TechSoup@PND

Through an arrangement with TechSoup, PND is pleased to offer a series of articles about the effective use of technology by nonprofits.

Grantmaker tech trends that nonprofits should know about

Grantmaker tech trends that nonprofits should know about

Yes, 2020 was disruptive, but how might we know which changes will stick?

Back in December, I identified a few trends with "staying power" on the NTEN blog in 3 Ways Philanthropy Tech Will Change in 2021. There, I described how results from a recent survey conducted by the Technology Association of Grantmakers (TAG) identified key practices already under way in the technology world for funders, as well as new practices that have emerged as a result of the pandemic and racial justice protests in 2020. There are many implications in the findings for nonprofits that work with foundations. Here are some insights from the NTEN article as well as others I hope will be useful to TechSoup members.

3 Key Trends Affecting Both Funders and Nonprofit Partners

Funders and nonprofit partners share a technology ecosystem for social change. It's therefore helpful to stay on top of key trends. Below are three ways that technology tools and practices have evolved in philanthropy, including surprising shifts as a result of the pressures we experienced in 2020.

  • Increasing focus on the grantee experience with respect to a foundation's tools, systems, and practices
  • Leading software choices that tend to include support for grantee tools
  • Expanding racial equity support to tech teams, vendors, and partners

The grantee experience matters more than ever

Likely no surprise to TechSoup members, the grantee experience can make or break a nonprofit's mission. This realization was pivotal in 2020 for many funders, who quickly recognized at the onset of the pandemic that changemakers needed access to funds, tools, and support without the usual burden of process and paperwork.

As I shared with NTEN, this "make or break" reality morphed into a clarion call for philanthropy to streamline and support the grantee experience more than ever before. As shown in the chart below, 61 percent of the foundations responding to the survey report streamlining the grant application process in response to COVID-19, while 47 percent report streamlining their reporting process. Recognizing and rapidly reducing the burden on grantees of onerous application and reporting is a heartening change. However, some funders went even further, as shown below in orange. According to our survey, 28 percent of responding foundations in 2020 provided training and technical assistance directly to grantees, while 22 percent report providing tools and tech.

Here are the new ways that foundations report supporting grantees in response to 2020's challenges:

fig.1.1-tag-grant-trends-graphs-1

These changes in philanthropy, coupled with efforts such as #FixtheForm, which surveyed five hundred nonprofits to identify pain points in grant application processes and systems, are the harbingers of a fundamental shift for funders. The shift I'm seeing is a recognition that the grantee experience in philanthropy is one of the key constraints for enacting social change on the ground — a recognition that I hope becomes a driving force for continued improvement in the sector.

Funder software choices point to better support for grantees

Of course, a core element of the foundation toolstack is the software selected for grant application, management, and reporting. The implications of this choice are wide-ranging because the grants management system (GMS) fundamentally defines the ways in which a nonprofit interacts with its foundation partners. While there are many good choices available, the results of the 2020 State of Philanthropy Tech survey highlighted four leading platforms. (It's worth noting that several include moules aime at easing reporting and communication for nonprofits.)

  • Fluxx is the most popular grants management software among foundations. An Fluxx offers a no-cost software service for nonprofits called Fluxx Grantseeker that integrates with the Fluxx platform and allows users to track and share their impact with funders.
  • Foundant Grant Lifecycle is also popular with foundations. Foundant hosts an application for nonprofits called GrantHub that also tracks and reports a user's progress to funders.
  • Salesforce is third on the list. The Salesforce Nonprofit Success Pack is their product for nonprofits.
  • Fusion Labs GE is fourth in popularity among foundations. The company hosts GE Spectrum, which integrates with Blackbaud.

Below are the complete results from all two hundre and thirty-three foundation respondents.

fig.1.2-tag-grant-trends-graphs2

It's worth noting that when segmenting these results by organization type (e.g., family foundations or community foundations), different systems become more prominent. For example:

  • For family foundations, Fluxx (29 percent) and GivingData (22 percent) are the most popular systems.
  • For community foundations, Foundant Grant Lifecycle Manager (29 percent) is the most popular system.

Racial equity expands to include tech teams and partner organizations

Like many, foundations have accelerated their funding for and focus on racial equity. However, one finding from the State of Philanthropy Tech survey shows that operations teams such as IT departments are often left behind when training and programs are offered. This gap was first identified in a 2018 survey conducted by TAG. At the time, 40 percent of responding foundations reported that no diversity, equity, and inclusion (DEI) training whatsoever was offered to technology staff. In 2020, TAG saw a small improvement, from 40 percent to 37 percent, the percentage of IT departments offering DEI training to team members. Clearly, it's time for a more systemic focus on advancing equity within philanthropy and the nonprofit sector.

fig.1.3-tag-grant-trends-graphs-3

There's room for optimism, however: Already, among TAG members, I'm seeing organizations commit to providing DEI training — not only for IT staff but for contractors and vendors as well. I'm also seeing organizations recognize that they need to move beyond a "check the box" approach to hiring diverse staff and also begin to provide leadership cultivation an development.

This shift is an opportunity for nonprofit partners to engage their funders in a conversation about holistic approaches to equity efforts. For example, what would it look like for funders to offer equity training for nonprofit partners and technology providers? Or conversely, imagine nonprofit partners inviting funders into their own equity programs. The new year presents an opportunity to walk through the door an an engage in conversations about a systems-change approach to equity.

We are at a pivotal moment in the long struggle for racial justice and equity in Americas, an I hope these reflections provie you with some steps you can take in partnership with your funders. In the meantime, here are links to resources mentioned above for your continued consideration:

Chantal Forster is the executive director at the Technology Association of Grantmakers (TAG).