you do? You come in and help them put that in place?

Sherry: I do. I posted on LinkedIn the other day -- and I'm a big LinkedIn fan -- but I was talking about how, even with my own business or other entrepreneurs that I network with, you always hear this like, oh, I'm honing my sales skills. Or you think of top sales performers in the U.S. -- they're always mastering that conversation or that tone or that ask. And my post that I put out was like, fundraising is sales, but people never come to me saying, we want to be the best, the experts at that one percent of salespeople who know how to ask and we have that skill set, or we want to put money into our team so they can grow and align. I rarely have people come to me with that. I think sometimes in the sector we think, well, they'll figure it out, or people will just see that our mission is so incredible that they'll just give to us.

Sherry: This is a skill set issue. Just because your staff is killing it when it comes to grant applications or events or appeals and campaigns, it doesn't mean we've had the training of sitting down with a major donor, walking them through your financials, your strategic plan, and soliciting them. And frankly, I believe that's -- and I see that every day -- that's leaving millions of dollars on the table. So it's a skill set issue. And thank you for bringing up the board so early. I'm all about my board members participating in those CEO-to-CEO conversations. And so the board is going to take the cue from the staff. And so if the staff is only doing transactional fundraising activities, why wouldn't the board just follow suit? So it really is critical to equip your team to really know how to pivot into these what I call investment-level conversations, which is that one-on-one, that conversation that's beyond heart-based storytelling and into the financial and growth story of the organization.

Jeff: And I actually see that as an evolution of the board, because when you're small, I think everything's transactional or it feels that way. I mean, the very first thing I ever did when I founded my first nonprofit was run an event. And so you pick board members who are really good at that. Oh, you're a hard worker. You'll go get me auction items. You'll clean up after the event. You can be on my board. But to your point, at some point, that's not what you want your board members doing. You want them being those types of people that can help you close those bigger deals.

Sherry: Totally. And honestly, sometimes -- I do so many board workshops and board trainings -- and someone will always say right at the get go, I hate fundraising. And I say, I think you hate what you think fundraising is, because who really wants to collect auction items and go beg their friends and do all those things. Actually, if it is more relational and -- Jeff, you said like, oh, hey, actually I know a person who would love this mission. I'd love to arrange coffee and maybe just introduce you and see if it resonates. That's probably what you do on a day-to-day basis with clients. That's actually natural. And so it's funny when I do workshops and I say, well, maybe you don't need to be doing those things. What if you each were just participating in a handful of relationships and just attending the coffees, doing the thank-yous, helping lead this donor on an incredible journey? They think, oh, well, that feels way better. And boy, that's what you want me to do? That's going to yield way more money, to be honest.

Jeff: It totally makes sense to me because as I think about it too, most organizations -- and we need to come back and talk about events, right? That's the Elevate Your Event podcast. But events play a critical role in all of this. But outside of that, as I'm thinking about how do I take my organization from a million to five million -- if that's the strategic plan, I think the evolution of your board is as important, to your point, as the evolution of your team and what their skill set is.

Sherry: I agree. I think, you know, we hear things like, well, we have a working board, or all of these kind of scripts.

Inga: Which -- this is not a board conversation. Oh, the family members.

Sherry: Or family members or friends of friends. It does turn into -- and I could say this about so many things that probably you guys have this experience too -- it's like, well, that structure or that thing that brought us to that point is fantastic and nothing was wrong with that. But it's not going to get us to that next point. It's not going to 2x, 5x. So we really have to do something different and we have to look at the model we're running, the strategy we're running, and be okay stopping things if they no longer serve us.

Jeff: So let's dive into your brain a little bit. You've got a lot of knowledge and experience and you've helped a lot of nonprofits in this area. So what are some of the things that you do when you come into an organization to help them get from the one or two million to three or four million?

Sherry: Good question. So here's what I'd say to that. We can't just start with, okay, well, let's crank up the fundraising activities. And what I mean by that is so often donors are not giving their best gift. I'm working for a donor's best gift. I want a general operating, really generous gift. They're not giving their best gift because there's some misunderstanding or some confusion. And what I mean by that is, if we think of -- and I'm talking at the top of the pyramid -- those donors need more. They have to understand what your plans are, meaning what are you doing this year? If you're $1 million now, why do you want to be $5 million? What's going to be happening then? How are lives changing? And then how are you actually going to get there? Why do you need a million this year if you're going to need five in five years?

