Courting Generation Next

Charities try new ways to attract big donors under 40

The Boys and Girls Clubs of Palm Beach County, in Florida, has spent the last several years reaching out to potential donors under the

age of 40. It has recruited more than two dozen young people to its 150-member board, for example. And other young volunteers, once relegated to “junior committees,” now play a key role in orchestrating fund-raising events.

But the charity has yet to transform their participation into another precious commodity: big cash donations. While the group’s “Barefoot on the Beach” party is a must-attend event among 20- and 30-somethings, who pay $250 per ticket, the charity is unlikely to see bigger gifts from the partygoers any time soon, says Mary T. O’Connor, the charity’s president. “It could be 20 years before they’re able to make larger donations,” she says.

Ms. O’Connor’s organization is not alone: Many charities have been unable to raise gifts of $1,000 or more from people under 40.

Part of the problem may be due to generational differences. In a 2003 study by Richard Steinberg and Mark Wilhelm at the Indiana University Center on Philanthropy, 53 percent of households headed by members of Generation X — individuals born from 1961 to 1981 — reported giving to charity. That was significantly less than households headed by baby boomers (75 percent) and those headed by people born before World War II (80 percent).

Even so, some charities are managing to attract large gifts from donors in their 20s and 30s. Among their approaches: recruiting young philanthropists who in turn bring in their wealthy peers; offering younger donors access to exclusive gatherings or educational activities tailored to their interests; creating high-profile, invitation-only groups for young donors who get involved in multiple aspects of a charity’s work; and appealing to young professionals’ desire to advance in their field or showcase their skills.

Hip Image Doesn’t Hurt

While many older, more-established charities have had to work hard to reverse their staid image among people in their 20s and 30s, some charities are taking advantage of a hip, urban image to win affluent young donors.

The Robin Hood Foundation, for example, which fights poverty in New York by raising money for local charities, has attracted many young hedge-fund and investment managers, celebrities, and other movers and shakers with its focus on rigorously evaluating the nonprofit groups it supports, using measures borrowed from the investment world; making big commitments to expand or improve those organizations’ operations; and getting board members to cover all of its administrative costs so every dollar raised goes to its cause.

To further capitalize on its appeal among the young and wealthy, the foundation started a Leadership Council about three years ago for donors in their 20s and 30s, who can join the group only if they are invited to do so by the charity’s board. The donors each give a minimum of $25,000 annually and also hold house parties, receptions, and other events to raise money; so far this year, the council’s 17 members have raised $8-million, including their own contributions. In addition, they attend quarterly meetings, which are usually held at a charity supported by the foundation, and most sit on one of four committees that conduct site visits, distribute grants, and engage in other program-related activities.

Recruiting the young and wealthy is helping other, more-traditional charities inject new vitality into their organizations.

The Milwaukee Symphony Orchestra was facing a $12-million deficit in 2004 when it recruited a philanthropist, Chris Abele, now 39, to its board. Mr. Abele heads his family’s Argosy Foundation, which annually distributes more than $11-million in grants, and he is also an active volunteer with several other arts groups in Milwaukee.

Since becoming the symphony’s chairman, Mr. Abele has recruited two people near his age to serve on the board, as well as several other influential community leaders. He also was instrumental in hiring Mark C. Hanson, 32, the symphony’s president and executive director.

Mr. Abele, who has contributed some $3-million to the symphony since joining the board, is also leading a plan to close the orchestra’s deficit by cutting administrative costs and creating new revenue-generating activities, including a more-aggressive effort to seek donations to the annual fund and creating a giving club for donors who give $25,000 or more. One of the founding members, Mr. Abele has seen the new club grow from three such gifts when it began in 2004 to 16 this year.

The board has also increased ticket sales with events such as Classical Connections, informal concerts for young professionals who each pay from $86 to $188 for the series, depending on the seats.

The concerts are shorter than usual, are preceded by an hour-long cocktail reception, and include commentary by the conductor during the performance and other innovations such as special lighting effects. In addition, a new Next Generation Committee of young volunteers has organized post-concert receptions for people who pay $100 apiece to attend. Some of the receptions, held in volunteers’ homes, last into the wee hours of the morning.

“Supporters under 40 are playing a bigger and bigger role,” says Mr. Hanson, the symphony’s president. “The involvement of significant numbers of younger professionals has helped us build more confidence in the institution.”

‘Big Say’ in Fund Raising

Other arts groups that have persuaded people under 40 to give at least $1,000 annually say they have learned that such donors, unlike their older counterparts, prefer more-informal gatherings and expect to have a big say in any fund-raising activities they help organize.

Norma Hurlburt, executive director of the Chamber Music Society of Lincoln Center, in New York, learned quickly that young people weren’t all that interested in going to Alice Tully Hall, where the chamber society’s performances are held.

She decided to hold events in other spaces such as a reception in an artist’s studio. After getting a good turnout for the events over a year’s time, Ms. Hurlburt started a group for young donors called Opus and helped organize a house party at which seven donors agreed to give $10,000 each and assist the charity in raising money. The founding members have since recruited 32 of their peers to donate $1,000 each.

When Opus planned its first fund-raising event, a Valentine’s Day gala called “Lovestruck,” featuring romantic chamber music and desserts, Ms. Hurlburt let the charity’s newest supporters lead the way.

