Fundraising Agreement Template

In plain language: Identifies the organization and the fundraising party as legal entities, describes the purpose of the engagement, and states the effective date of the agreement.

Common mistake: Using a trade name or DBA instead of the registered legal entity name for either party. If the names don't match corporate records, enforcement and payment obligations become difficult to trace.

In plain language: Defines precisely what fundraising activities the consultant or agent will perform — donor outreach, investor introductions, campaign management, event coordination — and what falls outside the scope.

Common mistake: Describing the scope vaguely as 'fundraising services.' Without a specific list, disputes arise over whether the fundraiser's obligations include follow-up communications, reporting, or post-campaign stewardship.

In plain language: States how and when the fundraiser will be paid — flat fee, hourly rate, retainer, or success fee — and whether expenses are reimbursable, with a hard cap if applicable.

Common mistake: Agreeing to percentage-based compensation for nonprofit fundraising without checking state/provincial law. Most US states and Canadian provinces prohibit or heavily restrict contingency fees for charitable solicitations.

In plain language: Specifies how collected donations or investor funds are held, whether in a dedicated account or escrow, who controls disbursement, and the timeline for transferring funds to the organization.

Common mistake: Allowing the fundraiser to commingle donated funds with their own operating accounts. Commingling creates fiduciary exposure and, in the case of donor-restricted gifts, can trigger regulatory action.

In plain language: Each party confirms material facts — that the fundraiser holds required licenses, that the organization is a validly registered entity, and that neither party is subject to legal restrictions that would prevent performance.

Common mistake: Omitting the warranty on regulatory compliance. If the fundraiser operates without required charitable solicitation registrations, the organization can be held jointly liable for violations.

In plain language: Prohibits both parties from disclosing donor lists, investor contacts, financial data, and campaign strategy to third parties during and after the engagement.

Common mistake: No confidentiality clause at all. Donor and investor contact lists are among an organization's most valuable assets; a departing fundraiser with no confidentiality obligation can take them to a competitor.

In plain language: Sets the start and end date of the engagement, the notice period for early termination by either party, and the conditions that allow immediate termination for cause.

Common mistake: No termination-for-cause provision. Without one, an organization must continue paying a fundraiser who has committed fraud or lost regulatory licensure until a full notice period expires.

In plain language: Specifies what the fundraiser must do upon termination — returning donor records, transferring campaign accounts, delivering a final report — and any tail period during which a success fee may still be owed.

Common mistake: No provision for return of donor or investor data. Without this clause, fundraisers may retain and use lists built at the organization's expense after the relationship ends.

In plain language: Allocates responsibility for third-party claims — each party indemnifies the other for losses caused by its own misconduct — and caps total liability to a defined amount, typically the fees paid under the agreement.

Common mistake: One-sided indemnification protecting only the organization. Courts in several jurisdictions have found grossly one-sided indemnification clauses unenforceable, leaving the organization without the protection it intended.

In plain language: Specifies the jurisdiction whose laws govern the agreement and the mechanism for resolving disputes — arbitration, mediation, or litigation — and the venue.

Common mistake: Choosing a governing law with no connection to where either party operates or where funds are solicited. Several states and provinces apply their charitable solicitation laws regardless of a contractual choice-of-law clause.

A fundraising agreement is a legally binding contract between an organization — such as a nonprofit, startup, or business — and a fundraising party, such as a consultant, placement agent, or campaign organizer, that governs the terms under which funds will be solicited, collected, and managed. It specifies services, compensation, fund handling, confidentiality, and termination obligations for both sides.

You need a fundraising agreement any time a third party is involved in soliciting donations or capital on your organization's behalf. This includes hiring a nonprofit fundraising consultant, engaging a placement agent for an equity raise, contracting a professional solicitor for a phone or mail campaign, or formalizing terms with a crowdfunding intermediary. Operating without one exposes the organization to fee disputes, regulatory liability, and loss of donor data.

In the nonprofit context, percentage-based compensation is prohibited or heavily restricted in most US states and Canadian provinces. Regulators view contingency fees as creating a conflict of interest that can lead fundraisers to prioritize volume over donor relationships. For commercial capital raises, success fees tied to a percentage of funds closed are standard — but may require the agent to hold a broker-dealer license under US securities law.

In the United States, professional fundraisers must register with each state where they solicit charitable donations — requirements vary by state but most require annual registration, a bond, and contract filing with the state attorney general. In Canada, provincial requirements vary and several provinces require registration as a commercial fundraiser. For capital raises involving equity securities, the fundraiser may need a FINRA broker-dealer license in the US or an exempt market dealer registration in Canada.

Unregistered charitable solicitation typically triggers civil penalties against both the fundraiser and the organization that engaged them. In some jurisdictions, all funds raised in an unregistered campaign must be returned to donors. Reputational damage can significantly impair future fundraising. Including a warranty and registration verification requirement in the agreement shifts primary liability to the fundraiser while giving the organization a breach-of-contract claim.

Collected funds should be deposited into a dedicated sub-account or escrow arrangement — never commingled with the fundraiser's operating account. The agreement should specify the account details, the maximum time funds may be held before remittance (typically 15–30 days), and the reconciliation reporting the fundraiser must provide. Most state charitable solicitation laws independently require proper fund handling, and a contractual obligation reinforces compliance.

In the United States, several states — including New York, California, and Pennsylvania — require that contracts between nonprofits and professional fundraisers be filed with the state attorney general's charitable solicitation division before any solicitation begins. Filing deadlines and contract content requirements vary by state. In Canada, some provinces require contracts to be available for inspection but do not mandate proactive filing. Always check jurisdiction-specific rules before launching a campaign.

A fundraising agreement governs the relationship between an organization and the party soliciting funds on its behalf — it is a services contract. A grant agreement is between a funder and a recipient organization and governs the conditions attached to awarded grant funds, including reporting obligations and allowable uses. Both documents involve money flowing toward an organization but serve entirely different legal purposes.

For most standard engagements, a high-quality template is a solid starting point. Legal review is recommended when the fundraiser will operate across multiple states or provinces with differing registration requirements, when the engagement involves equity securities and potential broker-dealer licensing issues, when the compensation structure is complex, or when the funds at stake exceed $100,000. A 1–2 hour attorney review typically costs $300–$700 and is worth the investment before a major campaign launch.