What Is Development in a Nonprofit? The Office, Roles and Costs

In a nonprofit, “development” means fundraising plus everything that makes fundraising possible: finding donors, building relationships with them, thanking them, keeping their records and planning where next year’s money will come from. The development office or department is the team that does it, and the development director is the person who leads it. The word exists because raising money from people who keep giving for years is mostly relationship work, and only occasionally the ask itself. This page explains what a development office does, how it is structured as an organization grows, what the titles mean, and, from IRS data on 256,539 charities, how few organizations hand any of it to outside fundraisers.

Development, fundraising and advancement

The three words overlap and are often used interchangeably, but each has a centre of gravity.

• Fundraising is the activity of asking for and receiving gifts: an appeal, an event, a grant application, a major gift conversation.
• Development is the function that plans and sustains fundraising over years: the donor database, the cultivation and stewardship of relationships, the annual plan, the reporting. A good development office raises next year’s money this year.
• Advancement is the term universities, independent schools and hospitals use for a wider function that usually includes development, alumni or community relations and sometimes communications.

If a job advert says development, read it as fundraising with a strategic and relationship emphasis. If an organization says it has no development function, it usually means it raises money only when it needs to, which is the expensive way to do it.

What a development office does

A full development office has up to nine units. Most organizations have two or three of them, often all inside one person.

The unit that is most often missing and most often regretted is advancement services, the operations work of gift entry, receipts and data. Every other unit runs on the donor database. When gifts are entered late or donor records are unreliable, the major gifts officer prepares from bad information and the annual fund mails people who have died. The CRM and donor management software comparisons cover the system; the discipline is a staffing decision.

How a development office grows

There is no standard staffing ratio for development, and we could not find a credible source for one, so treat any rule of thumb you hear with care. What is consistent is the order in which functions are added.

Two rules of thumb hold at every stage. First, the person responsible for major donors needs protected time for them; the moves management guide works out how many relationships one person can actually carry, and Apra’s research on gift officer portfolios suggests the commonly quoted figure of 150 prospects is several times what one officer can work properly, a point covered in how many prospects per gift officer. Second, every new fundraiser needs someone, or something, keeping the data clean, or their productivity falls within a year.

The titles, decoded

Titles inflate with organization size. A development director at a $600,000 charity and a development director at a $60 million hospital foundation do very different jobs. When comparing pay or responsibilities, compare by organization budget, which the nonprofit salaries data does.

Build or buy: what the IRS data shows

The obvious alternative to staffing development is paying someone outside to do it: a consultant, a grant writer, a professional solicitor. Form 990 lets us see how often charities do. Part IV line 17 asks whether the organization paid more than $15,000 for professional fundraising services, and Part IX line 11e records the fees.

Across all 256,539 charities in the IRS extract with at least $25,000 of spending, only 3.0% reported paying outside fundraisers more than $15,000 in the year, and their fees totalled about $1.41 billion. Under $1 million in spending, fewer than one charity in thirty pays any professional fundraising fee at all. Where small charities do pay, the median is under $10,000, the cost of a grant writer for a few applications or a short consulting engagement.

The conclusion is not that outsourcing is wrong. It is that for 97% of charities, development is done in-house or not done, and line 11e records only fees to outsiders; staff time spent on fundraising does not appear in it. Contractors are a sensible way to buy specialist skills, a feasibility study, a campaign plan, a grant application, and a poor way to buy relationships, because the relationship leaves with the contractor. The rules for using them are in can a nonprofit hire independent contractors.

What fundraising costs, by activity

The figures below are the guidelines most often cited in the field, from James Greenfield’s work on evaluating the fund development process. They are rules of thumb from practice, not a measured benchmark, but they explain why development offices grow in the order they do.

Major gifts are the cheapest money an organization raises, which is why the second development hire is usually aimed at them. Acquisition mail costs about what it raises, which is acceptable only because a retained donor keeps giving, a point made with numbers in the donor retention guide. Events are expensive per dollar once staff time is counted, which the fundraising metrics guide shows how to calculate.

