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Are we Purposely leaving Money on the Table? Heed the Wake-Up Call!
Yes, new reports show that both giving (in dollars given) and the number of donors decreased in the 4th quarter of 2022. Other reports show that growth — in terms of individual giving — has slowed. BUT, if you dig into the stats over the last decade (or even longer), you’ll see that there has been a downward trend, but the sky is not falling. Donors continue to give, bequests continue to come in, corporations and foundations have reworked the way they give, and nonprofits continue to thrive, accomplish and make a positive impact on our world.
Nonprofits are more important than ever, for many reasons. Now is not the time to jump ship or give up, rather, it’s time to look at the trends as a wake-up call. The time to substantively change how fundraising is done is now.
Why? Because you’re likely to be leaving money on the table. Lots of money.
Look at your database of donors and prospects. Are you missing large numbers of potential donors, because you don’t really “see” them, or you don’t see them as having significant giving potential?
Here are some stats and interesting points for you to think about:
According to the recent Indiana University Lilly School of Philanthropy report “Muslim American Giving Report: Motivations of Giving”, Muslims have a rich tradition of charitable giving through different modes of obligatory charity, known as Zakat, as well as several other optional charitable giving practices. The report explains that “In Islam, giving a portion of one's wealth to those in need is seen as a way to purify one's wealth and help support those who are less fortunate. This tradition of giving is deeply ingrained in Muslim culture, and many Muslim Americans continue to prioritize charitable giving as an important aspect of their faith.”
This new report tells us that “Specifically, on average, givers with the highest levels of motivation tend to be Muslims, compared with the general and non-Muslim populations. Islam is the world’s second-largest and fastest-growing religious tradition and may exceed all others by the year 2100. There are 1.8 billion Muslims in the world and approximately 3.45 million Muslims in the United States. Muslim Americans make less money on average than the typical American (Ware, 2021).” “Still, they are found to be more generous, compared with the general and non-Muslim U.S. populations (Siddiqui & Wasif, 2021; Siddiqui et al., 2022). According to Siddiqui and Wasif (2021), compassion for those in need is one of the most powerful motivators for American Muslims to give charitable donations.” Interestingly, the researchers found that American Muslims think more favorably of fundraisers asking them for money than other groups. In addition, they write that “the lowest motivations for Muslims and non-Muslims to give are receiving a tax credit, recognition, financial strain, and the belief that donating money to charities is wasteful”.
There are many studies of Black donors and giving, and they are typically packed with information that many of us are not aware of. For example, The Stanford Social Innovation Review, in a podcast, noted that “it has been customary to refer to Black Americans as a new and emerging demographic in charitable giving despite participating in charitable giving in the U.S. for decades.” In this report, you’ll see that Giving Circles aren’t so new, as the Black community has been working together in giving groups for centuries.
As of now, that same report concludes that “Since Black households have outpaced giving from white households, the growing number of Black donors should give nonprofits reason to be optimistic about the future of giving, although more can be done to cultivate them.”
A terrific piece from Hawwa Muhammad of Pink Trumpet, published by the Tides Foundation (2021) gives us some very specific data. Citing a previous report by the W.K. Kellogg Foundation, Muhammad writes that “Black households give 25% more of their income annually than white households, and nearly two-thirds of African-American households donate to organizations and causes, totaling $11 billion each year.” Despite that figure, the piece points out that “Black communities are seen as the recipients of aid rather than as individuals actively engaging in the practice of philanthropy.”
In late 2020, the IUPUI (the Indiana University Lilly Family School of Philanthropy) partnered with the University of Chicago’s NORC research organization to better understand the makeup in America of donors to social and racial justice causes. They found that “People of color are more likely than white people to say they give to social and racial justice causes.” Probably not a giant surprise, but the breakdown of groups is interesting. The research project reported that Americans who said that they gave to social and racial justice causes (including cultural and arts institutions, universities and racial justice groups) were 30.7% Asian, 19.25% Black, 13.88% Hispanic, and 12.59% White.
And just in case you’re thinking that those are percentages and not dollars, look at the success of the Asian American Foundation (AAF). The AAF was founded in 2021, and within their first year, they had raised $ 1.1 billion. Learn more about them here.
One of my favorite stories to tell is about the women donors at Dartmouth who raised $379 million plus an additional $61 million in bequest expectancies when a female alum, who had basically been ignored by her alma mater, stepped forward to make needed changes in the way that Dartmouth interacted with and recruited their female alumni (relative to giving). If you haven’t read it yet, it’s a must-read. Check it out here. https://www.philanthropy.com/article/women-led-fundraising-effort-reaps-big-rewards-for-dartmouth.
Obviously, these are just a few examples to help you get a sense of the large amount of money out there — typically beyond your usual donor “file”. Women, people of color, people from other countries, younger people, and people who combine some or all of those descriptions are out there. Many (if not most) of them want to make a difference in the world, and many of them can afford to make an impact (financially) on your nonprofit — if you just begin to “see” them in the same way that you “see” your “usual suspects”. Now’s the time!
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Welcome to Philanthropy 451, a weekly newsletter with my thoughts on the state of the nonprofit industry, including anecdotes, statistics, and helpful recommendations. I'm Lisa Greer and I'm obsessed with Saving Giving.