Smarter grantmaking benefits nonprofits
A study released yesterday by Grantmakers for Effective Organizations (GEO) contained some good news for nonprofits. Funders are increasing the amounts they allot to unrestricted grants, doing more multi-year funding and seeking more dialogue with nonprofits about their needs.
The study, “Is Grantmaking Getting Smarter?” surveyed 637 funders with assets ranging from under $10 million to more than $400 million. The largest group (36 percent) had assets between $10 million and $50 million. Of all the participants, 69 percent were independent foundations, 19 percent were community foundations, 5 percent were corporate foundations and 8 percent were other foundation types.
The study found that grants devoted to general operating support rose to 25 percent in 2014, up five percent in each earlier year that similar studies were conducted by GEO.
Fifty-eight percent of foundations surveyed said they made multiyear grants, doubling the number that reported giving operating support grants in 2011. With these figures, one can project that annual operating support grants have increased from 2011 by as much as $2.7 billion.
For decades nonprofits have tried to make the case to foundations that to succeed at their missions they need help with operating costs that underpin their programs. They got help making their case from several studies that examined the issue.