Neighborhood House, a Seattle-area social-service agency, faced a serious dilemma: press on with its annual breakfast or cancel and take a financial hit from the loss of an important fundraising source.
The director of development, James Lovell, said what made the decision especially difficult is that it’s impossible to know what the coronavirus situation might be like a month from now. Could the health threat from the virus subside by the time of the on April 8 event at the Washington State Convention Center? If the group postponed a decision, the cancellation fees would escalate rapidly as the date of the event approached.
Plus, there’s the question of attendance even if the situation improves. “If you’re a nonprofit whose live event is trying to recruit guests over the next two or three weeks in town, good luck,” he said.
Entry to the event is free, but attendees are encouraged to make a donation. Lovell said the event brings in about $170,000, about one-third of the nonprofit’s fundraising for unrestricted dollars.
Across the nation, nonprofits like Neighborhood House that raise a large portion of their revenue from walkathons, galas, luncheons, conferences, and other events face similarly agonizing choices.
Lovell says his staff “painstakingly” came to the decision to move the event online. The group is still working out details — including how it will highlight its sponsors on the online feed — but supporters will be able to learn about Neighborhood House’s work via livestream. In the end, he hopes the financial situation is a wash for the nonprofit, which has an annual operating budget of $23 million.
“Even if we brought in 75 percent of what we project, we’d still be netting the same amount” as in a typical year, Lovell says. The nonprofit will save on expenses for the event, like catering and audiovisual equipment rentals.
Tough Choices
Vu Le, author of the blog Nonprofit AF, said smaller nonprofits that rely heavily on luncheons and galas for revenue could be hit the hardest in the current environment.
“We’re putting a lot of nonprofits in a bind where if they cancel the event, they’re going to lose funding, which jeopardizes their services. But if they don’t cancel the event, then they risk infecting other people and spreading the virus,” Vu Le said.
He added that such decisions are creating a lot of tension at many nonprofits, where some are pushing to cancel fundraising events and others are resisting.
Part of the answer, says Le, is for foundations to do more for nonprofits that “are constantly in survival mode.”
Kathleen Enright, CEO of the Council on Foundations, summarized the tension in philanthropy in a tweet: “Many will lose money canceling conferences and travel, but social distancing saves lives and enables the health-care system to keep up and help those most at risk.”
Finding Alternatives
David Hessekiel, president of the Peer-to-Peer Professional Forum, said nonprofits should seek ways to hold “alternative” events that keep the revenue stream intact. For example, nonprofits can transform group walks to “virtual walks” so people can raise money without gathering in a crowd.
For events supported by businesses, nonprofits should talk honestly with their sponsors. Although corporations typically want to see the return on their investments when sponsoring a charity event, they also want to be seen as good corporate citizens, Hessekiel said.
“It’s not like the event might be canceled because of some knee-jerk, not-very-well-thought-out decision by the charity,” said Hessekiel. “We’re in a worldwide emergency. Charities are going to find they’re able to work things out with their sponsorship partners.”
The following are examples of how some nonprofits are adjusting to the threat of the coronavirus:
- Seattle-based Communities Rise, which offers a variety of services to nonprofits, postponed a March 19 fundraising dinner. A March 9 fundraising clinic and other events were transformed to telephone coaching sessions.
- Another Seattle-based nonprofit, King County Sexual Assault Resource Center, canceled its annual fundraising Be Loud Breakfast and appealed for support. “Part of our decision was based on the strong belief that our supporters will stand with us, and with survivors, from wherever they are,” the nonprofit’s website says.
More Cancellations and Delays
Other major cancellations (not necessarily charity fundraising events) sent shudders through philanthropy.
The Donors of Color Network canceled its mid-April convening, co-director Ashindi Maxton announced on Twitter. “Every single person who replied to our email thanked us for doing the right thing,” Maxton wrote. For others holding events, she added, “if you’re on the fence, consider people are probably waiting for you to do the right thing.”
Co-director Hali Lee said in an email that the group hopes to reschedule the event in mid-September. The organization expects to lose about $60,000, or perhaps less if it can negotiate a reschedule date, Lee said. “There are, of course, other losses that are harder to quantify — like the loss of momentum, loss of potential membership revenue,” Lee said.
She added that at least one of its foundation supporters has already asked about the financial hardships the Donors of Color Network is facing due to the coronavirus.
“Without making any promises, that program officer said they’re gathering similar info from other partners to see if there’s a possibility of helping us out,” Lee said.
Other notable cancellations:
- The SXSW Interactive Festival, which is heavily attended by nonprofits. The organization laid off about 50 employees after canceling the annual event.
- The 2020 Skoll World Forum in Oxford, which draws some of the biggest names in philanthropy, plus celebrities like Bono and Don Henley. Registration fees will be refunded, and some reimbursements will be made for transportation and lodging “that have caused financial burden to you or to your organization.”
Meanwhile, the Association of Fundraising Professionals said its conference in Baltimore from March 29 to 31 will go on as scheduled. The organization has announced additional hygiene safeguards, and CEO Mike Geiger said in a news release that it will add online access for people who can’t attend in person.
“There’s nothing like being together with thousands of your colleagues at a conference, but we understand that for many people, that sort of experience simply isn’t possible right now,” Geiger said.
