Start With the Heart: Why Transactional Fundraising Is Failing Leaders, and What Comes Next

In this episode of The Disruptor Podcast, John Kundtz sits down with Bill Crouch, CEO of BrightDot Fundraising Advisors and former college president, to discuss why traditional development tactics are failing leaders, and what replaces them: 

➡️Trust, 

➡️Relevance, 

➡️Relationship, and 

➡️Mattership (the discipline of making supporters feel seen and valued, so philanthropy becomes relational, not transactional.)

Bill shares the origin story behind his “start with the heart” philosophy (including the dinner that failed), why major donors evaluate leadership before the mission, and the practical disciplines nonprofit CEOs can use to build momentum without burning themselves or their teams out.

What you will Learn:

1️⃣Why transactional fundraising is failing—and how donor expectations have changed

2️⃣What “start with the heart” looks like in real donor conversations

3️⃣How major donors assess leadership, credibility, and trust before committing

4️⃣The difference between targeting donors and earning a relationship

5️⃣A simple weekly cadence leaders can use to build a sustainable fundraising engine

About our Guest:

Bill has spent 40 years helping nonprofits and higher education leaders shift fundraising from transactional activity to transformational impact through BrightDot’s “Art of Fundraising” approach—blending strategy with human connection, storytelling, and leadership presence.

Connect with Bill on LinkedIn
Contact Bill Crouch: bill@thebrightdot.com
Buy his book: Start with the Heart
Visit BrightDot's Website 

Transcript

Introduction to Disruptive Fundraising

John Kundtz 0:00

Start with the heart why transactional fundraising is failing leaders and what comes next. Hi everybody, I'm your host, John Kuntz. Welcome to another edition of the Disruptor Podcast. For those that are new to our show, the Disruptor Series is your blueprint for groundbreaking innovation. We started the podcast in December of 2022. Our vision was to go beyond conventional wisdom by confronting the status quo and exposing the raw power of disruptive thinking. And today's guest embodies that spirit, Bill Crouch, CEO of Bright Dot, has spent over 40 years helping not-for-profits and organizations transform fundraising from transactional processes into a catalyst for lasting change through the art of fundraising, where science, strategy, and human connection converge. Today we'll explore how traditional fundraising models are breaking down what not-for-profit leaders must do differently to build trust, connection, and momentum. Welcome to the show, Bill. Thank you, John. Delighted. It's great to have you here. We'll get into this in a second, but I think you and I have spent uh a good bit of our professional careers in the in the not-for-profit space. And I was thinking about this. I don't want us to sound old, but I think our combined experiences were probably over 70 years of experience, maybe closer to 80 or 85. But anyway, before we get started, tell us a little bit about your background, your education, your experiences, how'd you get here? Start anywhere you want.

Bill Crouch 1:50

I started out in college wanting to be involved in the nonprofit world. I went and got my doctor's degree. I went on the faculty and staff of university. I was there for about six months when the president invited me to his office, which was a scary moment for me as a young faculty member. And he said to me, I think you could be a college president one day. I like who you are, I like how you think, but you got to learn how to raise money. So I I want to put you in the development office. I want you to create a corporate and foundation strategy for the college. And then I want you to be my chauffeur. And I want you to ride with me where I go to see donors because that's going to be the best way for me to mentor you. So that led me to getting another doctor's degree, basically, by this wonderful individual. Led me to becoming a director of development of a statewide nonprofit. Then I became a vice president development for another college. Then I became president of Georgetown College in Kentucky, where I was for 20 years. And you know, John, one of the things about these small private liberal arts colleges, even 20 years ago, we're always the underdogs. You know, we're competing against large public universities, we're competing against the United Way and everybody else. And there are just so many reasons for people to give. And in at my particular college, we had 1,200 undergraduate students, was our student body. We had no master's degree program. Our job was to help prepare students to go to graduate school. And I had to figure out how to compete against others for the philanthropic dollar because I was not getting any state money. I built 17 buildings when I was there and didn't get a penny from the state or federal government. It all had to be private fundraising. So I had to become very disruptive in how I thought about going out and competing against the University of Kentucky, which was 12 miles down the road, and had tickets to basketball games and football games and all those, all those types of things. Then I got involved with the Jerry Penis fundraising firm in Chicago. I was a senior managing partner there for a couple of years, but decided that wasn't my why. What I really wanted to do was to help the smaller, smaller organizations, smaller colleges, a lot of community colleges to think differently about how they went about fundraising. But now I've been doing it for uh Bright Dots 11 years old now, and we've had over 150 clients, and we've had a lot of success.

