Black-Led Nonprofits Miss Out on Promised Funding Surge After 2020 Racial Reckoning
The 2020 racial reckoning following George Floyd’s murder ignited hopes for increased funding towards Black-led nonprofits. Companies started channeling donations to historically Black colleges and universities. However, recent studies indicate that this financial support was not lasting, affecting many of these organizations significantly.
Temporary Funding Increases for Black-Led Nonprofits
A research analysis by Candid and the Association of Black Foundation Executives (ABFE) shows that only a small fraction of large, Black-led nonprofits experienced brief increases in funding between 2020 and 2022. Smaller organizations, which are crucial for community support, reported no significant financial changes during this period.
The setback in funding has put these community groups, critical in addressing the needs of low-income families amid rising healthcare costs and food prices, in a vulnerable position. Cliff Albright, co-founder of Black Voters Matter, emphasized the increasing demands on these nonprofits with dwindling resources.
Reliance on New Funders
- Many small, Black-led nonprofits depend on new funders rather than maintaining long-term relationships.
- Over one-third of their funding arises from these new sources, complicating their operational stability.
Asiaha Butler, CEO of the Resident Association of Greater Englewood in Chicago, recalls a moment in summer 2020 when additional funding opportunities arose. However, these new financial relationships were short-lived, resulting in a drop-off that jeopardized long-term goals.
Challenges in Securing Funding
Foundations typically lacked established relationships with Black organizations before 2020, creating a disconnect during the push for funding in response to racial justice movements. Kia Croom, a fundraising consultant for nonprofits in Black communities, noted that the influx of corporate donations often led to temporary support rather than sustainable partnerships.
Kandee Lewis, CEO of the Positive Results Center in Los Angeles, shared similar sentiments about the ephemeral nature of funding, which often occurred without a deep understanding of her organization’s mission. This trend has left many organizations struggling to establish meaningful connections with funders.
Impact of Shifting Funding Priorities
As the philanthropic landscape shifts, many Black-led nonprofits are witnessing minor changes in funding patterns. Jaleesa Hall, head of the Raising A Village Foundation, noted the challenges of being excluded from vital funding conversations, further complicating their ability to secure long-term investments.
| Funding Support | Black-Led Nonprofits | Other Nonprofits |
|---|---|---|
| General Operating Support | 33% | 50% |
| Continuing Funders | Fewer | More |
Despite a sector-wide shift towards trust-based funding that supports general operations and multi-year grants, Black-led nonprofits have not benefited equally. Susan Taylor Batten, CEO of ABFE, criticized the ongoing poor investment practices that disproportionately impact these organizations.
Butler’s group faces challenges obtaining ongoing funding for their community-centered initiatives. The organization plans a large capital project, aiming to develop an 8,800-square-foot building to foster economic justice and local entrepreneurship. However, funding applications are fraught with uncertainty, and securing support remains a significant hurdle.
Conclusion
The urgency to evolve philanthropic practices is clearer than ever. Black-led nonprofits, crucial for community development and support, deserve sustainable funding practices that extend beyond temporary engagements. Without a commitment to building lasting relationships and understanding the unique needs of these organizations, the gap in resources will remain a critical issue.
