As campaign spending numbers rocket off into the stratosphere, political fundraisers are expected to keep the engines stoked with a steady flow of money.
As campaign spending numbers rocket off into the stratosphere, political fundraisers are expected to keep the engines stoked with a steady flow of money. But how do you increase your fundraising totals in a down economy? What’s your best bet—direct mail or e-mail? How do you motivate candidates to keep dialing for dollars? And will political fundraisers ever get the respect they deserve from their colleagues? To find out, we brought together four veteran fundraisers for a shop talk, moderated by C&E Managing Editor Daniel Weiss. An edited transcript of the conversation follows. Holly Robichaud Kimberly Scott Steve Linder Evan Goldberg Holly Robichaud is the founder of Tuesday Associates, a Republican political consulting firm based in Massachusetts. A columnist for the Boston Herald, she has over two decades’ experience managing campaigns. Kimberly Scott is president of ConklinScott, a Democratic political consulting firm specializing in national political affairs and strategic fundraising for pro-labor and progressive organizations, candidates, and causes. Steve Linder is a partner at the Sterling Corporation, a Michigan-based Republican consulting firm, where he specializes in raising funds for caucus committees, ballot initiatives, issue organizations, corporate and trade association PACs, political parties, and statewide candidates. Evan Goldberg is president of Bulldog Finance Group. The firm, which has offices in Washington, D.C. and Atlanta, focuses on fundraising for Democratic political campaigns and nonprofit organizations. C&E: As fundraisers, what do you see as your major challenges approaching the 2012 campaign cycle? Steve Linder: The biggest challenge has nothing to do with the election cycle really, but if you’re doing major-donor fundraising, the economy still pretty much stinks. The amount of discretionary income that people are willing to spend, especially in terms of hard dollars, has not recovered. So, quite frankly, the biggest problem that I see is getting hard money, especially into candidate funds. Right now, campaigns are becoming third-party adventures as opposed to candidates spending money on themselves. Evan Goldberg: I certainly agree with that. But I would say, for some of the candidates and potential candidates that we’ve been speaking with, one problem they are facing internally is they are not sure what the primary driver of donations from the individual perspective is going to be yet. If you look at past campaigns, there are primary drivers: excitement for a candidate or ideology or anger towards an incumbent or another sort of sentiment. I think that potential candidates and even people running for re-election are having trouble identifying where the American people are and how to approach them. Kimberly Scott: I would agree with both points actually. To clarify further, donors are motivated by three basic things: the candidate, the issue, or the access. 2008 was an historical presidential cycle, with a fresh face and a serious national and international backlash against the incumbent. Going into 2012 as the incumbent party, I don’t know that the motivators are as clear for the electorate and for potential donors. While that may make fundraising more difficult with major donors, I still expect an unprecedented amount of Internet fundraising. Smaller, online donors are motivated by the moment, loyalty, and the cause. Holly Robichaud: I would say there are three things basically confronting those of us trying to get money into campaigns. One is obviously the economy; people have less play money to put into campaigns. The second problem for Republicans is that we had an unprecedented crop of nationwide and local GOP contenders and, when you’ve only got so many donors, you’re really competing hard for those dollars. And the third is more of a technical problem, which is taking these campaigns that have a great amount of Facebook friends and turning them into actual donors. Linder: I wanted to talk a bit about online fundraising. I’ve been raising money since the late ’70s, and one of the observations that I’ve had with online fundraising is it is absolutely not a panacea. You still have to have a hot candidate or a hot cause to get people to respond to an e-mail or drive themselves to a website to make a donation. People just don’t go looking for reasons to make political contributions unless they’re impassioned and driven to do so in the heat of the moment. Fundraising is still turning over rocks—creating that relationship, whether it is by mail, through events, or through personal calls. Goldberg: I think that when you look at online fundraising, you have to be careful when you’re analyzing the results. Did someone read an email blast that a candidate sent out and in the next twenty-four hours go onto that person’s website and make a donation? Or was someone surfing around on Facebook or another social site and say, “Hey, I really like this candidate.” And they decided to give ten or twenty dollars? Or, are the donations coming online as an alternative way to pay for events or donations that would normally have been made by checks or cash? One thing to look for in 2012 is to see how much online fundraising takes away from direct mail fundraising. As more and more people in rural areas are connected to the Internet, it’ll be interesting to see how many candidates remove some of their direct mail budget and focus on Internet solicitations, which are pretty significantly cheaper and can have a bigger ROI based on the frequency and type of communication they have. Scott: I would definitely agree with you on one hand that we still need to tailor fundraising to the targeted audience and online fundraising fits a certain demographic; but, as was just pointed