Fishing for Prospects The Promise of Validations

Fishing for Prospects: The Promise of Validations

By Elisa Shoenberger

Finding new prospects is often compared to fishing. You throw out a proverbial net and hopefully get an incredible number of fish in return. Some are going to be bigger than others; hopefully, you’ll throw the smaller fish back into the water to grow and thrive.

That’s a great metaphor for an organization’s wealth screening. All of the constituents in your database (or maybe a portion) were screened, likely through the use of a third-party vendor; you’ve gotten a major gift rating on them as well as their associated assets. Who knew the hidden wealth in your constituency? Or that there are people who have given $20 for years that could actually give millions?

So, what’s your next step? Do you start contacting everyone? That’s going to be challenging with a lot of records. Maybe you start from the highest rated prospects?

Unverified Data

The quick answer is no. Typically, you don’t just want to start reaching out to people, even starting with the names that returned the highest ratings and assets. The wealth screening is a great tool, but it’s not magic. Many screenings use a matching algorithm on name and address to find possible wealth. That means that there are going to be some false positives.

For instance, you might notice that there are a lot of people at the top of the list with common names. Folks like Bob Smith, William Donnelly, Mary Brown may rate really well — but that’s because the screening has attributed a lot of assets, philanthropic gifts, etc. to the name, making them look extremely wealthy, when in actuality that is the wealth and philanthropy of several people who share that name. Granted, sometimes Mary Brown is the billionaire but there’s only one way to find out – validation research!

Another example is when a prospect may appear to own a multi-million dollar building, but when you dig a little deeper, they just own one apartment in the building. In that instance, the wealth screening has mis-attributed every apartment to the prospect. Or sometimes, you’ll discover that the prospect’s tony home is actually owned by their parents, not the prospect themselves.

These are just some examples of why it is so important to take the wealth screening information with a grain of salt. Even better, you want to get someone, such as a friendly, trained researcher, to help validate the data.

Validation. Validation. Validation.

Validating the information can help gift officers prioritize their time by talking to the most promising prospects. That doesn’t mean you should ask for full profiles on every single person, though. Because some of those prospects are not going to be responsive and profiles take a lot of time and effort. Instead, researchers can start with the most promising segment, often with the highest wealth and philanthropy, and spend 15-30 minutes confirming the data, such as real estate, giving, company ownership, foundations, and more.

That means looking closely to see whether Mary Brown does indeed own all of the units in 15 Central Park, New York NY, or if she only owns one cooperative apartment. And those 1000 gifts attributed to her? Well, the five $1M+ gifts to arts organizations are probably from her. In a short period of time, a researcher can cover a lot of ground to help figure out if the prospect is as promising as they initially seem to be.

A Good Start

Validating data is often the first step in deepening your nonprofit’s prospect pool. It helps sort out the really good prospects from the prospects who may not have the wealth — or don’t have the wealth just yet. But it’s not going to be a replacement for deeper research.

There’s going to be information that Research won’t be able to untangle in a short period of time, such as how a person made their money, their connections to an organization, family relationships, and much more. Plus, wealth screenings may underestimate the ultra wealthy people, so you’ll need that deep research to draw those folks out.

But validations are a starting place. They pre-qualify people so that you can confidently pick up the phone to start cultivating the prospect. Then if there is a promising connection, it might be a jumping off point for further research and deeper cultivation.

While wealth screenings give us a jump start on segmentation, it is important to know that wealth screenings are not the only way to analyze your database. There are other ways to find prospects, such as datamining for new donors giving $1K+ to your organization, constituents who are reported in the news, or other variables.

There will be wealthy, philanthropic people that the wealth screening is going to miss entirely. Some people deliberately keep their wealth and philanthropy private, and some people may hold their wealth in different ways, like holding real estate in LLCs, that is missed by wealth screenings.

For this reason, make sure that you use a fishing net, but also use other tools in your toolbox. At Aspire, we help clients leverage a combination of strategies to identify the best prospects for their major gift initiatives.

Whether you are seeking to build your major gift pipeline for your development team or preparing for a campaign, we methodically guide you through the process, ensuring you have more than data. At Aspire we make sure you know how to take action on the information we provide.

Learn more about Prospect Identification with Aspire. Schedule your free consult today!

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