Episode 12: 2021 Non-Profit Predictions

Welcome to another edition of “Around with Randall,” your weekly, ten-to-12 minute podcast, making your nonprofit more effective for your community. And here is your host, the CEO and founder of Hallett Philanthropy, Randall Hallett.  

I appreciate your time here on another week with “Around with Randall.” I want to try to play a little bit of prognostication 2021.

As we begin, the year appears to be such a great series of opportunities for those of us in the non-philanthropic market and nonprofits in general. And I just want to spend a couple moments talking about maybe some thoughts, predictions, what might happen in this entire process, and see if we can't get to some possibilities in terms of what you might be looking for.

So there are seven things I'd like to try to predict. And then next year, we'll take a listen back at this and to our comparisons to see if I even got one or two of them right. So let me start with it. Won't be till the end of the year, we'll know this, but I think that we're going to find out that the generosity of Americans, particularly around also people around the world, but I'm more familiar with the statistics here in America is, will be overwhelming that 2020 will have shown people to be unbelievably generous.

In 2021 will be the same - that there may be in be a small jump in the percentage of GDP that philanthropy is a part of, and it uses about 2%. I might even think it might get closer to 2.3 - 2.4%. But that comes with a caveat. One of the other things that I think will be a challenge is that a lot of this is going to be regionalized in terms of the type of growth, as we have all endured Covid I think that States and municipalities have treated the way that they are dealing mean with Covid in different ways. And we're not going to judge one way or the other here, but the states and the municipalities that have shut down their government and their business society a little bit more are going to struggle more in a recovery. And when that generally happens over time, what we've learned is, is that philanthropy doesn't grow as much.

So I think there's going to be some places in our country we're going to see growth in philanthropy. I think there's going to be places where we see a drop in philanthropy and not because of anybody's heart or desire, but because the economics may not allow there to be as much growth in certain areas. And I think a lot of that's going to be about economic recovery in certain geographic areas. I also think my second prediction, which is somewhat connected is, is that there will be a renewed push to some very basic services, in terms of fundraising and the needs of the community. So things like food banks, shelters, basic housing, basic services will be a renewed emphasis in 2021. And particularly in those areas that geographically have had financial challenges, more so than other geographic areas in our country. And so it's going to be harder for places that aren't providing some of those basic services to see philanthropy at the level of increase that they desire.

So things like key statements and things of that nature will be even more important about impact. So that's two.

Three, I think we'll see a growth in stock gifts. I think with the growth of the stock market, for those who were invested during 2020 and into 2021, that the idea of giving stock and marketable securities will increase that will exponentially be true if, and when, there is an increase to the capital gains tax that comes out of Congress and signed by the president. So my third prediction is that marketable securities will become more advantageous and a bigger part of philanthropic giving in 2021.

Number four, I think that we will start to see for the first time some conversation around donations that are related to cryptocurrencies. Things like Bitcoin, that particularly with their increase in value over the last couple of years, that that will continue that the stock market may not see the growth, that maybe a cryptocurrency might lead to higher values going forward. We're going to begin to get people who are asking, well, “How do I make a gift with Bitcoin or with other cryptocurrencies?” And to begin it, I'm not sure nonprofits have the answer to this, but I think we're going to read articles about organizations trying to figure it out because there could be bigger gift opportunities and they've got to find a way to make that gift come to fruition. So number four is the idea of cryptocurrency being at the front edge of a paradigm shift in terms of giving opportunities. 

The fifth is probably the one I feel the most strongly about. I kind of tried to tie these together by areas. I think that the major data breach regarding CRMs in one particular company is going to cause a ripple effect on several fronts. Number one, because of the 2020 election, this story, and certainly Covid, I think the story was not downplayed, but it wasn't covered as much. And as a result, you're going to see states attorneys generals and further lawsuits. The states attorneys generals are going to become more interested in the effects of on this data breach on their citizens.

There are already, I believe, five class action lawsuits. There will be more. They may be all joined together, but the issue of the data breach and the size and scope of it will become more prevalent. And internally it's going to cause issues with compliance and it with non-profits who use vendors for analysis for feasibility studies, for wealth screening, for likelihood screening, and vendors are going to have to become more sophisticated, carry more insurance, going to have to provide greater detail and security audits because of this. And that this story is just beginning and may end up in some interesting legal proceedings and financial decisions regarding a major CRM data breech, that’s number five.

 Number six, I think that in our industry, there will be more acceptance, a stronger acceptance, to creative, new non-traditional ways to building relationships. So two things to think about, obviously Covid has caused the entire world to look at virtual communication or visual communication through different platforms in new and exciting ways. And for some of us, particularly with employees around the country, we were doing things like this for awhile, but it's pushed it along.

Traditionally are our organizations, particularly if you either live in a retirement type area in a warmer climate, and you're going in the summers to see people that maybe take opportunity to go North where it's not so hot or in reverse, you're in a colder climate and you have donors that go South. The need for travel budgeting for that gatherings will begin, over time in 2021, begin to diminish because we can use communications like this, like Zoom, and GoTo Meeting, and WebEx and everything else that's out there, that donors are going to become more accepting of this. 

