Philanthropy This Week

Courtesy of BRAC

Good morning.

Of the 2,300 nonprofits that have received donations from MacKenzie Scott, 13 struck gold more than once.

There doesn’t seem to be a common denominator among the recipients, reports Jim Rendon. They work on the environment or poverty or health. Some make grants to other nonprofits or directly to people in need. Some focus on crises like the pandemic or the war in Ukraine.

Scott appears to have twin goals, Benjamin Soskis, a senior research associate at the Center on Nonprofits and Philanthropy at the Urban Institute, told Jim.

“One is we need to figure out ways to get as much money out the door as possible, so we’ll give to organizations that can absorb that money reliably and can regrant it,” he said. “Then there’s another mode of thinking, which is we need to give money to a different set of organizations that in the past haven’t been the kind of organizations that get big grants.”

Donor collaboratives have been an effective way for Scott to multiply the number of groups she funds, and they have the capacity to give much more, according to a Bridgespan Group report. Blue Meridian, which did not disclose the amounts, got four Scott gifts, and Co-Impact received a total of $125 million in two contributions.

Other big winners were GiveDirectly and UpTogether.

“These groups give direct cash transfers to people,” Phil Buchanan, president of the Center for Effective Philanthropy, told Jim. “That’s something she really believes in. And the research suggests it’s really effective.”

Here’s what else you need to know:

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At a Grateful Dead concert last May, Chronicle columnist Eboo Patel had an epiphany: Nonprofits should take a page from the band’s resurrection a decade after lead guitarist Jerry Garcia died.

After the band’s most iconic member was gone, “everyone thought that was it for the Dead,” writes Patel. “We fans were grateful for the memories.”

But three decades later, with pop music star John Mayer as the unlikely lead guitarist, the band is back and selling out venues across the country. The performances are as stellar as before but with new elements, like video storytelling.

After a particularly tough decade, Patel writes, nonprofits, too, need to adapt to new realities and integrate new staff while keeping true to their original missions.

“The longevity and adaptability of the Dead offers a model for how to meet the challenge of maintaining an organization’s essence while allowing for different approaches to implementing programs.”

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When writing a proposal budget, nonprofits are often torn between trying to keep administrative expenses low to please some funders and the desire to build capacity instead of seeking support for programs alone, which others favor.

But that schism is the wrong way to look at it, reports David Wheeler, who asked veteran fundraisers for their strategies. Instead of shaping a proposal budget to please a grant maker, write it with your group’s own needs in mind.

The best approach is to create a budget that shows you manage money well, make sure your budget and your narrative complement each other, carefully follow the funder’s guidelines, show that you have broad support — including donations of goods and services — and ask for the true cost of programs. You’re more likely to get support if you include specifics in the budget, like funds for monitoring and evaluation or improving financial management technology — even from funders who say they don’t give for administrative expenses.

“Funders just don’t like admin,” Andy Posner, CEO of Capital Good Fund, told David. “But you have to make the case for it, because you can’t not cover it. Otherwise you’ll go under.”

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There’s a better way to raise money than requesting cash, a recent study has found. Nonprofits that asked donors to pay for something tangible — like a monthly ration of food — received 57 percent bigger gifts than those that asked for cash, reports Rasheeda Childress.

The size of the request mattered, too. Donors asked to give enough for a month’s worth of food gave more than those that asked for a day’s worth.

Surprisingly, mixing detailed information with the request generated smaller gifts.

“If I tell you, ‘Hey, you can feed a child for a day for a dollar,’ you might think, ‘OK, I can give that,’” Raphael Epperson, lead researcher on the project, told Rasheeda. “Already a dollar is enough. So people start to give less.”