Sherry: So they have to understand your plans. It can't be what one donor said to a client of mine before I was working with them -- "Hey, it feels like you're trying to boil the ocean." It can't be, "We're ending homelessness." Tell me what you're doing. And tell me why you need my money. That's that best gift every year.

Sherry: They have to understand your programs. This sounds a little bonkers because it's like, well, they're giving to us. They should understand what we do. So often donors and board members don't understand really what the organization does. Or maybe if there's three programs, they kind of get one. They don't really see how the advocacy and education fits in. So they're not understanding how maybe those three programs have to fit together for good, which yields general operating gifts.

Sherry: Third, maybe my most important or exciting topic -- budgeting. They don't understand your financial need. And so you think, well, we're a nonprofit. How could they not understand your financial need? Donors don't understand. Are you a big organization? Do you have a $2 million need or a $5 million need? Do my tax dollars go to this? Or I see big corporate logos on your website. They don't always understand your financial need. So plans, programs, and need. You have to make sure that major donors see that you are a good investment. You're going to use their money well. And that you are running a good business that yields the mission. And so often we kind of gloss over those because we've got a great story and who wouldn't want to give to us, and we go straight to the fundraising activities. When actually there's questions in donors' minds and then they're just going to be like, okay, cool, here's $1,000. That's where the money is. That's where you have to start.

Jeff: I mean, it's hitting home to me because some of the boards that I've sat on -- where I don't want to be the working board member, I run a company, I don't have time for that. I'm happy to lend some expertise, and I'm actually happy to have coffee with whoever you want me to have coffee with. But what I saw recently at one of the events they ran -- I love events, obviously we run tons of them and I think it's a great entry point for some of these conversations. But I don't think, to your point, you're always going to get your best gifts out of these people there. You might start a conversation there, but it's got to finish somewhere else. And I think what's lacking in that best gift is exactly what you just described. They don't know the plans. They don't know the program. They don't know exactly what you're going to be doing with this money. I don't know how big you are. How big of a problem are you solving? Are you solving a problem in a county in Denver? Or are you solving a problem for the entire metro area? For the country? And so I like your idea -- put some boundaries around it so they can see how meaningful their gift and how impactful their gift is going to be. I think it's really smart.

Sherry: And you know what? I feel like the other part of this to lay on top -- it takes 81% of donors six months to 24 months, if we're doing it right, to lead them to their best gift. And so the other part of this -- we actually need to let the relationship simmer and take that long so we make sure we answered all their questions and that when we are sitting down to make that ask, we're super confident that they are going to give their best gift because we took the time to build that relationship and remove all those obstacles. And so that's another really counterintuitive part, I think, of our sector. It's just kind of baked in that -- we have the meeting. Oh my gosh, they're rich. Oh, they had tears in their eyes. We told the story. Let's ask them for money. It doesn't always work out. Trust me. And so let it simmer -- we're not proposing on the first date. We've got to take the time to do the thing. And then attract donors who actually -- our mission is their mission. And they want to give us a lot of money. What's wrong with that?

Jeff: Or even if it's relational -- one of the organizations, obviously the very first one I founded, it was for my daughter. And it was kind of the impetus for Handbid -- the Prader-Willi Syndrome Association of Colorado. And it's a statewide scope, but it's definitely got some global implications. But what you just described became a big problem for us for a while. I would have people come up to me and say -- because we'd talk about the problems we're trying to solve -- and they would say, just explain to me what you want to do and how you want to do it and how much money you need and I'll give you the money. Now, that sounds pretty easy, until you go back and say, I really do have to put a plan together here. And to your point, you can boil the ocean with that. Hey, we want to solve long-term care for adults in Colorado with Prader-Willi. Well, why would we stop there? Maybe we should do this for the entire country. And then all of a sudden, your $2 million project becomes a $50 million project.

Sherry: I totally agree with you. This is why -- and people come to me saying, hey, how do I find major donors? I say, let's reframe that and ask ourselves, how are we attracting major donors? I have a client who's incredible, and she came to me as a $1 million organization. And she said, new strategic plan, I need to be a $10.9 million org. And she said it with such confidence. I said, okay, let's go. As we met with donors and funders, one guy said, I love this, but it's not risky enough, not innovative enough. Come back to me when it's bigger. And we're just conditioned in this space to say like, oh, donors don't like risk. Very few would fund innovation. But you've got to know what you need to be able to sit with that donor and say, thank you so much for pushing me on that. I've gone back to the drawing board, and can I walk you through that? We can attract people who are like-minded. And so we as leaders scaling nonprofits have to have all those things in place.