Challenges in Traditional Fundraising

John Kundtz 4:30

That's excellent. I love that story. I also love the fact that you focused in on liberal arts because I'm a product of a liberal arts education. Again, it's relatively small, just up the road, if you will, up 75. Yep. At Denison University in Grandville. And so again, they struggle with some of the same things. I love about liberal arts, just a side note, is especially today, I wouldn't be where I was today without a liberal arts education, even though I was a scientist and got dual major, the science degree and then the liberal arts degree. And it really helped me think community, critical thinking, problem solving, all these things you need, especially today when things are just sort of going to go upside down with all the technology changes. Right. But anyway, what I think makes this discussion interesting is we do have sort of a parallel tract, although it'd be a different. When I joined IBM in 1984, the first thing they said is you need to get involved on boards and community. It's part of the culture of IBM was to not only sell stuff to our clients, but also to give back and it put it into our DNA. I've been spent spending time on the board side of not-for-profits for over 36, 7, 8 years now. So I seen a lot of the things we you talked about in your book and some of the things we'll talk about today. And I think it'll be a great sort of melting of our two, our two roles, you on the, I'll call it on the on the on the sell side and me on the board side. Yeah. But speaking of that, so what are some of the biggest mistakes you see not-for-profit leaders making when taking this more traditional transactional approach to fundraising? Because when I started it, I was just bang stuff out, send them letters, send them this, invite them to a benefit or whatever. And that's in my mind's clearly changed.

Bill Crouch 6:16

It's changed for a lot of reasons. One one, the demographics of the country have changed a lot. Secondly, the tax incentives for the middle class where they're itemizing their deductions. Now they get an automatic deduction. So that's that's changed. The the the way the way young couples and families operate are so differently now. There's a whole lot more competition for time, investments, and and philanthropy that that people have. And the the transactional way just won't work. But I'll tell you, just recently, John, I've begun to really realize that one of the real challenges of being a CEO of a small nonprofit or a liberal arts college is risking investing in something now that will have a long-term gain. You know, I always was when I was coming through, they said you only had to do one thing to keep your board happy, and that's to balance the budget every year, right? Which is a detriment to trying to think long-term. So I know it like in my company this year, I invested in four long-term strategies that meant that I had an unbalanced budget this year, but next year we're going to see the rewards of that. That's not the thinking that that you see there. And so when we when we go in and say, hey, we want to help, we call it build you a philanthropic engine for the future, but you're going to have to invest up front before you start seeing the ROI, that's a very difficult decision because that might mean not balancing the budget that year. Correct. And you know, from your board perspective, that's uh that's always of a cheap concern. It's interesting to me, too, that board members who can be risk takers in their businesses and risk takers in how they invest in technology and stuff for the future, but once they come to the board at the college, a lot of that risk taking goes away. And it's it's just a different kind of mentality that that takes place. So we're always we're always trying to talk that way with our clients. Invest, invest, invest. That's different from an expense.

John Kundtz 8:44

Right. And it's it's a tough conversation to have. I think some of it has to do with the fact that a lot of board members are corporate and they're coming from for-profit, publicly traded companies, and having worked for one for 40 years. I know we were very coin operated. It was like, what have you done this quarter? And it is a it's an interesting balance because as a board, you know, board chair now and then and a board member and been on finance committees and governance committees, and you name it. You don't want to get in a position where your programming paces your ability to pay for, because at least the the not the not-for-profits I work with, which are not educational institutions as much, but they're great at programming. You got to balance that because you don't want to be in a situation where you're trying to ask people to donate to put good money after bad because nobody wants to be in it. It takes some real tenacity, for lack of a better word, to balance the the need to make investments, especially today, as you mentioned. It's it's a it's a different world than it was 30 years ago, as far as that fundraising piece. But at the same time, some of these smaller folks are right on the edge of not making it.

Bill Crouch 9:54

Well, I remember one of my favorite favorite stories is about the Woodruffs in Enry University, and they're getting ready to build a big science building. And at the groundbreaking, the development staff wanted everybody to come to have a test tube given to them as they got there with a rose in it. And they wanted to say to Mr. Woodruff, we have a special test tube for you. It's gold, and we promised to you for the rest of your life that every single day we're gonna deliver a red rose to your office. Well, if o went crazy. He started he started adding up, well, what if he lives to be 65? What if he lives to be 75? How much does that cost us? How much is the gas to deliver it to his office and and all of that? But they went ahead and did it. And after a year, one day, Mr. Woodruff called the president of Emory and said, Nobody delivered the roads to me today. And all of a sudden he realized, and when he left a hundred million dollars in his estate to the to the university or something like that, but the but the the thinking to CFO, no, no, we can't we can't spend that kind of money for that. And that's one of the challenges we run into all the time, is is getting people to believe that these investments will pay off. Five and ten homes.

