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Continued: The risks and rewards of star-studded fundraisers

Minnesota's hottest celebrity fundraiser rolls out the red carpet Saturday, when former President Bill Clinton and comedians Robin Williams and Billy Crystal are expected to attend the Starkey Hearing Foundation annual gala.

It's an extreme example of nonprofits turning to Hollywood and beyond to try to ratchet up attendance, media coverage and social status. But the practice comes with risks, say fundraisers.

Stars and galas are expensive. Starkey, for example, spent nearly $2 million to orchestrate its 2010 event, according to its most recent tax returns. Celebrities can be quirky: Some demand certain accommodations, including specific foods, drinks, towels, even chairs.

And if the celebrity isn't the right match for the nonprofit, or the tickets are priced too high, the nonprofit can wind up taking a bath.

"It's a gamble," said Mark Davy, a veteran nonprofit fundraiser in the Twin Cities. "You're putting your staff, your volunteers, your time, on the line. You need to make sure whoever you choose has a very good chance of succeeding."

But the payoffs can be worth it.

"Not only can you make money, you bring the marquee on your charity," he said. "You get to attract people."

Star power brings the buzz

It's a star-studded weekend in the Twin Cities, as the limos arrived at Macy's Glamorama fundraiser Friday and will be at the Starkey gala Saturday.

The Starkey Hearing Foundation is in a class by itself in the number and status of celebrities it attracts. Bill Austin, the CEO of Eden Prairie-based Starkey Laboratories, has provided high-tech hearing devices to celebrities and politicians for decades and is on a first-name basis with many.

But most Minnesota nonprofits can afford just one big name or two. The Pacer Center, for example, has hired more than a dozen celebrities over the years, ranging from comedian Bill Cosby to singers Aretha Franklin and Jennifer Hudson. The Children's Cancer Research Fund has brought in the likes of singers Harry Connick Jr. and Kenny Loggins.

Meanwhile, Glamorama, the annual fashion show sponsored by Macy's that benefits the Children's Cancer Research Fund, was held Friday night and featured a younger generation of celebrities -- R&B artist Robin Thicke, now on ABC's talent competition "Duets," and Nick Noonan of the duo Karmin.

The star power, in theory, will create a buzz around an event and attract new and existing supporters. Top donors often get to pose for photos with the celebrities. Attendees dress up and get a chance to see and be seen.

"The celebrities make it a fun evening," said Mary Schrock, development director at Pacer. "We always get a spike in calls after the event."

Choosing the right star, of the right generation, is also critical. Ideally, he or she should appeal to a broad audience, nonprofits say. Baby boomers are a particularly attractive target audience, hence the large number of entertainers who were popular in the 1960s and 1970s.

'Riders' can dent funds

It costs about $100,000 for an act, nonprofits say. The contract typically comes with "riders" or travel needs. One musician demanded that only black towels be available for his crew backstage, Schrock said. Another wanted only white. Many musicians want no food served on paper plates.

And if they must eat off paper or plastic, it's got to be a certain type. Schrock recalled one musical guest requesting "10-ounce red Solo cups" for backstage beverages.

That's the cheap stuff.

"Most want to fly first class, stay in the top hotels," Davy said. "To do it right, you have to capture their hearts."

Most bigwigs, in fact, cut some slack for nonprofits. But that wasn't always the case, said Jon Pratt, executive director of the Minnesota Council of Nonprofits. When former "rat pack" singer Sammy Davis Jr. appeared on behalf of a nonprofit in Chicago years ago, he brought several guests, recalled Pratt. Those guests proceeded to charge thousands of dollars worth of items from hotel stores, including men's suits. The nonprofit wound up losing money, he said.

Such lavish spending caught the attention of Congress, Pratt said. About five years ago, Congress changed the IRS reporting requirements for nonprofits, requiring that they report net gains and net losses from their biggest fundraising events. Previously, nonprofits could lump all their fundraiser information together, he said.

The rule of thumb is that for every donated dollar, a charity spends 50 cents, said Audrey Kintzi, a professor of philanthropy at St. Mary's University of Minnesota. But that 50 cents buys more than a hot night out; it also buys potential new, long-term donors.

'A big undertaking'

A successful event includes both a wow performer and superstar volunteers, Schrock said. Pacer, for example, needs 350 volunteers to run its annual event. It also has a 60-person gala committee and a 25-member corporate committee. "It's a big undertaking," Schrock said.

Another challenge is making sure the celebrity knows something about the nonprofit's mission. Most nonprofits send informational materials to the celebrity in advance of the performance and try to talk to the entertainer before the fundraiser.

"A lot of performers are curious," Schrock said. "Some are not."

For some nonprofits, however, the star power was not worth the effort. After two decades of bringing in big celebrities, the Children's Cancer Research Fund switched gears about five years ago. It recruited top Minnesota talent and added videos and other elements to its fundraiser.

The result: Its entertainment budget dropped 75 percent, said Jim Leighton, the center's director of events.

"We saved tens of thousand of dollars, resulting in more money for research," he said.

That said, Leighton still appreciates the excitement that comes with the rich and glamorous. And the Glamorama event still offers that, he said.

"Who doesn't want to meet [famous] people?" Leighton said. "People want to rub shoulders with celebrities. If you can do that within your budget, then go for it."

Jean Hopfensperger • 612-673-4511

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