Giving Compass’ Take:
• Nonprofits require funders to bankroll their programs, but often funders accidentally undermine the nonprofits they aim to help.
• How can funders better serve nonprofits? Why are funders failing to put the needs of their grantees first?
A new report finds that the largest cause of damage to nonprofits missions is the demands of the people funding the projects.
Nonprofits face a lot of unexpected threats when trying to make change in the world. But the biggest, and perhaps most surprising bucket of despair, is created by the very people who are trying to help. When an organization bankrolling positive change accidentally torpedoes it by changing their funding strategy mid-grant cycle, delaying disbursement of funds for some reason, or being generally inflexible in how they dole out money that generally cash-strapped groups depend on. Call them “funder-created obstacles.”
These findings, and the terms, come from Open Road Alliance, which provides bailout grants to groups that encounter unexpected, mission-crippling obstacles. The group, which has been offering charitable or recoverable grants since 2012, has also been tracking exactly what led groups to seek its services. The result is their newly released “Roadblock Analysis Report” that tracks 102 applications with 22 distinct problems, all of which fall into one of those three boarders areas of concern.
Overall, Funder-Created Obstacles accounted for 46% of nonprofit difficulties, followed by Act of God/Economics and Organizational Misfortune, which tied at 27% each, in terms of total reported problems.
Read the full article about how funders hurt nonprofits by Ben Paynter at FastCompany.
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