Fundraisers Should be Fun, But They Also Must be Profitable

December 2nd, 2025 | Nonprofit
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If you’re planning a major fundraiser such as a dinner gala, you may be focused on the fun factors — for example, the venue, menu and entertainment. After all, providing attendees with a good time can help cement their allegiance to your not-for-profit. Even better, they may bring guests who become new supporters.

But don’t ever forget the key objective of your event: raising money. To make your fundraiser profitable, pay close attention to the numbers, even if it means substituting what you initially wanted with more affordable alternatives.

Set Goals First

When you begin planning your event, start with a total fundraising goal. This should include funds received from event attendees, sponsors and any pre-gala solicitations. Your financial objective should be realistic, based on your nonprofit’s experience with previous fundraising events. But consider a stretch goal — say from 5% to 20% more than last year’s big fundraiser.

Estimate Expenses

Estimate expenses for items such as:
  • Facility rental
  • Food and beverages
  • Prizes and decorations
  • Invitations and publicity
  • Outside event coordination
  • Speaker and entertainment fees
  • Special event insurance coverage
  • Permits (for example, to charge sales tax or host a raffle)
Examine your list closely for expenses that can either be eliminated or reduced. If, in the past, you held your annual event at a luxury hotel, you might want to try a new venue that will discount the space for the opportunity to host your community’s leaders. Even if you receive discounts, be sure to include the original expenses in your budget should you need to pay the full amount for a future event.

Seek Sponsors

Good sponsors are critical. Not only can they help defray expenses with donations of goods and services, but they can also raise your nonprofit’s profile by introducing your name to a new audience. Be careful, however, not to promise too much in sponsor benefits, such as free advertising — it could lead to unrelated business income tax problems. In general, quality is more important than quantity. Target well-known names with a connection to your nonprofit. For example, children’s apparel companies may make ideal sponsors for a K-12 education nonprofit. A successful business book author might be a great fit for a trade association meeting. Board members can be particularly helpful in finding sponsors by working their connections.

30% Rule

Obviously, you don’t want your fundraiser coming off as “cheap,” and sometimes it’s necessary to spend money to make it. Just keep in mind a long-held rule that says fundraising events shouldn’t cost more than 30% of net proceeds. For help making an efficient event budget and other revenue-raising ideas, contact us. © 2025