third-party fundraiser

A third-party fundraiser is a great way to raise extra money for your nonprofit organization.

It happens when someone outside of your organization with a passion for your organization’s mission hosts a fundraiser on your organization’s behalf, donating all the proceeds to you.

In short, they do the work and your organization gets the money!

You reap the funds from an event without putting in hours upon hours of labor, wearing out your volunteers, and bearing the weight of all the expenses.

The only bad thing is that the decision to host the third-party fundraiser lies with the third party. They choose if and when to fundraise for you.

And not all third-party fundraisers are the same.

Some are wildly successful and others generate little to nothing.

Third-party fundraisers are hard to plan because it’s not up to you.

Yeah, you might be able to motivate a few organizations to raise money for you, but they must have the drive to start a fundraiser AND the desire to make it work.

I’ve seen well-intentioned people start a third-party fundraiser only to get stuck or overwhelmed, raising just a bit of money, which makes everyone involved feel bad.

When you get those third parties (usually individuals, small businesses, or civic clubs) who are excited to host a fundraiser for you, it’s best to support them so the fundraiser can be maximized to its full potential.

So, when someone approaches you with an idea for a fundraiser, keep an open mind, and ask some questions to make sure they’re ready to take it on and you’re ready to offer them tools and encouragement.

Five Questions to Ask Before Committing to a Third-Party Fundraiser

The first thing you should do when someone wants to do a fundraiser for your nonprofit is find out more about what they have planned to make sure it’s a fundraiser you WANT done on your behalf.

1. Does this fundraiser align with your mission? What if a community group approaches you about holding a fundraiser on behalf of your organization, and you find out it’s something that is not a good fit? For example, what if the local winery wants to host a tasting for your nonprofit that fights alcoholism? The event needs to be on brand and something you’d be proud to promote to your audience (and you might find yourself doing that later) so make sure it fits and won’t cause confusion or raise any eyebrows.

2. Does the group planning the fundraiser align with your organization’s values? What if a college sorority wants to hold a fundraiser on your behalf, and a Google search reveals that the sorority was suspended for excluding members based on race or religion? Could your reputation be tarnished by partnering with the sorority? Obviously, you need to be very careful to decline a third-party fundraiser if your connection with the host will be a problem in any way.

3. Will your supporters be invited to the fundraiser? Is the third-party planning to do all the publicity themselves or do they need your help? Be careful who you say “yes” to – if you set the precedent to promote third-party fundraisers, you may find yourself promoting event after event and fundraiser after fundraiser which will wear your donors out. And, you don’t want to promote a third-party fundraiser when your annual event is just a few weeks away.

Ideally, third-party fundraisers should target a separate audience from your donors, bringing in new people to learn about your organization’s work. In short, third parties should bring in people from their network, not depend on you to tap your network.

4. What is your organization’s role? Will you be expected to sell tickets? Cover any of the costs? Take a lead role in marketing and promotion? Ideally, the third party should take on the full responsibility for planning and execution of the fundraiser, but there may be times when it makes sense to offer a bit of assistance.

I once helped with a golf tournament hosted by a local civic club. They wanted me to handle registration before the event and get players signed in the morning of the tournament. It took a small amount of time to support them and we received $15,000 from the event. Cool, right?

Just be careful – the magic of a third-party fundraiser can start to wear off if your organization’s resources are drained to host it.

5. How will proceeds be allocated to your organization? Which expenses will be deducted from the revenue? Will 100% of the proceeds after expenses go to your organization? What does the fundraiser host anticipate the proceeds to be? It’s important to get clear from the beginning so there aren’t misunderstandings or disappointments later.

Okay, once you’ve answered these questions, you can move forward.

First Things First: Get Everything in Writing

Hopefully, the third-party has contacted you and shared their idea for a fundraiser.

This gives you a chance to have a discussion about what the event will be whether or not it’s a fit for your nonprofit. You can make suggestions and offer guidance to the third party for the fundraiser or even decline it if it makes sense to do so.

If after discussion, the fundraiser sounds like a good idea, get a memo of understanding (MOU) in place to make sure both parties are on the same page.

