A Nonprofit Economic Survival Guide to COVID-19

     A Nonprofit Economic Survival Guide to COVID-19

     The Washington Post categorized the COVID-19 economic recession as the ‘most unequal in modern US History’. The report cited black women, men and, school-age children as the groups hit hardest by the loss of jobs. In a crisis, nonprofits traditionally step in to fill in the gap, providing a safety net to their communities including lifesaving services such as healthcare, food, shelter, and childcare. This time, however, the nonprofits are the ones who need the help. In a 2019 COVID-19 Survey conducted by the Nonprofit Finance Fund, 30 percent of nonprofits were anticipating a significant increase in client usage of services. Meanwhile, 75 percent of them also saw a reduced earned revenue and 57 percent of those were forecasting the same financial faith in 2020 – the height of the COVID-19 pandemic.

      Prior to the COVID-19 crisis funding to nonprofits, both from government and individual donors were on a steady consecutive rise. Foundation giving had increased by 2.5 percent, federal grants had almost doubled in the last 20 years and, in 2019 individual donors were pouring healthy chunks in the balance sheets of nonprofits. Pre-COVID statistics are evidence of the threat global and national crises pose to the financial vitality of nonprofits. Nonprofits must evolve as quickly as the COVID-19 virus does, changing rapidly to its environment and emerging threats.

      Sector Matters

     To begin guiding your organization into a recovery, growth, and resiliency phase, organizations should first realize that their sector matters. The Blackbaud Institute Index, a research company that analyses charitable giving trends, noted ‘organizations should always monitor specific subsector trends. While nonprofits provide valuable services to their communities it is crucial to realize that they still serve people, who are subject to influence from social, economic, and generational forces. In fact, in 2019, according to the National Philanthropy Trust, 29% of charitable dollars went to the religious sector, half of the dollars allocated to education, the top two consumers of charitable giving. Understanding how your donors (including the government) behave and the human-center factors that drive that behavior is core to your fundraising initiatives.

     Money On The Web

     In the wake of COVID-19 lockdowns, the economy went digital. Companies like Amazon, Microsoft saw a sharp increase in digital revenue. Turns out, nonprofit did too. Double the Donation, a charitable gift matching company, reported that all age groups prefer to donate online and most of their donations were made using a mobile device. Adopting a superior digital strategy is key to organizational success. Galas, local government fundraisers, and other in-person events are a thing of the past, COVID-19 or not. Re-allocating bigger sums of an annual budget towards a digital infrastructure and the operational model that supports is the first step to building digital resiliency and increasing the chances of surviving the digital era and any other crisis that may confine us to our homes and away from the traditional spaces where nonprofits make revenue.

     Put The Grants On Top

     We can live in peace (for now) knowing the charitable donations from both public and private pools continue to rise.  We should however be concerned about the value we place on grants and the people that write them. The NonProfit Times captured the phenomenon in a recent article published last month and I wanted to echo their report for sake of emphasis. In 2019, regarding nonprofit revenue, grants surpassed individual donations by almost double the amount, $862 billion and $309 billion respectively. Yet, The NonProfit Times remarks, grant writers are underpaid, and many are ‘not involved in strategic planning or goal-setting’. The report is problematic and an antiquated reality of nonprofit organizational structures. In the same way nonprofits should reinvest in a digital infrastructure and the operational model to support it, nonprofits must reimagine the role of grant-writers and their entire workforce, including volunteers.

     The Future Volunteer

     Volunteers provide a significant life-supporting contribution to the financial health of nonprofits. The benefits of volunteering to society can me measured in dollars, a value that in 2017 alone racked up a whopping $195 billion worth of services. Today people have greater appetite for volunteering, with Gen Z, Gen X, and Boomers leading the drive. Corporate America has also found the importance of giving back to your community by sending swarms of corporate workers to volunteer all over American nonprofits, a growing asset to nonprofits. We can anticipate more opportunities for volunteering as people are now empowered to contribute to nonprofits from the comfort of their couches. Equipped with the fruits of the modern digital era, volunteers will be able to remotely connect with nonprofits and offer skilled services such as SEO optimization, marketing, and translating services. Wondering how to encourage people to volunteer? Organizations like North Node recognize the value of volunteers and the services they offer to their communities. North Node has created an app and platform that serves as a channel for volunteers and nonprofits to communicate and tap into an untapped pool of resources. With deep roots in a network of college students and local NYC volunteer, channels like these North Node are helping normalize volunteering, deepens the relationship between volunteers and nonprofits and embrace technology to advance the causes that matter most to us.

 Phase Recovery has begun. Is your nonprofit equipped for success? 



Lian Valera

Founder, The Bloc Media & Consulting 


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