The self-funder flop

The self-funder flop
If your opponent has big money and the desire to spend it, they're more beatable than you might think.

Connecticut is beginning to look like ground zero for self-funding candidates. Last cycle, three of the top ten statewide self-funders ran and lost in Connecticut and at least one of them is ready to try again next year. The state seems to breed deep-pocketed political wannabes.

As manager for Democrat Dan Malloy's gubernatorial campaign last year, I had to battle two of them. Republican businesswoman Linda McMahon was just the latest in a tradition that includes Democrat Ned Lamont, Republican Jack Orchulli and a host of others. These self-funders have had a lousy track record, in part, because they face fundamental values issues and frequently make a series of operational blunders.

It's easy to be intimated by a self-funder, but you shouldn't. Self-funders tend to be very beatable and even though they can lay out big money for TV buys, they're prone to mistakes that the opposition can exploit.  

The values questions: The knee-jerk line used against a self-funder is that he or she is trying “to buy the seat.” It’s a sharp blow, which cuts two ways. At first, the line suggests an assault on democracy, and a claim that the self-funder’s resources seem to entitle him to play by a different set of rules. Dig a little deeper and it’s a suggestion that he’s really not up for the job. A voter’s first instinct is that the only reason a self-funder is able to run is because he or she can -- they have the cash and the voter doesn’t. These are simple, yet damaging lines of attack when used correctly. 

Most self-funders made their money working up the corporate ladder. While “running a large business” sounds like a great line for a candidate seeking elected office, the values and skills are different. Governing is about building coalitions and fostering consensus. The life of a CEO is structured and top down, and ultimately has one goal -- to generate profit. “Laid off thousands while paying himself/herself millions,” is an easy hit on a corporate self-funder, and cuts deep into the first two values questions. 

Moreover, self-funders are perceived as being immune to the economic problems we’re facing. Voters think they haven’t felt the pain of the economic crisis. If you’re not like me, how will you understand my problems? 

Cash isn't king: Having unlimited resources means no fundraising. That’s a blessing, right? A candidate can build a campaign that blasts his opponent day and night without the drag of making fundraising calls. But not so fast. Unlimited campaign funds means there’s no shutoff valve. Dominate everything, then dominate it again and keep repeating it until you beat voters into submission simply because you have the money? That’s actually not so smart and there is such a thing as voter fatigue.

Most candidates would dream of a campaign with no fundraising. No constant drain on the schedule, or ever present financial deadlines and cash flow problems. But fundraising is a part of the political process and the quarterly numbers serve as a barometer of public support. Cut this opportunity to get involved, and you cut a supporter’s connection to your campaign. Moreover, you do something even more dangerous – you tell them that you don’t need, and don’t want, the help of voters.  

Making it flood: Other than the questions of values and the desire to dominate the airwaves, self-funders often end up overpaying staff and consultants. In these instances, their cash advantage quickly erodes. During Ned Lamont's primary campaign in 2010, staff and overhead costs were 30-50 percent higher than on the Malloy campaign. Waste $1 million on staff and overhead fees and your cash advantage drops pretty quickly.

Self-funding campaigns would be smart to pay the market rate (and offset that with victory bonuses if you’re feeling generous) to set the right tone and culture, and keep the budget in check.Talking money: Self-funders often struggle with how to talk about the way they are funding their campaigns. They try little tricks -- skipping financial deadlines, reporting late Friday after press time, or pushing the envelope on what is legal and what isn’t. It doesn’t work. Everyday that a self-funder spends fumbling over the question of how they're funding the campaign is a day they don’t talk about their values and experience.

Smart rivals make this an issue, calling on the self-funder to abide by spending or contribution limits. Self-funders would be smart not to hide their massive contributions. Just come clean, take the hits and move on.

Obviously self-funders aren't destined to lose. But until they can address fundamental questions of values and commit to running smarter campaigns, they’ll continue to have abysmal records. Self-funders would be smart to think hard about these values questions and operational pitfalls, because those running against them have a playbook that has already been tested successfully.

Dan Kelly has consulted on, managed, or led field operations on 24 campaigns in ten states and managed nearly 300 full time staff. In 2010, Kelly managed Dan Malloy’s campaign for governor in Connecticut, defeating two of the top ten self-funders of the cycle.

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