Welcome to Fundraising Update. This week, we look at several recent studies that start to predict the state of philanthropy after the pandemic. Plus, how one grant maker’s support for digital fundraising is paying off.

I’m Eden Stiffman, senior editor at the Chronicle of Philanthropy. If you have ideas, comments, or questions about this newsletter, please write me at eden.stiffman@philanthropy.com.

Thanks to sponsor DonorPerfect for supporting Fundraising Update.

Optimistic Giving Forecast

Hope is on the horizon. Based on predictions that the economy will grow rapidly in 2021 as more people are vaccinated and the need for social-distancing declines, some philanthropy experts project a period of “broad philanthropic growth” over the next two years.

A recent report from the Lilly Family School of Philanthropy at Indiana University forecasts a 4.1 percent increase in total giving in 2021 and a 5.7 percent increase in 2022, my colleague Michael Theis reports.

For individual and household giving, the report forecasts a year-over-year rise of 6 percent in 2021 and 3.9 percent in 2022. Meanwhile, giving by all types of foundations is predicted to dip by 1 percent in 2021 but then jump by 8.8 percent in 2022. The small projected decline in this year’s foundation giving is due to the spike that occurred in 2020, according to Jon Bergdoll, a statistician with Lilly who co-wrote the report with Anna Pruitt. Foundations are expected pull back a bit and revert to more typical levels of giving after an unusually big year for grant making.

The report also projects that giving by corporations will rise 4.3 percent in 2021 and 6.4 percent in 2022. Giving from estates is projected to grow 1.1 percent in 2021 and 12 percent in 2022. Estates are often impacted by the state of the stock market, and the growth in estate gifts can be impacted by just a few large bequests each year.

That Lilly report is one of several released recently that have begun to predict the state of philanthropy after the pandemic.

At the individual organization level, the outlook isn’t bright all around.

A January survey from the consultancy CCS Fundraising found that many charities expect their fundraising revenue to take a hit in 2021. Forty-three percent of charities expect to see a decline in their 2021 fundraising compared with what they raised last year. Thirty-three percent of fundraisers at those charities expect a modest decline, while 9 percent expect a significant decline. One trouble spot is special-event fundraising, with 66 percent of responding nonprofits expecting a decline in that source of revenue this year.

Other reports point to positive operational shifts from donors. The pandemic inspired hundreds of foundations to make big changes to the ways they make grants, loosening restrictions and reducing paperwork, among other things that many nonprofits applauded.

A December 2020 report from the Center for Effective Philanthropy found that 56 percent of foundations plan to permanently stick with loosened restrictions on grantees. Thirty-two percent said they were undecided, and 13 percent said the changes they’ve made are not permanent.

Read the rest of Michael’s roundup of recent giving and fundraising data.

Hear From You

Has your fundraising outlook changed as the vaccine rollout has accelerated, the next wave of stimulus passed, and we move into the second year of the pandemic? Drop me a line. I’d love to hear what you’re thinking and what you see as your biggest challenges.

Need to Know

$8.2 billion

— Corporate contributions that were earmarked for racial equity in 2020

Corporate giving to racial-equity causes has far outpaced donations from foundations and individual donors since George Floyd’s killing in May, according to the philanthropy research organization Candid. Companies donated or pledged about $8.2 billion of the $12 billion in total contributions that were earmarked for racial equity — the “first time direct corporate giving to racial-equity causes has reached this magnitude” — Andrew Grabois, Candid’s corporate philanthropy manager, told reporter Haleluya Hadero. Hadero covers philanthropy for the Associated Press, which is working with the Chronicle to expand coverage of the nonprofit world.

The trend signals a shift for large corporations, fueled by the evolving expectations of younger employees and consumers about corporate responsibilities to social causes. Advocates say the corporate money won’t be enough to soon achieve the racial equity in hiring, housing, and policing or the investment in Black communities and institutions that they’ve sought. But it marks a start.

Plus:

  • Providing support for professional development opportunities that help fundraisers connect and learn from others in the field is one proven way to improve employee retention. But such opportunities are often unavailable at smaller nonprofits, write Sarah K. Nathan, Heather A. O’Connor, Genevieve G. Shaker, and Pat D. Janin, all faculty or doctorate candidates at the Lilly Family School of Philanthropy. Based on their new research, they suggest that peer mentoring networks — informal relationships or networks that provide coaching and opportunities to share knowledge and resources while also offering personalized attention, friendship, and a safe space to recharge — are an important option for supporting small-shop fundraisers. They offer tips on how fundraisers can get started and how leaders can support these peer groups.

