This special issue of FN&C Now is part of an occasional series highlighting an event or hot topic for grantmakers. This one focuses on online donor services.

For many community foundations, the Internet has transformed foundation operations and donor expectations. Providing donors with 24-hour access to their account information has become an essential component of any donor advised fund. Recently, FN&C Now interviewed John Sestak, DonorCentral product manager for MicroEdge, Inc. to learn about recent trends in donor services.

FN&C Now: Why do donors and advisors want to access fund information online?

JS: We live in busy times. Online donor services allow advisors to take care of things on "donor time"—to make grant suggestions to nonprofits, check on their funds and the status of contributions whenever it's convenient for them, from any computer with an Internet connection anywhere in the world. It goes hand-in-hand with the growing need to deliver high levels of service to clients. We work with a lot of clients who tell us, "customer service is key." With online services, they can provide better donor service all the time.

FN&C Now: Why is it so important to provide online services?

JS: Online donor services provide a great way to link the donor to the foundation via the Web—the most far-reaching and convenient communications vehicle available. Foundations using DonorCentral have also reported that for donors who produce a lot of suggestions, it provides a cost-effective and faster mechanism for them to put those suggestions through.

FN&C Now: What else can donors accomplish using online services?

JS: The right solution will allow donors and fund advisors to log on to a private, secure area to view fund balances and download formatted fund statements. Data is always fresh, since it is tied directly into the foundation's back-office systems, such as FIMS and FoundationPower from MicroEdge. Within minutes, donors can view how many contributions were made during a given year, including the date, amount and type of each gift. Detailed grant information lists every grant ever made from the fund, including the date, the amount and the recipient. Clients can even update their profile and contact information online.

We also provide the ability for foundation staff to browse a list of their foundation's approved charitable projects and select one or more to add to the list of grant recommendations with software called SuggestionCentral. Donors can browse a list of charities that have been given grants by the foundation, link to their websites, or obtain more information through GuideStar, right from their browser. In a nutshell, it's one-click grantmaking.

FN&C Now: Are you working with a lot of community foundations providing online donor services? What type of growth have you seen?

JS: There is a huge need for online donor services, and the growth has been nothing less than phenomenal. For example, the DonorCentral service was first made available in late 2000 and just four years later, approximately 12,000 advisors are managing 14,000 funds with the service. A remarkable 32,000 grant suggestions were made in 2004, totaling $236 million. Our service volume has just exploded, with a growth rate of over 100 percent in each of those four years.

FN&C Now: How can community foundations benefit from offering online services?

JS: Some foundations using DonorCentral have over 60 percent of suggestions coming in online. There are significant cost savings associated with this process, and it also saves staff members' time—time that can now be devoted to more strategic work. Donors appreciate the ease of information retrieval provided by the online service. Also, foundations report that it has created closer donor ties to the foundation. For example, foundation staff can easily send broadcast e-mails to fund holders, which helps to maintain open lines of communication with their donors.

FN&C Now: How do online services create closer ties between advisors and foundations?

JS: First, giving advisors instant access to information and the ability to conduct their business when it's convenient is an invaluable service. Online services also facilitate communication. We are steadily adding new features to DonorCentral to more closely connect donors to the foundation. For example, often within foundations there are many important funding initiatives that go unfunded. Now foundations will be able to better connect donors to these funding opportunities by presenting specific grantmaking opportunities to their donor advisors—as those needs arise. This is a very exciting area of future software development for us and is another way of more closely connecting the donor with the foundation.

John R. Sestak is the DonorCentral product manager for MicroEdge, a leading provider of technology to community foundations and one of the first companies to offer Web-based donor solutions. MicroEdge has been serving community foundations for nearly 20 years, and currently supports more than 85 percent of community foundation assets in the industry. John has spent the past eighteen years developing software solutions for some of the largest community foundations in North America. After graduating from the University of Minnesota School of Management with a BSB in accounting, John joined Arthur Andersen's tax practice. John was then recruited to DMO Inc. and worked as the project leader in the development of community foundation software systems. In 1991, John started Integrated Foundation Services, which merged in 1997 with NPO, which then became MicroEdge.

MicroEdge is the leading provider of software and services for the grantmaking community worldwide. With effective technology solutions, MicroEdge is helping grantmakers deal with many of today's challenges, such as:

• Compliance, transparency and alignment
• Effective communication with stakeholders
• Emerging social reporting standards
• Evaluation and measurement of giving impact

Find out how you can more efficiently promote, share, manage and measure your giving vision inside and outside your organization.

Visit: http://www.microedge.com

E-mail: info@microedge.com

Call 1-800-899-0890, ext. 250