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Companies House: a treasure trove of info on UK companies

Carrying on with the theme of prospect research and the UK for another week, I’m delighted to welcome Toby Savin as the author of today’s Intelligent Edge article on finding information about companies and company directors from Companies House. An experienced researcher and leader in the UK prospect development community, Toby is Development Research Manager at the University of Leeds. My thanks to Toby for sharing his knowledge! ~Helen

Over here in the UK, for all the challenges we face, including (and because of) a culture where it’s still seen by many as crass or taboo to discuss money even in the context of giving it away to a worthy cause, the prospect research community has one resource that our counterparts elsewhere can only dream of: Companies House.

Companies House is the UK registrar of companies and there are 4.4 million companies (and their associated filings) on the register, many of which are privately-owned. This includes not just limited companies, whether quoted on an exchange or not, but also limited partnerships (the legal business structure of choice for private equity funds and hedge funds) and limited liability partnerships (‘LLPs’), which have been astonishingly popular across many sectors of the economy since being introduced in the UK in 2001, thanks to the twin benefits of limiting partners’ liability and not incurring UK corporation tax. It also includes companies limited by guarantee (as opposed to share capital), a structure much used by charitable trusts and foundations.

What’s more, it’s free to access this data: in 2015, a Beta version of the register – freely available to anyone with an internet connection – was launched as part of the UK government’s commitment to free, open data. Sure, the register has its faults: one major issue, which was successfully used to push for a formal consultation on reforming the register last year, is that the information filed is not actually verified or checked by anyone at Companies House.

But, unlike data on non-quoted companies that many other countries are forced to rely on (typically, top line numbers self-reported to large data vendors within a voluntary and entirely unregulated framework), in the UK there is a statutory requirement to formally submit a whole range of filings and many of the accounts themselves are externally audited. Make no mistake: this is a treasure trove of public data that ought to make us the envy of researchers across the world, especially the US, where finding reliable, detailed information on privately-held companies can be difficult or impossible.

Want to know not just who owns a particular company but how much they own? Check.

Want to know the total compensation of the highest paid director? Check.

How about estimating the value of a privately-owned business? For sure, this is a tricky pursuit at the best of times (like a house, a business is only worth what someone is prepared to pay for it) but close to impossible – and perhaps even futile – if you have only sparse, unreliable numbers to hand. Here too, Companies House can help: businesses of a certain size are required file full audited accounts with a profit and loss account, balance sheet and cash flow statement.

And in addition to the hard numbers, Companies House provides an abundance of less tangible (but equally useful) information. A Chairman’s Statement on the company’s performance and strategy, for example, might be taken with a large pinch of salt by a forensic accountant looking for fraud but in the hands of a savvy prospect researcher, the salient points can be summarised and used by a frontline fundraiser to completely transform a discovery meeting with that top prospect who hitherto has been impossible to engage.

For anyone wanting to tap this most valuable of resources as part of their prospect research (or indeed gift acceptance due diligence), here are some things to take into consideration.

Firstly, if you intend to process any personal data, you’ll need to carry out an assessment as to what research is acceptable from a data protection perspective. There is an abundance of guidance available, from bodies like the Institute of Fundraising and CASE (the Council for Advancement and Support of Education).

Secondly, you’d do well to keep tabs on any changes to the legislation governing the information that companies are required to disclose (thankfully, these are widely reported across the blogosphere and beyond) as well as changes to the search functionality and other aspects of the free Companies House beta service itself (signing up to be a member of the user panel can help with this).

Last but by no means least, you really need to know what you’re doing: the proverb “a little knowledge is a dangerous thing” might as well have its origins in interpreting data in company accounts. This one is a bit trickier to address but I’d like to highlight a couple of initiatives that will help.

Here in the UK, Researchers in Fundraising (RiF), a special interest group of the Institute of Fundraising, has launched a major project to develop a Researcher’s Handbook (including a chapter specifically on estimating wealth and capacity). Work on this is in progress and in the meantime, one very enterprising former prospect researcher has been working with some of the best talent in the sector (and me) to launch a Community Interest Company called PyroTalks offering a wide range of (virtual) conferences and training sessions, including a number that are specifically aimed at helping prospect researchers navigate some of the data you can find on the Companies House register.

Companies House isn’t the only source of useful data on UK organisations and potential donors but it is an essential part of any researcher’s tool kit; and, for all its faults, we’re lucky to have it. Take a look and expand your UK company knowledge.

Toby Savin is Development Research Manager at the University of Leeds in the UK, having joined the Alumni & Development Office there in 2010. Prior to this, he spent a decade working for a leading business risk consultancy in London and then a Nasdaq-quoted fraud prevention company, carrying out investigative due diligence and background checks on employees and vendors for banks, hedge funds and FTSE 100 clients.

