Importance of Annual Fund in a Capital Campaign

Date Published
Kathy Giles

So, you are starting to hear the rumblings of a capital campaign at your organization. But, since you are part of the Annual Fund, this won’t affect you.

That may not be true.

Yes, when we talk about capital campaigns, the first thing that comes to mind is transformational gifts from major donors and corporate partners, which is the backbone of all capital campaigns. This is how buildings are built, services expanded, new equipment purchased, and futures secured through endowments.

But, isn’t annual giving the lifeblood of fundraising programs including major giving? Could a capital campaign be the perfect time to bolster your annual giving program?


Annual giving provides for the day-to-day workings of just about every nonprofit. It pays employee salaries, keeps the lights on, and allows you to fulfill your mission – daily.

When a capital campaign is over, the annual fund needs to continue to do its job. As the goals are met, the receptions end, and the excitement about the capital campaign wraps up, the annual giving program needs to come out on the other side stronger than ever.

This is the time to increase acquisition, invest in a mid-level program, and develop the donor journey. And, this is true for comprehensive and traditional campaigns.

As planning for a capital campaign commences and a feasibility study is underway begin to place focus on the annual giving program in three key areas:

  1. Acquisition: Start to increase acquisition. If possible, increase the quantity mailed in your current campaigns, add an additional mailing, or look to digital channels. By investing in acquisition, you are investing in your donor file, bringing in additional donors and the opportunity to move more donors up into higher giving levels, feeding the major gift donor pool over the course of the campaign. This is an important function at any time, but during a capital campaign it can be a vital part of achieving and surpassing the goal.

    For a comprehensive campaign, the health of a donor file is imperative. Increased acquisition offsets annual attrition and helps to maintain and expand the donor file. And when every dollar counts toward the campaign goal, making sure you have donors to turn to will set you up for success.

  2. Mid-Level Giving Program: If you do not have a mid-level program, now is the time to start one. Mid-level giving is a stepping stone toward major giving. It helps to identify those who have the ability and inclination to increase their financial support.

    A capital campaign can also help to expand a mid-level program by opening the campaign to donors at this level, providing an incentive for donors at lower levels to reach for. It allows these donors to be a part of the experience and achieving the goals of the campaign, furthering their connection to the mission and the organization, helping to increase donor lifetime value.

    Capital campaigns are driven by major gifts and a mid-level program directly feeds major giving. It is an important relationship to have developed as you enter a campaign. 

  1. Donor Journey Development: The donor journey is the bridge between a newly acquired donor and moving him/her up into mid-level giving and beyond. It maps out the potential avenues a donor relationship can take. It helps to engage the donor with the mission to encourage retention. For a capital campaign, you will want to have the donor journey planned from the very beginning.

    The donor journey includes all donor communications across channels and includes solicitations, cultivation, stewardship, and engagement opportunities. It is how the donor relationship develops and is why donors continue to give. It provides donors with different paths they can follow, ultimately deepening the relationship with the organization and increasing annual giving. Donors can join a monthly giving club, become a mid-level donor, attend events, make an estate gift, and expand their support to major giving. Without the donor journey in place, donors will stay stagnant in their current role and can even stop giving because they have lost interest. The right donor journey will incentivize donors to not just keep giving but increase their support.

Annual giving programs can be the strong silent partner to a capital campaign. It can continue to feed donors into the major gift pipeline, before and during the campaign. At the same time, a capital campaign can be leveraged to strengthen the annual fund program by increasing the donor file, building a mid-level program, and creating a comprehensive donor journey. All of these initiatives will support the goals of the capital campaign, while also setting the annual fund up to succeed after the campaign.  

About the Author:
Kathy Giles
Director of Client Management, Agency Services

Role at the Company

As an Account Director with Agency Services I work with clients to develop their direct response, annual giving, and membership programs. I am responsible for the strategy, budget, creative oversight, planning, and results reporting for each campaign as well as ensuring we are meeting all client expectations. I also work to build the client relationship to not only retain the client, but to also look for opportunities to increase activities with clients, through any of our three business areas. And new business is always on the radar!

What excites you about your work at AFG?

With the three divisions, we have more opportunities to support our clients. We can extend the services offered to provide more full-service-oriented solutions to current and prospective clients, allowing AFG to become more involved with a client’s program. This also allows for more growth and learning, on a personal note.

What’s something most people don’t know about you?

To feed my love of stories and storytelling, I went to school for film production, with a concentration in documentary film. I have had the opportunity to work on a few documentaries including one for the United Nations on the history of interpretation where I was able to visit several embassies and spoke with the amazing people in the UN Interpretation Service.

Today, I get to tell the stories of the non-profit clients I work with.

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