5 Trends Redefining Nonprofits by 2035

[Music] The Small Nonprofit podcast is brought to you by Further Together Fundraising, which is actually my company, where fractional fundraisers work with social justice nonprofits in Canada and the States. Typically organizations who have tried hiring wins or twice, but it hasn't worked out. We use community-centric fundraising to build sustainable revenue systems, and here's the key. We don't just strategize. We roll up our sleeves and do the work with you. Donor meetings, campaign execution, grant rating, all of it. If you're ready to stop doing fundraising alone, visit gofurthertogether.ca. Early studies already show that donors may or may not have an issue with AI being used to steward them. Right? So that is one aspect that we need to think about because we have this personalization paradox. Donors are able to receive increasingly personalized stewardship directly to them with a click of a button. However, donors know that this is not a real relationship. So some of them may have mixed feelings towards receiving stewardship drafted by AI, which is why I say that major gift stewardship, major gift officers are going to become way more higher in demand. So what are organizations doing about it in 2025? Hi, friends. Ever wondered how you could turn your big ideas into results? Together, let's reimagine a better sector, tackle systemic issues, and yes, raise some serious cash. Welcome back to the small nonprofit, the podcast where your passion meets action. We're going to go over my predictions for what the future of nonprofit looks like. So based on five different things happening in our sector, what is our sector going to look like in 10 years? My name is Maria Rio. And if you're new here, I'm a fundraising professional with over 15 years of experience. And I'm on a mission to make your life easier so we can fundraise more without the stress. So let's jump into it. So there's five common themes that I think are greatly impacting the nonprofit sector today. That is the workforce and talent, funding and donor concentration, technology and AI, government funding volatility, and CCF slash D.I. backlash. These five things have already started to shape what our sector looks like today and will continue to have very big impacts on what it continues to look like in 10 years. So let's start with the first one, workforce and talent. So according to the 2023 nonprofit workforce survey results run by the National Council of nonprofits, works are having a lot of difficulty recruiting and retaining staff 72.2% of them say it's because of salary competition, right? They can't compete. They can't pay well enough to be competitive 66% said it's budget constraints or insufficient funds. They just don't have the money to actually go out and look for someone to help them. And 50% say it's burnout lots of people are leaving the sector and their organizations because they just find the workload unsustainable. It's someone sustainable that people today in 2025 are actually reporting higher job vacancies than they were at the height of COVID. So 50% of organizations are saying they have more vacancies now than pre-COVID and 75% of the organization surveyed actually had a job vacancy at that time. So what are organizations doing about this? How are they combating? How difficult is to hire and retain staff right now? Well, here are a few things. They're turning to fractional leaders like me a fractional fundraiser to actually support their in-house team. They're turning to mission premium paid. So if you are a fundraiser, you might be paid more than someone who's a frontline person. And that's because the organization might be considering you as more critical to the organization and another staff person. So there's a little bit of a wages parity, even if it's not the most equitable approach. Something else that organizations are exploring are shared expenses. So how can your organization actually partner with a different one? And the last thing that organizations are exploring are funded mentorship. So really investing in the people that they do have who are secure around and building up their professional development. So they are more inclined to stay at the organization and not leave the sector. Now what are my 2035 predictions for the workforce in nonprofits? I predict that nonprofits will have a core team, but also a roster of frequently called upon consultants. So these consultants will support or lead task traditionally done in house. So that is not so bad, right? But unfortunately, that means that more people who traditionally would work in house are now going to be thinking about transitioning to become consultants or leave the sector altogether. Further deepening this retention crisis is succession crisis that's already on our hands, right? So if there is a succession crisis and a fundraising crisis, many organizations will find themselves unable to compete or to stay open. So I see many of them actually closing if they're not able to become a competitive employer. So the makeup of surviving organizations, I predict will be competitive, right? So these are organizations that pay well or have different benefits that can balance a lack of salary, right? So maybe they have a four day work week. Maybe they have a really strong employee assistance program. I see surviving organizations as also being on two extremes. So either extremely collaborative and they benefited from running joint fundraising programs, sharing admin expenses or they're highly siloed because they never have to rely on other organizations to begin with, right? They had that access to wealth power connections. So they never had to build those networks. So they're either very collaborative or very siloed. Surviving organizations might also be benefiting from earned revenue strategies. So maybe they are doing B to B or B to see strategies to actually bring in that revenue and fundraising less. However, as we're