Remember us? Now cough up

In today's harsh financial climate, universities are emulating their American counterparts and turning to former students for cash. Lucy Hodges reports

Have you had a call yet from your university asking you to donate money? If the answer is no, you may find that your alma mater is not doing its job properly. Today's universities are expected to raise money from alumni as well as from rich people and from companies and trusts.

That money - as American Ivy League universities have shown - can buy excellence. It can make the difference between a so-so university and one that has fantastic student facilities, some really tip-top research and a stunning business school. Yet Britain, as Bristol University's vice-chancellor, Eric Thomas, points out, has a long way to go compared to its competitors in the United States. "For most universities in this country this sort of activity is still very peripheral," he says. "It's mostly located in the two ancient universities [Oxford and Cambridge] and in the ones that were chartered at the beginning of last century [the civics such as Birmingham and Liverpool] because they have a large number of alumni and quite a long history."

But some younger universities are making strenuous efforts to catch up, egged on by the Government, which promoted endowment funds in its White Paper on higher education. Warwick, the university that has streaked into the top 10, has invested in an office of 19 people whose job is to raise money from outside donors. It is perhaps no coincidence that its vice-chancellor is an American, David van deLinde, and that the fundraising office is run by an American, Ron Gray, who came from Washington University in St Louis. Five posts have yet to be filled: four will be devoted to what is known in the jargon as major gift fundraising - trying to persuade wealthy people to cough up for Warwick; the fifth will be in charge of raising money for the university's 40th anniversary celebrations.

"We are in the early stages," says Professor Van deLinde modestly. "The message we're trying to sell to alumni is that their support will help students and enable us to become truly world class." Warwick is making a major commitment of money. In addition, it is planning a big campaign to drum up money for a new business school building costing £10m to £12m. It is hoping that there will be someone out there like Wafic Said, the millionaire Saudi businessman who gave Oxford its spanking new business school, who will want to plough a small fortune into Warwick's future.

Few universities are investing in major donor fundraising, because it is so expensive and takes so long to bear fruit. Those that are include Oxford, Cambridge and the London School of Economics.

Each year the LSE employs an army of students to pick up the phone and ask alumni for money for its annual fund. It currently has 6,000 donors giving a total of £250,000 a year. This is not a vast sum, but it is useful, according to Mary Blair, the LSE's director of development and alumni relations and another American, because it is unrestricted. It does not have to be spent on any particular project.

In addition, the LSE targets some individuals with big pockets. This takes an immense amount of time, charm and patience. "You talk to them, you cultivate them and you see what their interests are," explains Ms Blair.

It took ages, for example, to persuade a woman with a long history of involvement in human rights to donate money for the lead professorship in the LSE human rights centre. "The important thing for her to see was that there is benefit in the academic approach to human rights," says Ms Blair. "She needed to see how the horizons of students on the Msc programme could be broadened." Only then was she willing to donate £500,000 to fund a professorship over five years. Through its fundraising efforts the LSE raised £7.5m last year - the difference between being in the black and tipping into the red.

All this takes big bucks. First, you need a good database - the names and addresses of as many alumni as possible - and you need to maintain it. The LSE pays for someone to oversee that full-time. Then you need someone in charge who knows what they are doing. Because university fundraising is in its infancy in the UK, there are very few British people with any experience. That is why universities are turning to America.

Finally, the vice-chancellor needs to be committed. Professor Anthony Giddens, the previous director of the LSE, took fundraising very seriously. Similarly, Professor C Duncan Rice, the principal of Aberdeen University, has been energetic and raised large sums in a £100m campaign.

"If Aberdeen can do it, everyone can do it," says Joanna Motion, vice-president of international operations at CASE Europe, the body that promotes university fundraising and public relations. New universities, the former polytechnics, may find it difficult to ring up their alumni and ask for money. Many do not do so. But London Metropolitan University, in its former guise as London Guildhall, raised money for its women's library, collecting large sums from outside donors. The University of Derby is starting up an alumni programme, which means contacting former students to see if they might be interested in further study, for example. Once contact has been made, it might move on to fundraising later.

A few old universities, such as Cardiff, do very little with their alumni. Sheffield has started up an alumni office again after closing it in the mid-1980s and has a fundraising campaign geared to its 2005 centenary. In the last 18 months it has raised £500,000. There is little doubt that university fundraisers have an uphill struggle persuading people to hand over money in a country that has expected the state to fund higher education for 50 years. The British are also shy about asking for cash. But Steve Smith, the vice-chancellor of Exeter University, which has started to put more effort into raising money, says it is important to explain that government funding for universities has fallen by 36 per cent in real terms since 1988. "The only way we can keep doing things for students is to get money from former students," he says.

l.hodges@independent.co.uk

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Exeter University has not done enough to tap its alumni and raise funds externally, according to its vice-chancellor Steve Smith. But it began to intensify its efforts three years ago, raising £182,000 from two, five-week telephone campaigns. "Exeter has not seen alumni and fundraising as a core part of its activities, whereas now we do and are planning to put a lot more money into it," Smith says.

But Exeter has been fortunate in having the Ruler of Sharjah, His Highness Dr Shaikh Sultan bin Mohammed Al-Qasimi, as an alumnus. He completed a PhD in Middle Eastern studies at the university in 1985, and gave his former university £2.4m to build an Institute of Arab and Islamic Studies, complete with stylish Arabic architectural flourishes. Another university which had the Ruler of Sharjah as a student was Durham. He did his first degree there, and donated £2.25m for a new building for the Institute of Middle Eastern and Islamic studies. Another Durham alumnus, Peter Ogden, donated £2.25m to put up a building, the Ogden Centre for Fundamental Physics, which was, in turn, used as leverage to raise money for a bigger project. More recently, Liverpool University has had a successful fundraising campaign for a new £8m business school. Contributing to that were two alumni, Sir Robin Saxby, the entrepreneur who started up ARM Holdings, the chip company, and Paul Roy, who ran investment banking at Merrill Lynch. Both came from humble backgrounds, and feel that their degrees gave them their start in life. "I want to help the place that did well by me," says Sir Robin.

Both men get enormous satisfaction from their philanthropy. "I could not have done what I did without my degree," says Roy. "It gave me a foot on the ladder."