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GivingNet closing doors

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Ret Boney

After almost nine years of operation, a collaborative experiment designed to strengthen community foundations in the U.S. will cease operations on September 30.

GivingNet, formerly known as Community Foundations of America, was launched in 2000 and grew to include more than 130 foundation subscribers.

The goal of the project was to bring community foundations together to develop strategies, products and services necessary to succeed in a rapidly changing marketplace.

“We worked on those issues and we made some strides, but there’s a lot of strengthening to be done,” say Carla Dearing, president and CEO of GivingNet. “The whole question of infrastructure and technology is not a luxury anymore. It needs to be fundamentally part of every business and how it’s growing.”

While well-funded in the early years by the David and Lucile Packard Foundation, Ford Foundation, W.K. Kellogg Foundation and Skoll Foundation, the group found funding harder to come by recently.

The earned-income portion of the organization’s business model, which includes subscriptions and services, was successful, Dearing says, but “philanthropy infrastructure funding isn’t what it was.”

GivingNet explored several avenues to continue operations and evaluated several merger partners, including for-profit organizations, but concluded the “prudent” option was to wrap up operations while still on sound financial footing.

“In light of this changed funding environment, the board and management of GivingNet have decided that it is best to complete the organization’s original program on a high note, declare a limited victory, and thus allow all involved to re-focus resources and energy on future opportunities,” Lawrence A. Hough, board chair, and Karthryn E. Merchant, former board chair, said in a recent letter.

The organization was launched amid some challenges in the marketplace, the letter said, including resource and capacity constraints, a lack of consensus on what would be required to meet donors’ needs and an inability to get access to needed data.

But GivingNet achieved successes along the way, including creating a set of technology requirements and a roadmap for reaching them; developing the National Marketing Action Team to create standardized marketing materials; and a low-cost, shared Internet platform for community foundations.

Lessons learned from the effort’s successes, as well as its failures, were shared with subscribing foundations along the way.

Challenges remain for community foundations, Hough and Merchant said, including developing the infrastructure required to run these complex funders, and finding a way to make collaborations among community foundations and other stakeholders cost-effective.

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