out, as the role of the Internet becomes larger in each individual’s life in this country, there will be more options for them to contribute. Regardless, driving online donations comes back to having an effective online plan and that comes down to the message. Robichaud: I think online fundraising is important, but it also starts with educating your candidates. Many first-time candidates think, “Well, I’m just going to do a money bomb and I’m going to get thousands and thousands of dollars. I don’t have to get on the phone and make the phone calls. I don’t have to do the direct mail. I don’t have to do the events.” Money bombs take effort, from putting together good e-mail lists to being able to have things go viral to having a good base of support before you can raise hundreds of thousands of dollars in one quick online effort. Also, candidates need to understand that there are still people that donate just because they get asked to go to events and then there are people that donate just in response to direct mail and that online isn’t the only thing out there. Scott: That comes back to donors who are motivated by access. There will always be people who need to “touch” the candidate. It is a very important part of fundraising and a consideration in everything that we do. Linder: The problem with the proliferation of e-mail is there is so much of it. I don’t think direct mail will ever go away. Because there is so much e-mail and so much less mail, people value the mail that they get and pay attention to it; you just have to be strategic about it. We’re shifting away from doing a lot of small-donor mass mailing to major-donor mass mailing, which is still showing a significant ROI as opposed to some of the e-mail fundraising that we’re doing. People ask me all the time, what’s the best way to raise money? Well, there is no best way to raise money. If there was a best way, everybody would be doing it. C&E: Are you finding that it is more difficult to reach out to larger donors? Are they more inundated with fundraising solicitations? Linder: Well, it depends on what you consider to be large donors. If it’s large individual donors who are not necessarily involved in the outcome of legislative debates or regulatory debates, it’s a tough pitch, given that a lot of them have diminished resources. I’ll tell you a quick, funny story. I was working on a ballot initiative, and we had a guy who committed four million dollars. I collected the first two million and then went back in October of 2008 to collect the other two. I had looked him up, this guy was worth close to a billion dollars, and he said, “I can’t give you the other two—my net worth has been diminished by about 35 percent.” So I thought, “Well, you’re only worth 700 million now!” But, you know, he had hit a trigger point with cutting back. Interest groups, corporations, and associations that have direct interests in the outcome of legislation or regulations, either at the state or the federal level, we’re not seeing a whole lot of diminishment of contributions from them. Goldberg: We’re seeing a little bit of, not diminishment, but there is more time between the initial solicitation and the time that the person makes the donation and here’s why: I think more than ever these large donors, as we’re calling them, they are few and far between. And these people have been inundated with solicitations from numerous different types of campaigns and advocacy groups and organizations. If you look on the Democratic side, for example, people that normally give a couple thousand dollars to their gubernatorial candidate or their congressional candidate are now also being hit really hard for money by the DNC and the DCCC and the DSCC and the governors association. And then with the formation of some of the Democratic special interest groups to rival those that were formed on the Republican side, those people are being targeted as well. So when you’re dealing with candidates specifically, some people are a little bit confused or hesitant about what’s going to make the biggest difference. If I’ve got $10,000, who should it go to? What we have to do is educate them as to why their money should come to us, or the candidate that we’re representing, or the organization that we’re representing. Scott: I would agree. What I’m seeing with our larger donors is that they’re more selective about where they are placing their money. That may be true across the board, particularly for smaller donors because of the economy. They are looking to validators—whether that be the party or organized donor groups. On the Democratic side, I think we’ve been effective in trying to convene some of those larger donors under various umbrellas for their mutual interest. All the more important is our role in conveying those validators to a donor. Particularly when you’re trying to raise money for a (c)(4) organization—whether already established or one of the growing number established after Citizens United. Being an effective and credible national political fundraiser today in the midst of what is probably the most technically sophisticated and, ironically, rich fundraising environment as we go into the presidential means you need to be able to write a political plan and manage a coordinated appeal, all while directing donor, political, and legal traffic. It is incumbent upon us, more than ever, to present the case to individual donors, large or small, and convey that message effectively. Robichaud: For established candidates, we’re not having a hard time raising the high-dollar donors for them, but for the first-time candidates, it’s always hard to get beyond that firewall of whoever is screening the calls. And so our candidates have had some great luck being innovative with the types of messages that they leave to get that callback or getting through that gatekeeper. We look for connects on issues and connects through people they