In between these two ten-year periods working as a researcher, he gained first hand experience of worker-controlled co-operatives at two food co-ops in Manchester and volunteered on a number of different food and environmental projects. This experience formed the basis of a dissertation on the co-operative movement as part of a Master’s degree in Food Policy at City University in London, which he successfully completed with Distinction in 2011. Toby also holds a Bachelor’s degree, with Honours, in Hispanic Studies from the University of Birmingham, UK.

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Who is doing well now in the UK?

Back in April, I wrote a blog post about companies, individuals, and sectors in the United States that were doing well despite (or in some cases, because of) the coronavirus pandemic. Today I want to offer some research that I’ve done on the same topic, but focused across the Atlantic. For everyone who has prospects in the United Kingdom, this one’s for you.

Just as everywhere, the economy in the United Kingdom right now is on a slanting slide into sure recession. However, that doesn’t mean that every company or sector is in the red along with it. As I go through the individual companies and sectors that are doing well right now, think not only of those who are executives or major shareholders that are in these companies, but the companies themselves and others in that sector that may be prospects. Also consider if they have a corporate foundation with funding priorities that your nonprofit might fit.

Basic goods

Just like here in the States, the major supermarket chains are experiencing solid sales right now: Tesco’s sales are up 12.7% and Sainsbury’s and Waitrose are both up 12.5%. Discount grocery chain Co-op is up 30.8% and sales for mainly-frozen-foods grocer Iceland are up 29%.

In order to get those groceries, many people are relying on the UK’s main delivery service, Ocado, which is reporting sales that are up nearly 33%.

Companies and manufacturers

According to Make UK, the professional organization for the UK’s manufacturing sector, 90% of UK manufacturers have continued to operate fully or partially since March, although around 20% have furloughed or laid off staff.

Which manufacturers specifically are doing well?

Any company manufacturing Perspex (plexi-glass), for example. Every person operating a cash register or sitting at a customer service window has (or will have) a sheet of plastic between themselves and the customer, so those manufacturers are operating on all cylinders.

The same goes for anything medical related, including PPE manufacturers/suppliers (face masks, gowns, visors, aprons, thermometers), medical equipment parts and materials (beyond just respirators to the base materials like plastics and sheet metals), and companies that make household and institutional cleaning supplies, including Reckitt Benckiser, the maker of Dettol, and hand sanitizer manufacturers.

And of course early on in the lockdown just as in the United States, UK television streaming services, games, and other forms of entertainment did (and continue to do) really well, too.

Who does well all the time?

Grocery stores usually operate on fairly thin margins, but people always need groceries so they tend to be fine no matter the economic circumstance. Banks, energy companies (those delivering heating oil and gas, for example), internet and phone companies, and the infrastructures that support them do well, too.

Right now, in addition to ecommerce (like UK-based companies selling must-have items like Argos, B&Q, Curry’s, Screwfix, office suppliers, etc.), shipping (and supporting industries) are also doing well because all of those ordered items have to be delivered.

Which companies and industries are having a moment?

And speaking of delivery, a new-ish form of vehicle is increasingly important, with drones supplying medicines and PPEs in half the time over the Solent to the Isle of Wight and from mainland Scotland to the islands. Look for companies like drone operator Skyports and defense and technology companies like Thales that manufacture these useful technologies.

It’s not just corporations and UHNWIs doing well: Local bike shops can’t keep stock on the shelves – especially bikes under £500, and they can’t keep up with repairs, either. Electric bike sales are up 96%! Britain has re-discovered biking in a big way, and it’s healthy for the bikers and for the bike sellers, from local shops to chains like Halfords.

The UK is a gardener’s paradise, of course, and garden centers which have now reopened are experiencing the same sort of panic-buying (and associated boom in sales) as we Americans had with toilet paper in late March. There’s an 8-week wait for certain plants as sales at some centers have exploded 75%.

Who will be doing well moving forward?

Because of COVID-19, demand is also beginning to rise for contact-free items like touchless faucets, flushers, and dispensers, so watch those manufacturing spaces as well.

Property investors with deep reserves like Great Portland Estates, one of the largest property owners in London’s West End, bought up bargains during and after the Great Recession. They purchased nearly 60% of their current portfolio between 2009 and 2014, and according to an article in the Financial Times (paywall) they plan to do it again.

As in the United States, look for managers and investors in contrarian hedge funds. Some that shorted the market back in January and February have made hundreds of millions of dollars.

Any company with a contract to supply to the government should do well in the next year (or more) as well. Once awarded a contract, a company can expect steady payments from a reliable source. Look for connected companies like Liberty Global, (no relation to Liberty of London) which signed a deal with the UK government to provide on-street charging points for electric vehicles.

Finally, although it would be easy to think that private equity and venture funding would be completely dried up, it’s not always the case. I spent a little time spent in Crunchbase and found that startups and young companies in the UK received $3.9 billion in the period between March 1 and June 1 of this year. A quarter of those companies are outside of London, too, so it’s not all invested in the south. Both the funders and the companies funded are worth a look to see if there are prospects for your nonprofit.

