This paper explores how private philanthropists—especially those in the “Meaningful Middle” giving between $1 and $25 million per year—can support the U.S. social sector as it navigates unexpected budget cuts and workforce reductions. Our research and insights offer a suite of innovative approaches for donors to support nonprofits effectively during these turbulent times beyond making additional grants. These solutions empower philanthropists to do more with less by leveraging sustainable funding mechanisms, embracing collective action, and leveraging relational capital – and it offers the donor perspective to fundraisers hoping to engage further with existing and new donors. Read the full paper here!
Key Takeaways:
Foundations Can Spend More Now Without Sacrificing Perpetuity
A one-time increase in grantmaking doesn’t necessarily endanger long-term sustainability and can still result in portfolio growth over time. Foundations can also use IRS rules to “carry forward” excess distributions and reduce future distributions.
Recoverable Grants Stretch Impact
Recoverable grants give organizations critical capital with a possibility of repayment after meeting pre-set objectives. If repaid, the funds can be reused to support additional organizations—extending donor impact without requiring more funds. Even if not repaid, the structure provides flexibility without significantly harming the donor’s financial position.
Collective Action Accelerates Response
Pooled funds allow donors to quickly mobilize and deploy resources for emergency or bridge funding. Lightweight governance and reporting are key to agility. And emergency credit facilities can provide nonprofit liquidity without burdening a single donor or lender—repaid funds can be recycled.
Relational Capital And Skills Are Underutilized Assets
In today’s environment, nonprofits are seeking expertise in restructuring, mergers, and crisis response—skills common in the private sector. Donors with commercial experience can offer advisory support, facilitate nonprofit M&A, and even fund exit packages to enable leadership transitions.
