Fundraising Update

Welcome to Fundraising Update. This week, we look at the takeaways from a large, in-depth survey of donors released today. Plus, why analyzing the state of philanthropic funding for racial-equity work is a challenge. And the Chronicle analyzed more than 200 of MacKenzie Scott’s big donations whose recipients have disclosed gift amounts.

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

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More Than Half of Donors Plan to Give as Much This Year as in 2020

A new survey echoes other recent reports that have found donors expect to keep contributing at high levels in the year ahead. Fifty-three percent of respondents to the latest Burk Donor Survey said their 2021 giving would keep pace with 2020. More than a fourth said they expected to give even more this year, and of those, 38 percent were motivated by the continuing public-health emergency, 27 percent by calls for racial justice, and nearly a quarter by election issues and voter rights.

My colleague Emily Haynes wrote about the report from Penelope Burk, president of the consulting firm Cygnus Applied Research. Her firm polled 20,098 donors from February 22 to March 31 about how the events of the past year — including the Covid-19 pandemic, racial-justice protests, and the presidential election — affected their giving decisions.

More than half of respondents — 56 percent — said they gave a larger sum to charity in 2020 than in 2019. By contrast, just 37 percent of respondents to an earlier survey said they gave more in 2019 than in 2018. Donors’ motivation last year was clear: Nearly three-quarters increased their giving because of the pandemic.

While donors’ plans for 2021 are positive, Burk warns fundraisers not to be complacent.

“Donors can’t sustain an emergency mentality for too long,” she told Emily. In 2017, for example, supporters increased their giving in response to deadly hurricanes and wild fires, but they reverted to their previous giving behavior the following year.

To avoid a drop in giving in coming years, fundraisers need to inspire donors with a new, compelling reason to give — and this strategy needs to start with the nonprofit’s management, Burk says. Charities need to “find their new case, which is also compelling and very specific,” she says.

Nonprofits should also point to their successes of the past year, telling donors, “We proved back to you that you can trust us because we did a great job in Covid. Now look what we’re going to do with this new initiative,” she says.

Read more about what donors are saying about their giving.

Plus, be sure to read Emily’s interview with Burk as she reflects on her more than two decades studying donors and the fundraising field.

Hear From You

How often does your nonprofit gather donor feedback through surveys or other tools? How do you adjust your work based on their responses? Drop me a line. I’d love to hear from you.

Need to Know

25%

Since last summer when she announced her first round of big giving, MacKenzie Scott has donated a total of nearly $8.5 billion to 798 nonprofits, including those she announced in June.

While Scott announced most of the organizations that received gifts, she left it up to the groups to decide whether to publicize how much she gave them. As of July 15, more than a fourth of her nonprofit beneficiaries from the past 12 months have disclosed the amounts either publicly or in response to requests from the Chronicle. This research was based on information provided by organizations that have distributed news releases or otherwise disclosed the information in media interviews.

Almost $1.5 billion went to 62 colleges and universities, and of those she gave a total of $503 million to 21 historically Black colleges and universities and a total of $429 million to 22 community colleges. Eighty-eight social-service charities, supporting a wide variety of causes, received a total of nearly $90 million.

Plus:

• More than 90 percent of donors who supported racial-equity efforts in 2018 have yet to report how much they gave in 2020. That’s according to a new report from PolicyLink, a research firm that focuses on advancing racial and economic equity, and the Bridgespan Group, a consulting firm supporting nonprofits and donors. So far, only $1.5 billion of the nearly $12 billion that was pledged can be tracked to actual charitable recipients, according to the philanthropy research organization Candid. Tracking the avalanche of donations toward racial-equity efforts is challenging for several reasons. For one, there is no consensus in philanthropy about what contributions fall under the term “racial-equity funding.” And, second, it’s unclear how much of the funding committed has gone to support advocacy groups or other work that’s not tax-exempt. There’s always been a lag in reporting philanthropic data since it’s tied to tax filings. The new report calls for institutional donors to share information about their grant making.

  If you want to dig deeper, read an opinion piece penned by the report’s authors. They argue that the infusion of philanthropy for racial-equity causes over the past year will be insufficient unless foundations, corporations, and wealthy donors do more to capitalize and sustain a vigorous social-change movement.

Tips & Tools

• Houston Ballet’s Charity Ball Offers a Blueprint for Pandemic-Era Hybrid Events: The spring event, which included small parties at private homes in addition to a virtual program, raised $850,000 for the dance company.
• What to Consider — and What to Avoid — When Reopening Your Nonprofit Office: Nonprofit leaders and human-resource experts share advice to help bring employees back to the office safely and support — and keep — them in the process.
• When Participants Partake in Evaluations, Equity Is Advanced in Surprising Ways: Three nonprofit executives say that program beneficiaries can offer essential feedback.

What We’re Reading

• “What happens when people get to a point where they feel like, ‘Well, it’s over, and now I can focus my attention and my resources somewhere else?’” The Los Angeles Business Journal looks at the challenges facing local nonprofits as donations taper off in this phase of the pandemic.
• Tainted money is better than none for struggling charities, Bloomberg columnist Max Hastings argues in a recent column. “Is it not better that all but the dirtiest pounds and dollars should be spent for the public good rather than hoarded?” he writes. Arts and cultural institutions have suffered crippling financial losses from the Covid-19 pandemic. Those and other charities would starve if forced to follow left-wing critics’ ethical standards, he argues.