What is Giving Compass?
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We’re done “keeping calm and carrying on.” We must face facts. If the virus continues to surge and the restart of the economy sputters into the winter, the next 12 to 24 months may well be the most trying time for the nonprofit sector in living memory. These are the realities we face:
- The demand for some core nonprofit services will skyrocket.
- The supply of funding for nonprofit services will decline, largely as a result of multibillion-dollar shortfalls at the state and local level.
There’s no question that the biggest driver of nonprofit success is the internal motivation of nonprofit leaders. But at this painful, precarious moment, even the most motivated nonprofit leaders need their donors to step up in a big way. To make concrete what this kind of support looks like in real life, we’ve created The Big Reset, a package of here-and-now suggestions for donors and nonprofit leaders alike. We’re gratified to see that many leaders are already putting these suggestions into action.
Here’s a quick summary of our suggestions for givers who want to make a meaningful, measurable difference at this critical moment for civil society and democracy:
- Give More. The generosity we’ve seen since March simply isn’t enough to cope with the enormity of the challenges we face. Not even close. So dig deeper. Give your grantees a space to be open and truthful about their financial challenges. If you’ve been saving philanthropic dollars in a donor-advised fund, now is the time to use those precious resources to save grantees that provide critical services in your community. Provide multiyear, flexible dollars that give the grantee the best chance to adapt and innovate.
- Explore Mission Investing. One good way to punch above our weight at this time of severe need is to go beyond traditional grants. If you have a family foundation, use the assets from your endowments to make loans and equity investments. You don’t have to be an expert to get started. There are many professionals with big brains and big hearts who can help you identify impact investments that align with your mission and values, such as Align Impact and Kind Capital.
- Go to Bat for Your Grantees. Pull out all the stops to introduce your grantees to those in your network who share your values and issue interests. Last week, one of Lowell’s clients provided a great example. To help stand up an equity-focused career program for University of Washington students, the client used his most precious commodity, his time, to reach out to friends and colleagues. He gave them both head (real data) and heart (human stories) reasons to get involved. The outcome: In the course of one week, three Seattle donors stepped up with generous gifts, and the program will move forward.
- Adopt an Equity Lens. It’s great to see donors talking about equity. But we fear that some new efforts will actually be counterproductive if they’re more about workshops and checklists than deep introspection and genuine culture change. At a minimum, give your grant pipeline a good, hard look. If you’re a typical donor, you’ll find that most of these organizations came to your attention through an influential person in your network. This dynamic hurts leaders of color. One outstanding nonprofit leader reports that he frequently finds funders investing huge sums in white-run nonprofits that look great in PowerPoint presentations but don’t deliver nearly as well as Black-run, neighborhood-based organizations.
- Lend Expertise When Needed. What skills and relationships can you share with your grantees? For instance, the Great Recession’s financial markets’ failure nearly bankrupted a school for children who learn differently. When the markets crashed, the school’s multi-million-dollar loan, collateralized by a swap agreement, blew up. A donor stepped in to help the school marshal leaders with great “work-out” experience and staved off foreclosure.
- Help Grantees Engage in Skillful Triage. Given the many challenges your grantees are facing all at once, encourage them to prioritize effectively with some form of triage assessment. We’ve developed a basic triage tool you might consider sharing with relevant grantees.
- Fund Nonprofit Advocacy. All the crises we face involve public policies. Help your grantees advocate for policies that can help and fight those that can hurt. And review your grant-award letters to ensure they don’t prohibit grantees from engaging in advocacy.
We know every donor in America feels besieged by solicitations — for COVID relief, natural disasters, racial equity, political campaigns, and so much more. But let’s all maintain perspective here. The pain of excessive solicitations is nothing compared to that being felt by our grantees and those they serve. We simply must go beyond our previous comfort zone while our communities teeter in a crisis zone.