When drafting the MOU, get clear about and include the following:

  • third-party fundraiserName, address, and contact information for both parties.
  • Details of the event including the date, time, location, and a description of the event.
  • Role and expectations of each party, including who will cover expenses and manage the logistics, including ticket pricing, sales, and marketing.
  • Approval process for marketing materials bearing your organization’s branding and logo.
  • Logistics, including an opportunity for your organization to make a brief presentation and set up a table with information if appropriate or link to your nonprofit’s website.
  • The procedure for collecting revenue, reimbursing for expenses, and disbursing proceeds.
  • Anticipation of risks, such as event cancellation, alternate dates for weather, and insurance coverage for attendees if appropriate.
  • Whether names and contact information for people in attendance will be shared with the receiving organization if appropriate.

Each party signs the MOU and each party keeps a copy.

An MOU can get everything in writing but that doesn’t mean the third party will adhere to it. I’ve seen lots of third parties start out with lots of enthusiasm and excitement then have their fundraiser fall completely apart before it even got started. So, keep your eyes open and stay positive, supporting the third party as best you can.

Supporting a Third-Party Fundraiser

third-party fundraiserEven though a third party is hosting the fundraiser and you have an MOU that spells out exactly what’s expected of each party, you may want to attend planning meetings, just to make sure everything is moving forward.

Some fundraisers and events are more complicated and require more planning than others. And not everyone who has an idea they’re excited about will understand this until they start down the path of planning the fundraiser.

Resist the temptation to jump in and take over planning beyond what you agreed to in the MOU. This might be difficult if you are used to planning your organization’s events. Remember that you are not the host and THEY need to do the work. Otherwise, they just brought you an idea and more work.

Having said that, there MAY be things that you can easily do that take very little time and will add a lot of value to the fundraiser. It’s usually worth doing that, especially if the third party is someone you want to work with again or someone prominent in your community who you’d love to have the association with.

When it comes to marketing the fundraiser, you need to ask to see what messages, images, and video the third party is planning to use to be sure they are on brand. You don’t want the third party changing the color of your logo or using language to describe your program participants that’s harmful (I’ve seen both happen).

If it makes sense, leverage any connections you have to get media coverage of the event. Work with any media outlets to make sure the host organization is credited for their role, and your organization is mentioned as the benefactor.

It may make sense for you to attend or participate in the fundraiser. Coordinate with the third party to let them know how you can join in if you’re planning to.

After the fundraiser, you may want to suggest a wrap-up meeting with the third party to celebrate the fundraiser’s success and talk about improvements for future events and opportunities to continue your partnership if that’s something you want. Be sure to thank the third party and all involved for their efforts, even if the results are less than what you had hoped.

When you receive the proceeds from the fundraiser, thank the third party again for choosing your organization.

Guidelines for Third-Party Fundraisers

There are many types of events and activities that work well as third-party fundraisers. In fact, just about any type of event can work.

The best third-party fundraisers:

  • Are simple. The fundraiser should be clearly described and easy to understand, especially if the host is a business and plans to incorporate the fundraiser into their marketing. Something that requires a lot of explanation or has too many rules or layers will probably not be successful.

  • Play to the strengths of the host organization. A cycling club might want to hold a cycling event and give the proceeds to your organization. A choral group might want to make your organization the benefactor of their concert.

  • Appeal to the host’s core audience. A bingo night would work well for an audience that includes families with school-age children. A beer tasting at a brewery would be fun for a host with a core audience of Millennials. I once worked with the Lady Vols basketball team who encouraged fans to bring 4 cans of food to a ball game to get a free ticket to an upcoming ball game. It wasn’t a fundraiser, but brought in thousands of pounds of much-needed canned goods for the food bank.

  • Focus on fun. We all want to have fun. If a fundraiser promises a fun time and a good cause, people will want to attend.

10 Third-Party Events That Can Be Successful

third-party fundraiser1. House Party: A supporter of your organization hosts a small party in their home with several of their friends in attendance. You attend the party and mingle with guests. You make a very short presentation about your nonprofit then the host shares with guests the various ways to donate. If you can have a program participant there to speak (this doesn’t always make sense), it’s even more powerful. The host may even offer to match all donations up to a certain amount to encourage giving.

The host of a recent house party placed a basket for checks on the food table, in between the pigs-in-blankets and the stuffed mushrooms! Another one brought a student from their music program to play the violin for guests before the ask was made.

The house party is a tried-and-true way to raise money and gain supporters.

2. Concert: A concert is a wonderful opportunity to highlight a cause the performers care about. The Indigo Girls are known for their generosity in holding benefit concerts for causes close to their hearts. They once held a benefit concert at the middle school they attended, and the school used the proceeds to replace outdated library furniture.