Inga: And if I may add, as logical as it sounds, I still believe that most of the donors give from an emotional standpoint. And let's not forget that most of the donors are asked every day, bombarded every day by many, many organizations. So how do you stand out? Why should I give it to you?

Jeff: Especially for the wealthy. But as I've said many times, generous people are generous. Rich people are generous. But it brings up a good point because I do know a guy locally here and he came to me once and he said, I just hate going to charity events because they just think I'm going to give them money because I'm wealthy. And he's like, your organization never asked me, never expected that out of me. All you've done is pour into me what you're doing and you're giving me the opportunity to think about it myself and then come back to you and say, how can I help?

Sherry: You nailed it. So you're connecting me to your mission first and foremost. I think this leads us into event talk. Some people come to me, they've got a gala in place, and their board members are just trying to fill these tables with many people who they think can give at high levels. And there's always this one couple -- if we could just get the Thomases to this event. Sometimes I'll tell my clients, okay, great, we got the Thomases to come. They're going to sit at the table. Let's tell them not to give. Let's say, hey, we're so excited that you're coming. I'd love for you to sit with our board president, learn, listen, and don't feel any pressure to give. And then if this resonates with you, let's grab coffee in a couple weeks. That advice is baffling to people. But actually, we're going to get a lot larger and longer-term gift if we don't come off desperate and we actually are authentically wanting to build relationships with people who want to be our friends.

Jeff: I love it because you're right. We talk to so many people and they're like, well, our paddle raise didn't go great. It's like, it is not the software. People are standing up there raising their paddle in the air. It is your expectations and your connection with the people in the room. That's it. It's not the technology. People want to give. They're going to find a way to give. But you've got to create that desire. I sit on these boards and we're like, how's table sales going? We got to get the Thomases there. If we get them there, they're going to donate $10,000. How do you know? Well, they're rich. That doesn't make any difference if they do not connect with what you're doing as an organization.

Inga: They might bid in the auction. Auctions do have a purpose, which is to extract money out of people who aren't necessarily ready to write you a check.

Sherry: And I think what you said, Inga, about it being an emotional tie -- storytelling gets such a buzz in our sector, which it should. We want to tell the stories of lives that are being changed. But oftentimes we are stopping halfway through the story. We're telling the heart, the mission, the impact. But for the Thomases who can write a $100,000 check, part of sometimes their emotion is, what's the financial story? What's the growth story? How are you transparently scaling this organization? Are you a good investment? For a CFO, their heart conversation is money. We can't ignore that half of this story for our mid- and major-level donors who need to know a bit more.

Inga: I agree. And it boils down to a lot of organizations still doing one major fundraiser a year, not fostering and maintaining that beautiful relationship, growing that relationship throughout the year with their donors. Doing nothing after the fundraiser. And then expecting next year the Thomases show up and give more, when they haven't heard from you for the rest of the year. So clearly, you don't care. Why should they care?

Jeff: Yeah, I'll give you a thousand bucks. Because you're not doing anything to grow me, to develop that relationship with me, to get my best gift from me. Sherry, you were going to say something?

Sherry: I was just going to say, this is a perfect example right now with an incredible organization doing mental health work. They had this great annual event. But it wasn't getting them out of the cash flow crunch every year. It wasn't helping them diversify their revenue. And they actually chose to push the pause button on the gala. That was scary. As they analyzed who had been giving at the events and had some honest conversations -- do we really know these people? Have we ever had one-on-one conversations with some of these people who have come for years? In many cases, the answer was no. As they pivoted into these one-on-one conversations, four conversations with donors yielded the same amount as their gala.

Jeff: Isn't that nice?

Sherry: I love those results. It was just highlighting -- some of those were event donors and they're going to go away. But half of the people weren't getting their best gift at that event. Rarely is somebody giving their best gift at an event. I just love results like that, when people have made a real conscious effort to say, we have to stop doing it this way because it is not getting long-term results. Moving into these deeper relationships with donors always pays off.

Jeff: So talking about events -- when you come in and have a client running a gala or golf tournament, what tends to be your recommendation?

