In this post, I focus on how nonprofits can remain resilient and impactful in uncertain times by addressing both sides of the financial equation: revenue and expenses.
In my last post, I wrote about on Risk Management, in the one before on Financial Fraud, and the one before that on Managing Critical Business Accounts. All these areas are important to ensure your organization can face challenges due to external factors such as the economy and internal ones due to staffing changes.
Focus on Both Revenue and Expenses
Nonprofits are being squeezed from both sides. Government and foundation funding are declining, while community needs continue to grow. This moment calls for clarity, courage, and creativity—from both nonprofit leadership and boards. The path forward requires sharpening fundraising efforts, staying rooted in mission and relationships, and making smart budget decisions,
Board Members: Lead by Example
If you are a board member, now is the time to step up.
- Make a meaningful gift. A personally significant gift from every board member sets the tone and inspires others. Stretch as much as you can.
- Open doors. Introduce staff to new prospects, host large and small gatherings, and share your organization’s story with your networks.
- Establish a sustainability task force. Partner with your CEO to explore funding models, strategic cost-cutting, and collaboration opportunities. Help the organization stay focused on its most impactful work—even if that means pausing initiatives you care about.
Fundraising Is About Asking and Thanking
Several strategies are important on the fundraising side. A focus on individual donors is key but do not ignore corporations and foundations. Be prepared to tell a compelling story and to present supporting data. Consider diversifying your funding stream. And importantly, show gratitude to all supporters. As a caution, be patient. Changing your fundraising strategies will take time.
Double Down on Individual and Member Donors
As institutional and government funding shrinks, individual donors are more important than ever.
- Communicate urgency and impact. Be clear about why support is needed now and how every gift makes a difference.
- Make the Ask. Donors respond when they understand the urgency, see the impact, and feel personally connected to the work. But you have to ask—for money, for connections, and for hosting events.
- Invite members to do more. If you are a member-organization, reach out to your membership and ask them to stretch and give more than the minimum. Members are already connected and committed.
- Strengthen stewardship. Stay connected and check in regularly. But do not just send emails or texts. We are all overwhelmed with information. So, make it personal. Pick up the phone, schedule a Zoom or in-person meeting, and send personal updates. Make donors feel seen and valued.
Stay Connected to Institutional Funders
While government, corporate, and foundation grants are declining, they are not completely disappearing.
- Be transparent. Be clear about your financial situation, your impact, and how you are proactively approaching today’s challenges. Program officers appreciate your openness.
- Stay in touch. Check in with program officers. Send them updates about your work and impact. It is important to maintain a strong relationship.
- Continue to apply for grants. Even if you do not receive a grant now, you are laying the groundwork for the future.
Tell a Compelling Story and Support it with Data
- Inspire through storytelling. Share how your work makes a difference and why community support matters.
- Back it up with data. Highlight your results and communicate how you are using funds wisely.
- Diversify communication. Use newsletters, social media, site visits, and donor updates.
- Frame challenges as shared. Show how your donors can be part of the solution.
Say Thank You—Often and Sincerely
Gratitude builds loyalty.
- Respond promptly. Send heartfelt thank-you letters or make personal calls. Thank both individual donors and institutional program managers personally.
- Recognize publicly. Acknowledge donors and funders publicly when appropriate.
Diversify Revenue Streams
Broaden your fundraising base and reduce reliance on any one type of funding.
- Encourage recurring donations. Monthly and multi-year commitments provide stability.
- Launch a legacy giving program. Train staff and promote your legacy program broadly.
- Accept stock donations. Ensure your organization is set up to receive gifts of stock. Review and update, if necessary, your gift acceptance policy that spells out what to do with non-cash gifts.
- Explore earned income. Research mission-aligned income streams such as consulting, training, or product sales.
Sharpen Budget Discipline—Without Losing Your Mission
Financial discipline is critical—but so is protecting your organization’s ability to serve. So do strategic scenario planning that centers your mission.
Prioritize What Matters Most
- Focus on core mission areas. Identify the programs that have the greatest impact. Pause or reduce others.
- Lead with mission. Reaffirm your “why.” Revisit your vision, mission, and theory of change to ensure your programs align with your intended impact.
- Align budget with strategy. Let your purpose — not panic — guide where to scale back or invest.
Scrutinize Costs
- Make staff cuts strategically. Hopefully, you will not have to cut staff. But if you do, think strategically. If you lose funding for a specific program, do not just cut the staff working on that project. Instead, keep your strongest performers and most versatile workers. Plan ahead and communicate clearly with all staff.
- Renegotiate contracts. Look at leases, subscriptions, and vendor agreements.
- Delay non-essential spending. Postpone travel, technology upgrades, or consultant engagements unless critical to mission delivery.
Plan and Reforecast Regularly
- Use rolling forecasts. Quarterly or monthly updates keep you nimble and prepared.
- Scenario planning. Develop best-case, base-case, and worst-case models for both revenue and expenses.
Collaborate to Stretch Resources
- Share services. Pool back-office functions like HR, finance, or IT with peers.
- Explore joint programming. Collaborating on service delivery can reduce duplication and appeal to funders.
Lessons Learned
Nonprofits are no strangers to navigating challenges — but this moment requires something more. It requires leadership that is proactive, transparent, and deeply rooted in mission and relationships.
You are not alone. With smart strategy, courageous conversations, and a deep belief in your work, your organization can emerge not just intact — but stronger.