10 Strategies for Tough Economic Times


What can your foundation do to make a difference? There’s no “one size fits all” answer, but here we share some strategies used by Exponent Philanthropy members.

Keep in mind that any of these strategies below will have an even greater impact if you consider them in light of your foundation’s mission and long-term goals. Even if you decide to make changes to your grantmaking and operations, making these changes in light of your values and mission will help you make a greater difference in the work that means the most to you.

  1. Give more or maintain giving levels, despite loss of assets

    This can mean a conscious decision to dig into corpus and spend down. Strategies include negotiating with grantees to give smaller grants over a longer period, and giving one-time “emergency grants.” For some Exponent Philanthropy members, this is a time to reconsider the notion of operating in perpetuity. Other donors are considering adding to the foundation’s assets to avoid reducing giving levels.

  2. Focus more on funding immediate needs

    In your community—food, clothing, shelter, fuel. One Exponent Philanthropy member sees this as providing core support for core services, “because this is not the time to start new programs.”

  3. Increase your responsiveness to grantees and grantseekers.

    An effective strategy is to ask what your key grantees really need now, and keeping those needs as top priority in developing a plan of action. To be responsive, Exponent Philanthropy members are:

    • streamlining their application and reporting practices to reduce time and paperwork for grantees;
    • providing more general operating support to key grantees (this support often is essential to keep services going);
    • releasing restrictions on grants - the thinking is: “We trust you enough to know where you need the money most.” Part of being responsive, too, is being clear with grantees and grantseekers up front that funding may not be, or is not available now.
  4. Focus more on your foundation's mission as a way to prioritize, and also achieve higher impact over time.

    Some Exponent Philanthropy members’ missions involve working over years in a strategic, focused way to achieve some specific impact -whether it be expanding early childhood education, saving a river or bay from collapse, or reducing domestic violence. Some members with focused missions are cutting grants that are not related to their long-term mission, and focusing support on projects and organizations that advance their mission. This can be very difficult in times of increased need, but these members recognize that tens of thousands of dollars (or more) they’ve invested over years may be wasted if they abandon their commitment to important outcomes.

  5. Clarify for your foundation the difference between its mission and its responsive grant programs, and refine its efforts in both.

    For some Exponent Philanthropy members with focused missions, this is a good time to re-commit to their long-term, strategic goals, and also to commit a part of their funding to addressing immediate needs.

  6. Widen the array of strategies you use to help grantees.

    The opportunities to support grantees are many--for example:

    • donate stock;
    • advance payment on multi-year grants or guarantee the next payment so grantees can leverage it;
    • volunteer in addition to giving financial support;
    • build the capacity of key grantees—e.g., build technology systems so staff can spend more time with clients;
    • fund the training of board and executives to build skills;
    • provide grants for strategic planning;
    • provide program related investments such as loans and loan guarantees;
    • promote the work of key grantees to other funders;
    • advocate for the causes you care about by building awareness of need.
  7. Collaborate with other funders, and encourage collaboration among grantees.

    Exponent Philanthropy members are convening meetings with other foundations in their community to share information, prioritize needs, and join forces to address top needs. Some are tapping into already created funder networks. Others are convening grantees to identify ways to collaborate, find efficiencies, and leverage resources. Members note that collaboration does take an investment of time and money to make it work.

    Find peers to help with tips on collaborative fudning in the Member Directory.

  8. Try creative approaches

    Such as buying buildings to house nonprofits; buying foreclosed properties to rehabilitate as rentals for low-income families; moving funds into mission investments; and establishing donor advised funds with gifts of stock at local community foundations.

  9. Re-negotiate your investment fees with investment managers.

    Some members are evaluating their investment advisors to ensure that the foundation is getting the best value for good service that it can.

  10. Streamline

    Your own operations by cutting travel, freezing hiring of staff, and assessing foundation budgets.

    See Tools & Resources for more information, or call Exponent Philanthropy at 202-580-6560 for more information.

    Opportunities to Keep in Mind

    Exponent Philanthropy members note the following as opportunities that can come out of the economic downturn:

    • The nonprofit sector will think more deeply about what it does, and will come out overall stronger and better.
    • This is an invitation to become laser-sharp—to look more carefully at grantmaking and become more strategic.
    • It’s a chance to bring grantees together—for economies of scale, overlapping missions, and leveraging strengths together.
    • “I’m hoping one thing that comes out of this is less distance between funders and nonprofits...”
    • “Scarcity inspires innovation!”