By Shari Finnell, writer/editor Charitable Advisors
When Bryan Orander launched Not-for-Profit News in 2001, the internet had not yet reached its saturation point; only 52 percent of American adults reported using it at the time, according to the Pew Research Center. And Orander considered the e-newsletter as nothing more than a project to keep him busy while starting his consulting business, perhaps a tool that would help a few people find jobs, he recently said.
As NFPN celebrates its 20th anniversary year as an online weekly publication with more than 14,000 subscribers, Orander reflected on how the nonprofit sector of Central Indiana has navigated various changes during that period, including internet saturation, the economic recession of 2008, technology advances, evolving giving patterns, and, currently, the impact of a global pandemic and unprecedented racial equity protests.
Orander, founder and President of Charitable Advisors, a consulting firm, said no other period in the past 20 years fully matches the challenges faced by nonprofits today, but there were similarities during the economic downturn of 2008.
“From our vantage point — from 2008 to 2010, we saw job ads drop off, donations being directed to basic needs and away from the arts and the environment,” he said. “We’re now seeing a lot of the same things. Right now, at least, COVID-19 relief funds are being directed to human services and basic needs. That makes sense.”
Studies reveal that many nonprofits weathered the 2008 recession fairly well, Orander said, which gives him reason to hope that many of them will survive the current turbulent period. Here are some of Orander’s perspectives on the trends that continue to shape the nonprofit sector in Central Indiana.
Increasing dominance of the larger nonprofit: Orander said some of the same patterns that have dominated the B2B sector, including the decline of small businesses, seem to be playing out in the nonprofit sector.
“Looking at the bigger picture over the past 20 years, it appears that the nonprofit sector has evolved with more clearly defined, substantial nonprofits. It’s almost a case of the-haves and the have-nots,” he said. “The organizations that are able to hire the best people, invest in advanced technology and implement the best techniques are getting better and better at raising money and attracting donors. Meanwhile, a lot of other nonprofits are being left behind. And that gap is getting bigger.”
Changing profile of donors: Citing a 2019 report published by the Indiana University Lilly Family School of Philanthropy at IUPUI, Orander noted that the number of people donating has decreased from two-thirds of U.S. households in 2000 to slightly over half in 2016. “While overall charitable donations continue to slowly increase, the number of people donating is decreasing. We have a donating class and the rest,” he said. “People with less means are giving less, while people of means are taking over a bigger share of the giving.”
While overall giving hasn’t declined, Orander said, nonprofits need to be more strategic about how to target wealthier donors. “You have to be sophisticated at soliciting donations, and that seems to leave smaller nonprofits in a tough position because most have not developed major donors.”
Models of charitable giving are evolving: During the past 20 years, Orander also has noticed changes in the giving model — with some donors moving from a focus on organizations that align with their values to a model that generally focuses on a donor’s loyalty to a cause. “There are continuing studies on this, but it appears that charity and cause in terms of giving are viewed differently among different generations,” Orander said.
For example, he said, younger people are more likely to be loyal to a cause, such as environmental concerns, while older people tend to support nonprofit organizations that align with their passions and beliefs. Since younger generations may be more passionate about a specific cause, they may decide to give through an engaging online campaign or work for a for-profit employer that is dedicated to their cause.
Crowdfunding also has changed the charitable giving model, Orander said. “There are so many ways that people can give online; there’s now a fuzziness between charity and giving. A lot of people don’t discern the difference between giving to a food bank or to a worthy person through an on-line crowdfunding platform.”
Businesses competing with nonprofits for new hires: As a professional recruiter, Orander also has some perspectives about how hiring trends are impacting nonprofits’ ability to compete for talent.
“A positive trend is that the younger generation wants to be involved in a worthy cause. They want to make a difference, so they would traditionally be more likely attracted to nonprofits,” Orander said. “However, for-profit businesses have realized that their prospective employees want to be part of a making a difference, so they often affiliate themselves with a cause.”
Socially responsible companies have become so mainstream, that “the lines are kind of blurry between working at a nonprofit with a cause or a for-profit that has a cause,” Orander said. “Employees may determine that, either way, it’s possible for you to make a positive difference. But with some employers, you can make more money and still make a difference.”
Impact of starting a new nonprofit: While it’s not impossible, it is much more difficult to start a nonprofit with real impact than it was 20 years — even without the challenges presented by the COVID-19 pandemic, Orander said. “It may not be difficult to create one, but it’s harder and harder to rally the people and the resources to do anything with it,” he said. Many new nonprofits are created in response to a personal or family tragedy or loss and not because the community doesn’t already offer those services, Orander has observed.
The Future: As Orander looks forward to continuing NFPN’s role in the Central Indiana nonprofit sector, he foresees developing more opportunities to connect people, organizations and resources, with a focus on informing and inspiring through the news and stories it delivers.
“When we first surpassed 10,000 subscribers, I knew we were really helping to connect and inform people in the local nonprofit community. We had become the go-to place for jobs and news,” Orander said. “It felt like we were making a difference. I feel the same way now. It’s been an interesting and humbling experience.”