Philanthropy in Flux Part IV | Real-Life Observations + Pivots
By: Porter Durham, GPA Partner
Funding Quandaries
For any professional, being drawn into a “real life” conversation with folks who don’t know what you do for a living, and then hearing them out on their issues of the day, can be a thought-provoking eye-opener. When it happens in a thoughtful exchange of ideas, the conversation is truly a gift of insight.
These types of exchanges happened to me the other evening at a reception fundraiser which I hosted for a local nonprofit. This particular group included both liberal progressives as well as traditional conservatives. They came together to support a college pipeline and support organization for talented first generation students for whom even the idea of going to college would be foreign. Very high persistence and graduation statistics tell the story of what regular personal support and mentorship can mean for these individuals.
Inevitably, the conversations turned to funding, how that works, what is required per student, and how much government funding, both state and federal, is involved. Unlike this particular nonprofit organization’s sister groups in other states, funding comes exclusively from private sources, both individuals/families and foundations. These funding sources are allowing this organization to continue to plan and dream about a supportive future for these students. Sadly, it seems that the government supported nonprofits groups will most likely wind down. The likelihood of these funding streams returning is slim.
Needless to say, after the presentations, the small conversation groups that sprung up among the attendees were focused on resources. And as would be expected, some expressed sadness and anger that the government had withdrawn funding, while others believed that government funding was likely not appropriate in the first place, given larger fiscal issues and the “proper” (in their opinion) role of government. I mediated, listening intently. What came next was important and surprising: a general agreement that private funding was a better and more efficient approach, and that the government has always been a fickle partner.
All of us have grown up in the era of government-funded programs in many arenas, deployed with varying degrees of efficiency and success. Likewise, during the same timeframe, we have seen the rise of ponderous federal and state budget deficits and general debt. The size and depth of the circumstance, the magnitude of the numbers, leaves us numb and without meaningful reference points to consider. Hence, the siren song of the fickle partner has continued.
A Call for New Thinking in Philanthropy
But now, the very special, almost exclusive role of private philanthropy is on full display. The sort of deep and specialized funding a private source can supply is making the difference, right in this moment, between those nonprofits which will survive to continue their work, and those which won’t. To be clear, the work left unsupported may be critically important, may be very special to a particular community, may mean the difference between success and failure for an individual. Certainly, private philanthropy cannot replace the government as a funder; however, it can stand for mission and purpose now, and it can lead the way for many nonprofits which seek to re-imagine their work, eliminating what is unnecessary and inefficient, and train the tax-advantaged resources it does have on those who need it most for the greatest effect. To do this well will require new, faster and better thinking by donors and more close attention to the needs to be served. Both will benefit, and all who are supported by them will as well.
In an effort to continue our series entitled Philanthropy in Flux, we continue to share our observations of the philanthropic field and philanthropists’ changing behaviors as they meet the moment. Don’t miss the earlier parts of the series:
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We’re an independent firm helping clients to focus and maximize their philanthropy—in turn, strengthening the fabric of our communities. Founded in 2019, we help donors move from responsive patterns of giving by assisting clients to identify values and become more strategic in their philanthropy. Our goal is to help donors to become more effective as change-makers. We work with foundations (large and small staff teams), donor advised fund holders, multi generational families, individuals, philanthropy supporting organizations and corporations to design philanthropic strategies.