What other companies and sectors do you know of that are doing well in the UK right now? Please share in the comments for all of us to benefit from!

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On Being a Prospect Research Possibilist

Over the past two months the HBG Book Club has been reading Hans Rosling’s Factfulness and, considering what’s going on in the world around us right now, the timing couldn’t have been more perfect. I asked my colleague and fellow book clubber Jayme Klein to share her perspective about the book for our blog in today’s article. Thanks, Jayme! ~Helen

People often call me an optimist, because I show them the enormous progress they didn’t know about…I’m not an optimist…I’m a very serious ‘possibilist…,’ someone who neither hopes without reason, nor fears without reason, someone who constantly resists the overdramatic worldview. As a possibilist, I see all this progress, and it fills me with conviction and hope that further progress is possible.” -Hans Rosling

During April and May, the Helen Brown Group Book Club read Factfulness: Ten Reasons We’re Wrong about the World- and Why Things are Better Than You Think by the late Hans Rosling. While our meetings are always virtual, spanning homes and offices across the globe, these gatherings felt different. We were all at home universally quarantined.

As we logged in each week, we admired the various Zoom backgrounds that book club members had chosen. All of them were drastically different places than our kitchen, office or living room. They sparked conversations about personal interests, old vacations, or something calm and pleasant to look at.

No matter what the background, we all had a desire to go somewhere else, to stop focusing on the current struggles all of us were a part of in the pandemic.  Many of us expressed overwhelm with the deluge of Covid-19 news. As we dove into the book and started to look at our thoughts more objectively with Rosling’s guidance, it became clear how much our backgrounds and belief systems shape our worldviews.

Rosling had a decades-long career in medicine and international health. Through anecdotes highlighting his own bias, he showed the challenges and rewards of changing viewpoints after experiencing different cultures and opinions.

By describing 10 instincts that affect how we see data, Rosling explained how those beliefs, and how data is shaped by them – keep us from seeing how much progress civilization has truly made in the past few centuries. We learned that although some of what shapes our thoughts and feelings are unique and personal, some of these are more universal and deep-rooted than we may have thought.

His “Factfulness Rules of Thumb” deftly summarized the book with hints that would prove helpful no matter what the situation when faced with personal or professional interpretation. I’ve adapted them for our prospect research needs:

  • Look for the Majority: Sometimes looking between categories is where the largest common denominator is. For example, alumni, parents, and staff all have the same thing in common: a relationship with the school. While the nature of the relationship may differ, the school still holds value for all of them.
  • Expect Bad News: It is easier to find a negative story than a positive one about a prospect. Keep digging and see what else exists about them beyond something sensational. When reading negative contact reports, look at the history of the prospect’s relationship with the organization. Was the negativity related to a person or story? Was it an outlier amongst years of positive contacts?
  • Resist the straight line. Lines might bend: Sometimes the prospect with the highest net worth may not be the best. Look for other data trends that show a dedication to your cause, such as consistent giving and regular, positive interactions.
  • Calculate the Risks: How much work will a project take to get the results that your team needs? Is the new, shiny resource going to help your workflow?
  • Get things in proportion: Is the prospect’s million-dollar house the biggest in town, or just a small cottage in a high-wealth area?
  • Generalization: Just as Rosling advised in the first point, resist the urge to assume that your top prospect is the wealthiest. What categories do you automatically consider? What lesser-considered factors could help you identify someone?
  • Slow change is still change: Our field is constantly evolving, and it sometimes takes time to adapt. Learning a new resource, evaluation technique or piece of software isn’t easy, but is always valuable. Give yourself credit for adapting- no matter how small it may seem.
  • Get a toolbox: Keep a running list of resources to help you in your work. HBG regularly updates our list with input from staff. Additional lists, such as APRA’s, can further guide your work.
  • Resist blame: Why didn’t you get the results you wanted? Maybe the search criteria for a foundation search was too specific for a long list of funders. Think about how you can change the keywords, loosen the search terms, or re-examine the request to find better results.
  • Take small steps: Faced with an overwhelming list of prospects to screen? Try sorting the results in different ways to reveal different population segments. Using variables such as confirmed assets, number of philanthropic gifts given or the prospect’s largest gift could reveal new and interesting prospects.

In an industry such as ours, facts are paramount to our success. Rosling’s book helped us look more objectively at how data is presented to us, as well as how we take it in and use it in our work. We highly recommend it, especially now, if you’re interested in how data is presented to us and how our perspectives change how we receive it.

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Lockdown Learning

If your inbox is anything like mine, I imagine that you have been receiving a lot of webinar invitations lately. I’ve probably attended more webinars in the past two months than I did in all of 2019.

