New Data Shows Small NPO Fundraising Hammered

Data from the Internal Revenue Service (IRS) and other aggregators show that the vast majority of nonprofits raise $1 million or less each year. And data in a new report from DonorPerfect, a division of SofterWare, Inc., in Fort Washington, Pa., shows that the smallest of those nonprofits really have been clobbered during the pandemic.

Starting in February 2019, donation activity at small nonprofits was consistently growing, achieving a rolling three-month growth rate of between 3% and 10%. This changed dramatically with the start of the pandemic in March 2020. Because the chart represents a 3-month rolling average, the decline looks somewhat gradual but the reality is better reflected in the 17% and 18% decline reported in the more recent three-month periods, according to SofterWare CEO Doug Schoenberg.

The DonorPerfect Fundraising Benchmarks Report provides fundraising growth by sector, detailing how the focus of donors has shifted to nonprofits whose missions align with providing relief related to COVID-19. “The primary objective of this initial report is to provide data that allows organizations to understand general trends and benchmark their performance against a relevant peer group, according to Schoenberg.

Revenue at nonprofits where less than $235,000 is raised was down 22% and down 18% at nonprofits where funds raised is between $235,000 and $775,000 annually. Revenue at organizations where $775,000 and more is raised were down 11%.

None of the seven categories tracked showed an increase for the three-month period ended Aug. 20. The 531 arts and culture nonprofits in the data led the pack, declining an average 29%, followed by education, down an average of 23% at 944 organizations; 12% at 457 environmental and animal nonprofits; 10% at 1,934 human service organizations; 9% at 458 faith-based nonprofits; 6% at 400 public and social benefit nonprofits, and 23% at 2,782 more general organizations.

Future editions of the report will offer additional benchmarks and insights. “The DonorPerfect Fundraising Benchmarks Report is the first step in our efforts to use the vast amount of data managed within DonorPerfect fundraising software to help small nonprofits grow and raise more money,” Schoenberg said. “In future reports, we plan to delve into drivers of fundraising growth such as donor retention, new donor acquisition, and amounts raised per donor.”