seeing even today, the nonprofit job market will become more competitive, which means that employees will have more of a selection of where they work, right? So positions will say open for and as we see some of these other themes come into play like AI automation. But we'll actually see the devaluing of some fundraising roles. So if you were in a fundraising position where your job could be mostly automated or taken over by a chat GPT by you might want to start thinking about how you can better position your skill set to be more relational and less reputable by AI. So my prediction is that major gifts officers will become an even harder commodity. The level of personalization relationship building and just community involvement that a major gifts officer can do is not replicable by AI, right? So this will become a really highly sought after skill set, especially as we start to see greater wealth disparity between the very rich and the not so rich speaking of which, let's move on to my second round of predictions around funding and donor concentration. So why are organizations thinking about their funding? One of the most worrying trends is the long term decline in the number of active donors, right? So we've seen an increase in charitable dollars, but we're seeing those dollars come from a smaller slice of the population. This trying to call dollars up donors down and this is happening because of various economic factors. So inflation, wealth inequality, these contribute to the contraction of your smaller donor pool. In Canada, we've even seen less people claim a charitable donation on their tax returns. So we see this is a widespread problem of people being unable or unwilling to engage with nonprofits unless they're in a certain wealth rockets. This means that nonprofits are increasingly more reliant on major donors and deepening those relationships with people who are aligned with our cause. Of course, this brings up the age old question of our fundraisers meant to be catering to these wealthy people. There's a lot of strain already on fundraisers. How are they supposed to build these relationships with people who are elusive billionaires hiding behind doubts, right? That's going to be even more pressure on your fundraising professionals because these dollars are so highly concentrated already organizations are always worried about losing a major donor because if you lose a $400,000 gift, it's very different from losing a $40 a month gift, right? So we have too many eggs in very few very affluent baskets and not all those baskets are actually available to nonprofit professionals. Think about donor advice funds for example. So in the States, donor advice funds accounts grew from about 273,000 in 2015 to over 1.7 million by 2023. And these accounts in 2023 already hauled 251 billion in assets. Yet we're seeing payout from devs not really match the power that they have available to them, right? So in 2023 about 54 billion was disperse, which is only about 24% of the total available pie meaning that a lot of wealth remains blocked away for future funding. A lot of nonprofit professionals look at devs and say, oh man, wouldn't that be a full, but unfortunately there's not a minimum payout in the States for how much needs to be paid out every single year from a dev. There is in Canada, but critics still say it's too low. Another reason why organizations are not seeing stable funding is because they're not doing donor education. They're not bearing in donors along with Let's take a quick break. Hi friends. Have you heard of the What the Fundraising Podcast? It is hosted by the amazing Mallory Ericsson. Tell us about it Mallory. If you've ever thought fundraising shouldn't feel this hard. I want you to know you're not imagining it. What the fundraising is a podcast for fundraisers who are tired of burnout, scarcity, and being told to just try harder. Each week I sit down with scientists, fundraisers, and sector leaders to unpack what's actually happening in our brains and bodies, our systems, and our relationships with money. This show is about helping you raise more without hating your job and without abandoning your values. You don't have to choose between effective fundraising and feeling good. Come listen to What the Fundraising wherever you get your podcasts. That sounds amazing. If you're friends, I really encourage you to go listen to the really interesting conversations on what the fundraising is. Let me know what you think. And now back to the episode. The realities of working in our sector. So if you're experiencing a deficit, they might not share that information with their broader donor community, leading to increased instability. Because it's such a tumultuous time, a lot of organizations are also a little bit worried about investing in their fundraising. And they're not taking time to invest on those longer-term strategies that have a huge return on investment, particularly planned giving. We know there's going to be a huge transfer of wealth from one generation to the next relatively soon, but a lot of organizations have never even tapped into their planned giving strategy. So being unable to reap the rewards of doing that work now will also bite a lot of organizations in the butt later down the line. So what are organizations doing about unstable funding today in 2025? There's many that are approaching donor-advised funds through an advocacy line. They're exploring different forms of revenue generation, including earned revenues we talked about earlier, but also mutual aid and patron-style subscriptions. So now that we've set the stage, what are my 2035 predictions for funding and donor concentration? So well, I see many organizations thinking about what their earned revenue potential could be. Not many of them have already started implementing them. So I think by 2035, that number will exponentially increase. So many will be thinking about what is a product or service that an organization can