It’s been really nice to see other people, many of them familiar faces, in the Brady Bunch layout. But this week I realized that the selections I’ve made up to now have been more about being with my community than personal education. And that is going to change.

My change of heart came because my exceptional alma mater is doing a series called “Lockdown Lectures” featuring star professors like Brian Cox. The first “lecture” wasn’t a lecture really – Cox was simply interviewed by a student and talked about a wide range of things including what made him decide to transition from touring rock band keyboardist to astrophysics professor in the first place. (I mean, really, what a story!).

In answer to one of the student’s questions, Cox mentioned that in the process of writing a new popular book about black holes he’s discovered that some of the ABCs of his field have bumped up against each other in his head, and not in a comfortable way. It made him realize that he needs to go back and look more closely at certain scientific theories and re-test some of his assumptions so he can understand his field better.

The guy is a brilliant scientist and communicator, and he’s unsatisfied with his knowledge about his field. I found that really inspiring.

So inspiring, in fact, that I signed up for a terrific webinar that happened yesterday sponsored by the Colorado Nonprofit Association called “What You Need to Know about Navigating Nonprofit Mergers, Partnerships and Acquisitions.” I knew nothing about nonprofit mergers (which was kind of the point of me signing up), and had honestly never given them a minute’s thought before, but now I’m much better informed about something that (I learned) is fairly commonplace in our sector.

So what am I saying here? Until the stars re-align and life goes back to whatever “normal” ends up looking like, we’re probably not going have another opportunity like this (let’s hope) to take advantage of all of the related and tangential learning that is available for free or low cost right now. Working from home now, we actually have flexible time to be able to fit learning into our day.

So I encourage you to take this opportunity to re-learn what you thought you knew, or to learn totally new stuff that will help you be better informed and become a more well-rounded employee, boss, or just…person.

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New White Paper! Who Is Doing Well Now?

A month ago I wrote an article for this blog called Who’s Doing Well Now? which highlighted several companies and individuals that were doing well financially due to their prescience about the market or because of the goods and services that their company is manufacturing, shipping, or selling during this pandemic.

Since then, a number of other companies and individuals have been added to that list, and I’ve gotten overwhelmed (in a good way!) with articles about philanthropists stepping up right now. It was too much important, good information not to be shared to help our sector.

So we wrote a white paper to pull this information together for you. We hope that it helps you and your nonprofit identify prospects and industries that will help you get through this time.

It may be that the specific individuals and companies you see in this white paper aren’t in your database – but people like them, or industries they represent, might be. You may be in the UK or EU or South America and the company names are all different but use this as a creativity lab for prospecting.

The white paper is here in our Learning Media Library and it’s free. Let us know if you find it useful, and add any articles or resources in the comments that you’ve found to be helpful.

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Donors that are stepping up right now

While it becomes increasingly easy to believe that the nonprofit sector’s glass is half empty at the present moment, the reality is that people want to help nonprofits, and they are stepping up. If you don’t believe it, I thought I’d share some of the many places you can go to get some really good, heartening news.

At the same time that 80 percent of US nonprofits surveyed were telling the BBB Wise Giving Alliance that they expect revenues will be down in 2020, Fidelity Charitable announced that giving from its donor-advised funds was up 36% this March compared to the same time last year.

Fidelity surveyed its donors who had given at least $1,000 during the second half of March. Over half had no plans to decrease their giving this year, and 25% said that they planned to increase their giving.

Including support just for COVID-19 related giving (which was $160.7 million as of yesterday, and up $20m since last Friday), total giving from Fidelity’s DAF donors so far in 2020 is well over $2 billion. This month Fidelity issued a “COVID-19 Relief Challenge” to its donors to give $200m before #GivingTuesdayNOW on May 5. This is clearly having a positive impact on their giving numbers.

If you haven’t yet read the Chronicle of Philanthropy’s April 9th article by Michael Theis titled “Giving From Donor-Advised Funds Surge as Pandemic Spreads” you should get on that now – it’s a barn-burner full of hope and a call to action. From the article:

 Money is not simply flowing out of the funds. Donors are also contributing to their accounts, even though the slide in the stock market and the tumbling economy might have caused some supporters to pause their giving.

Deanna Spaulding, a spokeswoman at Fidelity Charitable, declined to provide figures for incoming gifts, but she added that the number of new fund accounts opened has also grown since the start of the year.”

And it’s not just Fidelity. DAF sponsors large and small all over the country are reporting the same thing.

Giving from funds at Schwab Charitable were up 21% February 14 – March 31 compared with the same period last year. Schwab “asked the Center for Disaster Philanthropy for a list of organizations responding to the pandemic globally and highlighted them on its website. Those organizations saw a nearly 450 percent increase (emphasis mine) in grant dollars from Schwab account holders.”

Over the past few weeks, the new CEO of the Silicon Valley Community Foundation, the place where tech millionaires and billionaires send their philanthropic dollars to DAF, has been calling donors asking them to spend at least 5% of their invested funds now. And she says they’re seeing donors answering the call.

