Setting Sponsorship Levels

Reader Question: “We are looking at having a community wide 5K run to help raise funds for the sports programs at our elementary school. We are planning for about 1,000 people. We are charging $20 for adults and $15 for kids. It’s in Berryessa, San Jose, CA. We wanted to have 3 tiers of sponsorship. What amounts would you suggest? It’s our first time putting on this event. The costs are expected to be about 8K. We are a PTA so we are non profit.” – Manju

A Small Change: Before I say anything about levels I should say that your sponsorship levels really change depending on the size of your event, your organization, what kind of benefits you can offer, etc. So this is more of a starting place than a definitive reference on how to set your sponsorship levels. It makes a difference what businesses or groups are geographically near where you work, are you in a big town with lots of small middle and large businesses? Are you in a small town that has mostly small businesses?

Often times non-profits will either ask for way too much or way too little. If your fundraising office raises between 2 to 7 million dollars a year it is going to be a long time before you are able to find a presenting sponsor at the $50,000 level. I would say set your presenting level at somewhere between $20,000 and $30,000. It might take a couple of years to get there but at least you have a starting place. If you have a great event with a sizable number of prominent people coming don’t sell yourself short.

Make sure that you have a few different tiers of sponsorship. Have a basic level that will be your entry point for new businesses and organizations to come in. I usually put that between $500 and $1,500 depending on the size of the event. You want to have a middle level to upgrade those businesses to, and a higher level for your major supporters. The middle level could be anywhere from $1,000 to $5,000 depending on the size of your event. For a high level sponsor I’d put the level somewhere between $5,000 to $10,000. If you have a huge event you might have another level in there but do not set too many levels or it gets confusing. I think 3 to 5 levels is a good start. If you are a small event with just a couple hundred people $5,000 might be your presenting level.

Think about who you are approaching. If you are approaching a big business they probably have or with the right amount of cultivation could be a major sponsor at some point for you. If you are working with local stores and small family businesses they will probably give in the $500 to $1,000 range. Asking businesses for the right amount is important make sure you are cultivating existing sponsors and that you know something about them (see my post on Making “The Ask” and Prospect Research).

Another thing you can do with sponsors that cover hard costs is provide them with a sponsorship for an in-kind gift or in-kind and cash gift. I would only do this if they cover a hard cost. Some example might be if you have a sponsor that creates your annual video for you for no charge, or you are getting medical supplies for no charge, or services. Make sure that it is something that you will actually use not just a general in-kind service.

It is hard to set levels and set a hard rule for all events. If you have specific questions or you have sponsorship levels at your organization please post them below. Another time I will talk about sponsorship benefits and what kinds of benefits you can offer and what businesses are looking for. My next couple posts will probably be about how to find donors or transparency in giving. Thanks for your comments and please post any ideas or questions.

Reader Question: “I am a member of a fraternity and our chapter is planning our first weekend event next summer for 300-350 tickets being sold. How far out should we start trying to get sponsors?” – Harold

A Small Change: Great questions Harold. It is never too late to make an attempt at getting a sponsorship. I’ve had businesses make a decision to give even a week before an event. However, if you are going to ask for sponsors of $1,000 or more, you need to give your businesses at least 3 to 6 months. When you start getting sponsors that give $5,000 or more you really need to start 9 to 12 months out. Many businesses need enough time for the sponsorship to be in their annual budgeting process.