do, and hopefully that is one that is mission-aligned. Organizations will be thinking about delivering value to other businesses, so B2B, or delivering value directly to a consumer, B2C. And they may or may not consider their customers to be part of the nonprofit base. When it comes to increased advocacy on-dance, I feel like that's something that nonprofits will heavily prioritize over the next decade. By 2030, Dance are predicted to have accumulated over $400 billion with a B locked away for future giving. Hopefully through advocacy, we can see an increased annual pay-al minimum. So these organizations are able to access the donor-advised funds in a way that is timely and that actually helps deliver that programming now, not in the future. I also predict that there's going to be greater reliance on the ultra. Of course, this could yield big pay-offs for the organization because wealthy donors are giving at record levels and record amounts, but it also means volatility. So a budget can be thrown off completely if a few donors decide to change their giving priorities. Because of this increased reliance on ultra-rich people, we're already seeing nonprofits increase our major gift staffing and analytics to find that big next donor. So looking out there for who their next big donor will be, donors will feel so, hunted. There might be a loss of trust in organizations or in philanthropy in general, or they might be a heightened expectation from the donor to have some saying how the organization runs its programming. Because of this reliance on the ultra-rich, staff strategies and tapping into people who manage staff will also become a big part of what nonprofits are thinking about. Let's move on to something else that's also shaking up the sector, technology and AI. We've already seen a huge uptake of nonprofits adapting AI. Many of them are sticking to four main tools, chat GPT, Gemini, Quad and Microsoft Co-Pilot. How are organizations using AI? Many different ways they're using it to create chatbots, to write emails, to draft campaigns, to optimize their analytics, to do graphic design, to do grant writing, many, many different ways, including the generation of videos and photos. Many show that 60 to 80% of nonprofits have already integrated AI into their daily operations, which means that many nonprofits are now thinking about ethical issues. So how is the data that I put into the AI used? What is a building on for, especially if you're an art-based organization? Some of these questions are very tricky to navigate. Outside of ethical considerations, people are thinking about the bias that's vacant to the model and different things that they could do to move around their staffing. So do you actually need a full team that is focused on grant writing now that you have integrated AI into your operations? And if you feel like many organizations are starting to think, "No, I just need a grant bot." Early studies already show that donors may or may not have an issue with AI being used to steward them, right? They're creating AI policies. They're being transparent with their donors. They're doing automation and setting up systems. And they're rethinking their operations and staffing. Now what are my 2035 predictions for tech and AI? I predict there's going to be a distrust of digital stewardship because there's such a lot of human connection, right? There's also going to be an increased use of AI to create images of service users, which are not representative of any real person, but heavily could lean into bias when trying to portray an entire community with an image that is not a real depiction of any person. This might actually create a bigger barrier and a bigger gap between the donor and the service user instead of bringing them closer together and more comfortable in one room. The other thing that makes me think that we'll have a distrust of digital stewardship is something called the labor perception bias. So this is a cognitive bias that we automatically all humans have this, right? People trust in value things more when they see that there's work behind it, right? Now people don't love waiting in general. If they have to wait too little, it actually can build up a little bit of skepticism as to how meaningful this stewardship point actually is to you. That's why we really value one to one personalized stewardship because it takes time, right? Takes time to write that letter. It takes time to make a phone call and it's not replicable. So if we now have tools to make everything that we do become much easier and much less time consuming, it becomes harder to actually create meaningful stewardship touchpoints. While in 2025 some organizations are not as excited to adapt AI, I feel that by 2035, most of these resistors will actually be eclipsed. Just like using a computer, AI usage and skills will become the norm. There is going to be more software's integrating AI. So even if you're a resistor, you might not be able to escape the AI wave that's coming towards you. And of course, if AI has improved this much during this very short period of time, I can't imagine what 10 years will do. If you're using AI, I'm assuming that a lot of organizations will be able to benefit from better decision making. Not only will we have more information at our fingertips, but we'll be able to automate and visualize it in a completely new manner. This I also predict will reduce some vendor reliance, right? So there's going to be less need for people to draft your speech, for example, or to come in and take photos or to write a campaign. So the nonprofit vendor space is going to look completely different. I don't know about you, but I've definitely gotten a lot of emails in the past from spam accounts trying to scam me and my nonprofit saying, "Hello, this is your board chair. I want you to buy 10 Amazon gift cards for $100 each and send them to this address, right? That's obviously a pretty easy to spot scam, but as AI becomes