Even smaller DAF sponsors are seeing a huge uptick. ImpactAssets DAF reported to Barrons that by the end of the second quarter of 2020 investments in its fund will exceed $143 million, more than total investments made in the fund for all of last year. Their DAF donors made more than 1,000 grants totaling $11 million from their DAFs last month, two times the number made in a normal March.

If there was ever a moment for DAF donors to allocate those funds they were saving for a crisis, it’s now, and they seem to be stepping up.

Who else is giving right now? Startups.

Earlier this month, Crunchbase reported that a number of startups had accelerated their philanthropic giving due to the pandemic. Their initial article listing 24 startups grew so fast that they abandoned adding to the article and embedded a running spreadsheet of companies, which is now up to 140. Check out the interactive list to see if there’s a company donating in your area.

Also, private and family foundations, companies, and LLCs

Candid reports on their new popup COVID giving/tracking webpage that total coronavirus giving they’ve counted so far stands right now at nearly $8 billion.

Just like the number of coronavirus cases out there, there is likely lots more giving that just hasn’t been counted yet.

Donors are eager to give and, as we pointed out two weeks ago, there are plenty of companies and industries that are doing really well right now. We may have to adapt or throw out some old ways of doing things and adopt new technologies and strategies, but it appears that as the need for funding has risen, so have the numbers of donors who want to be helpful.

FURTHER READING

Charity is off the charts amid the coronavirus. Is that a sign of America’s strength or weakness? By Laurence Darmiento, LA Times, 4/20/2020

Community Funders Balance Priorities in the Face of Overwhelming Needs, by Paul Karon. Inside Philanthropy, 4/22/2020

Special Report: Covid-19 and the Charitable Sector. Give.org BBB Wise Giving Alliance

Want to see some fascinating stats on email solicitations right now? NextAfter has created a web page chock-full of real-time analysis of 90 nonprofits with lovely charts and graphs showing

  • The types of verticals in the analysis
  • Median monthly visitors for each vertical (the top nonprofit type has 4x the visitors of #2)
  • How has the average number of gifts changed Jan-April this year vs last?
  • How has avg. revenue been affected in recent months? (Spoiler: it mostly hasn’t)
  • How has each vertical changed their volume of messaging in recent months? (these numbers were really interesting).

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Prospect Research for the Here and Now

In the midst of any crisis, after the first moments of stopping and taking stock of what is happening around us, the next thing people normally do is jump into action to help. This week my colleague Grace Chandonnet shares her perspective on practical ways that we in prospect research can jump into action to be helpful to our organizations. Be well. ~Helen

We’re a few weeks into the new (for now) normal and lucky to be in an industry that lends itself well to remote work. It seems like a good time to be strategizing around ways to get through an economic downturn with our organizations intact, and also a good time to look ahead and prepare for the future.

I’ve been thinking about things that we fundraising intelligence pros can do to make the present moment more productive and satisfying that will also help prepare us to move ahead through – and past – turbulent times. Here are some practical things that we can do now.

Projects and Planning

This might be a good time to consider all those things on your to-do list that you never seem to have time to fit in. What can you be doing to look to the future and be ready to hit the ground running when we emerge? For example:

  • In-person events are off the table right now, but can you work on prospecting projects for future event attendees?
  • Now is a great time to plan and implement analytics projects to find the hidden gems in your own databases. Consider appending free or inexpensive data to make your data insight projects even more robust.
  • Research and draw relationship maps to identify strong prospects who might know your organization’s friends and family and want to be engaged?
  • If you’re working at a school or university, now is a good time to re-imagine your parents research programs as we’re heading into summer.

Supporting the Front Line

Now is a great time to be looking for additional ways to support our frontline fundraisers. Our extroverted colleagues may be really struggling in a time of enforced social distancing. The logistics of business as usual – building relationships with donors and prospects – has been suddenly altered drastically.  If you’re a prospect development pro, take the opportunity of having more planning time with frontline colleagues and discuss their priorities and concerns to strengthen your relationships with them.

  • Work with fundraisers to help them re-balance their portfolios to set them up for future success. This could include re-assessing capacity with an eye toward the industries that are recession-proof vs. those that might not be – we can lead these discussions and also touch on the overarching economic outlook.
  • Use the aforementioned analytics and prospecting projects to target the prospects that will help fundraisers meet their visit and solicitation goals.
  • Set up some interactive trainings or presentations geared toward frontline fundraisers – perhaps a quick training on basic research – to give them tools for things that they can do themselves to get ready for a meeting or phone call when there is no time for formal research.
  • It might also be a good time to focus on process-oriented training, such as short sessions on entering research requests, prospect management moves, and/or contact reports into your organization’s CRM.
  • Now might also be a great time to host a few virtual coffee breaks – that have no set agenda – with small groups of fundraisers and you or your team of researchers just to get to know each other a little better.

