Surviving the Storm: How Funders Can Support Nonprofits Amidst Economic Uncertainty

By: Kate Sheahan McElroy, Research & Learning Manager, Resilia

In the realm of nonprofit sustenance, the responsibility doesn't solely lie on the shoulders of individual organizations. Especially during challenging times, unwavering support from the philanthropic sector becomes an indispensable lifeline. While financial aid from funders is undeniably beneficial, the transformation from mere contributors to devoted partners and champions can truly empower nonprofits. Before exploring ways funders can provide critical support during economic downturns, we invite you to read our first blog post, “Surviving the Storm: How Resilia Helps Nonprofits Weather Economic Recessions.” This insightful piece sheds light on how Resilia aids nonprofits in navigating economic downturns. Understanding their approach will serve as an excellent foundation for comprehending the strategies explored in this sequel.

Here are three ways that funders can support nonprofits, especially during difficult economic times: 

• Be community-focused by listening to nonprofit partners, community members, and peers in the philanthropic sector. Funders should rely on insights from their nonprofit partners and learn their needs directly. For example, funders can leverage Resilia’s Funder Dashboard for real-time data on how nonprofit partners utilize capacity-building resources. Funders can use these insights to shape future grantmaking, reduce their administrative burden, and eliminate over-surveying nonprofits to understand their needs. 

• Collaborate with nonprofits, community leaders, and other philanthropic partners. In Elevate, Resilia’s community of 60+ grantmakers, funders are committed to centering the voices and expertise of BIPOC-led and serving grassroots organizations. Elevate is a space for funders to share their experiences and solutions and find new avenues to strengthen grassroots organizations. 

• Offer flexible solutions like leveraging relationships with other funders, sharing data with nonprofit partners to support their work, and waiving or diminishing administrative burdens on nonprofit partners. For example, a funder can allow a nonprofit to reuse a report they prepared for other funders or rely on qualitative data - like Stories - to understand the impact of a grantmaker’s support. Resources like Resilia’s Funder Academy provide clear resources to help funders identify and employ trust-based practices created by the Trust-Based Philanthropy Project and strategies like those listed here. 

It’s been proven that the best way for a nonprofit to ensure their success as they navigate a crisis is to keep doing what they’re doing. A 2020 study from the Nonprofit Quarterly showed that during the Great Recession in 2009, some nonprofits maintained a surprising amount of stability: as the recession wore on, health, human services, and education nonprofits saw an increase in revenue as their services became more in-demand. Nonprofit employment stayed level in 2009, with nonprofit employers experiencing fewer unemployment claims than their for-profit counterparts. Support from funders is key to letting nonprofits do what they do best and continue to provide support and guidance for those in need.

“Hope for the best, expect the worst” is optimistic advice, but hope itself isn’t a strategy. Resilia can offer capacity-building support for both nonprofits and funders. Nonprofits gain access to Resilia’s tools, expertise, and an encouraging peer community, while funders receive insights better to help their nonprofit partners and a supportive community. By taking small steps to prepare for uncertainty, nonprofits and the institutions that support them can ensure that organizations have the systems, networks, and infrastructure to thrive in the face of any challenge.