She followed their suggestion to engage a public-relations firm and an event planner so their inaugural event would come off without a hitch.

“I wanted to take them seriously, and they had ideas that I never would have thought of,” she says.

The event attracted 200 people, netting more than $100,000.

Marie Samuels, 39, who contributed $10,000 to Opus, says she was impressed by the way Ms. Hurlburt accepted the group’s ideas. While Ms. Samuels, who owns an accessory business, has been a donor and volunteer with other charities, the experience hasn’t always been positive.

“I’ve left boards because I didn’t feel I had a voice,” she says. “Norma basically said, ‘You’re the experts here, I just want to listen.’”

Something Special

In return for large contributions, young donors want something special that other ticket buyers don’t receive, says Eve Loeb, development director of the Alabama Shakespeare Festival, in Montgomery.

After asking people in their 20s and 30s for ideas about events they would find appealing, the charity started holding five behind-the-scenes gatherings annually for its Act II Crew, a group of 20 young theatergoers who give $2,000 per year.

While donors enjoy drinks and hors d’oeuvres before the show, an actor or someone else connected to the theater gives a short talk about the performance they are about to see.

“Young people like to get something for what they give,” Ms. Loeb says.

While the 30-minute gatherings may not seem like much, she adds, the exclusivity of the meetings — only Act II Crew members, along with their guests, may attend — appeals to the theater’s youngest donors.

“The young people who helped come up with this concept put it very clearly: We have to give them something that not everyone can get,” says Ms. Loeb.

Tradition of Young Donors

While many charities have only recently begun such groups, United Jewish Communities, which represents 155 Jewish federations, has had a young donors’ club for decades. In 1962, it introduced its Young Leadership Cabinet as a way for donors to rise within the group.

The cabinet consists of some 400 donors ages 30 to 45. Each has been identified by his or her local federation and referred to the national umbrella organization to be screened. In addition to displaying good leadership skills, says Matt Abrams Gerber, director of the program, cabinet members serve a six-year term and are required to give generously each year.

“It takes a $5,000 minimum gift to get onto the cabinet and people should raise that gift significantly each year,” he says. At their annual meeting in August, cabinet members donated $2-million for United Jewish Communities and an additional $500,000 for emergency aid for Israel.

In return for their service, cabinet members receive training in leadership skills, opportunities to meet people who might be helpful in their careers, books, and invitations to lectures by well-known speakers.

United Jewish Communities is now seeking to expand its appeal among young people beyond the cabinet. Last March, the charity sponsored a conference in Tel Aviv that drew 1,000 young Jews from the United States, half of whom were making their first trip to Israel. Participants paid $500 each to attend the conference, which matched their interest in issues ranging from technology, cookery, and gay rights, with Israeli individuals and groups working on those topics. The charity picked up the remainder of the tab.

Participants were expected to give $500 to the charity in return for the experience, says Mr. Gerber. “Some of these people ended up giving $1,000,” he says.

Sharpening Job Skills

A chance to use their professional skills is another big draw for donors under 40. Children’s Hospital Boston recently started a project to buy and renovate a Victorian home that will serve as temporary housing for up to 23 families of patients receiving treatment at the hospital. Fund raisers have recruited 13 real-estate developers, interior decorators, and other professionals — all in their 30s — to lead the effort.

The members of the Next Generation Developers Task Force, as the group is called, have agreed to help the hospital raise $8.6-million and donate their expertise in areas such as zoning and building-permit requirements, as well as supplies such as building materials.

“It may be that not all of them can make a large cash gift, but their contributions will be substantial in terms of their connections and in-kind support,” says Janet Cady, president of the hospital’s fund-raising arm.

The chance to advance his career has prompted 35-year-old Matt Jones to give tens of thousands of dollars to the Cincinnati United Way. When a business associate who chaired the city’s United Way fund-raising campaign invited Mr. Jones to serve on the campaign committee in 2004, he says, “I’d never been asked to do something like that before.”

With help from Mr. Jones, a vice president at Altoria Solutions, a Cincinnati Internet security firm, and others, the campaign raised $64-million that year.

The experience turned Mr. Jones into a donor as well as a fund raiser. Impressed with the charity’s work in Cincinnati, he has given $12,500 so far and pledged another $10,000 next year.

He also learned something about philanthropy’s career-boosting potential: “I saw the power of networking and how it could benefit me,” says Mr. Jones. He was named one of “Forty Under 40″ by the Cincinnati Business Courier last year, partly because of his work on the United Way drive.

Last year, Mr. Jones was invited by the local United Way to chair its Young Leaders Initiative, part of a nationwide effort.

Formed four years ago, groups known as Young Leaders Societies give members the chance to meet local business leaders, and they are expected to donate both time and money in return. Such groups have been started by more than 100 local United Ways and have raised more than $31-million.

Mr. Jones says the groups are part fraternity, part service organization. “If I move to a new city I can instantly find like-minded people to be friends with,” he says. Meanwhile, the visibility of the United Way enables his local group to recruit Cincinnati’s top business leaders to speak to its young members, most of whom are in the early stages of their careers and hungry to meet key executives, says Mr. Jones.

“People at our age are thinking about their careers,” he says. “We’re giving people an opportunity to volunteer and help their careers. That’s what makes us so successful.”