Every year, the world of fundraising professionals eagerly awaits the release of the longest running and most comprehensive report on philanthropy in the United States: Giving USA. The report began in 1956. It was created by the American Association of Fundraising Counsel, now known as The Giving Institute, and is researched and written by the Indiana University Lilly Family School of Philanthropy. We look to this data as an indicator of philanthropic trends that can help guide our work. Here are some interesting takeaways from the 2021 report, which are based on 2020 U.S. philanthropy:
There are some other notable factors contributing to this data:
Looking at the Data with Eyes Wide Open
At Evolve, we love geeking out about data! Numbers don’t lie! However, we also know that it’s important to look beyond the data, especially when considering that this past year’s data was measured during a pandemic. So, what does the data not tell us? We decided to go back to some Evolve friends who were featured in our webinar last year on this exact subject: Giving USA: What the Data Doesn’t Tell Us. Here’s a summary of their thoughts on the 2020 research and some of their unanswered questions.
When initially reviewing the data, Christopher was not completely surprised to see where the money was going. For example, the increases and decreases in relation to the pandemic and the economy made sense to him (e.g. corporate giving decreased as many businesses lost revenue and had to furlough or lay off staff, etc.), as did the decline in arts, culture, and humanities giving, since many of these organizations ceased or limited operations with no live audiences. But, Christopher was pleasantly surprised to see total giving go up. Given that the report is conducted on such a large scale, he understands the difficulty in extrapolating what’s in the data considering the relative size of Ingenuity’s $3.5M budget. One thing is for certain: Ingenuity’s donors have been incredibly generous this past year; furthermore, many donors offered to release restrictions on their pledges or grants.
In regard to what’s missing, Christopher would love to figure out a way to determine the long-term impact. “What’s missing is what the report cannot provide: Is the investment in anti-racism organizations and BIPOC organizations going to continue at the pace it is now? Will arts and culture rebound?” He certainly hopes so (and so do we), noting that 2020 is “an outlier of a year.” We don’t have a crystal ball, but wouldn’t it be nice if we did? As always, we look forward to seeing what the data reveals next year and in the years to come.
Joi was not surprised by the significant increase in generous gifts to Covid Funds as well as endowments because she saw the same trends within her own work. ECF did have to lean on their endowment when the pandemic first hit in order to ensure that they had an immediate source of funds to distribute. At the onset of the pandemic, their CEO at the time made sure to help mobilize the team, who reached out to their most generous donors so they could pivot and support their partner organizations with those funds. ECF received a $1M matching challenge grant from a magnanimous donor, which spurred additional giving in the community. ECF’s revenue increased, mirroring the report’s results: ECF awarded more than $4M in 2020, five times more than what they awarded in 2019. In 2019, they awarded roughly $840K in grants. The team at ECF worked tirelessly to distribute the millions of dollars they raised immediately back into the community to nonprofit organizations as well as minority-owned, small businesses. Similar to Christopher’s work, ECF had donors who stepped up and released restrictions on funds to help the community. Additionally, ECF’s board was a constant and steady source of support for their team. There were days when the ECF team would get on a call with their board members and their board would say, “What do you need?” This would bring staff to tears, especially since the community need was so great. Staff needed the extra encouragement and leadership of board members as they strategized to ensure that Evanston residents had what they needed to stay healthy and safe during the pandemic. The Philanthropy and Communications Team also increased the amount of time they spent communicating with their donors in order to ensure that they understood EXACTLY how their dollars were being used in real time.
When we asked Joi what’s missing from the data, she responded with curiosity on how the faith-based community is factored into everything. We know dollars increase annually, but how does the faith-based community’s contributions reflect in giving dollars and in-kind support during the pandemic? She was especially curious about African-American families who give a majority of their discretionary income to their church. Joi questioned whether there is overlap of the African-American community giving to faith-based organizations (leading to the faith-based organizational giving percentage) and the individual giving data results. She wondered what percentage of the 69% of individual donors were African-American families. This led to a conversation about the racial justice movement and the push for more transparency around demographics and, particularly, whether giving by demographic will ever become a component of the Giving USA report.
Noteworthy philanthropy trends and their impact on the data
With another recent, huge surge of giving from philanthropist MacKenzie Scott ($2.74B to 286 organizations, this time, with a huge focus on public education), The Giving Pledge, and a push for more collaborative fundraising between organizations, as well as donors and organizations, we can’t help but wonder how this type of philanthropy will shake up the data we are seeing moving forward.
Assuming that giving in other categories remains relatively stable, Christopher believes that Ms. Scott’s philanthropy will possibly impact 2021 data if she continues at the same pace of giving, in the same way that the increasing number of “mega gifts” ($200M and more) have affected prior years’ data. Christopher is also hopeful that we will see more pooled resources and collaborative grantmaking, and that this will help create a more equitable distribution of funds. Joi does think these philanthropists’ generosity will contribute to the data’s increased metrics (in individual and foundation buckets). She hopes that, in conjunction, we will see more donors trusting nonprofits to make the best decision on how to spend these mega gifts (a trend in the way Ms. Scott is giving, with little strings attached), which may transform donor reporting and stewardship practices. Joi mentioned how the philanthropy industry is seeing more inspirational fundraising stories show up on blogs, websites, and podcasts too.
What are some philanthropy predictions for next year?
Christopher hopes that arts, culture, and humanities rebounds, and that we see continued increases in giving to the public society benefit bucket (assuming this includes DEIJ and anti-racism organizations). He also hopes foundations will realize that increasing their giving - as many did in response to the pandemic - won’t make them go out of business. Joi believes we will see corporations bounce back and have the staff and teams they need to thrive, and that they will then give more back than ever before.
Keep up the amazing work!
At Evolve, we have seen incredible resilience from our nonprofit clients and partners. Fundraisers did not stop their hard work. Fundraisers also continued with their solicitations – a notable difference from the Great Recession, where most fundraising came to a halt. The most successful fundraisers in 2020 were the fundraisers who picked up the phone and called their top loyal donors to converse about the pandemic’s impact on their organization’s mission and operational structure. As a result of this ongoing communication with their donors, we witnessed donors (many of whom were luckily not impacted by the pandemic) stepping up more than ever before for our clients. These donors wanted to continue supporting their top philanthropic priorities, including the racial justice movement, during COVID-19. We are certain this kind of relationship-based giving contributed to another surge in the data for individual giving.
So, what now?
Now is a great time to be a fundraiser! Capital campaigns are back in full swing and big gifts continue being closed. That being said, we need to pause and ask ourselves: will all of these 2020 donors continue giving in the future? Will we begin to see a shift in the way the Giving USA data is collected based on shifts in the ways philanthropists are making gifts?
We encourage you to think about the following: What data can you collect at your organization now to set you up for end-of-year fundraising success? When can you pause to think about lessons from this past year and apply that to your organization’s programmatic work for the future? What do those changes mean for your fund development efforts? Does this mean it’s time to refresh your case for support? What about strategic visioning as you look toward a changed future? Do you have the right development team structure in place? Or, if you’re a team of one, are you focusing your time and energy on where you will get the most impact to advance your organization’s mission?
Evolve will continue to blog and host webinars answering those questions. In the meantime, what would be helpful to you and enable you to move the needle in your work this year, next year, and in 5 or 10 years? We would love to hear your thoughts and suggestions, so feel free to email us at firstname.lastname@example.org.