Take advantage of trainings and webinars

We can also be focusing on our own professional development. Apra and many of its chapters  as well as  familiar vendors like iWave and DonorSearch offer ongoing, as well as timely and relevant virtual trainings and webinars on a variety of topics relevant to our industry and ways we can weather the pandemic. Is there something that you’ve been wanting to know more about? Wishing to take a deeper dive into certain industries, or know more about the hands-on intricacies of data analytics? With fewer research requests in the queue, it could be a good time to set aside some time for some of these free training opportunities.

Breathe

“Self-care” is an oft-used expression that means different things to different people, but there is no doubt that most of us are experiencing an increase in stress and anxiety, and a little self-care couldn’t hurt. It’s more important than ever to take a few minutes during your day to stand up and stretch, step outside and maybe take a walk around the block (as weather and social distancing guidelines allow), try out a meditation app, or to just sit quietly and breathe for a few minutes.

I do believe that our industry will weather this. We are a resourceful bunch (literally!) and we’ve been through troubled waters before. Let’s have each other’s backs and we and our organizations can emerge stronger than before.

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Stepping up with pride

My guess is that you fell into your fundraising career. Most of us have, including myself and my colleague Tara McMullen-King, this month’s Intelligent Edge author. What we make of that opportunity can be a combination of hard work, stepping out of our comfort zone, and the good fortune of meeting people that impact our lives and our careers. Tara shares her career trajectory and the choices she made along the way to her success in this #ResearchPride celebration. ~Helen

Happy #ResearchPride month everyone!

So – possibly like many of you – I graduated with a B.A. from a liberal arts college not really knowing exactly what path I wanted to embark on with my career. What did I want to be when I “grew up”? After starting out my studies with plans to major in Psychology, I then switched to English, and then finally settled on Studio Art in the first half of my junior year. Many days were spent happily painting and drawing and studying art history (while still taking classes in myriad different subjects – everything from Buddhist mythology to developmental psychology to Spanish literature to classes in anthropology… and the list goes on and on).

While I temporarily entertained aspirations of becoming a high school art teacher, I just wasn’t really 100% sure what I wanted to do with my life. The problem was that my interests were just so broad, and I fell passionately in love with pretty much anything and everything I studied. Once I graduated, I moved to the Boston area and had to quickly find a job – ANY job – to pay my rent (a whole $500 a month – those were the days!).

Soon after I moved, I managed to find an administrative position working for a small association management firm, where I helped process memberships, create newsletters, and register members for conferences and other educational programs we planned and executed for clients. Our firm’s two biggest clients happened to be the Massachusetts chapter of NSFRE (the National Society of Fund Raising Executives – now known as AFP) and NEDRA (the New England Development Research Association).

At the time, I knew nothing about fundraising, and even less about what development research was. However, through working closely with those two organizations, I was exposed to the wild and wonderful world of development – and I haven’t looked back since.

After about a year working for that company, I decided to take a chance and accept a position working in the development office at a college in Boston to explore my new-found interest in fundraising. This position required me to perform some basic research, such as event bios and some low-level information gathering and analysis on prospects.

The more I learned, the more I became enthralled by the world of prospect research, and realized that I was able to use all the diverse skill sets I had developed over the years– reading, writing, researching, analyzing, creating, communicating, and using critical thinking – to be successful in my work. I eventually accepted a full-time development research position at the college – but as a newbie to research, in a small shop, I had limited exposure to the field and few opportunities to meet other research colleagues. As a result, I sought out educational programs offered by NEDRA to help me gain more knowledge and find networking opportunities, and eventually became a volunteer for the organization. As I became more involved with NEDRA, I had the opportunity to meet a number of colleagues who became instrumental in my professional development, including my now-boss, Helen Brown, and the late Heather Reisz.

Back in those days, Helen and Heather were instrumental in creating the first NEDRA Boot Camps for researchers new to the field. Heather and I connected almost immediately upon meeting one another – she was vivacious, hilarious, and knowledgeable, and had a particular passion for “research newbies,” many of whom she took under her wing. As she and I became more friendly, she told me that she thought I would be a great board member for NEDRA, and that I would absolutely be a great Boot Camp instructor in the future. At the time, I sort of chuckled and didn’t take her ideas too seriously – I thought that she was just being kind. As someone who has suffered from imposter syndrome for most of my life, I was sort of convinced that I wasn’t “good enough” or smart enough for any of that, at all.

But then just a year later, I was nominated to join the NEDRA board of directors – to my shock – and decided to ignore my feelings of self-doubt and take that plunge. I was honored to spend six years on the NEDRA board, trying my best to give back to the organization that had not only provided me with integral support and education at a time when I needed it, but had quite literally exposed me to the field and piqued my interest in it in the first place. In a way, things had sort of come full circle.

