A strong nonprofit sector is critical to the success of any community. Yet, there is an inherent power dynamic that enters many of the conversations between funders and the potentially fund-receiving nonprofits which can hinder the development of open and trusting relationships. To truly provide impactful support to our community, funders must recognize this dynamic and work toward building authentic relationships with open and honest dialogue.

So how do you work toward this authentic relationship? First, recognize that both funders and nonprofits are needed in reaching their shared goal. Those with wealth are looking to fund programs and organizations who are working to address the needs which the funder sees as important. The nonprofits are transparent about their missions, goals and who they seek to help. When the two parties’ missions and desired impact goals align, it should be a beautiful partnership. It sounds simple, but conflict can occur unintentionally. To help overcome this, it requires intentional focus on seeking understanding, not evaluating or judging, during conversations. No one is served well if the nonprofit fears saying the “wrong” thing and being denied funding. Discussing only the nonprofit’s successes and programs that went well are certainly more comfortable to talk about; however, when a funder seeks true understanding of the work and allows the nonprofit to share its struggles and failures, they are able to reshape and continuously improve their programs which should lead to better results in the long run.

It is also important to be mindful of the position of the nonprofit. They are running a business. They have clients with needs, staff that require support, and funders that are willing to partner, but many times with varying, and even contradictory, requirements. They may have very few reliable sources of revenue. Federal and State funding can change drastically year to year. Grants from Foundations are often made for a one year period of time and must be applied for again, sometimes with onerous reports required to show evidence of success in their work. Donations from individuals and others can change with little warning. On the expense side, there are often more requests for support than the organization has funds for. As any business would do, they work to control expenses, improve efficiency and increase income. This can lead to hiring part-time staff in lieu of full-time, difficulty in offering competitive wages and benefits to employees, settling for donated or low-cost office space, using older computer and security equipment, reducing programs offered or the number of people it is offered to, and an overall environment of doing as much as possible with their limited resources.

Nonprofit workers must seek a daily balance of serving the needs of their clients, fundraising, and ensuring that their own family and personal needs are met. How many US workers are we talking about? According to a study released in 2019, there were 12.3 million paid workers employed by US nonprofit establishments, or 10.2% of the total US private workforce. For comparison, the US’s largest employer, Walmart, as of 2018 had approximately 2.3 million employees worldwide.

This collective nonprofit workforce has incredible potential to make a positive impact within our communities. They are doing so in an environment of unpredictable income, growing needs and a desire to provide greater support to their staff. When funders find an organization that shares their mission and impact goals, and they have sought true understanding of the nonprofit’s work and their plan for impact, it then turns to trust in the leadership and ability to implement their plan of action. So the relationship continues post-funding, allowing the nonprofit leader to share, openly without fear, the parts of their programming that didn’t go perfectly or failed. True partnerships will allow for adjustments as they learn and grow.

Keeping the end client, that both the funder and nonprofit are wanting to support, top of mind is imperative. It is also important to remain mindful that mandating excellence in the nonprofit’s outcomes, low cost administration, and reporting in each funder’s preferred format, may be unrealistic. I believe there is an achievable and needed balance between measuring impact and true partnerships. With an understanding of the nonprofit’s work, their successes and their challenges, and open, clear communication, together the funders and nonprofits can make a difference!