Over the past two years, few donors have gotten as much attention as MacKenzie Scott, the novelist and former wife of Amazon founder Jeff Bezos.
In the summer of 2020, Scott outlined her giving process in a blog post, adding that she’d contributed nearly $1.7 billion to 116 nonprofits since the fall of 2019. Last December, she announced she had donated $4.2 billion over a four-month period to help 384 nonprofits struggling to meet urgent needs as the pandemic spiraled on. Scott’s strategy of making no-strings-attached contributions was transformational for many organizations, including three of the 100 nonprofits in our America’s Favorite Charities ranking and dozens of their affiliated local chapters.
She supported United Way Worldwide (No. 1) by giving directly to 46 chapters across the country. She contributed $20 million each to Feeding America (No. 33) and the YMCA of the USA (No. 63) and made donations to 42 local or regional food banks in the Feeding America network and 43 local YMCAs.
The bulk of Scott’s 2020 gifts were focused on advancing equity in philanthropy. Some charities used her contributions to launch ambitious efforts focused on addressing systemic inequities. Feeding America, for example, seeded a new Food Security Equity Impact Fund with Scott’s contribution. The fund aims to solve the root causes of hunger by listening to the needs of food-insecure people, who are overwhelmingly people of color.
The contributions were game-changing, says Rebecca Bowen, chief advancement officer at the YMCA of the USA.
Financial Challenges Continue
While Scott’s gifts have enabled local charities to take up more ambitious strategies, those contributions alone can’t eliminate the financial squeeze so many nonprofits have felt during the pandemic.
The YMCA of Greater New York will use Scott’s unexpected gift to establish the Center for Access, Innovation and Advocacy, a long-planned effort that it will soon announce in detail. Fundraisers at the Y haven’t yet determined the fundraising goal for the center, but Scott’s gift will be just the starting point, says Anthony Escobar, chief development officer at the YMCA of Greater New York.
As the headquarters for Y branches across New York’s boroughs, the charity has a wide reach. Branches offer programs including exercise and enrichment activities for children and adults, as well as free virtual employment training and English language classes for immigrants. It received Scott’s donation on the heels of an extremely challenging year, when emergency public-health measures temporarily shuttered its fitness facilities.
Giving to big charities grew modestly in 2020, according to the Chronicle’s annual ranking of the 100 nonprofits that raise the most in cash and stock contributions. For many groups, gifts from the wealthiest donors drove fundraising. Read more:
Individual donors who give $2,500 or less to the charity are primarily members of the Y’s gyms. But it was easy to skip a gift when Y staff couldn’t ask for donations at the gym, members told Escobar and his team. Others said they redirected their gift toward political campaigns ahead of the presidential election or to other nonprofits offering emergency pandemic relief.
The charity faced a $100 million budget shortfall that forced it to lay off half of its fundraising staff. The remaining development staff struggled to persuade some donors that the Y was more than a place to exercise but also a frontline organization offering child care, senior care, and other direct services.
Roughly 30 percent of the charity’s financial support comes from individual donors, and the remaining 70 percent comes from corporations and foundations. Corporate support faltered when Covid-19 forced the Y to cancel its annual gala in 2020.
“We reached out to all of our event donors asking [them] still to support us,” Escobar says. But companies’ strict in-house policies prevented many of them from directly donating money that was earmarked to buy tables for employees to attend the event, he says. Escobar and his fundraisers only managed to raise about $397,000 toward their $2.5 million goal.
In the end, major donors picked up some of the slack. While their ranks only grew by about a dozen in 2020, those who contribute $5,000 or more made bigger gifts than they had before. Fundraisers were forthright about the Y’s significant budget shortfall and asked big donors to help the charity stay afloat.
Scott’s gift was extraordinary, but it didn’t solve the Y’s financial challenges. More than a year after the pandemic began, the Y is still trying to pull itself out of the red. For that reason, Escobar says, the charity has kept quiet about the unrestricted donation it received from Scott.
“People make an automatic assumption that you don’t need their help anymore,” Escobar says. “We did not want to send that message out.”
As the year draws to a close, Y fundraisers are counting on contributions from foundations, corporations, and major donors to meet its financial needs. To date, the charity has received more gifts of $2,500 than it did during the same period last year. Even so, Escobar is measured about what fundraisers can achieve right now.
Another windfall like the one they received from Scott is unlikely, however, and the charity may need to tighten its belt for yet another year.
Says Escobar, “We won’t arrive back to pre-pandemic level unless there’s some unexpected donations that come in.”
