Our Field’s Separation of Gifts and Grants Is Obsolete
Throughout my career, fund development has been organized around three areas: major gifts, modest-to-moderate gifts, and grants. This structure assumes that the motivations and mechanics of individual giving vary by size but that foundation giving does not.
I’ve seen a growing sector reliance on the wealthiest philanthropies. The work leading to those awards has more in common with major gifts than with modest grants. I have encouraged clients, based on anecdotal evidence, that major grants deserve more focus in fund development offices and training. It has been a struggle to validate these observations with evidence.
New research finally advances the issue. “Dollars and Change,” a study conducted by Candid, GivingTuesday, and Network for Good, is both a starting point and a model to further explore one of our field’s most timely trends.
Large Funders Dominate Giving
According to the data, high-net-worth individuals and large foundations dominate American philanthropy.
Donors giving over $50,000 annually make up just 0.3 percent of individual giving, yet they are responsible for 45 percent of total donations.
Institutional funders that award over $100 million annually make up just 0.1 percent of foundations but control 35% of all grant making dollars.
Our field acknowledges the special skills needed to tap into that tiny but robust area of major gifts. Let’s do the same for those we hire to secure major grants.
Size over Source
As the “Dollars and Change” authors state, “[D]onor size is a significant factor in trying to understand donor behavior—regardless of whether the donor is an individual or an institution.”
Modest and moderate foundation awards rely on traditional written applications. They are relatively straight forward.
Major grants:
Rely on strategy over writing
Navigate around increasing calls for “no unsolicited proposals”
Level up when a nonprofit’s plans extend beyond the proposed grant period
Emphasize organizational development
Require strategic relationship building
Highlight the systems change your nonprofit creates
Succeed when your non-development colleagues engage in major grants work
Involve knowing how to move forward from a soft no
Flourish when you create a virtuous cycle that leverages your organization’s credibility
The largest gifts and grants do have their differences, but this list mirrors the job descriptions of our major gifts colleagues more than it does our junior-level grants officers.
Mixing Major Gifts and Grants
When I began my career long, long ago, foundations’ donors were deceased. That crass description separated my line of work from my major gifts peers, who worked with philanthropists in the flesh. Over time, income inequality led families to open foundations during their lifetimes with assets rivaling the largest legacy funders.
Income equality now shapes modern philanthropy. It spans both individual and institutional giving—and the two can be inextricably intertwined. You may have worked with asset-rich foundations whose staff report directly to the donors. Depending on the circumstances, you might meet with those donors but ultimately sign a grant agreement before securing your check.
Is the resulting award an institutional grant or an individual gift? Let’s pause the internal debates around database coding and discuss the substance. The blurred gifts-grants divide accounts for huge swaths of the giving landscape.
I wish philanthropy was less top heavy. It’s what we’ve got for now. Day-to-day, I think about the impact of big gifts and grants on our work:
To what degree should our field differentiate between individual and institutional investors?
How should fundraising strategies evolve?
What does professional development look like in a field that recognizes the similarities between gifts and grants? Between modest and major philanthropy?
How can we make “Dollars and Change” the first of many reports that give both gift and grants professionals the insights needed on these topics?
We have a chance to remake the way our field thinks about, organizes, and executes on the bulk of charitable giving. When we cross-pollinate major gifts and grants, we get more efficient use of human and financial resources. We break down silos. We encourage creativity. We shape tomorrow’s norms.