Capital campaigns are transformative fundraising initiatives that allow nonprofits to think BIG like building a new facility, launching an endowment, or funding a community-changing project. But while vision drives excitement, financial planning ensures the campaign succeeds.

Here are the top 10 things your nonprofit needs to know in 2025, complete with detail and examples to guide your planning.

1. Start with a Feasibility Study

A feasibility study is your campaign’s roadmap. It tests whether your organization is ready, gauges donor enthusiasm, and identifies realistic funding levels. This usually includes confidential interviews with prospective donors, community stakeholders, and board members, plus a review of financial systems and staffing capacity.

Best Practice: Engage both internal and external perspectives. Consultants can provide unbiased feedback, while staff input ensures practical alignment.

Example: A science museum considering a $15M expansion discovered through its study that donors supported the project but wanted phased construction. Adjusting the plan allowed them to secure early commitments and eventually surpass their goal.

2. Define a Realistic Campaign Goal

Your campaign goal should stretch your organization but remain achievable. Overly ambitious goals can lead to frustration, while goals set too low risk leaving your project underfunded. Consider donor capacity, organizational history, and external funding opportunities.

Best Practice: Build in a contingency margin for unexpected costs, like inflation in construction materials or permitting delays.

Example: A community health center initially set a $10M goal for a new clinic. After reviewing donor data, they recalibrated to $7.5M, pairing it with grants to cover the rest. This approach inspired confidence and avoided a funding gap.

3. Plan for Donor Pledges Over Time

In capital campaigns, gifts rarely come as lump sums. Instead, major donors pledge amounts spread over three to five years. This creates a timing challenge between when commitments are made and when cash is available.

Best Practice: Create a pledge schedule tracking system that clearly outlines when funds will be received. Communicate with donors regularly to confirm payment timelines.

Example: A university received a $2M lead gift pledged over five years. Their finance team secured a construction loan using the pledge as collateral, ensuring dormitory construction stayed on schedule.

4. Manage Cash Flow Carefully

Cash flow is one of the trickiest parts of capital campaign management. Even if you’ve raised enough in pledges, you may not have the money in hand when expenses hit.

Best Practice: Develop a conservative cash flow projection that anticipates delays or partial fulfillment of pledges. Consider bridge financing options and maintain strong relationships with banking partners.

Example: A regional theater undertaking a $5M renovation arranged a line of credit, backed by confirmed pledges, to cover construction costs before pledge payments came in. This allowed them to move forward without cutting into daily operations.

5. Handle Restricted Gifts Responsibly

Many capital campaign donors give with strings attached—naming rights, designated rooms, or project-specific funds. While these gifts can be powerful motivators, they also create financial complexities.

Best Practice: Use fund accounting software capable of separating restricted and unrestricted revenue. Be proactive in matching donor restrictions with project needs to avoid lopsided funding.

Example: A hospital campaign received several restricted gifts for patient rooms, but little for core infrastructure. By carefully managing designations and transparently communicating needs, they balanced donor intent with essential funding gaps.

6. Account for Campaign Costs

Running a capital campaign is an investment. From consultants and marketing to donor events and pledge management, expenses can run between 5–10% of the total goal. Underbudgeting for these costs can jeopardize campaign momentum.

Best Practice: Treat campaign expenses as essential project costs. Factor them into your overall fundraising target so every dollar raised supports both the project and the fundraising process.

Example: A land trust included $400,000 in campaign costs within their $8M goal. This covered consultant guidance, donor appreciation events, and digital outreach—expenses that directly contributed to securing a $2M lead gift.

7. Keep Your Annual Fund Strong

Capital campaigns can unintentionally siphon attention and resources from annual operating support. If donors believe their gifts are only for the big campaign, your daily budget may take a hit.

Best Practice: Segment donor communications. Make clear distinctions between annual support (keeping the lights on) and capital campaign gifts (transforming the future).

Example: An arts nonprofit ran a $12M capital campaign while continuing its annual fund. Capital campaign communications focused on expansion, while annual fund appeals highlighted the need to support performances today. Both efforts thrived without donor confusion.

8. Focus on Donor Stewardship

A capital campaign is not just a fundraising project – it’s a relationship-building journey. Donors want to feel included, appreciated, and informed.

Best Practice: Develop a stewardship calendar with regular touchpoints, from personalized updates to recognition events. Remember that stewardship extends beyond the campaign’s end.

Example: A food bank shared quarterly video updates with campaign donors, hosted behind-the-scenes tours, and unveiled a donor recognition wall. Many first-time campaign donors went on to become loyal annual supporters because of the attention they received.

9. Plan for the Long-Term Impact

Securing funds for the project itself is just the beginning. New buildings, programs, or endowments bring long-term responsibilities like staffing, maintenance, and program delivery.

Best Practice: Incorporate sustainability into your campaign case. Consider creating an operating reserve or endowment to ensure your project thrives after launch.

Example: A children’s museum raised $20M for a new building and wisely included a $2M reserve fund to cover operating expenses. This forward-looking plan reassured donors and secured the museum’s stability.

10. Prioritize Transparency and Reporting

In the age of digital communication, donors expect regular, clear updates. Transparency builds trust, encourages future giving, and sets your organization apart.

Best Practice: Provide multiple avenues of reporting: campaign dashboards, annual updates, progress newsletters, and in-person briefings. Always tie updates back to donor impact.

Example: A conservation group built an online campaign dashboard showing funds raised, pledge fulfillment, and land acquired. Donors could see progress in real time, inspiring some to increase their pledges mid-campaign.

FAQs About Capital Campaigns

Q: How long does a capital campaign usually last?
Campaigns often take 2–3 years to complete, with pledge fulfillment continuing up to 5 years.

Q: Do we need outside consultants?
Consultants aren’t mandatory but can provide objectivity, expertise, and structure, especially for organizations attempting their first campaign.

Q: What percentage of gifts usually comes from major donors?
On average, 60–80% of campaign funds come from 10–20 lead donors. Building strong relationships with this group is vital.

Q: How do we prevent pledges from going unfulfilled?
Stay in touch with donors, track pledge schedules rigorously, and plan for 5–10% attrition when building your financial model.

Q: Can restricted gifts be changed if project needs shift?
Only with donor consent. Always request written approval before reallocating restricted funds.

With the right financial planning, a capital campaign can do more than fund a project: it can deepen donor relationships, elevate your organization’s reputation, and secure your long-term impact.