How Today’s Crises Are Affecting Young Donors’ Giving

Some young donors think it’s high time that philanthropists take a less arrogant approach to their giving and spend more time listening to charities that work to help those struggling the most right now and the people they serve.

That message came through loud and clear in an online discussion during which three young philanthropists talked about how the pandemic, recession, and today’s racial-justice and social-justice movements are affecting millennials’ and Generation X’s giving approach. The discussion was organized by book authors and next-generation giving experts Sharna Goldseker and Michael Moody.

These donors said the next generation of philanthropists should prioritize what the people most affected by today’s crises say they need and that wealthy donors should take a step back and refrain from imposing their assumptions about what works best on struggling communities.

“This moment represents an opportunity to disrupt the top-down donor dynamic,” says Andrew Dayton, a Rockefeller heir who leads the Constellation Fund, which works to raise the living standards of people who live below the poverty line.

Liz Banfield

“I’ve been approached as a donor for as long as I can remember and was always seen as an expert just because I give, but I’m not; I’ve not experienced poverty,” Dayton says. “Instead of listening to me, a rich white male, listen to the communities that experience poverty instead.”

Valaida Fullwood, a philanthropist and an expert on African American philanthropy, says the giving circle she co-founded — New Generation of African American Philanthropists — was formed 14 years ago to disrupt philanthropy’s status quo. She said her organization has worked hard to take what is best from traditional philanthropy while tapping into African Americans’ identity and culture of generosity.

“We are bringing our line of sight to our grant making and are acutely aware of racial injustices,” Fullwood says. “One key to good grant making is building accountability in our own community but also holding accountable other donors who have committed support to commit that for the long term.”

She said she and her giving-circle colleagues continually question each other about whether they’re taking the right approaches to giving. Fullwood says they work hard to stay focused on more than the dollars they give. Their professional expertise and their own experiences are equally important resources they can deploy to help the people and charities they support.

Ashley Blanchard, a fourth-generation philanthropist who is vice president of her family’s Hill-Snowdon Foundation, and her siblings worked together this year to reconfigure the foundation’s focus and devote the core of its support toward social-justice efforts led by people of color in low-income neighborhoods.

“You cannot turn away from the obvious inequities right now and not look a little more directly at our role in creating that,” Blanchard says. “I’m hopeful that some of the good coming from this moment is that we will shift the power dynamic and look at what we’re doing to make life better for people of color.”

Enormous Transfer of Wealth

Nonprofit leaders and fundraisers would be wise to take note of young donors’ opinions and outlook. Many are or will be the beneficiaries of the largest wealth transfer in history — $59 trillion through bequests and other estate mechanisms, according to research conducted by Boston College’s Center on Wealth and Philanthropy.

Others who built their own wealth are making bigger fortunes — sooner than previous generations of rich donors — and they want to start giving that wealth away now rather than wait until they retire.

Hallie Easley

Whether they inherited their wealth or earned it, Generation X and millennial donors are now or will soon become the main philanthropists in this second golden age of giving, says Moody, the Frey Foundation chair for family philanthropy at the Dorothy A. Johnson Center for Philanthropy at Grand Valley State University in Grand Rapids, Mich.

Unlike their 19th-century predecessors, today’s new donors are giving in ways that are sometimes harder for nonprofits to understand, Moody says. Some are giving through new vehicles, like limited-liability corporations, or upending the practices of their traditional family foundations.

“This new generation of donors will have more resources to give than in any other era, and they’re coming up at a time when philanthropy is rapidly changing,” Moody says. “They’ll be the most significant donors in generations, but we don’t know that much about them.”

‘Push on Us’

Moody and Goldseker, an affluent Gen X donor who founded 21/64, a nonprofit that advises young philanthropists, are the authors of Generation Impact: How Next Gen Donors Are Revolutionizing Giving, a book they wrote in 2017 and have recently updated and expanded.

This summer the authors surveyed 110 next-generation donors about how they and their families are responding to this era of upheaval and distress. Goldseker and Moody found that these donors are acting with more urgency than ever before.

“Many respondents said these crises provided an opportunity for them to talk about their values with their parents and members their families’ foundations,” Goldseker says. “We also heard them say they don’t want to spread themselves too thin by going to every event or responding to every request. They want to go all in on a few efforts they care about most.”

Some of the next-gen donors who responded to the survey said they moved up or front-loaded their grant making over the spring and summer to get money out quickly to charities that help people most affected by the pandemic and the financial crisis, many of whom are people of color or people who live in low-income areas.

Goldseker says one donor who responded to the survey said she used to spend months researching an organization before deciding whether to support it. But when she realized the local community foundation’s staff had a better sense than she did about which charities are doing the most for people struggling right now she gave $1 million to that organization instead..

Dayton, the Rockefeller heir, says nonprofits should not approach next-generation donors like him as if they are a separate or lesser category of donor. He says next-generation donors are becoming an important giving force, but that doesn’t mean major-gift fundraisers should tread lightly.

“Push on us. Don’t ask what I’m interested in,” Dayton says. “Say, ‘Hey, this is what this community needs from you and your philanthropy.’”