might know that have donated to our campaign. That gets us usually through the gate, and once we get through that gate, if my candidate has a good, intriguing message, it’s a matter of telling them why the race is important and why they can win. And as long as you’ve got your candidate on the phone with that person, and they believe that they can win and have a good explanation, my candidates are closing about 90 percent of the time. Linder: One point that I don’t want to get lost is we’re all talking about raising money at, sort of, point of sale. One factor that plays into whether or not we’re going to continue to raise large dollars from known donors is the care and feeding that they get. And one thing that we are finding is a lot of donors, especially those that have weathered a very bad economy for several years and feel a bit beleaguered, are responding to those that communicated with them, that took care of them, that kept them informed and made them feel that they weren’t just a check, but that they were a valued customer. Scott: It’s an ongoing courtship, always. Our livelihoods depend on those relationships and how well we execute that courtship. C&E: How is the role of candidates themselves changing in fundraising? Do you find that it’s a struggle to get them to devote the amount of face time or phone time with potential donors that is necessary? Goldberg: There’s a big gap between first-time candidates and incumbents—even those just running for a second time. There’s a big learning curve, and first-time candidates are under a lot of pressure to show people who they are in multiple ways. As fundraisers, we’re always talking about raising dollars, but really we’re an arm of the communications department as well. For us to be successful, the candidate has to be point precision on how he or she is communicating to different groups. So with new candidates we really emphasize the importance of building relationships through fine-tuned communication. That happens by making multiple phone calls, by sending out lots of different letters, by making statements, by having an active blog on your website, by really engaging with your potential constituents. For some people that’s tough, because they’ve come from environments where they’re not necessarily used to having to explain their policies to people or why they think in a certain way. And we do our best to tell them that fundraising is a marathon and not a sprint. And you’re going to have to do steps A, B, C, D, E, F, and G, which vary from candidate to candidate, in order to get to the type of money you want to get to. Scott: I would definitely agree, particularly with first-time candidates. I’ve got a good twenty years under my belt, and 95 percent of my candidates were open seat and challengers. That is the way that we deliberately pursued our business, because we wanted to help elect candidates and have an effect on the next step in their careers. I’ve done at least 100 congressional campaigns and just as important as the communications is how tight the ship is run. Not just how well it is managed, but also how we all communicate internally and convey the plan to the team. Make the candidate understand from the beginning, and this goes to organizations as well, that this is a courtship. As a fundraiser, you’re bringing to the table relationships and a reputation, and that’s why you’re hired. But it is also about working with the client to develop their relationships. Again, donors are looking for validators and to be convinced of the winnability of a race. That means providing candidates, too, with the tools to do so—the plan, the political talking points, the briefings, call sheets, donor history, background, and a goal. Organization is critical, regardless of which component you’re talking about. Robichaud: At the end of the day, 90 percent of candidates try to avoid having to dial for dollars. They don’t like it; it’s like going to the dentist for them. And so if they want to get out of fundraising, I usually tell them that they have to write a big check to their campaign. That’s the only way they’re going to get out of raising the money. I tell them that they have to get on the phone, that people want to hear from the candidates when they’re writing the big checks— Scott: Or tell them that, if they won’t get on the phone, they’re the ones that are going to have to tell their staff that they’re not going to get paid at the end of the day. (laughter) Robichaud: So, to put it bluntly, no, when it comes to the candidate participating in the fundraising portion of the campaign, no, that role has not changed. That role will not change unless they can self fund. Linder: Amen. Candidates hate this. We all have met our share of rock stars who were just born salesmen and fundraisers, but for the most part most of them hate it. They really never warm up to it. And, quite frankly, everybody has the same speech: “Money’s got to come from somewhere. It’s either going to come from somebody else’s pocket or it’s going to come from yours.” But, for the most part, they hate it. They don’t do it. I’ve never met a candidate where, from time to time, we haven’t had to have a come-to-Jesus meeting about the fact that they’re finding every excuse in the world to not sit down and make the calls or do the events. C&E: As campaign budgets grow, it seems that fundraising totals play an increasingly important public relations role in campaigns. For instance, Tim Pawlenty’s people were discouraging donations before April 1 so they could all be counted in the next quarter’s fundraising totals. Is that something that you advise campaigns on? Robichaud: Early on in a campaign, money equals momentum, momentum equals money. So for a fundraiser, you pay attention to those quarterly reports so that you are showing a lot of fundraising momentum. Look at President Obama; if he wasn’t raising the funds against Hillary