Sherry: I've been accused of not liking events. Everybody likes a party. And I'm rarely going to be the consultant who says throw this million-dollar gala out the window. However, in my model, I teach that your top 30 donors should be yielding between 50 and 75% of your revenue. I want those donors being solicited one-on-one, privately, having the conversation. Where I find money sitting on the table is -- all those donors are coming to your event and giving medium gifts when perhaps that event should just be a step in their donor experience as opposed to the donor experience for the year. Sometimes the obsession of the event goal is keeping our eyes down here and less on the bigger picture. I'm not saying get rid of it, but saying how can your event support each donor segment's journey? For grassroots donors, great -- auction, all the things. But for many major-level donors, I'm coaching to maybe move that ask before the event or say, if this resonates, let's talk later.

Jeff: That makes sense. That's why we push back on clients who refuse to collect data at events. I don't know how you're going to have a follow-up conversation with somebody you just created a fake email for.

Sherry: That's wild.

Jeff: It's painful. They do not want to bother their donor at check-in. But the people coming in the door for the first time -- don't you want to know who they are?

Jeff: How do you handle resistance to what you recommend? I work with one organization and they don't want to change anything.

Sherry: I do get resistance initially. We have to root everything back into the model -- the numbers have to do the talking. If we want to grow from $1 million to $5 million, what's the team, infrastructure, systems, technology, and multi-year financing plan that yields $5 million? If 50 to 75% of revenue is coming from relational one-on-one fundraising, the financing plan has to be rooted in that. Often you quickly see -- 25% of revenue should come from transactional activities, but the team is spending 100% of time on those activities. With board fiduciary responsibility, the financing plan becomes the compass. It tells us what to do, our team makeup, what to stop doing.

Sherry: I also have to be upfront -- my clients want to change. They are learners, ready for change, ready to open up all the cans of worms. They know I'm not a magician. This is not easy work, but they're committed. I have to message that early because so many organizations are resistant to change. I can bring 50% of the learning, but my client has to bring 50% as well.

Jeff: And the willingness. I'll tell you a story from 20 years ago. This organization called us and said, help us fundraise more. We put a plan together that started with a rebrand. We got an ad agency to do the entire rebrand pro bono. Eight months later, I present it to the board -- they had no idea. Disconnect. They were not happy. That was my first taste of resistance for the sake of "we've always done it this way." You're going to enact a lot of change to take someone from one million to five million.

Sherry: I'm starting year 13 of my business. I've had to get choosier. The comment that crushes my heart -- the board said no.

Inga: Because we've always done it this way, it's going to cost too much money, it's not in the budget.

Jeff: If all our software does is cost you money, I wouldn't buy it either. But guess what's also not in the budget? The increase of money you would make by investing. You can't just put expenses in without putting income in.

Jeff: Why would we hire Sherry? Because she's going to pay for herself fivefold.

Sherry: That's my goal. I have to give you a solution that gets results. Or I don't get a referral, which means my next client.

Jeff: Consultant can be a dirty word. But you're not a consultant -- you're an accelerator. You're telling them things they don't know.

Sherry: I look at myself as advisor, coach, teacher. Linking arms and guiding you. I shifted four years ago to only working with people for 12 months. Because it takes that long. I might work with five to seven clients. I'm going to know your business intimately. I'm going to be that phone call when you get the meeting with the Thomases on Friday. I have to be with my clients as they meet the Thomases, the Smiths, all the different scenarios and donor personalities.

Jeff: I'm smarter already. I'm going to go back to one of my boards and say, hire Sherry. So events play a role -- great entry point, great time to touch base with donors. But they're probably not giving their best gift there. What are you doing outside of event season to nurture these relationships?

Jeff: Sherry, if people want to hire you, how do they get a hold of you?

Sherry: I'm on LinkedIn every day -- Sherry Quam Taylor. Or you can go to my website, quamtaylor.com. That's Q-U-A-M-T-A-Y-L-O-R dot com.

Jeff: Awesome. Stay warm in the Chicago winter. We'll wrap up this episode of the Elevate Your Event podcast. Until next time, happy fundraising.

Jeff: If you enjoyed our show, please take a moment to leave us a review. You can find us on Apple, Google, and Spotify. Don't forget to subscribe for more great content. And if you're a fan of video, check us out on YouTube. Until next time, happy fundraising.