The future of fundraising
“Giving Plunges 6% in First Quarter” “Number of donors dropped by 5.3 percent”. “25 billion in lost revenue for nonprofits”
The headlines about the latest Giving USA study are scary, but do they portend an apocalyptic future?
Capacity Partners is encouraged that donations under $250 rose by six percent during the first quarter of 2020. We also know of some nonprofits that saw their coffers swell during the pandemic; organizations providing disaster relief and pandemic-related services have seen a surge in generosity. Organizations focused on racial equity are also seeing an upswing in contributions. Of course, other organizations are realizing mergers might be their only salvation as they watch income plummet.
Foundations are still making grants, but many are shifting funding to emergency relief for basic human needs, making it harder for arts groups to get funding. Organizations who were hoping for a grant for projects such as strategic planning may also find it more difficult to get support.
So far, virtual events are more successful than anyone thought they would be. Hopefully that stays true as virtual events remain the norm for the foreseeable future. It is difficult to imagine any in-person events being held for the rest of 2020, and maybe even the first part of 2021.
Right now, the rising stock market should result in major donors feeling comfortable keeping their commitments, but as we know from past experience, the market is capricious and as the economic recovery chugs along with a high unemployment rate, that could change. As furloughs become layoffs and as special unemployment benefits run out, budgets could tighten with less money available for charitable giving.
Fortunately, local and federal government grants and loans have kept many nonprofits whole in FY21; the question is what happens in FY22 as disaster relief programs end and government budgets are slashed due to revenue shortfalls.
In general, most corporations will be decreasing contributions, either cutting out all or a portion of many of their sponsorships. Capacity Partners predicts the effect on revenue will likely be in the second half of the fiscal year.
So much about future fundraising is uncertain; actually, so much about the nation’s future is uncertain. Covid-19 will be forefront in everyone’s minds for many months. The economy will remain fragile until coronavirus is controlled. Politics and the November election will generate stress-inducing headlines. All this is true, but equally true is the remarkable power of resiliency, caring, and determination.
Our advice? Stay close to your best donors. Stewardship is more important than ever. Don’t forget to give some of your attention to new donors, too.
In 2019, even though it feels like a lifetime ago, charitable giving showed solid growth, climbing to $449.64 billion, making that year one of the highest for giving. Capacity Partners believes that in good times and in bad, people will donate to the causes they believe are critical. Mary Robinson, Founder and President of Capacity Partners says, “Yes, even in a pandemic and in a period where unpredictability is the only thing one can accurately predict, people will give to the causes they care about.”
In a couple of weeks, we will be conducting a survey of nonprofit leaders to enable us to do a deep dive into the current state of the nonprofit sector in the DC metro area. We hope you'll participate in this brief survey so we can better understand the current situation and make recommendations to nonprofits as they navigate these unprecedented times.
Fundraising in these unsettled times
The world feels unsettled as our news feeds and lives fill with protests against pervasive racial inequity, a powerful and capricious virus that affects nearly everything, and an economy officially in recession. As nonprofits know better than anyone, this is a situation ripe for an increased demand for services while boards of directors and development staff fret over fundraising. Here are some tips to help you and your nonprofit organization raise the money you need.
1) Tell your story well and tell it often. Your donors -- both individual and institutional -- need to hear how you are making a difference under these unique circumstances. Use a variety of methods -- emails, social media, videos, Zoom calls, phone calls, etc. While it's always important to be a good donor steward, it's especially critical in uncertain times like these.
2) A matching gift can boost fundraising efforts. Perhaps your board will chip in to create a matching gift fund. Perhaps a long-term contributor will agree to a matching fund. The prospect of doubling a donation may help motivate on-the-fence supporters.
3) Avoid emergency, desperate requests for funds. You may not be sleeping as you obsessively pore over spreadsheets, but this is not the moment to share your anxiety with an anguished plea for money. Convey realistic optimism rather than panic.
4) Don't pre-judge your supporters. Don't assume they no longer have funds to give or won't appreciate hearing from you. Give your contributors the chance to show you how much they treasure your organization's mission.
5) Focus your time and efforts on current or past donors.because some organizations, especially those not providing direct coronavirus or racial inequity services, may find it more difficult to attract new donors right now.
The last three months have shown how many organizations are continuing to raise money effectively. Some are even surpassing their goals ... and not just disaster relief organizations. Some of our clients' events are hitting record highs, and some are getting generous grants. Unfortunately, some nonprofits are still having a tough time. Recovery will be an ever-evolving process so stay nimble — and ask.
Big challenges and big opportunities for the arts community
The arts have never been more important than they are today. They bring joy, act as a healing force, and educate the young and old. The arts are a key component of the economy and an important community partner as we recover and reinvent our world after the pandemic.
On May 22, Capacity Partners Founder and President Mary Robinson was honored to join Anne Corbett of Building Creative and Linda Sullivan, President & CEO of ARTSFairfax for an ARTSFairfax webinar focused on planning for what’s next in the Fairfax County arts community in the wake of the COVID-19 pandemic.
The challenges that organizations have faced over the last two months are extreme. Arts organizations, and really most nonprofits, are losing revenue, facing staff layoffs, and shifting strategies in how work gets done. However, with every challenge comes an opportunity.
As Mary Robinson noted during the webinar, to maintain organizational viability over the long term, organizations should use Dynamic Planning to create three, six, and twelve-month plans. Starting with the formation of a Dynamic Planning committee, organizations would then use the iterative Dynamic Planning process to reaffirm their mission, asses their strengths and weaknesses, and conduct scenario planning, identifying multiple scenarios and solutions.
For example, Capacity Partners client Arts for the Aging was committed to keeping their teaching artists on salary during the pandemic, despite cancelling all in-person workshops. The team of teaching artists has now activated multiple distance and virtual programs to continue serving their audience of older adults and their caregivers. Although the method of program delivery has changed, Arts for the Aging’s mission remains front and center.
Anne Corbett stressed arts organizations have a unique opportunity to be leaders in community resiliency and reinvention, utilizing multiple partnerships, audience engagement, and advocacy opportunities.
Some of the ideas discussed on the webinar include:
- Partnering with a food bank to include art kits in food boxes
- Partnering with real estate developers to bring outdoor art or performances in a socially distant and safe manner
- Producing virtual theatre or art shows and partnering with a restaurant or catering company to deliver a meal to patrons participating at home. (This would also work for virtual fundraising events.)
Webinar participant Lisa LaCamera, Senior Director, Communications & Marketing at Wolf Trap Foundation for the Performing Arts, said, “People are realizing the healing nature of the arts in times of crisis. People all over the world appreciate the need for the arts to get through this.”
Capacity Partners encourages arts organizations – and all nonprofits – to embrace the opportunities, confront the fear, create the plan, and move ahead to our next normal. The canvas of opportunity lies in front of all of us, and Capacity Partners stands ready to support you if you need a jump start.