Pay and the job market

The Bureau of Labor Statistics counts 140,900 fundraiser jobs in the United States in 2025, with a median annual wage of $72,550 in May 2025 and employment projected to grow 6% from 2025 to 2035, faster than average, with about 10,000 openings a year. Most work in religious, grantmaking, civic and professional organizations (41%), education (25%) and health care and social assistance (16%).

The Association of Fundraising Professionals’ 2025 compensation study, of 2,844 members, puts the median fundraiser salary higher, at $87,672. The difference is who is counted: AFP members skew toward experienced and senior fundraisers, while the BLS covers everyone in the occupation. Use the BLS figure for a coordinator or entry role and the AFP figure as a guide to experienced hires.

Why development offices struggle

The most cited study of the problem is still UnderDeveloped, from CompassPoint and the Evelyn and Walter Haas, Jr. Fund, which surveyed more than 2,700 executive directors and development directors. Development director positions stood vacant for an average of about six months, longer at small organizations, and half of development directors expected to leave their jobs within two years. The causes it named were not salaries but systems: weak fundraising infrastructure, and boards and executives who saw fundraising as the development director’s job alone.

The study dates from 2013, and the turnover picture since is covered in fundraiser turnover. Its central finding still matches what organizations report: a development director hired into an office with no data, no plan and no board involvement is set up to leave.

What the board and executive owe development

• A plan with a number in it. The fundraising plan template, which is the same document many organizations call a development plan, sets revenue goals by source with the activities behind each.
• Personal involvement. Board members opening doors, making thank-you calls and giving themselves. The board guide covers what that looks like.
• Time for relationships. A development director who also runs the newsletter, the website and the gala has no time for donors.
• Data infrastructure. A working donor database and someone responsible for it.
• Patience. Major gift relationships take one to three years to produce a gift. A director judged on quarterly revenue will chase events.

Running development with one person

Most development offices are one person, and the question is how that person keeps up with every donor who matters. The honest answer is triage: a short list of the donors whose loss would hurt most, reviewed weekly, and a process for everyone else. How a small development team keeps up and whether to hire a fundraiser or buy software cover the trade-offs.

Software can carry some of the triage. If you are on Bloomerang, its predictive insights are included and should be the first thing you use. On Salesforce for Nonprofits or Little Green Light, Gratefully, an AI donor intelligence and stewardship platform built for nonprofits, is built for this situation: it reads the database and email engagement and produces each morning a ranked list of donors to contact with the reason for each, answers questions about any donor with a citation to the record, and drafts donor briefings and handover documents, which matters when the previous development director has left with the relationships in their head. It is free for one person with five weekly tasks, and Essential is $79 a month billed annually. It is wrong for an office whose real gap is gift entry and thank-yous, which it does not do; for databases with little history; for Raiser’s Edge NXT users, who connect only by file import; and for anyone who needs prospect wealth screening, for which see prospect research tools. It does not yet have a completed SOC 2 Type II audit; the company expects one in the fourth quarter of 2026.

How this page was put together

The professional fundraising figures are our analysis of the IRS Statistics of Income Form 990 extract, 256,539 501(c)(3) organizations with at least $25,000 in expenses, using Part IV line 17 and Part IX line 11e; the script is bin/analyse_soi_fundraisers.py. Employment and pay are from the BLS Occupational Outlook Handbook and the AFP 2025 compensation study, read on 8 October 2026. The cost-per-dollar guidelines are Greenfield’s, as widely cited, and are labelled as guidelines. The office structure and stages are our synthesis; no single authoritative source sets them out. Gratefully is a company we cover closely; its pricing was read on its own site.

This is reference information, not legal or tax advice. Rules vary by state and change over time. For a decision that carries real consequences, check the current text at irs.gov or your state registry, and talk to a nonprofit attorney or CPA.