How think tanks raise funds and how much they reveal about their financial sources have been the subject of much discussion. The recent survey by Smart Thinking showed a broadly even split between those who think all donations should be declared; those who believe it should only be for any donations over £500 and those who do not think any donations should have to be revealed. While accepting that there is always room for debate about funding mechanisms and levels of transparency, this article focuses on the functional techniques for encouraging funders to support a think tank, and also provide tips on maintaining that support.
As for many types of organization, think tanks’ funding can be fickle. Interest in think tanks can be affected by a range of factors such as the political climate and election cycles. Resources can be stretched when demand for reports, events and insights into particular topics gains momentum. Think tanks provide a flow of ideas over a period of time and are uniquely placed to provide steady challenges which help to inform policy. This expertise is special in the information ecosystem and is why the financial sustainability of think tanks is crucial, along with the partnerships that they form.
Think tanks have to be nimble to deal with a range of stakeholders. Economic cycles play their part too. An economy-wide recession will lead to a downturn in donations to think tanks. The opposite can also be true: when the chips are down, interested parties ramp up their spending on think tank work as part of a strategy to help bring about better times. Finally, specific groups of funders or individual donors may increase or reduce their spend depending on their own fortunes.
Given these potential changes in circumstances, it is critical that every think tank has a strategy for raising funds, a contingency plan and robust operations to ensure success.
It is well worth seeking advice on different funding models and types of funders at the outset, and then undertaking periodic reviews with the help of advisers not involved in the day-to-day running of the think tank. There are a many consultants who offer such services and can take a deep-dive or light-touch review of the possibilities, depending on budget and stage of development. There are other sources of help too such as think tanks’ own advisory boards which often include individuals with a lifetime of business experience and contacts. Groups like Smart Thinking which offer networking, exchanges of ideas and informal get-togethers for people working in the sector are also very good places to pick up tips.
A quick survey of a handful of the UK’s think tanks reveals that there are many possible sources of funding. Some rely largely on specific individual donors, others on funding from businesses. Many draw on funds from charitable foundations and also from stakeholders who share the vision of the think tank, or who benefit from consuming the think tank’s output. Event and party conference sponsorship is a significant revenue stream for many. Consultancy is also an option. Having all your eggs in one basket can be risky and diversifying your funding streams helps to offset this.
Employing staff dedicated to developing and maintaining funding streams with partners is a key step. Professional fundraisers and partnership managers come from a variety of backgrounds, so it is worth keeping an open mind as to who will succeed. Many think tanks actively seek new recruits through internships, for example. My think tank, the Higher Education Policy Institute, has offered paid internships to students for a number of years, and also recruited new graduates into full-time roles. While these roles tend to be policy-focused, in a small organization like ours, some fundraising and partnership work is often also involved. In addition, all employees benefit from training and on-going professional development; allocating some resources to training staff in how to develop and maintain partnerships and fundraising are investments that will pay later.
Anyone who has had any commercial training, and particularly sales training, knows that almost all the widely adopted methodologies involve a systematic approach, starting with goals and a plan of action, and following up with logical steps to achieve those goals. Many organisations adopt customer relationship management (CRM) systems such as those provided by Salesforce (Salesforce.org is geared towards educational and charitable organisations), Oracle and the like, which help you structure your fundraising through scoping, pitching, nurturing and closing partners, and then support subsequent account (partner) management.
Persuading a new partner to support your think tank is as close to sales as it gets. While a hard sell is probably never appropriate in think tank land, if at all, the art of persuasion through developing relationships, understanding potential partners’ goals and challenges, and explaining the vision and work of your think tank, and how they align with your partners’ aims, are key. I’ve drawn on sales’ approaches like Miller Heiman and Challenger Sales as well as various techniques developed in-house in corporations for emotional selling and persona-based pitching in sourcing new partners for HEPI. The really satisfying part of pitching for think tanks is that the currency is ideas so it is always very interesting as you search for the policy area, values and beliefs that will hook the right funding partner for the think tank. Supporters of HEPI have told me that they like the insights that we provide, particularly about the direction of travel in our sector (higher education). Our partners have not always got time to track every policy development and understand the related context, let alone horizon scan or delve into particularly thorny topics, so are happy to support a think tank that can do all these things.
Most think tanks are predominantly staffed by policy experts and researchers as well as communications and events’ professionals. Many have separate business development professionals who are responsible for finding funding. It is essential that all staff are aligned and have a way of working that is mutually supportive. Most think tank employees are likely driven by the same thing: curiosity. As Rudyard Kipling wrote, “I keep six honest serving-men (They taught me all I knew); Their names are What and Why and When And How and Where and Who.” This ethos is as important for business professionals as it is for researchers and writers.
It’s vital to keep in regular touch with your donors, funders and partners. Developing relationships is essential and fine-tuning that for individuals or institutions is infinitely interesting. Some want details of your work, others the policy landscape, and others something entirely different. Some supporters like to be low-key and light-touch; others appreciate regular face-to-face catch ups and more active involvement. Then there is the need to maintain your think tank’s profile more generally through things like newsletters, social media, blogs, media appearances, guest articles and partner events to maintain the flow of insights and keep your supporters engaged.
Ultimately, it is a belief in what you do and the passion for ideas and stimulating debate, along with the quality of a think tank’s output which will be attractive to partners and fundraising bodies. From this you can build out the practical steps to connect and maintain those important stakeholder relationships.