Many nonprofit organizations under-invest in overhead costs like operations, staffing, skills training, and systems.
By Julie Bianchi
Human service organizations address some of the most complex problems ingrained in our society. Donors don’t need convincing that these are worthy causes – on the contrary, U.S. Trust Study of High Net Worth Philanthropy found 81 percent of high-net worth households gave to organizations addressing basic needs in 2014, and the sector is growing steadily. Yet, The Chronicle of Philanthropy reported that of the $10.2 billion given by America’s top 50 most generous philanthropists in 2014, not a single U.S. human service organization received a gift of $200 million or more.
Mega donors are giving to human service organizations, but they aren’t giving mega gifts.
The largest publicly announced gift given in 2014 to a human services organization (not including in-kind gifts) was a $16 million gift from the Dean and Barbara White Family Foundation to the Southlake Family YMCA in Crown Point, Ind. Meanwhile, the largest gift to higher education was $250 million to Yale University from philanthropist Charles B. Johnson.
What accounts for this gulf between the largest gifts to human services and higher education?
Not thinking big enough. Big dollars follow bold visions. While donors can believe in the ingenuity of science to find the cure for a cancer with enough money backing it, human service organizations have been less successful in convincing donors they can actually solve the big problems they manage in their day-to-day operations. Instead, human service organizations opt for treating symptoms through projects that allow for measurable impact within their issue area (like homelessness or unemployment), but restrict the possibility of visionary change and the mega gifts that fund it. Visionary change is driven by leaders collaborating across issue areas to find solutions to take to scale.
Not asking for philanthropic investments. Many human service organizations ask donors to give to relieve today’s urgent needs (charity), but miss the opportunity to invite investment in systematically providing opportunities for people to permanently transform their lives (philanthropy). The charity mindset taps into a mega donor’s checkbook for a year or two (I’ll write you a $100,000 check out of my bank account), but not their more strategic philanthropic investment portfolio (I want to leverage my wealth to invest in your solution).
Not investing in infrastructure. As the Underdeveloped report (largely representing human service organizations) highlighted; organizations, especially human services, are struggling to prioritize resources to develop relationships with donors of any level, let alone mega donors. In comparison, universities and hospitals have armies of fundraisers and resources to meet the complex visions and needs of mega donors.
The following tips can help strengthen a case for support to attract the gifts that match the scale of the problems human service organizations tackle.
Start with a big vision, and stick to it. The mega visions that have been successful in the health and higher education sectors come with high risks and high rewards. Instead of being discouraged by the daunting challenges of this sector, invite donors to think big along with you (lead the fight against hunger vs. feeding the hungry). If you lose sight of the problem you’re trying to fix, your donors will, too. Explain why the risk to end hunger is worth it, rather than just filling a food pantry year after year. Local affiliates of a larger organization should be sure to cohesively build on messages of the national vision while tackling issues in specific communities.
Make sure a credible plan is in place. With a bold vision as a guide, human service organizations can lay out actionable steps towards a higher goal to keep momentum building towards a slower-moving outcome like ending homelessness. Show donors your ability to succeed in being visionary without dropping the ball.
Instill a sense of hope and optimism. Human service organizations have attracted donors with a sense of urgency to end social crises like hunger and homelessness, and in the process, relied on crisis-response language to incite giving. To see the long-range visions of systems change, organizations can help donors imagine another possible future that includes a community benefit for everyone, with forward-thinking messages of hope and possibility.
Invest in yourself. Many nonprofit organizations under-invest in overhead costs like operations, staffing, skills training, and systems – all which contribute to the ability to absorb a mega gift. Additionally, to tackle huge problems, organizations need not be just the service provider – they need to be expert. Human service organizations tend to be especially austere and humble while tackling some of the greatest social issues, perhaps at the cost of convincing donors of their organizational power to affect change. Tell donors why YOU are the best organization to change the world, and how your mission hinges on big investments.
The power of a mega donor to affect change with their significant investments cannot be overstated. If organizations can make bold asks, lay out a forward-thinking vision with a credible plan, and invest in their infrastructure, they will be that much closer to the future they imagine.
To learn more about mega giving, please join us and register for our upcoming webinar, “Are We Getting Our Share? Building a Case for Mega-Gifts to Human Services.”
Julie Bianchi is a Consultant at Collins Group, a division of Campbell & Company. Julie aims to help clients build their visions and accomplish their goals. Her work is enriched by her sector experience in human services, community healthcare, and independent schools.