Capacity-building has long been a way for funders to supplement their traditional grants, boost nonprofit effectiveness, and ultimately help nonprofits be more sustainable. By investing in nonprofit leadership, technology, systems, and more, funders can equip their partners with tools and expertise to help them better meet their mission. As nonprofits face federal funding cuts and a shifting regulatory environment, many funders are turning to capacity building to provide additional support.

What Is Capacity Building?

The Grunin Foundation defines the capacity building it does as “equipping nonprofit leaders with the tools, knowledge, and support to accelerate their impact.” Other funders define it more narrowly, focusing specifically on technological assistance, for example. Regardless of how your philanthropy defines the practice, capacity building should increase a nonprofit’s ability to meet its mission.

Supporting Skills-Building

Some capacity building teaches people new skills that they can apply to their nonprofit work. This might be in the form of leadership coaching or learning a new technology system. For example, the Grunin Foundation hosts trainings and workshops facilitated by experts in the topic at hand. Not only do these optional events help nonprofit leaders hone their skills, but they also advance Grunin’s mission by centering equity, diversity, inclusion, and belonging in the programs and providing ways for the nonprofit community to work in partnership.

Beyond group offerings, the Grunin Foundation provides more individualized support such as one-on-one executive coaching. Danielle Valle Gilchrist—who works at Catchafire, an organization that connects nonprofits with skilled volunteers and technical assistance—shares that one of its clients recently learned how to use an accounting software through a capacity-building grant from the Pincus Family Foundation. This relatively simple training teaches the nonprofit leader a new skill and helps the nonprofit operate more effectively.

The Gift of Time

Many nonprofits are chronically understaffed and have to focus the majority of their time on tasks that are both important and urgent. Supporting a task or project that is important but not as urgent can be a meaningful way to contribute to a nonprofit’s operation without diverting leaders’ attention from more timely issues. For example, a nonprofit CEO wished to create an employee handbook. It was a necessary and important task but not time sensitive and thus fell to the bottom of her do-to list for years. Through a capacity-building grant via Catchafire, a funder supported a skills-based volunteer to complete the handbook giving the nonprofit leader the space to focus on the organization’s mission.

Read the full article about nonprofit capacity building by Maggie McGoldrick at National Center for Family Philanthropy.