The Economy and Fundraising

We have a new topic today. It concerns the flagging economy. In the past year, I have received many inquiries from clients and others about whether the slow economy, particularly slow here in Michigan, hurts fundraising. The most recent of these inquiries came in November from a prominent reporter for a business publication who was doing an article on philanthropy matters locally. The proposition was this: "There are so many capital campaigns going on right now, but will a slow economy hurt these efforts? Shouldn't these nonprofits wait until we have improved economic circumstances? Are there more campaigns going on than there is money to fund them?"

My response to this was that philanthropy is not like a pizza. A pizza is a finite, unexpandable entity. You slice it up. When you eat all the slices, the pie is gone. If there are 8 pieces of pizza and Joe has three, Bill and Mary can't each have 3 pieces. Three people can't divide an 8-piece pizza evenly. That's not what philanthropy is. But many people I've talked to over the years, especially a lot of Board members of nonprofits, seem to assume that if there are "too many charities in town" then there won't be enough money donated by the local populace for all of them to survive and thrive. But that's just not the case.

But I think philanthropy is more like an amoeba. It sort of grows tentacles out toward the food of good ideas and the more good, compelling ideas to give that there are out there in the marketplace, the more the "amoeba" of philanthropy thrives. The more compelling reasons there are to give, and the more great and wonderful things that are getting done to really help people and achieve the ideas we all generally share about the advancement of humankind, the more people are willint to give to those ideas.

Conversely, when there is a paucity of food, the amoeba shrinks, eventually dries up and dies. And, likewise, it seems to me that when there aren't a lot of good, compelling and motivating ideas happening in the area's nonprofits, when all is more or less ho-hum and same-ole-same-ole, the more people find excuses not to give. I don't think they become any less charitably inclined. Philanthropy, the "love of humankind" is alive and well in the hearts of many and is a tradition in our American culture. But people just become disinterested. Or they flock to the nonprofit that has the most compelling case for support and the one that gets the best results.