The end of the year is a critical time for many nonprofits leaders as you review your programmatic progress and outcomes for the year, while also planning your strategy for the new year. It is also a time of end-of-year giving campaigns and pursuing additional funding to expand your impact.
In July 2020, Philanthropist MacKenzie Scott asked a team of advisors to help determine the best organizations to support with their efforts to alleviate the suffering from COVID-19 and the resulting financial crisis. Scott’s organization used a data-driven approach to donate over 4 billion dollars to almost 400 organizations operating in communities with high food insecurity, racial inequity, and poverty. Scott’s organization has since given billions of dollars more to additional social-good organizations able to show they can absorb and make effective use of funding.
The Center for Effective Philanthropy (CEP) is conducting a 3-year study on the transformative effects of Scott’s gifts. They recently released the year-two report “Emerging Impacts: Going Deeper on the Effects of MacKenzie Scott’s Large, Unrestricted Gifts.” The goal of this blog is to discuss three key findings from the report that your organization can learn from.
Key-Finding One: Pursuing Opportunities for Impact
Key-Finding Two: Strengthening Nonprofit Capacity
Key-Finding Three: Funder Perspectives
Key Finding One: Pursuing Opportunities for Impact
In CEP’s report, nonprofit leaders described how they used the funding to expand and improve their programs by being innovative and taking risks. One leader shared that the grant “really allowed us to think creatively, and to create the program based on the need that we saw, and the need that our clients were telling us about.” Other organizations were able to serve a much larger population and expand their programming to new locations and establish partnerships for new, expanded programming.
Another common thread for these organizations was the push to be able to demonstrate their impact so they could sustain the same level of impact they achieved with Scott’s funding moving forward and be better able to attract new funding to continue expanding their impact.
Key Finding Two: Strengthening Nonprofit Capacity
Eighty-eight percent of the organizations interviewed by CEP reported improved staff morale, increased creativity, and increased focus on equity both internally and in their programmatic work. This was possible because the nonprofit leaders chose to use funds from Scott to increase staff capacity and transform organizational culture. Specifically, they empowered staff to think creatively and strategically about how they could better serve the organization’s mission. One participant reported “We had to have a whole session of really dreaming big and crunching the numbers, and [thinking about] what would help us grow exponentially and allow us to serve more people.”
More than 80 percent of leaders reported using funds from Scott to strengthen their organization’s long-term operational capacity. About 40 percent of respondents used a portion of the grant to upgrade their organization’s technological infrastructure for measuring and sharing their impact. One leader said “It made their work easier. It made everything update quicker. And so, it actually gave them even more confidence in their position and their job and gave them less time working on paperwork and more time interacting with the people that we serve.”
Key Finding Three: Funder Perspectives
More than 80 percent of funders interviewed praised Scott’s approach to giving and believe she is contributing to ongoing discussions in philanthropy about trust-based giving. Just under half the funders shared that they believed Scott’s funding will strengthen recipient organizations. They noted the opportunities the funding creates for “the whole organization, not just funding an idea or a cause at an organization” and for “some breathing room so they can think about the core of their work and how they want to do it.”
In addition to the praise for Scott’s approach to funding, many funders voiced concerns about accountability due to Scott’s minimal reporting requirements. They shared that there will be many unanswered questions, such as, “How successful is this? Was the money used properly? Did it go to actually doing what you hoped it would do?” When discussing lack of accountability, some funders shared that they worried there would be a lack of learning. Another funder was concerned that if somebody has a breakthrough that is applicable to the work of other organizations, it might not be shared due to the lack of reporting requirements.
Wrapping Up
CEP concludes their report by noting “It remains too early to draw more definitive conclusions about Scott’s giving and its effects. Scott’s grantees have had this funding for only one to three years. But their experiences to date can offer insights to inform other donors as they consider their approach to giving.” In the next year of this study (year three) CEP hopes to explore further questions for this research, including: “What additional evidence do these organizations have of the impact of these gifts on their programs, financial health, and operations?”
SureImpact provides the data collection and impact reporting infrastructure to meet the unique needs of social-good organizations as you work to achieve your organization’s mission. SureImpact’s simple and collaborative case management, outcome tracking, reporting, and analytics tools are designed to help you manage, measure, and communicate your social impact. This ensures you have impact data available in real time for grant applications, strategic planning, and stakeholder communication, without the burden of doing everything manually.
To learn more about how to set your organization up for success in 2024, check out our on-demand webinar “3 Must-Do Actions in 2023.”