The Importance of Donor Relationships

John Kundtz 11:23

Pennywise and pound foolish, as they say. A hundred million dollars can buy a lot of roses. Right. Right, right. That's so cool. In your book, you talk about the dinner that failed.

Bill Crouch 11:34

Yeah.

John Kundtz 11:35

And it's you're starting to tell a story, but I'd love you to tell the story about the dinner that's failed because I think that's part of your origin story and your epiphany bridge, if you will, that got you off to where you are today.

Bill Crouch 11:47

Yeah, so we the college had voted 30 years before I became president to build a new library, but it never had never done it. And and I knew that if I was going to be a president that the faculty were excited about, I needed in my first week or two to announce we're going to build that new library. And so we went through a process of getting it designed and all of that. And so then I had to go raise the money for it. And we had a a donor who had three sons who had graduated from the college. He and his wife, neither one went to college, so they really valued education. They had a magnificent company. He had two jet planes. There were there was plenty of plenty of resources there. He had made an earlier half million dollar gift to renovate our chapel. And so I decided this is the job level to give the lead gift to our library. And so I got everything put together perfectly. I mean, it was, John, it was the perfect situation. We went to the city club in downtown Louisville. I had all three of his sons and their spouses and his wife, and I had my board chair and wife and my wife with me. It was a perfect setting. And we sat there and had a delightful dinner, which the donor was paying for because we were on his membership. And then we brought in the flip chart with the beautiful renderings of the library. And I told the story that the faculty had been waiting 30 years for this building, and I told him about how many books that we were going to have in there, and I told him about how we were going to let the community come. I just told him about what a great building. And then we asked him, this was 1996, we asked him for 10 million dollars for us to build the building. He reached over and grabbed her hand. He looked at his sons, who all were in a very positive shaking their head, but he said, Well, we will certainly pray about this. And Bill, I'll give you an answer within two weeks. So when we left and we got outside to the parking lot where the board chair was parked next to me, we gave each other five high-five. On the way to the campus, I called my VP for development and said, We're gonna we're gonna get it. This is just is just it. We're gonna get it. And two weeks later, I get the call and he said, Bill, we just don't think this is what we want to do. And I was stunned. I was just absolutely stunned. I was embarrassed because I had indicated to our campus that this was this was gonna happen. And so for about two weeks, I I was just depressed for sure. But then I woke up one morning and it struck me I did this all wrong. I did it all wrong. And and I realized what I had done is I I had gone in there and only talked about the college, only talked about the the books, only talked about the board, and I had made a fatal mistake. I did not talk about him and his family first. So I called him, drove the hour and a half to back to Louisville, got to his office, and walked into his office and said, Oh you a big apology. I am so sorry that I didn't listen to your heart. And when I saw you reach over and grab her hand, and I've come to realize that was the most important thing in your life is your relationship. And his his name was Clyde. I said, Clyde, we need her name on the front of our library so it will be there forever, and that people can call and hear your story and how you went from nothing to there. And he looked at me and he said, Let's do it. And what I what I learned, and I teach this now to all of our clients, when you're talking with the donors, it's gonna be all about them. You gotta you gotta show them how they matter, and then you can talk about who you are and what you do and how it matters. So that was a real turning point in my in and I've been at it a long time. John, it took me a long time to get to that realization.

Strategies for Effective Fundraising

John Kundtz 16:30

Thank you for sharing that story because I read it in the book, and we got to share this because we've all been through this. I've been through it both on the corporate side and the not-for-profit side. And we've all sort of had these epiphany moments where we keep talking, we'll get into this a little bit, but we keep talking about the what and the how, but we don't talk about the why. And I think that's probably was your first experience, even whether you even had read Simon Sinek's book or not, it was probably your first intuitive of like, wow, I have to talk about why this is important to the donor, not why it's important to Bill or the college or the alumni. First of all, it's a great emotional story. Second of all, it's it's a story where you have to be a bit vulnerable to tell it. And I think it makes it a great for any leader, whether you're in the not-for-profit sector or not. I but especially today for trying to raise large donations from donors. And we make this mistake all the time. We we talk about all the cool programming we're doing and all the you know, the kids we're helping and whatever, all the horses that we are uh making better lives for, blah, blah, blah. But we don't actually necessarily understand why that donor would care. Yes. And so it's probably the next question, which is that's the mind shift, mindset shift, I think, that every not-for-profit leader would adopt before they they sort of make the ask. Would you agree with that?