$5 Billion and Counting

Facebook and Instagram users have now raised more than $5 billion dollars for nonprofits and personal causes, the company’s co-founder Mark Zuckerberg announced Tuesday.

Giving through the platforms has accelerated in recent years. Facebook hit the $1 billion mark in November 2018 and $2 billion in September of 2019.

Most donations are less than $25, a company spokesman said. This has always been the case and remained so during the pandemic.

Women, especially, have embraced the social-media giant’s donation tools. In 2020, women created twice as many fundraising events on Facebook as men and made twice as many donations. Sixty-four percent of the total money raised came from women.

Has Facebook had a major impact on your organization’s fundraising? Let me know how the platform and its giving tools have or have not changed how you raise money.

Foundation Steps Up Digital Fundraising Support

In the early days of the pandemic, nonprofits that were behind in their digital fundraising operations faced an especially dismal future. A long-standing complaint among many nonprofits is that foundations don’t provide grant dollars specifically for technology assistance. But as my colleague Alex Daniels reports, the pandemic and the move to working remotely for many nonprofits may have gotten some grant makers to pay attention to those needs.

Mari Kuraishi, president of the Jessie Ball duPont Fund, knew that a captivating presence on Twitter and Facebook was a key part of a successful digital fundraising operation. So as part of a larger push to help nonprofits become more proficient with technology, the Jacksonville-based foundation offered grantees crash courses in social-media fundraising leading up to GivingTuesday last year.

“It became increasingly clear that we needed to help them shift wholesale into a digital environment,” Kuraishi says. “If they didn’t have social-media experience, if they didn’t have digital fundraising, it was a ‘you’re-going-out-of-business’ type of situation.”

DuPont worked with Lightful, a technology company that developed Bridge, a technology training program that uses webinars, sharing of ideas with other participating nonprofits, and one-on-one coaching for nonprofit leaders who want to improve their ability to attract donations online. DuPont spent about $2.3 million on the program. Nonprofits that participated were eligible for matching grants of up to $50,000 if they attended most training sessions and if they attracted higher numbers of donors. All told, the participating nonprofits raised $3.1 million during #GivingTuesday, not including the duPont match.

The Jacksonville Humane Society was one participant for which the training really paid off. The group saw its online #GivingTuesday results leap 40 percent, after years of single-digit growth. The society raised money from 863 donors, a huge increase from the 493 people who gave on #GivingTuesday in 2019. Donation totals surged from $62,000 to $107,000. Plus, it got a $50,000 match from duPont.

Through the training, the Jacksonville Humane Society developed a digital campaign called “Let Love Lead” that stressed the connection between people and their pets. It directed cat and dog owners to the society’s pet-food banks with a simple, relatable message that stressed the connection between people and animals, says Denise Deisler, the nonprofit’s chief executive.

“We fancied ourselves decent at digital fundraising but had never really had to be as reliant on it as we had to be during Covid,” she says. “We may have had a broader audience, but I don’t think we would have converted that broader audience to donors were it not for this assistance that we received.”

Tips & Tools

What We’re Reading

  • Museums, universities, and other institutions would be able to shed the Sackler name without repercussions under a proposal from 23 state attorneys general. The officials want to amend a proposed bankruptcy plan for OxyContin maker Purdue Pharma to release nonprofits from naming obligations in gift agreements with the company’s owners, the Sackler family, without fear of litigation or demands to return the money. Among the institutions with the Sackler name on the wall is the Metropolitan Museum of Art. Private messages among the family that have recently become public “showed how the family tried to leverage their years of philanthropy to solicit positive PR from museums during the scandal.” (Artnet News)
  • Qualified Charitable Distributions are back. After a 2020 hiatus, Individual Retirement Account holders in their 70s and older can once again direct up to $100,000 of their required annual distributions to charity and reduce their federally taxable income. The tax strategy wasn’t all that big a deal until 2018, when — thanks to Donald Trump’s 2017 tax law — the number of people itemizing deductions, including charitable contributions, began to fall sharply. (Washington Post)
  • Something to chew on from Vu Le. “It is harmful for fundraisers to continue to operate as if things were completely normal, to believe that our primary goal remains connecting wealthy people to a salad bar of feel-good dishes, where they can mix and match to their hearts’ delight, spurred on by our gratitude, oblivious to the white supremacy that runs like a knife through every ingredient. ... In other professions, it’s frowned on to let the people with the least expertise but the most money determine courses of action, but in our sector, it’s considered best practice.” (NonprofitAF)