— Marilyn Dickey, senior editor for copy

Abortion providers trying to move to or expand in states where the procedure remains legal face a litany of obstacles as abortion opponents try to block them. Protests and physical attacks on buildings, squeamish landlords, bureaucratic setbacks, steep property-insurance premiums, meager health-insurance reimbursement rates, and paltry philanthropic support for poor patients combine to make it increasingly difficult to launch new clinics, even in blue states. (New York Times)

A federal lawsuit in Texas that would deal a crippling blow to a local Planned Parenthood affiliate is part of a conservative activist’s long campaign against the organization. The litigation, brought by an anonymous whistleblower against an affiliate operating in Texas and Louisiana, has ties to Leonard Leo, who guided efforts to appoint a conservative U.S. Supreme Court and overturn Roe v. Wade. Joined by Texas Attorney General Ken Paxton, the suit accuses Planned Parenthood of Medicaid fraud for accepting reimbursements while Texas’s effort to kick it out of the Medicaid program was being litigated in courts. It seeks $1.8 billion in penalties, which amounts to almost 90 percent of the organization’s annual revenue. (KFF Health News)

A religious nonprofit that runs 21 crisis pregnancy centers in Massachusetts is suing top state officials and the leader of an abortion-rights group, saying the state singles out its facilities for disparate treatment. A Woman’s Concern Inc., which operates the Your Options Medical Centers, cites disparaging language that Gov. Maura Healey and others have used about its clinics. It also says the Public Health Department’s website warns people that crisis pregnancy centers “are not a safe or trusted place to go for reproductive health care.” Healey declined to comment, and the leader of the abortion-rights nonprofit did not respond to a request for comment. (Boston Globe)

More than 200 employees of Save the Children say they have lost trust in the aid group’s top leaders. In a letter spurred by a planned reorganization that would leave hundreds vulnerable to layoffs, staffers called for more transparency and staff involvement in the process and “an independent review of structural and financial decisions over the last five years.” As international aid organizations face drops in donations and higher costs, one top executive said Save the Children has been talking with staff about the process for months and has been clear about the need to cut expenses. (Devex)

The California network of nonprofit contractors that serve people with developmental disabilities left nearly $1 billion unspent in a recent budget year. Officials said they struggled to hire workers to provide services amid the state’s low unemployment rate. They also said the state over-budgeted, expecting another Covid surge that would have translated into more expensive, one-on-one services. Meanwhile, multiple surveys have found a significant percentage of the state’s families who need such services are not receiving them. (Los Angeles Times)

Texas Attorney General Ken Paxton wants to shut down an immigrants-rights group that he argues flouts the rules that limit nonprofits’ ability to weigh in on elections. On social media, FIEL Houston, a nonprofit immigrant advocacy group, has called Texas Gov. Greg Abbott “a violent racist fascist man” and referred to Donald Trump as “the son of the devil.” It has also spoken out against a Texas law that allows the state to arrest and ultimately deport those who enter the country illegally. FIEL argues that Paxton is retaliating for previous lawsuits it filed, including against the attorney general, and is targeting groups “with whose content or mission he disagrees (Houston Chronicle — subscription)

The movement to diversify the U.S. tech industry is flagging amid dwindling corporate and donor support. The nonprofit Girls in Tech closed in July due to lack of funding after 17 years, almost simultaneously with the demise of Women Who Code for similar reasons. Companies and donors are pulling back as they cut costs and face a conservative backlash against diversity, equity, and inclusion programs, even as the share of women and Black workers in tech remains essentially stagnant. (Washington Post)

Though their funding sources are different, opera and classical music companies across Europe and the United States are having to innovate and adapt to soaring costs and changing audiences. In the United States, that means ever-greater reliance on donors. For example, ticket sales for the San Francisco Opera have shrunk from 60 percent to 16 percent of revenue over the past 60 years, while the cost of staging a season costs millions more than it did several years ago. The company now offers cut-price tickets for opera newbies. “Philanthropy has to pick up that shortfall,” Matthew Shilvock, the company’s general director, said. (Financial Times — subscription)

Nonprofit “microtransit” experiments in Vermont are testing the best ways to provide transportation to those who live in rural areas and small towns and either lack cars or cannot drive. These services typically offer free, on-demand rides, with transit-system costs per passenger higher than in urban/suburban systems. But one nonprofit executive said such projects are key to helping people rise out of poverty, and operators say they can make their systems more efficient by “right-sizing” their fleets and having passengers share rides whenever possible. (VGTDigger)