When Heather unexpectedly passed away in 2013, the loss was profound for those of us who had been lucky enough to know her. A few years ago, NEDRA’s then-president, Amy Begg, echoed Heather’s previous sentiments and encouraged me to get involved as a bootcamp presenter for NEDRA. Even though years had passed since Heather had first floated the idea, I still wasn’t sure about it – and those nagging feelings of self-doubt crept up yet again.

However, this past January – despite my nerves– I finally agreed to co-present a NEDRA Boot Camp in Boston. And you know what? It was amazing. Meeting a batch of new professionals coming into the field, and being allowed the chance to help them and arm them with the tools and confidence they need to get started was one of the most professionally rewarding experiences I have had in my career. Again – it felt like things were coming full circle.

Writing this today, after having now spent seventeen years working in development research, I have come to realize many things. First and foremost – it is okay (and normal) to sometimes have those nagging moments of self-doubt. I consider myself to be a pretty humble person (compliments make me uncomfortable; praise often makes me bashful), and I still have those moments on occasion.

But what I have learned is that putting yourself out there – pushing those feelings down a bit and taking some risk – can lead to some truly rewarding personal and professional experiences. During this month of Research Pride, I can truthfully say that I am proud of myself for taking those risks in the past, and I am proud of the work that I do.

I feel honored to have had the opportunity to work with many amazing non-profit organizations to help them achieve their goals and further their missions. I am proud to work with Helen Brown – who has been a mentor to me over the past thirteen years – and to be a part of the Helen Brown Group, where I get to work with so many amazing and intelligent colleagues each and every day.

I am proud of the work that NEDRA has done – and continues to do – to provide education, assistance, and networking opportunities to so many of us. And I am truly grateful for the support that so many other researchers offered me as I navigated my way through those first years in the field.

It may have taken me a while to figure out what I wanted to do when I “grew up,” but now I can’t see myself doing anything else. And in my heart of hearts, I would like to think that Heather would be proud of me as well.

Are you new to prospect research or know someone who is? NEDRA’s got another Boot Camp coming up in May! Registration can be found here.

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Due diligence and prospect research – are they different?

Scales of Justice – Frankfurt Version. Photo by Michael Coghlan.

Three things about the media that are true: newspapers (and online journals) need to sell copies (or access) in order to stay in business. Headline writers are always eager for a scandal to feature prominently above the fold. There are responsible journalists out there whose job it is to uncover and shine light on unethical or illegal activities when they see them (and they should).

The Varsity Blues, Jeffrey Epstein, and Sackler sagas are just the latest in a regular series of public scandals that are like super-powerful magnets pulling dark clouds over the nonprofit sector. Before those, there were Lance Armstrong, the London School of Economics-Gaddafi Affair and the Catholic priest abuse scandals. They’re bad news, and it’s easy to lay blame on an eager press, but the truth is the warning signs were there for the nonprofits involved.

The good news is that every minute similar bad press is being averted in the background for nonprofits everywhere because of critical due diligence research.

For those of you who are fortunate enough to have a prospect research professional on staff (or you are one) you may be wondering, “If we’re doing prospect research, are we already doing due diligence on our donors?”

Well maybe. But maybe not.

One of the goals of prospect research is to find out if a person, company, or foundation has the financial means to make a major gift and if they have a past record of being philanthropic. Also, do they have a personal connection to your organization or cause? And do they have the personal interest or motivation to become involved as a donor and/or volunteer to your nonprofit?

These are simple-seeming questions (and a very simplistic breakdown of the scope of our work), but there are a lot of data points (and resources checked) behind the answers. They all come down to: does this person (or company or foundation) have enough money and care enough about our cause to donate?

The goal of due diligence is different.

Due diligence takes a different approach. It is not about the prospective donor, per se. It’s about risk. Protecting your organization – its values, its mission, and its reputation – from potential harm. Some organizations choose to do due diligence as a precursor to involving a new donor. Others perform due diligence prior to each major gift ask as part of their gift solicitation/gift acceptance policy.

Either way, if you decide to do due diligence internally, some of the resources you use may actually be the same that you use for prospect research, but you may use them differently or look at the data with a different lens.

Prospect Research vs Due Diligence

For example, when you do prospect research you will look to see if someone has made philanthropic gifts, especially major gifts, and to which nonprofits. This gives you an idea what level of gift they are capable of, what they’re interested in, and if they are philanthropic generally.

When you do due diligence research, you will also look to see if they have made major philanthropic gifts, but you will look at their giving patterns differently. For example, have they made multiple large donations in a new-to-them geographic area with no other affiliation to or involvement with the nonprofits they supported? That’s how Ponzi scheme operators build reputations quickly.

Prospect research rightfully asks the question can they give? Due diligence asks what does their giving say about them?

When you do prospect research, you’re looking at someone’s past career history to paint a picture of their track toward success. Have they moved up the career ladder? What might their salary trajectory be?