The second thing is, is that there's a wonderful book by Brian Polian, who is writing from the perspective of coaching football. He's a, an assistant coach at Notre Dame, but he wrote the book about 110 pages, I think a little less than that actually about. The next generation and how technology has changed the way they communicate that they can have a meaningful communication differently than I would view it, via text messaging.

And that that's going to begin a conversation about with younger donors. How do we solicit annual giving from a younger population? That the tried and true methods that we're used to are going to begin to change. So 2021 prediction is that the acceptability of new untraditional, non-traditional, excuse me, traditional paths of fundraising will become more prevalent for both the major gift annual giving market.

My seventh and final, is that we will begin to see a greater conversation about government nonprofit partnership that as greater holes develop. And we're seeing the idea of the K recovery or the bifurcated direction in which we see those that have, and that have not. The governments are trying to figure out how in the world they're going to take care of those who are struggling to take care of themselves and the efficiency, or lack thereof, and government is going to push them to want to do more things with non-profits. And that the communities that find a way to bridge that gap between the nonprofit and the government entity will be the ones that are most successful at taking care of their populations for those who can't or are struggling on their own. So there's seven.

And I'm throwing a bonus. I think you're going to see the first steps of smaller, private, in particular, colleges close and struggle with finances. Education coming out of COVID, that's going to look totally different. And that schools in 2021, you'll begin to hear the inklings of schools saying we not sure we can make it. And that may mean mergers of schools. And that may mean enclosures of schools, but this is going to be a year, particularly in the summer and fall, where schools are trying to figure out and some won't know how to survive.

So you get a bonus eight. Eight predictions. 

So the tactical pieces. So there was the idea of generosity increasing. Number two was the idea of philanthropic support being directed more towards basic services. Number three was a great increase in stock giving because of capital gains changes and the increase in the markets. Number four was acceptance of, of cryptocurrencies or at least the conversation thereof. Number five was the data breach. Number six was the idea of non-traditional manners in which we communicate and maybe be able to solicit. Number seven was the idea of partnership between the government and nonprofits, in particular, in this space around basic services, and number eight was private schools.

So what's the tactical on all those things. Strategic planning is about figuring out answers to questions. Or being prepared for things you may not even understand or know. And I think it's worthwhile in a non-profit office. And I wouldn't say this needs to be a month-long conversation, but if you were to listen to this podcast and hear these eight, maybe thoughts, and maybe three, maybe four, maybe six apply to you, are you having conversations internally that say, if this happened, how would we be ready for it?

I don't think any of my predictions are crazy. I'm not sure any of them are going to be right, but I've learned that if you do this long enough, you kind of see trends. And I think some of these things are going to become really important conversation pieces and in the philanthropic nonprofit world. So is there a conversation on any one or all of them internally to say, if this happened, how would we adjust?

What are we ready for this? How would we adjust our messaging? How would we adjust our gift acceptance? How would we adjust data security? How would we adjust what we do if we're serving basic need, in terms of outreach or partnership, are there opportunities for you and your organization to take advantage of some of these things that may be coming down the pipeline and you can't do that until you actually have a conversation and talk about it, you can guess.

But it's much better to be proactive and be ready than it is to be reactive and just to follow. So the tactical is why not have a couple conversations about a few of these and say, what would we do? What are our plans? Should they be a part of our strategic thought not changing what you do, but being prepared for what 2021 brings us.

So a couple of reminders, don't forget the website www.HallettPhilanthropy.com. That's two L's, two T's and  HallettPhilanthropy.com. Send me an email that's info@hallettphilanthropy.com. If you have a suggestion for a topic, or if you totally disagree with everything, I said, I've got a place where I want people to tell me I'm crazy that they just think I, as I say, reek, send me an email at reeks, R E E K s@hallettphilanthropy.com.

Also we're posting a lot of blogs, minute reads, minute read every two, three days about the profession about what's going on. We're actually going to do a series on how to get your board ready. For new board members and beginning of the year. So there may be something there that's a value, but there's tons of blog information. Check that out. Lastly, it kind of makes me sick to even say this, but forward this podcast onto others in the nonprofit world, if you think it's helpful subscribe, so you get it when it comes out, it's meant not to be a marketing tool, but a helpful piece, hopefully, from someone with some gray hair who's been around the block one or two times, to help you and your nonprofit. 

And at the end of the day, that's what we're here for. And that leads me into how I end every non-profit or every segment, excuse me, or podcast here of “Around with Randall” is that this is a noble profession. You're doing amazing things. If you're in the philanthropic world, your helping your organization meet the needs of your community.

And that's never been more important, particularly as we have lived through this crazy 11 months, thus far, a ten-and-a-half months of Covid. People are hurting. People need help. And those of us who work in the nonprofit world, we get a chance to be difference makers for those who are seeking that assistance, no matter what area of philanthropy we serve or sector in which we serve it.

So remember my all-time favorite saying, some people make things happen, some people watch things happen. Then there are those who wondered what happened. And in life, we fall into one of those categories every second of the day. And then those of us who are in this non-profit work believe we are people who make things happen for those who are wondering what happened.

And I get up everyday. I don't know a better way to spend my professional life. And I hope you feel the same. Appreciate your time this week prediction show we'll come back next week with a little bit of a different look back to the norm. But I appreciate your time. Hope you have a great week. And most importantly, remember make it a great day.