Tuesday, September 10, 2013

How to lose 250 million dollars- Ignore donor relations!

Greetings from my new home in North Carolina! I'm the new director of Alumni Operations at UNC Charlotte and the transition has been fabulous! Although, I must admit, it's difficult to write a blog while driving from NYC to NC so I apologize for last week's absence!
I'm hoping some of you have seen the headlines about Centre College in Kentucky losing a $250 million dollar gift on Monday, if not, here are just a few. 




This gift was larger than their entire endowment. It's a huge lesson for all of us and the rest of the fundraising world on the importance of donor relations. So here is a breakdown of just some of the things we can learn.

1. They announced a gift this large WITHOUT a signed gift agreement or first payment in hand. According to officials, they felt pressured to because people would find out in the business news wires. HUGE mistake. Always have documentation before you hit the media.

2. The deal apparently fell apart because they couldn't agree on terms of scholarships to be funded by the gift. Hence the need for a great donor relations and stewardship person in place. If they had this and proper policies and procedures, this would have been worked out before they made the ask for the gift. You can't just wing it. It is CRUCIAL to have fundraisers and donor relations and financial aid all reading the same book.

3. When the deal fell apart, university officials had one story, the representatives for the donors trust had a completely different one. Seriously? I'm slapping my head here, Doh! You know this is going to make news, make sure you are clear and transparent, admit fault and make sure there's no media squabble. The VP centre said it was just a misunderstanding of viewpoints, "He said views might differ because, as he colorfully put it, one's view of the elephant depended on what part of the elephant a person had a hold of." Seriously? Sigh.

4. This is a direct quote from the VP of university relations: “In retrospect, gosh, we should change some of this, but that was not the hand we were dealt.” Needless to say they need some better PR and crisis communication advising.

5. Learn from your mistakes and let the donor breathe after all of this. This would not be the response I would be looking for if I were leading the trust and were the donor's representative: Trollinger(VP),  who has worked with Tamine (donor)  in the past on donations to Centre, said he would not stop pursuing other donations from the trust.
“While this didn’t work out this time, I’ll be coming back to bend his ear and twist his arm, because it’s a compelling good we’re working toward,” Trollinger said.

What lessons will you take away from this unfortunate circumstance? I hope you will forward tense articles to every fundraiser and development professional you know. At least we can learn from the mistakes of others. I would love to hear your comments below.




  1. Congratulations on your new position!

  2. Lynne,
    I have to disagree with you on this--slightly.

    This is terrible news for the college, no doubt about it. But from what I am seeing and reading this was not--at least primarily--a donor relations problem.

    As you point out there are many issues involved, including not having a signed agreement or details on the implementation; and a lack of a clear timetable for the gift.

    It is important to note that the background on this gift origin was complicated and apparently contingent on market factors largely out of the control of the college. All the more reason to wait to announce the gift? Sure. But while having a signed agreement in place help to mitigate problems, sometimes business and or market decision will change charitable plans. In my reading of the back story, the business and market realities are larger factors than any relations failures.

    The college president and the rep for the trust cite different primary reasons for the abandonment of the deal--I think that is to be expected. Both parties are required, in some ways, to put the disheartening news into the narrative that meets their needs.

    From other media reports I have seen Trollinger, while understandably depressed about losing one of the largest gifts of its kind in history, has made a number of positive comments about the trust and all is has done to support Centre College. He is doing what he needs to do to both continue relations with the trust--and to ensure a successful campaign for his college.

    --Michael Sullivan

  3. Michael,
    I welcome healthy debate! The source of the disagreement wasn't the market, it was the terms of the scholarships, they couldn't come to agreement on. a gift agreement and good donor relations would have at least helped!! :) Lynne

  4. Lynne,

    First, I congratulate you on your new position!

    Second, I assure you that I wrote my own blog post (http://michaelrosensays.wordpress.com/2013/09/13/250-million-gift-to-a-nonprofit-is-withdrawn-sort-of/) about this subject prior to reading your post. I'm gratified to find we are in agreement.

    The situation at Centre College certainly could have been improved somewhat with better donor relations. In addition, the College could have avoided a great deal of embarrassment with a much more effective public relations strategy.

    From the point that the College announced the non-gift as a "gift," through to today, the College has made a number of public relations missteps. We can all learn some valuable lessons from the College's mistakes.

  5. Welcome to Charlotte, Lynne!

    Sarah Ritzer