To land a benefit concert, follow your favorite acts on social media. If they mention an interest in your cause, contact their management about a benefit concert. Focus on acts that have ties to your area and a fan base to ensure a good turnout. Or focus on local or regional artists who are popular and might be willing to help.

3. Knit-a-thon: Your local yarn shop might want to host a knit-a-thon to bring knitters (and crocheters) together to craft for a cause. The yarn shop invites vendors to set up booths and a food truck to ensure no one goes hungry. Knitters can knit for an hour or all day, with the yarn shop benefiting from increased sales, and 100% of the entry fees can go to the cause.

4. Brewery tasting event:  When a new brewery opens in town or an existing brewery feels the crunch of increased competition, owners seek visibility. This could be a great partnership if your organization’s work appeals to Millennials and Gen Z.

Guests purchase a ticket, with part of the money going to your organization and part covering the cost of beer and food. Owners are often willing to forgo a profit to expose new customers to their venue and align their brand with a good cause.

You can put table tents on the tables with tidbits of info about your cause or an invitation for guests to learn more online along with a simple link.

5. Pub crawl: This is a social event alumni groups and others like to do to support local businesses while having fun. Adding a component where a nonprofit organization gets a portion of the ticket price and gets to make a brief pitch at one of the stops can give attendees an even better reason to participate.

6. Uno Tournament: This type of event is fun for college organizations, church groups, and anyone looking for a fun spin on game night. Boggle, Yahtzee, Bunco, and other fast-paced games can be adapted to a light-hearted tournament format. Some of these might even be possible to host virtually.

7. Film screening: Is there a short documentary about your cause that you would love for more people to see? By partnering with the filmmaker, you can help get the word out about their film in exchange for a portion of the proceeds of a film screening.

The filmmaker hosts a screening, selling tickets to the event, which includes a discussion afterward. Someone from your organization participates in the discussion with the filmmaker. The filmmaker and the organization split the proceeds. (In some cases, the filmmaker might allocate all the proceeds to the organization. But keep in mind it costs money to make a documentary.) This event works well in a virtual setting.

third-party fundraiser

8. Speaking engagement: College groups often bring sought-after speakers to campus. Adding a benefit to a nonprofit organization whose work is supported by the speaker and the student group can bring attention to the event. Your organization gets a portion of the ticket price, or the group puts a donate button on the registration page.

9. Virtual cooking class: A food-loving supporter partners with a local chef to conduct a cooking demonstration. While cooking, the supporter and chef talk about the dish and also about the organization. Guests participate in person or virtually.

10. 80s dance party: You may have a supporter who just wants to throw a party. For an 80s dance party, the supporter clears space for a dance floor, hires a DJ, and serves food and beverages. Someone from your organization makes a brief presentation, and the host encourages guests to contribute. Then, back to dancing!

The Passive Third-Party Fundraiser: Just Deposit the Funds

third-party fundraiserThe amount of work you have to do to support a third-party fundraiser depends on your agreement with the host. Sometimes it’s worth it to offer to help with the publicity or back-end tasks.

Sometimes you don’t have to do anything but accept the proceeds, which is awesome!

If you want more completely passive third-party fundraisers, encourage people to host Facebook fundraisers for your nonprofit.

If your nonprofit is set up right on Facebook, people can easily hold a birthday fundraiser and name your organization as the recipient of funds. Or they can host a fundraiser for another occasion or just because they want to help. They set the goal, ask their friends to help, and voila! You get a donation!

How to Find a Partner to Hold a Third-Party Fundraiser for Your Organization

As your nonprofit grows and more people learn about your cause, opportunities for third-party fundraisers will present themselves.

Since third-party fundraisers depend on the host to decide whether or not to hold a fundraiser and you’re completely reliant on their time and energy for success, these can be difficult to recruit for.

But sometimes, you can suggest an idea to a local business, community group, or enthusiastic supporter who wants to get more involved.

Be ready with an idea or two but don’t twist anyone’s arm into saying “yes” to hosting a fundraiser for you. Remember, if you have to work hard to get them to agree to host the fundraiser, you’ll probably have to work hard all the way through it until it’s over, which defeats the point of having it!

The Bottom Line

Third-party fundraisers can be a great way to raise extra funds and reach new audiences for your nonprofit.

Next time someone asks, “What can I do to support your work?” suggest a third-party fundraiser.

You can strengthen your relationship with your supporter, meet some new prospective supporters, raise money, and have fun!