Clinton, nobody would have ever paid attention to him. I can’t tell you how many candidates I’ve had that were considered a long shot, and then that first quarter report comes out, and they’ve done an outstanding job—they’re now in the mix. And the press turns around and says, “Wow, this candidate’s got something going on! How did they raise all this money? They must have a lot of support.” Goldberg: I think that one of the biggest burdens that I find as a fundraiser is the cash-on-hand number at the end of each quarter. I know that it plays a significant role in how people perceive the viability of a campaign, but to me it’s become a little bit more of a detriment, and here’s why: I can think of numerous instances where we were at a March 15 or March 20 date, and there was a really good opportunity to spend some money, which could potentially bring in money for us over the coming weeks, but it’s chosen not to in order to maintain that cash on hand ten days down the line at the beginning of April. In every business, you have to invest a little bit to make some money. It is the same way in campaigns, and I think we focus way too much on some of these deadlines, which really is a factor of the continuous news cycle. Twenty years, thirty years ago, I imagine that people were not talking as much about cash on hand at the end of the quarter as they are now. Linder: You are absolutely right. You know, the cash-on-hand number really only matters to people who are on the inside. To most people, there’s no context to it, they don’t know what it means. I would much rather have raised a lot of money, not have as much cash on hand, and have people say, “Boy, I see your signs everywhere, I see your billboards or your materials at every door.” That’s the metric that we ought to be focusing on: how much money we raise and how effectively it’s deployed, not how much cash we have on hand at any particular time. Scott: You are proving something to the public by those numbers as well. The bottom line is, regardless of what your cash on hand is, that is publicly reported, and we are in a media environment. It’s about the numbers and how the media frames it and, more importantly, how we frame it for them. It comes back to money and message. The two are intertwined. Whether the subject is cash on hand or a particular donor, we need to be able to frame the perceptions around our candidates or our organizations’ contributions and how much they raised. When we go into a reporting deadline with a candidate, we write out talking points about why this is a successful report. Look at Barack Obama: He was able to say, while raising more money than anyone in history, that one-third of his donations were $200 or less. He was always communicating with the common person and relating to them throughout the campaign, regardless of the millions of dollars that were raised at a higher level. C&E: I’m wondering whether you feel that fundraisers receive the appreciation that you deserve in the world of campaign consultants. (laughter) Linder: I think everyone is going to have a one-word answer. Goldberg: You know, it’s kind of funny, throughout the business world, but particularly on campaigns, when something goes wrong, it’s very easy to say, “Well, if I just had more money, I would have been able to do this differently or that differently.” Even if we’re on target with what we’re projecting, it’s just a really easy thing to blame. But, you know, it comes with the territory. Robichaud: My favorite part is when the candidate will reject all your different ideas and then ask why it’s not working. You give them a good plan, you say, “This is what you need to do,” and they’ll say, “I’m not going to do that, I’m not going to do that.” And then they’ll come to you and say, “Why isn’t this working?” Linder: I can’t tell you the number of campaigns I’ve been brought into as a fundraiser where they’ve got a budget, whatever it is, and nobody’s done any sort of marketplace feasibility to see if that budget is realistic and where they think that money is going to come from. The candidate, however, has already bought into the budget—two million, three million, four million—regardless of whether that’s twice the amount of money that’s ever been raised for the district. So usually the first step to being effective is going in and making sure in the beginning that you inject a dose of reality regarding how much money you can raise and over what period of time you think you can raise it. Goldberg: That’s an excellent point, I can’t tell you how many phone calls my company received last year between say mid-July and September from mostly challengers who called and said, “Look we’ve been running for nine months, a year, we have a budget of two million, and we need some help in the final two months.” And I’d say, “OK, well how much have you raised to date?” “Oh, well, we’ve raised about $90,000.” (laughter) Well you’ve raised $90,000 and you’ve been running for nine months and now you’re calling a fundraiser? I think there’s a sort of delusion sometimes that you bring on a fundraiser, and money is just going to trickle down from the sky overnight. That simply doesn’t happen. There’s a lot of initial activities that have to start up when you bring on a fundraising consultant, especially when you’re brought on towards the end of the game. You could be rewriting a plan or revising a plan. You might have to have your candidate go back and meet people he or she should have met months and months ago. Scott: The key is to know your candidates before you take them on, and then, once you do, it is about communication and the “paper plan”—a matter of documenting your work and holding everyone accountable. As Evan pointed out, most of the time, regardless of when you go in, you’re going to have to re-create the plan, and I’m not just talking about fundraising. I’ve rewritten many a campaign plan as well.