better, I feel like these will become even harder to spot, especially if we're doing remote work." So there's going to be an increased risk of deep fakes, misinformation, and fraud if we're not very diligent, which a lot of small organizations are unable to be diligent. So this is definitely a huge problem to start thinking about now. Let's move on to another thing that is greatly impacting our sector today, and that's government volatility. So as we have seen in the States, they're going to spend a huge granting freeze. And this is because of that government volatility. Now, I'm just going to walk you through some stats from the 2025 Urban Wire Study called, "What is the financial risk of nonprofits losing government grants and the chronicle of philanthropy?" So why are organizations worried about government funding? Well, in the States, 300 billion in government grants is given out each year to 103,000 organizations. And for these organizations, 60 to 80% of them would run deficits of grants froze. In 2025, we know that at least 20,000 people have already lost their full-time jobs due to government cuts. Therefore, instability of government funding is the highly rated issue of concern for most organizations. So what are organizations doing about that? So many of them are trying to increase the reserves. They're laying off staff, they're decreasing expenses, they're looking to revenue diversification. So if you're very reliant on one revenue strategy, you might be looking at other ones and different types of fundraising portfolios. And they're doing advocacy around charitable status, right? So through this government instability, we have seen some not-so-grade actors say, "Hey, charitable status does not have to be non-political. It could be political." And if so, then we run the risk of having DAVs fund far-right extremist movements. One other thing that organizations are doing about government instability is exploring community bonds. So how can we rely more on ourselves to build that well? So what are my 2035 predictions for government instability? I believe that we might see the rise of partisan nonprofits. As we've already seen, there's many organizations that are being penalized for having an equity mandate. And that have been threatened with the removal of their charitable status. So therefore, charitable status might be based on political alignment with the government and power, which right now is one of fascism. This means increased tax cuts for the ultra-wealthy, and increased scrutiny of programs in advocacy that don't align with the political ideology of the day. We've also seen that the government is willing to openly abandon their community and stop funding to organizations that I see as unaligned from their political ideology. So therefore, organizations that are based in advocacy and are based in equity may have to make up the government funding gap, increasing the pressure put on already strained groups. Worst of all, these governments empower, don't only impact your charitable status, but they could also impact the broader eco space of where you work, right? So if there are policy decisions that impact your service users and double, triple, quadruple, the number of people who look to your services, that may be unsustainable for most nonprofits. So if these policy choices come to be, we'll see an increased number of service users come into a smaller group of nonprofits. And we will also see an increased need and affected communities. I do quickly want to say that if you are looking for support in your fundraising and want to get future ready, please look at that link in the description down below. It explains how you can actually work with me and my company to get your fundraising ready for years to come. It's always down in the description. So if you ever needed it's there, but also click subscribe to this YouTube channel and make sure that you tell YouTube that you really care about this kind of content. But before we jump into that last theme that we're going to discuss, I want to make sure that I let you know that this is a very overwhelming time. It's a very overwhelming topic. It's been said that's jumping to my last theme is CCF, so Community Centric Fund Rasing and DI backlash. So CCF is a fundraising model grounded in equity, justice and inclusion. And it's been around for a couple of years, definitely since the bright before the murder of George Floyd. However, many organizations are still struggling to implement it. These organizations may feel like they can't openly advocate or they worry about biting the hand that feeds them, right? But lots of organizations have been successful. So I'd love to jump into those stats. 90% of organizations surveyed by Johnson Center and AFP actually know CCF. They're familiar with the concept of ethical fundraising. 76% of organizations surveyed changed their practices. But one of the main problems that a lot of these organizations cited was their boards. So their boards are very risk-adversed. They don't want to try something new. And again, this ties back into this cognitive bias that we all have as humans to be risk-adversed. We actually sometimes reject things that may be better for us because we don't understand them. And I think this is exactly what's happening here. Another reason why organizations are thinking about equitable fundraising is because of the generational shift that's happening, right? Many organizations are having an increased number of candidates who have a very best-sid interest in social justice. And they speak in a language that many older generations just don't use. So how do you bring people along in a way that everybody can participate in the work of social justice? Many staff and risk feel that CCF is deeply in alignment with their personal values. So that's something that a lot of organizations might have to grapple with. How do you live and operationalize your stated values in a way that is sustainable that allows