When Charles Robbins assumed the role of executive director of The Trevor Project in West Hollywood, Calif., four years ago he was alarmed by what he described as the organization’s “West-centric” tilt. Like many lesbian, gay, bi-sexual, transgender (LGBT) nonprofits, the Trevor Project had a constituency on the West Coast but had not moved inland.
Since then, he has seen the nonprofit that focuses on crisis and suicide prevention efforts among LGBT youth, grow from five to 24 staffers and its budget expand to the tune of $2.2 million. “I think the reality was that we had not even scratched the surface,” said Robbins, who left his post last month. “The organization only had a presence on the West coast. When we opened our New York office we were able to capture more philanthropic energy.” LGBT nonprofits like the Trevor Project that have spread themselves nationally have seen productive fiscal years by capturing this “philanthropic energy,” but small, regional LGBT nonprofits have not been as lucky in appealing to donors, having seen their revenue and funding sharply decrease during the past year.
Success experienced by The Trevor Project is unlike what has been experienced by the majority of LGBT nonprofits. According to a report published by the Movement Advancement Project (MAP), based in Denver, revenue among 39 participating organizations saw a 20 percent decrease from 2008 to 2009. Attributed to the economic downturn and lack of election and key issue to rally around, these LGBT nonprofits saw revenue dip from $202.7 million in 2008 to $161.3 million in 2009.
As for fundraising, the average participant in the study received half of its revenue from its 10 largest contributors during 2009. Individual donors represented 42 percent of overall revenue (the largest source of revenue for these nonprofits), and only 3.4 percent of the people who donated to these charities were LGBT adults. Foundation support also fell of the deep end, from $33 million in 2008 to $29.5 million in 2009.
By beginning to look nationally in appealing to more donors, the Trevor Project has experienced the opposite of what has been felt by smaller and regional LGBT nonprofits. Contributions at The Trevor Project increased from $737,032 in 2009 to $909,163 in 2010, with other revenue generated from special events, in-kind contributions and grants. There was also an increase in grants from $214,500 in 2009 to $282,500 in 2010. With no layoffs and adding two new positions, The Trevor Project grew in its scope and programs during the past year.
Johnny Cooper, director of annual giving at The Trevor Project, credits the nonprofit’s success to an untapped segment of the donor population. “We were fortunate in getting into the young professional network. It’s really exciting because they are very passionate and excited about our work. And as they grow in their careers, they’ll grow in The Trevor Project. It also wasn’t so long ago that they were in the same situation as many of the kids we help. They feel connected to the cause.”
With LGBT nonprofits responding to challenges like the Proposition 8 ballot anti-gay marriage initiative in California, Roger Doughty, executive director of the Horizons Foundation in San Francisco, argues that more regionally based LGBT nonprofits need to invest in the long-term. In the San Francisco area, there are only a handful of LGBT organizations that have had success in fundraising nationally, with budgets exceeding $1 million, leading other the smaller, regional nonprofits to live hand-to-mouth due to their small budgets.
These smaller LGBT nonprofits are not able to implement national fundraising campaigns like The Trevor Project or Services and Advocacy for Gay, Lesbian, Bisexual & Transgender Issues (SAGE) because the services they provide are largely for local residents. Appealing to donors nationally would not make fiscal sense because the cost of obtaining this donor might even outweigh the amount they’ll donate.
According to the MAP report, it cost 15 cents to raise $1 for LGBT nonprofits last year, increasing 4 cents from 2008.
“The margin they live on is pretty thin and these organizations are typically very fragile,” said Doughty. “While the movement has certainly made enormous strides during the past 30 years, the movement has been constantly responding to challenges, and then, you had the epidemic (HIV/AIDS) right in the middle of it. The focus in the past has been on meeting immediate needs. There has not been any real opportunity to build institutions.”
By institutions, Doughty means entities that become strong and sustainable in financial terms and managerial structures. A solution that Doughty believed would prove beneficial to the LGBT movement is more of a reliance on community endowment. “The only route to long-term financial stability is to build community endowment. We have successfully established a LGBT endowment fund in our community,” said Doughty. “I can’t really think of any other way to build those types of institutional resources.”
With investment in community endowments, smaller regionally-based LGBT nonprofits can be more liberal in their spending because they wouldn’t be as reliant on contributions from individuals or corporate entities. From knowing an amount of money they will receive yearly from the community, long-term budgeting can take place, ensuring somewhat fiscal health even among recessions, like the one occurring last year.
SAGE was known as a local, New York City nonprofit for its first 28 years of existence. Now it is like other larger LGBT nonprofits, has begun taking a stance on national issues, trying increase its donor file size nationally.
“Part of our growth plan was to expand nationally,” said Kenneth Cox, senior director of development at SAGE. By advocating for LGBT issues on a national level, we were able to expand our mailing to include a lot more (donor) acquisition. Our goal was to mail to more and more potential donors.”
