“There are too many nonprofits.”

“Yes,” someone else will chime in. “There are too many nonprofits.”

It’s a comment I hear frequently in gatherings of funders, and when it’s said, I notice, many people nod.

We heard this from some foundation CEOs when my colleagues on our research team interviewed them about the current context last fall, and I hear it frequently in my travels and meetings. David Callahan, whose writings about philanthropy I appreciate and frequently (but not always) agree with, made the same argument last year in Inside Philanthropy, suggesting that many organizations are inefficiently duplicative or just “mediocre.”

The vision, I guess, is that, after a purging, the resources that had gone to the “mediocre” organizations that cease to exist somehow gets redeployed to other nonprofits — the exemplary ones. Of course, it’s more complicated than that. These judgments are highly subjective: one person’s mediocre organization is another’s exemplar.

It’s true there are more than 1.5 million 501(c)(3) charitable organizations in the U.S., and, admittedly, that is a big number. Still, I don’t really know if that’s “too many” or not. Who am I to say, after all? Presumably if a nonprofit has enough funding to exist, then some set of supporters has deemed that organization worthy of support.

You don’t have to support them. I don’t have to support them. But if others do, isn’t there an argument to be made that this is what makes our pluralistic, diverse, sometimes messy nonprofit sector special and strong, with donors free to make their own choices about who to support?

Yet the idea that “there are too many nonprofits” remains a common lament.

"Too Many Nonprofits": A Sense of Overwhelm?

I have heard this sentiment more and more in recent months, as we at CEP have shared data about the degree to which nonprofits across the country are reeling (and we’ll be sharing more data tomorrow — more on that later in this post). At some level, foundation leaders feeling like there are “too many nonprofits” makes total sense: foundations, after all, are seeing increased demand for funding as a result of the ripple effects of federal funding cuts and other challenges, as our research has shown. It’s legitimately overwhelming.

Read the full article about the idea of there being "too many nonprofits" by Phil Buchanan at The Center for Effective Philanthropy.