Rutgers has long had a problem with fundraising.
Other American universities that date back to the colonial era—such as Harvard, Princeton, and Yale—formed the Ivy League and amassed huge endowments with the help of wealthy alumni. Rutgers, however, lagged behind in its fundraising efforts, so much that the school, then known as Queens College in New Brunswick, was forced to temporarily shut down twice in the late 18th and early 19th centuries. When Revolutionary War veteran Henry Rutgers donated interest from a bond he held, the grateful school renamed itself.
In 2010, Rutgers launched the “Our Rutgers, Our Future” campaign, with the goal of raising $1 billion in five years. Only a few weeks into 2015, the university announced it had surpassed that goal. The school has raised more than $400 million for faculty and research, $300 million in new endowment funds, and more than $100 million in athletics funding (spurred by Rutgers’ entry into the Big Ten conference).
The revamped fundraising efforts and successes are instructive for struggling colleges and universities, which increasingly rely on other funding sources as states reduce aid to higher education. Here are a few of those lessons, some of which are especially pertinent for schools that have been laggards on the fundraising front.
Rally alumni, yes, but also non-alum donors
In sharing stats from the campaign, Rutgers president Bob Barchi said the university had engaged 130,450 donors, of whom 70,690 were alumni. That's interesting. Many of these non-alums are no doubt linked to Rutgers through family ties, with parents of students likely making up the biggest share. But as we've also been stressing in our reporting, schools often reel in non-alums who live nearby and see boosting higher ed as a way to improve the community and broader region. In Rutgers' case, it has enormous brand identity in New Jersey, one of the wealthiest states in the country (and one where some residents have a chip on their shoulder). Clearly, the school has a found a way to cash in on that.
As for engaging alumni, Rutgers rallied the troops enough to hits its goal, helped by a number of wealthy and hardworking alums who served as co-chairs of the campaign. Along the way, it overcame some major weaknesses in this area. In 2013, Rutgers brought in a new fundraising chief, Nevin Kessler, a star fundraiser from NC State, who wasn't pleased with some of what he found when he got to campus. Kessler discovered that many Rutgers alumni had not had any contact with the university in decades. Take, for example, U.S. Trust President Keith Banks, a 1977 graduate who has given nearly $300,000 in the past decade. Rutgers never contacted him to solicit donations; Banks contacted them himself and asked how he could give back.
How could a university have so little on the ball in hitting up an alum who was a top bank executive? It's more common than you might think, and we've come across other examples of super-wealthy alums who reached out to offer help after being overlooked by campus fundraisers. The elementary lesson here, of course, is to zealously track your alumni.
Make the best of institutional supporters
Rutgers is based in a state packed with major corporations, as well as one of the biggest foundations in the country, the Robert Wood Johnson Foundation. The school has worked hard to take advantage of that fact. RWJF is Rutgers’ top benefactor; the foundation has given the university more than $80 million in the past decade, including $12.5 million in 2014 to help Rutgers merge with University of Medicine and Dentistry of New Jersey. Other big donors include major pharmaceutical firms in New Jersey, such as Novartis and Bristol-Myers Squibb.
Not every school lives in this kind of target-rich environment, but all should obviously be hitting up whatever businesses and foundations are nearby. One promising corporate strategy is to connect with the labor needs of companies, particularly around STEM. We've been seeing an avalanche of funding for STEM education by corporations worried about finding enough skilled grads. Rutgers has capitalized on some of that, but it's put more energy into connecting with the financial industry, which is one of the biggest employers in the New York area and a destination of a fair number of Rutgers grads. A program called Rutgers on Wall Street, intended to strengthen and monetize ties with finance, has been part of its billion-dollar campaign.
Health and Medical Education = Donor Dollars
Health science and medical programs bring funding for medical research and other health-related projects. Nearly a quarter of the University of Michigan’s endowment is reserved for the UM Health System. The acquisition of University of Medicine and Dentistry of New Jersey gave Rutgers several medical and health science schools, which university officials hoped would boost Rutgers’ standing and attract more dollars. Colleges with programs in medicine, nursing, public health, and related areas must leverage these to attract funding.
Here, again, connecting with the needs of local employers can be key. The healthcare sector will remain one of the fastest-growing areas of the economy over the next decade, and many employers in this area are worried about meeting their future labor needs. Universities can pull in big money by positioning themselves as helpful in this regard.
Sports Boost Fundraising (and Not Just for Sports!)
It’s no secret that sports generate millions in revenue for colleges and universities across the country. Rutgers’ entry into the Big Ten pushed athletics into the spotlight and helped drive donations, but the majority of funds raised went into research and academic activities rather than athletics.
Despite its fundraising successes, Rutgers’ endowment still trails those of other Big Ten schools, such as Michigan and Ohio State. A 2014 analysis by the Star-Ledger newspaper in Newark found that Rutgers’ $783 million endowment ranked dead last among Big Ten conference schools. While it may be playing catch-up for years to come, here’s hoping that Rutgers will continue the winning efforts of the last five years and continue to aggressively pursue donors (and that struggling colleges will learn from and apply the lessons).