Let's double down for small nonprofits.

By Todd Butler
Causewave President & CEO

Our community faces significant challenges to creating a better future. The good news is there is no shortage of energy for change, as evidenced by the nonprofits, large and small, who are driving us towards that better future. Small grassroots and BIPOC-led (Black, Indigenous, People of Color) nonprofits are some of the best tools in our community's toolbelt to make real change. These organizations can pivot quickly to meet needs, are often founded and run by the very people who are closest to the challenges they are addressing, and have high levels of trust in their communities. Despite all these strengths, I often see small nonprofits struggle the most through my work at Causewave. And it begs the question - are we as a community really setting them up for success?

The public trusts nonprofits the most.

Trust is perhaps the most valuable asset for a nonprofit seeking to make change in their community. Just last month, The Independent Sector put out their 2024 Trust in Civil Society report. It showed that trust in nonprofits rebounded from last year by five points, with 57% of those surveyed indicating high trust in the nonprofit sector. This meant nonprofits were now more trusted than any other sector, including federal government (18%), state government (19%), private foundations (37%) and small businesses (43%). This was a major win compared to their 2023 report, which showed that nonprofits had the biggest decline in trust compared to all other sectors tracked. In fact, the 2024 data shows that the American public trusts nonprofits to reduce national divisions more than they trust corporations, government, or media. Throughout these statistics, one thing remains clear - the public has high hopes for and high expectations of our sector.

Demand is growing, resources are thinning.

A national nonprofit study by accounting and consulting firm FORVIS revealed that 71% of nonprofits had increased demands for their programs and services in 2023, resulting in waitlist increases and delays. At the very same time, funding is dwindling, with recent reports showing that overall giving declined in 2023. In addition, many nonprofits are facing increasing staffing gaps. The logical reality is that for small and BIPOC-led nonprofits, these problems are even worse. They face increased challenges to fund their work, often without the benefits of sufficient infrastructure. They also feel every staff departure more acutely than their larger-org colleagues.

An inverse relationship between trust and resources.

The challenges faced by local small and BIPOC-led nonprofits are illustrated by recent attempts to fund a group of them through the Community Resource Collaborative (CRC). Federal funding was provided by Monroe County to support service integration and collaboration between small nonprofits across Rochester to address some of our community’s most profound issues. In addition to the funding provided to those organizations through the CRC, 10 other grassroot community-based organizations received other additional funding. What started off as an effort to direct funding to small, BIPOC-led nonprofits ended in frustration and illustrates the need to match program dollars with the infrastructure needed to support it. The resulting missteps hurt everyone - with community members lacking the services they need, the organizations facing crises due to delayed funding and trust damaged all the way around. What could have been a step forward may have left them worse than before.

The cruel irony is that the nonprofits with the fewest resources are the ones that have both the most trust among those they serve and the highest expectations on them. Which is why we as a community and sector need to use this opportunity to double down in support of these organizations rather than pull away.

Trust goes both ways.

Many nonprofit leaders of color have long expressed their frustration with philanthropy and the nonprofit system. So much so that a growing number are more hesitant than ever to step into a leadership position. Many even question the need to engage with the sector at all in order to do community-based work. Which means that while our sector is increasingly in need of the trust of our partners and the public – we are also in need of building and repairing trust with nonprofit leaders of color themselves. What would it mean if our organizations and sector built a system that sought out, uplifted and protected BIPOC professionals and leaders? What would it take for us to create a system that is worth trusting?

Where will we go from here?

As a sector, we are at a critical crossroads. We should recognize that it is our responsibility to lift up small and BIPOC-led nonprofits. That may mean going out of our way to find new collaborative partners, being intentional about how inclusive our support networks are and recognizing when our organizations can step aside in order for others to take the lead.

As a community, we could encourage our government leaders to go beyond program dollars in order to build infrastructure in BIPOC-led and small nonprofits. We can be the catalyst that pushes our community's decision makers to invest in nonprofit staff, operations and forward-thinking strategic planning. We can invest in these vital organizations so they can be stable, reliable resources for the communities they are so passionate about serving. We can do more when we invest in organizations - not just programs - that have authentic community support and connection.

There's hope, but historic underinvestment won't be changed overnight. When things get tough, true partners double down rather than pull away. In order to truly build trust, we need to be willing to invest - and re-invest, even in the face of adversity.