Tap into a New Source of Funding: 10 Tips to Grow Stock Gifting

Stock Gifting – A Rising Trend in Fundraising

As the nonprofit sector continues to navigate the aftermath of the pandemic, organizations must explore innovative ways to secure funding. One approach is stock gifting, a strategy that has seen a surge in popularity.  With Americans owning $40 trillion in stock, nonprofits have an enormous opportunity to capitalize on this untapped source of revenue.

In this article, we’ll explore why stock gifting is a key component of the future of fundraising. We will outline the benefits of stock gifting and provide 10 tips for nonprofits to grow this innovative funding source.

According to research by Russell James, non-cash gifts, including stock, are critical to nonprofit fundraising success. Data shows that when the share of non-cash gifts grows more than 10%, overall gifts grow 22%. Likewise, where the share of non-cash gifts falls by 10%, overall gifts fall by 13%.

Recession fears may also prompt donors to keep a tight lid on cash and opt, instead, to give appreciated, non-cash assets.

Consider this:

  • Stock holdings are the most widely held liquid asset.
  • Households (45+) have 8x more in their investment account than in the bank.
  • Unlike cash in a checking account, stock gains are largely discretionary.

DonateStock is a company transforming charitable giving by making stock gifting easy and accessible for all donors and nonprofits. The company reports that the majority of stock gifts processed by their organization were found to have been held for over five years, indicating a long-term investment mindset among donors.

Market volatility notwithstanding, the stock market has shown impressive growth over the past five years, with popular stocks like Apple growing more than five-fold.

This trend highlights the significant potential for unrealized stock gains to be harnessed by astute fundraisers, making it a unique opportunity to generate substantial support for charitable causes. In essence, there is a vast reserve of untapped value waiting to be unlocked through the strategic deployment of donated stocks.

The concept of democratizing stock gifting has gained traction in recent times with companies like DonateStock. In the past, this form of philanthropy was reserved for affluent donors and major non-profit organizations, creating an imbalance in the distribution of resources. Even among the limited number of organizations that could accept stock gifts, the process was often manual and cumbersome, making it difficult for both donors and nonprofits to take full advantage of the potential benefits. This has prompted a shift towards greater accessibility and automation, making stock gifting a more equitable and user-friendly option for a wider range of donors and charitable organizations.

How to Harvest Stock Gifts

Below are simple tips for helping donors make smarter pre-tax stock gifts:

  1. Add a stock gifting Easy Button to your ‘Donate’ and ‘Ways to Give’ pages.
  2. Educate internal stakeholders about the importance of stock gifting a key part of your fundraising program.
  3. Optimize your ‘Donate Now’ pages to include a stock gifting option and make ‘Other Ways to Give’ highly visible to donors.
  4. Add content to your site to educate donors on the benefits of donating appreciated stock.
  5. Make it newsworthy: Issue a press release about your nonprofit can now receive tax-advantaged stock gifts.
  6. Ask your Board to make a stock gift and try to ‘Easy Button’ themselves.
  7. Communicate with your donors: Send an email announcement on the benefits and ease of donating stock, and how donors can have greater impact by making a pre-tax gift.
  8. Make it social: Include stock gifting in your social media posts, newsletters, and web communications.
  9. Integrate stock gifting language in all communications: newsletters, brochures, impact statements, emails, donation requests, and commitment forms.
  10. Communicate your successes! Nothing drives stock gifts like previous stock gifts. Share your wins with your supporters and create a virtuous cycle of support.

Stock gifting presents a valuable opportunity for nonprofits to grow their fundraising initiatives and reach new donors. With new tools and innovations, nonprofits of all sizes can easily receive stock gifts and make the most of this untapped source of funding. By following our ten tips for harvesting stock gifts, nonprofits can ensure that they are making the most of this valuable resource and setting themselves up for long-term success.

Happy stock-gifting!

Content collaboration with:

Steve Latham

Steve Latham, Co-Founder and CEO, DonateStock

A serial entrepreneur and Harvard MBA, Steve spent the last 25 years in finance, digital marketing and advanced analytics. Before founding DonateStock in 2020, Steve launched and grew 2 digital marketing technology companies and 2 nonprofits. He has been a contributing author and thought leader in the marketing and financial services industries and is a lifelong supporter, fundraiser, and volunteer for many worthy causes.

email: steve.latham@donatestock.com