This spring, the Chronicle of Philanthropy commissioned an exclusive survey, conducted by Clarion Research, asking over 350 nonprofit leaders about their approaches to technology, the challenges they face implementing it, and the promise they see it holds.
The findings reveal a sector at a crossroads, where organizations that can afford to modernize are pulling ahead, while those that can’t fear being left behind entirely. (You can read our in-depth story about the survey results here.)
Here are five key takeaways:
Nonprofits spend a fraction of what businesses do on tech.
Nearly 9 in 10 nonprofit leaders say technology is vital to their fundraising success, yet most spend less than 3 percent of their budgets on it. In contrast, for-profit companies spent nearly 6 percent of their budgets on technology last year.
That investment gap has made it difficult for organizations to adapt to a rapidly digitized world: Where AI is already disrupting industries, many nonprofits still struggle with basic email management or cybersecurity protections.
The tech gap is creating winners and losers.
Not all nonprofits face the same struggles. Those spending more than 3 percent of their budgets on technology are twice as likely to report using it in advanced ways, according to the survey.
Experts say this creates a reinforcing cycle, where the most digitally savvy groups are able to attract more funding for, say, a flashy new AI-driven tool, while their less technologically sophisticated peers fall further behind.
As Melissa Lukin, executive director of the housing nonprofit Rebuilding Together Peninsula, put it: “It’s this endless cycle of being considered inefficient but then not being able to access the skills that would make us more efficient.”
Leaders know what’s wrong — they just can’t afford to fix it.
Two-thirds of leaders think technology deficits are hampering their organization’s growth, with manual processes eating up staff time or complicating their ability to communicate with donors. Yet most say they lack the time or money to tackle critical but often overlooked improvements.
Nearly 9 in 10 nonprofit leaders cited budget constraints as their primary obstacle to improving their tech strategy, while 64 percent point to a lack of in-house expertise and 62 percent say they don’t have time to properly vet and implement new tools.
Small changes can make big differences.
Even so, a single tech-savvy staff member or board volunteer can drive dramatic changes for smaller organizations by acting as an advocate and early adopter for new software and workflows.
Beth Schafers, who handles fundraising and communications at Family Promise of Greater Wichita, often uses ChatGPT to streamline her workflows as a “one-person development department.” When she needed to onboard a new gala chairperson — a task that typically requires hours of work — she prompted the AI to create a comprehensive roadmap. “Within five minutes, I had the document,” she said.
The stakes have never been higher.
As federal funding cuts and financial pressures pulsate through the sector, some experts say that technology could increasingly help determine which nonprofits thrive and which struggle to survive in a world where AI is already rapidly transforming everyday life.
Despite the stakes, only 29 percent of nonprofit boards actively discuss tech strategy. And while 77 percent of organizations expect to use AI within five years — up from 46 percent today — only 19 percent feel confident that they’re currently using technology in advanced ways.
In other words, many leaders know what’s coming but feel ill-prepared to navigate it well. If nonprofits can’t find a way to bridge that gap soon, experts warn that essential organizations — and the communities they serve — may be left behind.
