[Editor’s note: This article is the second in a PJ series on how North Carolina nonprofits are coping with the lingering effects of the recession, and how funders are supporting their work.]
RALEIGH, N.C. — A foundation’s impact is only as great as that of the organizations it funds.
So when a foundation’s grantees are struggling, its own mission is in jeopardy.
In the wake of the recession, many nonprofits find themselves on shaky ground, with depleted reserves and staffs, more demand from the communities they serve, and donors who are giving less or nothing at all.
Funders are taking notice.
In the fall of 2009, the John Rex Endowment in Raleigh, for example, launched a new effort to fund capacity-building and organizational-assessment projects for local nonprofits.
“When we stepped back, we realized the success of the organizations we deal with will have a lot of impact on our interest in improving the health and well-being of children,” says Kevin Cain, president and CEO of the endowment.
Since last October, the endowment has awarded a total of $140,000 in grants specifically aimed at bolstering nonprofits’ capacity, and has budgeted more than twice that to be awarded through three funding cycles this year.
The endowment offers $5,000 grants for organizational assessments, which pay for a consultant to help the organization take stock and identify areas that need attention.
Larger grants of about $35,000 each are awarded for capacity-building efforts.
Since the program’s inception, the endowment has awarded 12 assessment grants totaling $60,000 and four capacity grants totaling $80,000.
The Boys and Girls Clubs of Wake County received a capacity-building grant of $31,225 from the endowment to improve its website and Internet presence.
The Boys and Girls Clubs debuted its new site in February, in conjunction with the launch of its capital campaign, replacing an eight-year-old website, says Valeska Wittek, the group’s director of development and marketing.
“That was part of our new communications strategy,” she says. “We hadn’t done a lot of online communications. Now we have enabled features that give people more of an opportunity for a two-way conversation.”
The new site has an updated look and allows supporters to create personal fundraising pages they can use to disseminate information about the group to prospective donors.
YWCA of the Greater Triangle and WakeUP Wake County both received $5,000 for organizational assessments in the latest round of funding.
Sometimes those smaller projects bring grantees back to the endowment for larger grants to bolster vulnerable areas that surfaced in the first phase of work, says Cain.
“After you do a few assessments, the capacity requests start to roll in,” he says.
In what Cain calls a “reflection of the times,” several capacity-related requests have been in the areas fundraising or marketing.
Nonprofits are realizing they need to do a better job of reaching out and finding support, he says.
“What I see is not a recognition of weakness, but a recognition that ‘we need to make changes to stay current or get better,'” says Cain.
Documentation and reporting are gaining in importance, says Cain.
“There is motivation to do a better job of documenting outcomes of their programs,” he says of nonprofits. “There’s an expectation that agencies can report good data on what happens as a result of involvement with them.”
And the endowment itself is monitoring how its new grantmaking program is faring over time, says Cain.
The organization is tracking outcomes of the capacity work it funds, and surveys all grantees about their perceptions of progress in the fundamental areas of their operations.
Combined, that data will help the endowment learn how the initiative is working across all funded organizations.
Cain’s goal for grantees is continuous improvement by providing better services and spurring more efficient operations, outcomes that would serve the endowment’s mission well.
Other stories in this series: