“I think the unintended consequence was it really opened this arena before for us to think about the learning opportunity, and to create this kind of consortium of sharing insights and discussing and taking away the learnings from how this is going to advance the field that we're all also part of.”
- Jake Taesang Cho, Director of Philanthropic Engagement, IDinsight
Often grant funding dictates the prioritization of programs over strengthening the overall organization. The great advantage of unrestricted funding is that organizations can determine how to invest resources where it’s most needed. Nonprofit leaders shared that unrestricted funding provides organizations the freedom and agency to make critical investments in the necessary systems and structures to foster long-term sustainability and growth. Depending on organizational needs, some leaders invested in increasing staff, updating systems, refreshing communications and branding, advancing resource mobilization, and implementing digital security.
- Invest in and scale operational systems to strengthen organizations to deliver on their core mission.
- Revisit organizational strategy and theory of change when evaluating and identifying which systems investments are needed, which can help to carry the core organizational mission, values, and principles forward.
- Anticipate and invest in digital security to combat hacking attempts.
Invest in and scale operational systems to strengthen organizations to deliver on their core mission.
An ongoing challenge for organizations is scaling up operational systems for hiring, finances, and operations. It is not often organizations have access to unrestricted funds to do so. The ability to invest in organizational development through systems and infrastructure helps organizations deliver on their core mission, increase resilience and sustainability, and multiply impact.
An organization recommended using the windfall gift for operations while focusing existing donor funds on programmatic efforts.
Revisit organizational strategy and theory of change when evaluating and identifying which systems investments are needed, which can help to carry the core organizational mission, values, and principles forward.
A key consideration in evaluating and identifying which systems investments are needed is to revisit organizational strategy and theory of change. This helps to ensure that the core mission, values, and principles of the organizations are being carried forward during the change that an unrestricted gift can bring. It can also support internal stakeholder buy-in across leadership and staff for success.
An organization had just finalized its strategic plan and budget when it received a windfall gift and then had to revise its plan and budget given the substantial change. They decided to spend about half the money in the first 16 months on improving their internal infrastructure and making large-scale changes that they needed to grow, including a refresh of their brand and website. They mostly used vendors instead of bringing on staff, a helpful consideration for organizations that want to avoid increasing recurring costs.
An unexpected pitfall of receiving such a financial boon is becoming vulnerable to hacking attempts. Organizations noted that digital security was critical and often did not have appropriate information technology systems to respond to unexpected cybersecurity threats.
An organization mentioned receiving tens of thousands of hacking attempts upon receiving the grant and had not been effectively prepared with robust IT systems to fend off these unexpected cybersecurity threats. This underscores the need for strong investments in IT systems, infrastructure, and personnel who can meet these requirements. It may also be helpful for organizations to be forewarned of the risk of putting mitigation measures in place ahead of receiving the grant.
Tools & Resources
How to Build Nonprofit Talent Systems During Times of Rapid Growth
Four data-driven, inclusive human resource systems that can help quickly scaling nonprofits maintain their efficiency, values, and performance.
Nonprofit Policy Toolkit
A toolkit that provides a selection of templates that can be useful when nonprofits are establishing policies across their organization.
Cybersecurity Assessment Tool
An assessment that measures the maturity, resiliency, and strength of an organization’s cybersecurity efforts to help illuminate a recommended path forward.
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