Small Social Service Charities Struggle to Reach Donors

Although the election of Donald Trump has sparked an outpouring of donations to some nonprofits, the additional resources have been unequally distributed, Vox reports.

For example, while the American Civil Liberties Union collected more than $79 million in online donations in the three months after Election Day — more than 60 percent what it spent in all of 2016 — Ayuda, a smaller D.C.-based nonprofit that provides legal assistance and social services to low-income immigrants is in danger of losing the government funding that accounts for more than half of its $4 million budget. And elsewhere, small nonprofits working to meet the needs of the global poor worry they’ll be forgotten entirely as donors' attention and dollars increasingly are drawn to higher-profile groups opposed to the president's agenda.

It's a development that underscores two evergreen issues in the nonprofit sector: the difficulty donors have in figuring out which nonprofits create the most impact, on a dollar-for-dollar basis, and the tendency for donors in the U.S. to direct their donations to organizations focused on domestic issues. Indeed, according to Giving USA data, giving to all charities was up 4 percent in 2015, the latest year for which data is currently available, while giving to organizations in the Chronicle of Philanthropy's list of the largest charities (in terms of contributed income) grew more than 7 percent.

Compounding the problem is the fact that newer charities typically struggle to attract funding and don't have sufficient resources to devote to marketing or fundraising. According to New Profit, of the twenty-one hundred social impact groups that have been launched since 1970 and have been in operation for at least twenty-five years, only twenty-four have raised as much as $20 million in a single year.

While third-party evaluators such as GiveWell and the Center for High Impact Philanthropy have emerged over the past decade with the aim of identifying the most "effective" charities, such efforts are expensive and time consuming. Which is why, says Benjamin Soskis, a philanthropy expert at the Urban Institute and a consultant to GiveWell, we need more, rather than fewer, third-party evaluators. "If you want a dynamism that is good for the sector," Soskis adds, "the best you can do is increase the public's understanding of what works and doesn't work."