But doing that same work with a due diligence lens, we’re now looking at gaps or sudden changes in a prospective donor’s resume. Those holes require us to look for a newspaper article, or criminal or civil case explaining the reason for that gap. There may be a simple solution like a layoff or birth of a child, or a more complicated one like a bankruptcy or court-enforced “vacation.”

In the course of normal prospect research, we likely wouldn’t check a sex offender’s database. Or ask a prospect’s peers what their reputation for integrity is in business or in their community. Or find out if they are a politically-exposed person. Or if their company is on an international financial sanctions list, or has a failing grade from the Better Business Bureau. Those aren’t the questions we’re being asked to answer through prospect research, and it wouldn’t be appropriate (or time-efficient) to do that level of research on every single prospect. In certain cases, it also may not comply with privacy laws.

That said, anyone doing prospect research should always send up a red flag (and investigate further) if they see things that concern them!

These questions are increasingly important for us to ask because we are linking our organization’s reputation to a donor every time we ask them for a significant gift. It doesn’t even matter if the donor’s name is going on the side of a building anymore – stories about unethical or illegal activities by individuals, companies (and – unfortunately – nonprofits, too) are great fodder for selling papers. And the truth eventually comes out.

Due diligence and prospect research are increasingly important for the success and security of our nonprofit organizations. If you don’t do either type of research internally, think about outsourcing it at a level consistent with your budget and risk tolerance.

If you want to create your own due diligence policy, here’s a good place to start.

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A bigger boat

My brother-in-law’s voice had a huge smile in it when I picked up the phone. He might not even have bothered with a “hi.” Just: “You’re going to love this, Helen.”

As part of his and my sis-in-law’s kayak and outrigger tour business in Jaco, Costa Rica, Neil captains the Ashuma, a trimaran that guests book for day sails in Herradura Bay.

Neil’s also got a pretty good nose for prospect research, and every once in awhile he comes across a tip or resource he knows I’ll like, usually related to Central American sources or to yachts and/or the people who own them.

“I’m standing on Ashuma looking at the Hodor. Nice helicopter on the back. I’m going to send you a picture.” 10 seconds later, this pops up on What’s App:

Hodor. Photo by Neil Kahn

Now, Ashuma is not exactly a small sailboat – she’s 7.6 meters (25 feet) long, but Neil tells me she’s a dingy next to the Hodor, which I later learn is 66 meters long (216 feet).

As Neil is talking about what she looks like, I click the link to the article on the building of the Hodor on Super Yacht Times that he sent after the photo. It’s got lots of nice pictures which I start to scan through.

I see a helicopter, three or four boats on the deck, a winchy-crane-looking thing, three dune buggies, a gorgeous cabin and galley…

I’m skimming, skimming, mainly looking at the pictures, not really reading because he’s still on the phone…and that’s when I see it.

“Wait! Neil??!?”

Neil chuckles at the tone of my voice: “I was waiting for you to find that.” Simultaneously he and I both say, “SHE’S THE SUPPORT YACHT.”

My exhale turns into an almost-silent “holy cow.”

Lonian. Photo by Neil Kahn

Hodor is essentially a floating carriage house carrying the 20 support crew and toys that don’t fit on – or that they don’t want crowding up – the $125 million, 87 meter (285 foot) superyacht Lonian. Lonian is owned by 51-year-old Las Vegas billionaire, philanthropist, and art collector Lorenzo Fertitta and his wife, Theresa. The megayacht only has room for 12 guests, so you can imagine how big each stateroom is.

There are lots more resources

As we were about to hang up, I mentioned to Neil that two weeks ago my colleague Rick Snyder (no relation to this fine craft) wrote an article chock-full of resources that can help us think about (and estimate) the additional costs that a wealthy lifestyle entails. Nannies, housekeepers, family office managers – all of the people needed to keep the small village of everyday high net worth life running smoothly.

Neil’s call was another reminder to me (and to all of us) not to take things we see at face value, but to look behind the cost of the big yacht (or house, or island) to see if there’s an even bigger one to consider. Fortunately, there’s lots of information about these wealth indicators if you know where to look for them.

For example, if you ever happen to be walking down a wharf and see a yacht in a slip (or slipping down the waterway you’re walking by) you can check it out on the very handy MarineTraffic.com. The website/app doesn’t go into detail about a watercraft’s ownership, but you can get a lot of information for free about that ship sailing by.

Besides that and the other sources linked in this article, help yourself to lots more yacht (and art, and horse, and jet) resources which can be found in the “Wealth Indicators” section of the HBG Prospect Research Links (Americas page). Access is free; we just require your email address (which we don’t use to mail you) to register to access the pages.

If you have other favorites, don’t be shy – share them here with all of us, and I’ll add them to the links page for everyone to use.

ABOUT HBG

The Helen Brown Group was formed in 2002 with a goal to be different.

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