With increased visibility and national expansion, SAGE mirrored the financial success crucial to The Trevor Project’s growth. Contributions increased from $2,293,470 in 2009 to $2,352,865 in 2009. Additionally, government grants and contracts grew $943,636 in 2008 to $966,130 in 2009. By expanding nationally, SAGE was hoping to avoid the pitfalls that come with being a regionally-focused LGBT nonprofit. It also helped that as opposed to only assisting older LGBT people in a small area, SAGE has a mission that extends to improving the life of older LGBT people across the country.
In comparison to The Trevor Project, SAGE was able to find donors among people in there 40s who are educated on the types of challenges faced by LGBT people who are more mature. “As aging issues become more obvious, we receive a lot more donations. These aging issues include subjects like equal rights or marriage. Trying to get recognition is only part of the ultimate goal,” said Cox.
With now 20 affiliates, SAGE is able to elicit donations from throughout the nation, in addition to providing assistance and guidance to people in need. Having facilities in areas as diverse as Louisiana, Wisconsin and Utah has made a difference, according to Cox.
“Our national growth has been extremely beneficial to the organizations on a local level because we are in a place to help them develop programs. To become an affiliate of ours, all they have to do is sign a memoranda and they are allowed to use our branding. We are not fiscally responsible for them, but there is an agreement that we share certain values.”
One of the programs has been the SAGE National Resource Council. Aimed at utilizing high-level donors to become more involved with the organization, SAGE encourages these donors to become ambassadors to exchange ideas.
This is a group of highly-invested donors who want to make more of a difference besides the contribution of money, said Cox. With the engagement that comes from these figures getting together, connections are able to made across the country that will have an impact in the future. Lobbying the government on behalf of the LGBT community, the Human Right Campaign (HRC), according to Cathy Nelson, vice president of development and membership, “has been able to weather the storm much better than other nonprofits.” The Human Rights Campaign saw its annual income increase each year from 2000 through 2009. Gifts dove from almost $17 million in 2009 to $14,360,143 in 2010.
Michael Cole-Schwartz, press secretary of the Human Rights Campaign, thought this was due to the unprecedented amount of LGBT issues that came to ahead in 2009. “We saw such a huge response in our community donations during the presidential election and Proposition 8. It wasn’t a great surprise to see our contributions in somewhat of a slump at this time,” he said. Because of HRC’s event-dominated fundraising, Nelson advocated that through a lot of diversification in the way people could donate, fiscal health could be ensured for the upcoming year. These diverse fundraising streams include, a direct mail campaign run nationally, a midlevel donor group, telemarketing, typical foundation contributions and planned giving programs.
However, due to its national reach, the HRC is able to target many more donors because the foundation of their mission is the preservation of rights for LGBT adults across the nation, not just Los Angeles and New York.
The HRC is able to capitalize on a very active volunteer program. Volunteers go to music festivals where they chat with people on a one-on-one basis. Nelson said that between 40 and 50 percent of HRC members come from this type of street canvassing.
HRC’s major donor program starts at $5,000, generating roughly 14 percent of its revenue. Among these high-level donors are corporate sponsors, which have only in the past decade begun to support the LGBT nonprofit community. “Because we have a workplace report (that reports the best places for LGBT people to work), many businesses want to be perceived by the public as supporting equality to their employees, staff and executives,” said Nelson.
Some 37 companies support the HRC, including 40 percent of the Fortune 500, said Nelson. The HRC displays these businesses on its website as corporate sponsors interested in sustained equality. As more of a mainstream LGBT nonprofit organization, the HRC can enjoy this corporate support with relative ease. Across the board, MAP saw corporate funding decrease from $6.3 million in 2008 to $4.3 million in 2009 in other LGBT nonprofits.
Another challenge that hinders some LGBT nonprofits from securing funds from foundations and corporate sponsors is a stereotype of the LGBT person being a “white, urban, wealthy man,” according to Gary Gate of the Williams Institute.
Based on the campus of UCLA in Los Angeles, the Williams Institute is a think-tank researching sexual orientation law. Gate said stereotypes stem from two factors, one of which is caused by the media. From television shows like Modern Family, said Gate, “We see a type of homosexual that is vastly different from actuality.” Another problem that caused this stereotype was the LGBT community trying to convince the business community that LGBT people are a demographic to which they could market.
“The LGBT community might be culpable as well as corporations because one of the ways to get businesses to change policies was to make LGBTs a consumer market,” said Gate. “They reinforce that they have a disposable income to spend on goods.”
Doughty echoed these sentiments and added that because of this stereotype corporations might be hesitant to donate to LGBT nonprofits.
“There is a commonly held stereotype that the average person in the gay community is white, male, affluent and urban,” said Doughty. “There are those people, but as studies show that on the whole gay people are average. Gay men are actually trail their heterosexual counterparts in terms of wealth. It’s not that we have an unusual poverty situation. In terms of making the case to a foundation, it is a big obstacle, because if the CEO thinks this way, there might not be a true understanding of what the community needs.” NPT