Bill Crouch 17:55

Absolutely. Absolutely. I recently interviewed a woman billionaire, and I asked her if she would give me 30 minutes to talk with her by Zoom, and I told her I wasn't asking her for a donation. And so we got on the phone and I asked her how she and her husband were were making their philanthropic choices now. And and she she immediately went down the same thing. So we want we want to know that the people that are asking us for money know who we are. She even went so far as to say, I want to know that that they know what art I love and what music I love, that they know a lot about me, and that we can have that kind of relationship. I we call it eagle to eagle. It's it's the the executive director of the VP development rising to the eagle level to have that type of conversation with somebody. That's how we've got this partnership with Crane Stationery. You know, high high wealth people use very nice stationery. And and she said to me, Don't don't send me a letter on your your nonprofit stationery. Send me your personal stationary. I want to know you personally, which is another thing I've learned a lot about they these high wealth people are looking for a relationship with the leadership. They they want to know that they trust the leadership, including the board. Right? Who's on the board? Do I know these people? If I've seen them in action before, are they people that might be really maximized? And to me, that's not transactional at all. That's that's relational, and that's what we call donor mapping, which is part of one of our strategies.

John Kundtz 19:52

That's it's so relevant. I just had a thought and now it just escaped me. So it'll come back. So you've worked with a lot of not-for-profits, higher education leaders for decades, as we mentioned earlier. And what makes your approach fundamentally different, especially for people that want to try to start transforming the way they're doing fundraising?

Bill Crouch 20:13

We we call it the we we add the color to what a president will do. I'm working with a with a college president right now, and he was getting ready to invite eight potential donors to his office for a luncheon. And when I and we so we started talking about who these people were in the agenda, and he said to me, Well, the first thing I'm gonna do is to show him the new building that I want. I said, I got a better idea. First thing you do after everybody's seated, I want you to say to go around the room and say to everybody, let's go around the room. I want to know what your favorite childhood toy was. In the process of their answering that question, you're gonna learn about what brings them joy, what brought them happiness. You're gonna learn some things about their childhood. You're gonna learn some other things that can be important to you as we start building on the relationships. Right? And so that's the type of things I said, where are you showing up in the community where people wouldn't expect you to show up? Right? What are what are the how do you how do you I even ask what kind of stationery are you using? I'm I'm trying to coach the presidents and executive directors to know what the high wealth world looks like. Because whether we like it or not, you know, it's more money being given in this country today than ever before, but it's being given by fewer people. And it's and it's the high wealth that we call the 95 5 rule. 95% of all the wealth in any community is controlled by 5% of the people. And and We tend to focus on now in the nonprofit world is on the 95%. That's the transactional part. And what we try to say is let's keep our finger in that pot. Let's keep doing that. But we've got to really focus on who are the 5% of the people in the community who have the resources and what do we got to do to build relationships with those people. And if they have a horse farm, we better learn a little bit about horses. And when we go out there to see them, we better be in jeans and boots. And not everybody gets that, John. You know, is they don't understand. So we spend a lot of time coaching towards the 95-5 rule. As the millionaire woman said to me, she said, Bill, if I were talking to a nonprofit executive and I said to that person, I have to leave to go to the FOB to catch my plane, most of them would not know what an FOB is. Right. Right? And they need that. So we've created what we call the presidential toolbox for 10 things that a president needs to know before they go see high wealth people. And it's and it because you know most most CEOs and most in nonprofits, particularly the smaller ones, have low self-esteem when it comes to high wealth family, high wealth asking. Most is I think I mentioned you before, we think about 90% of all people that look work for nonprofits grew up in lower to middle class families. And all of a sudden they're being asked out of necessity to start building relationships with high wealth people. We even do etiquette training for some of our clients because we think that's an important part of building the trust relationship with others.

John Kundtz 24:04

It's hard. I don't care how I spent my entire career in business development and sales and consulting and stuff. And it's hard. You don't want to come off sleazy. You don't want to come off like you're greedy. You don't want to come off desperate. And you're right. And then you add on top of that, now you're talking to somebody that's flying on private jets and's got five houses around the world. I can see how just a little bit of coaching really could make a big difference. Again, building that personal connection, empathizing with the donor, understanding why they want to give money versus what they want to give money to, things like that.

Bill Crouch 24:42

Another thing I would point out real quickly is that we we bring a lot of fun. We don't think that there's enough fun going on within within the shops. And just to give you an example, everybody knows that women over 70 are a very important group right now because this trillion dollar transfer of wealth that's coming on, et cetera, et cetera, et cetera. And so we will go into a place and they'll have a uh a tea at 10 o'clock at the at some place for the women to come. And and and what we're learning, that's not what women over the age of 70 will. The older you get, the more questions you have about your value. If I'm 86 years old sitting in a senior living hall, what's my value to the world? And what we're saying is give them value. So we we'll take a women in philanthropy group, which a lot of places have, and we don't call it that. We call it grandmothers that give a hoot. And we invite them to the college to play games, to do things, to to do at have activities where they're relating to the the people that we're serving, and to keep saying to them, you matter, you matter, because one thing we know about grandmothers, they care about their grandchildren, and that's a heart thing. Has nothing to do with what building we want to build. It it has showing these these women they are they still have value. Relating to college students is really can be a very powerful thing. So that's how that's how we do our stuff.

Final Thoughts and Future Insights

John Kundtz 26:27

Interesting. Excellent. So we're starting to wrap this up, but so before we do, is there any one insight or lesson you think a not-for-profit leader needs to hear about before they what they should do, but they don't often do just because they don't think they have time.

Bill Crouch 26:42

I think it's compartment call it compartmentalization. What what we think is that if a CEO or executive director would take two hours a week alone in a place where there's no distraction and totally focus on fundraising, they would raise so much more money than they do now. And we have a we we even have an agenda for those two hours. So we want you we want you to write four four handwritten notes. And the four handwritten notes are looking backwards. We want you to write the former board chairs. We want you to write somebody who gave them the state gifts family. We want you to do that. We we like the fact we say for uh the colleges and for others, whenever you have somebody in your your a donor who dies, fly your fly your flag at half mass. Not the American flag, but your your organization's flag. Take a picture of it, frame it, and send it to the family and say how much you matter. Then we want the president to make two phone calls during this two hours. Then we want the president reading Start with Tart or some fundraising book, a couple of chapters. But what happens is we get so distracted. And the fundraising piece often falls to the eight o'clock at night piece. And we think it's about intentionality, two hours a week, very purposeful, and getting a lot accomplished.

John Kundtz 28:14

Well, and the the eight o'clock at night strategy fails just because your brain is just not as fresh. I don't care how old you are, these kind of things, and you're gonna deep thinking and and and intentional work, particularly today's sort of interrupt-driven world, I find is you gotta get some of that. Just wake up in the morning and do that first thing and get it over with. Otherwise, you just kick that can down the road and you'll procrastinate, and then some fire drill will come up, something with the programming. That's great advice. All right. So just to sort of wrap it up and start with why, back to Simon Sinek, who famously reminds us that people don't buy what you do, they buy why you do it. And Bill, what I really appreciate about this conversation is how clearly you are reframing the why behind fundraising, not as the transaction, but as an act of leadership and human connection. And with that said, we're gonna have a follow-on episode, and I'll be sitting down with Greg Warner, the CEO and founder of Market Smart, to explore how these ideas get operationalized through systems, signals, and disciplines at scale. Because as we just discussed, philosophy without systems doesn't scale, and systems without part don't last. So, Bill, for our listeners who want to learn more about you, your work, book, bright dot, what's the best place to start? How do they get a hold of you? What are your socials?

Bill Crouch 29:44

Yeah, so we're we're we're very active on LinkedIn, Facebook, so you can just type in Bright Dot and you'll find us. Or my my email is bill at the bright dot.com. And we have some really great conversations that we we would love to have with you if you are if you're interested. But this is I think this is a golden moment for fundraisers 2026. I think because of donor advice funds, the RRA distribution, the tax law changes, it's a golden moment. 2026 should could be one of the biggest philanthropic years ever. And we've got some thoughts about that.

John Kundtz 30:24

That's a topic for a whole nother podcast that we might want to do. We will include all of those links into the show notes. I will definitely put a plug-in for your book. Start with the heart. It's it's a good read, it's it's a quick read, it's available on Amazon and all the other places you can buy books.

Bill Crouch 30:42

And I want to go back to the why. Understanding your why and understanding the why of the people who work with you. We've identified nine different whys that employees can have. It's so critical if you're going to serve others and want to know about their why. Getting to know of donors why is the key to successful fundraising in the future.

John Kundtz 31:09

Great advice. So, again, I'm John Kunz. Thanks for joining us on this edition of the Disruptor Podcast. Have a great day.