you to continue to operate and brings your donors and your community along for the ride? Not every organization is up for the challenge. Some organizations have taken to limiting their advocacy or doing very lukewarm statements. So they may not refer to the genocide in Palestine as a genocide, but maybe as a conflict. And this is the result of the nonprofit industrial conflict. So this feeling where organizations feel they can't bite the hand that feeds them, but the importance of we also exist to dismantle the systems that keep people in power. So this is one thing that organizations are trying to grapple with currently. Also some organizations have faced lawsuits, which is a serious concern. One example that comes to mind is there is this organization that was supporting black women entrepreneurs that rejected a white man from their program and he sued them and took it all the way to the Supreme Court. So we might see an increase of lawsuits meant to coerce nonprofits to act or advocate in a certain manner. Something else that we're seeing in 2025 is funders adding non advocacy clauses to their granting agreements. So for example, the Ontario Trillian Foundation actually listed advocacy as something that was a non-negotiable. You cannot go there. You cannot do that. If you wanted to receive funding from the Ontario Trillian Foundation. And similarly, we've seen some non advocacy around genocide clauses added by sign-as-funders. Now if you have the privilege of not falling into any of these categories and you feel like none of this actually impacts me, well, that's pretty lucky because for a lot of the racialized people or disabled people or immigrant people in a sector, all of this is causing a huge mental strain, right? So people are burning out. They're catering to a ritual, the white people who may or may not have any vested interests in releasing some of their power, right? So we're seeing an exit of racialized people from the sector either to become consultants or to leave the sector entirely. So when it comes to CCF and DI, what are organizations doing? These are two kind of competing priorities, right? You have CCF, ethical fundraising, ethical, everything that we want to do. And this DI backlash where organizations are being attacked simply because of their mandate. So we see organizations are starting to form legal coalitions. They're fundraising for legal defense funds. They are adapting their gift acceptance policies to see which gifts they reject in which advocacy causes they accept. They are rethinking donor recognition. They're rethinking their advocacy and they're trying to diversify their donor pools to not be exclusively focused on rich white wealthy people. Now what are my predictions around this? In 2035, I think that CCF's movement will really have to be nailed in. Luke Warms Association is like AFP, the Association of Fundraising Professionals will continue to become increasingly less relevant. The CCF Global Council and CCF movement as a whole will need to continue to mobilize in order to avoid the same fate. Since so many organizations have already started exploring CCF, I see that many more will continue to adopt that and try it out. See how the principles adapt to their specific organization. In 2035, I also believe that there might be increased threats from political climates. Because of that, less people will be willing to register as a charitable organization and instead will try to do it their own way. So there's going to be an increase of non-qualified donays. And also, if organizations are smart, they're going to be thinking about how they can actually pull their legal defense funds and potentially their organizations, right? With the increased funding instability and increased instability in the political climate, it just makes sense to be thinking about fundraising as a dual track. So when track leads you to increased growth and the other is, do we need to be responsibly handing off our programming to another organization that has more stability than us? The overall, I believe that nonprofits are going to be changing from really steady solid institutions into very fluid networks able to swap expertise, money and tech as fast as a crisis hit while holding on to your mission integrity. So what does this look like in actuality? Well, here's a quick example. In 2025, Maya loses two fundraisers, right? That staff retention issue coming up. In 2027, Maya switches to a 50% fractional team and an AI grant bought in 2038. There's a state bill that passes and threatens political charities, right? So Maya's organization crowdsources a legal fees overnight with the help of their coalition. And by 2035, the organization runs with four core staff, 12 contractors, an AI driven outreach approach and a community run budgeting process. We've discussed a lot today regarding these five themes. But the most important question is how will you adapt? There's a lot of things heading our way and we need to be really strong as the sectors. If you need any help with your fundraising, please click that link down in the description. I'll have it listed there. And if you made it this far in the video, I'm so thankful. I know this is something that you're probably thinking about a lot too. You can see how much I've been thinking about it a lot. But I'm so thankful for you being here and for you trying to get a bigger picture of what is happening in our sector because I feel like usually we're so isolated and I really appreciate your support. If you're not already subscribed to the channel please do so and don't forget to like, comment and subscribe to tell the algorithm that you like videos like this. But that's it for today, until next time. Thank you for listening to another episode of the Small Non-profit. If you want to continue the conversation, feel free to connect with our guests directly or find Yon LinkedIn. Let's keep moving money to mission and prioritizing our well-being. Bye for now.