Fundraising Update

Welcome to Fundraising Update. This week, we look at how anonymous gifts are both changing and challenging fundraising. Plus, we dig into the ways older and younger generations give.

I’m Jie Jenny Zou, fundraising reporter at the Chronicle of Philanthropy. If you have ideas, comments, or questions about this newsletter, please write me.

Thanks to our sponsor DonorPerfect for supporting Fundraising Update.

How Anonymous Gifts Are Changing Fundraising

Plenty of donors duck the bouquets of praise tossed after big gifts. But the story behind a $500,000 gift to Mount Calvary Christian School comes with a twist, reports my colleague Drew Lindsay. Whoever made the gift cloaked their identity by donating through a start-up called Silent Donor. The company, which launched publicly two years ago, is betting that a growing number of Americans want to give money to charity but not their name.

Its business model is simple. Donors send gifts to a donor-advised fund affiliated with the company. For a fee — typically 5 percent of the donation, sometimes less — the DAF forwards the money to the charity designated by the donor.

Whether or not Silent Donor’s bet pays off, the venture illustrates the new ways that the anonymous donor — a perennial character in philanthropy at least as far back as medieval times — is showing up in the 21st century. With philanthropy increasingly conducted digitally and through intermediaries, donors have easy means to hide from the public and even the receiving charity. Donor-advised funds are the biggest of these go-betweens, but there are plenty of others.

The headline news is that these giving vehicles can provide cover to questionable activities, including funneling “dark money” from the wealthy to influence politics. Yet donors also are deploying anonymity for strategic and practical purposes unrelated to their policy goals or their humility. It’s become a handy tool for the busy and the privacy-minded, a virtual Swiss Army knife to address any number of concerns. That’s changing the dynamics of giving, introducing new tensions to the nonprofit-donor relationship, and challenging fundraising conventions.

Tsunami of Solicitations

Tim Sanders, founder of Silent Donor, reached out to Drew when the company publicly launched in 2022. At the time, he was seven years out of the University of Wisconsin at Madison and coming off a job as a project manager with GG&A, the fundraising and philanthropy-management consulting firm.

Sanders says the market opportunity for Silent Donor presented itself in the relentless stream of nonprofit solicitations that hit his inbox after he made a charitable gift as a wedding present for a friend. There was no easy way to give to charity, he concluded, without triggering an email tsunami.

Sanders also saw signs of a nascent but fast-growing privacy movement that he believes the nonprofit world is ignoring. Sales of software to block monitoring of your web browsing. The popularity of VPNs, virtual privacy networks. The calls for stringent privacy-protection laws like those adopted in Europe.

Worried by identity theft and the sale of their personal data, consumers balk at handing over information in routine transactions, including donations, Sanders says. “Our plan was to create the path of least resistance for privacy-seeking donors.”

For more, read Drew’s entire story.

Need to Know

78%

— Share of donors age 50 to 80 who say charitable giving plays a significant role in their lives

More than three-quarters of donors approaching retirement and those who have already retired say charitable giving plays a significant role in their lives, writes my colleague Rasheeda Childress.

A new report from Fidelity Charitable surveyed 2,512 donors ages 50 to 80 who had given $500 or more in the previous year.

About a quarter of survey participants are “committed givers” who agreed with the statement “giving is much more important than other financial priorities.” Of those donors, 55 percent said, “Charitable giving is a significant part of their lives.” Sixty-eight percent of committed givers donate more than $1,000 annually, and 72 percent have volunteered in the past 12 months.

The top reasons retirees and pre-retirees said they give are to make a difference, give back to their community or faith, help solve a problem, and support an organization they care about.

The report found that respondents were unaware of many of the tools they could use for philanthropic giving. Less than a third knew about donor-advised funds (22 percent), qualified charitable distributions from retirement accounts (26 percent), and donating appreciated assets (32 percent).

Pirozzolo says that nonprofits can combat this lack of knowledge by sharing information on their websites.

“Some of the smartest nonprofits — if you go to their websites, many of them have really clear pages on ways to give,” she says. “And if you look at those ways to give, they’re really trying to educate donors and be very open and inclusive about ways that you can donate: stocks, IRAs, bequests through a will, a donor-advised fund, payroll deductions.”

For more, read the full story.

Plus ...

Changing Perceptions. By spotlighting everyday stories of generosity in the Muslim American community, the creators of a new exhibit hope to challenge harmful narratives Muslim Americans face and open the doors to new funding relationships for Muslim-led charities, I reported.

“Inspired Generosity: Muslim American Stories in Philanthropy” debuted last month in Atlanta as a multimedia exhibit featuring videos, photos, poetry, digital art, and audio stories from the public about small acts of kindness.

“A lot of times we applaud stories about a million-dollar check, but it’s also the little things,” said Dilnaz Waraich, president of the WF Fund, the lead partner for the exhibit, which includes more than a dozen organizations. “Inspired Generosity asks the average Muslim American to tell their everyday stories of philanthropy.”

For more, read the full story.

Gift of the Week

Adeline Yen Mah and Robert Mah gave $20 million to the University of California at Irvine through their Falling Leaves Foundation. The funds will support the construction of the Falling Leaves Foundation Medical Innovation Building, a medical research and education building that was named for the couple’s foundation in 2021 when they donated $30 million for its construction.

Robert Mah is a professor emeritus at UCLA, where he taught environmental microbiology. Adeline Yen Mah is a retired physician who practiced internal medicine and anesthesiology. During their careers, they had hoped to one day conduct medical research together. Instead, they started their foundation in 2007 to promote research and understanding of recent advances in medical science.

For other notable gifts this week, read my colleague Maria Di Mento’s Gifts Roundup column To learn about other big donations, see our database of gifts of $1 million or more, which is updated regularly and has data going back to 2000.

Advice and Opinion

Create a Winning Year-End Strategy in 2024: Here’s How. Experts share nine ways to build a strong campaign despite the challenges — and hit annual revenue goals.

Fundraisers Need to Speak Up About Their Challenges — and Funders Need to Listen (Opinion). While many rightly express alarm over the decline in giving, they rarely link the problem to fundraising.

What We’re Reading

Informing grant makers helped double lead-poisoning funds. Donors have to know about your cause to support it. Fundraisers for lead poisoning leaned into this maxim to double the amount of funding allocated to prevent lead poisoning, according to Vox. Lead poisoning accounts for at least 1.5 million deaths annually but philanthropic spending to address exposure has averaged less than two cents per child poisoned by the heavy metal. A new $150 million initiative spearheaded by Open Philanthropy will double overall global spending on lead exposure. Among the funders are USAID and the Gates Foundation.

“This is one of the easier fundraising efforts I’ve been associated with,” Samantha Power, administrator of USAID and one of the principal organizers of the partnership, told Vox. Funders didn’t know just how bad the lead problem was and how cheaply it could be mitigated by tackling causes of poisoning like lead paint, contaminated spices, and industrial recycling. Power was also initially unaware of how much of a problem lead poisoning is.

“My first reaction was ‘this can’t be true,’ that something that’s generating this much harm is not being addressed,” Power told Vox.

Like Power, once grant makers learned of the significance of the problem, they got on board to fund this initiative. (Vox)