We’re in a pivotal moment for civil society. Nonprofits are on the front lines of supporting communities across the United States—and philanthropy is a critical partner. As a mission-driven consulting firm working with both nonprofits and funders nationwide, we’re uniquely positioned to hear what’s working—and what’s not.
What we’re hearing strongly echoes the principles of Catalytic Leadership in Philanthropy (CLIP)—a values-driven approach that goes beyond dollars to spark long-term, systemic change. Today, we’re sharing insights from our nonprofit partners by highlighting three unhelpful behaviors that hinder progress—and three catalytic practices that are helping to build trust, connection, and impact.
What’s Not Helping Right Now:
3 Common Missteps
We recognize that funders are navigating a time of uncertainty—but some practices, though unintentional, are undercutting the very work philanthropy aims to support.
Nonprofit leaders across the country are voicing concern about the future as funding becomes less predictable and the landscape for civil society in the U.S. shifts in profound ways. This is a moment that calls for bold, responsive leadership from philanthropy. Here are three common missteps we’re hearing about:
1. Staying Quiet
Nonprofit leaders know the future feels uncertain for funders too—and that you may need time to regroup and chart a path forward. But communication is essential. Trust with grantees depends on open dialogue, even if it’s just to say you’re still figuring things out.
When priorities shift or decisions are delayed without explanation, nonprofits are left guessing and anxious. If they’ve reached out for guidance and hear nothing back, it leaves them in the dark—and erodes trust.
2. Pulling Back When the Sector Needs You to Lean In
Nonprofit leaders understand that funders are weighing how best to respond to this moment. They’re not asking for rash decisions or indiscriminate spending.
But stepping back—or postponing funding decisions—can seriously destabilize organizations that are already stretched thin. In a moment this critical, how funders choose to act in the coming months may determine whether key nonprofits can stay afloat.
3. Creating More Hoops and Complexity
We’re also hearing about a rise in application requirements, even as funding pools shrink—forcing nonprofits to jump through more hoops for fewer resources.
Overly complex processes sap time and energy from already overburdened teams. And they don’t necessarily lead to better funding decisions—just more polished applications from those with the most grantwriting support. Meanwhile, smaller, grassroots, and marginalized groups may be discouraged from even applying—deepening existing inequities.
What Is Helping:
3 Practices We’re Seeing Make a Difference
We’re also seeing powerful examples of catalytic leadership from funders across the U.S.—practices that align beautifully with CLIP and build lasting trust, capacity, and momentum across the sector. Here are a few we want to highlight:
1. Clear, Two-Way Communication
Nonprofit leaders tell us about funders who are being exceptionally transparent about their strategies—and who invite candid feedback as they finalize their plans.
At a time when many in the sector feel uncertain, these funders are building stronger relationships by communicating openly and often, both formally and informally. They’re keeping grantees in the loop and actively seeking input. Even sharing that you’re still working through your strategy is better than silence.
2. Investing for the Long Term
Let’s be clear: now is the time to increase the use of multi-year, flexible funding. This kind of support builds the infrastructure nonprofits need to survive—and thrive—especially in times of instability.
Yes, it requires mutual trust. But when that trust exists, the results can be transformative. Flexible funding empowers organizations to stay focused on their missions rather than short-term survival.
3. Using Your Convening Power Strategically
Funders have a unique superpower that individual nonprofits often don’t: the ability to bring people together. Convening is sometimes the first thing to go in lean times, but it can be one of the most powerful tools for long-term impact.
Funders who use their influence to gather grantees, community leaders, and fellow funders are sparking new ideas, building networks, and strengthening community. In a time of fragmentation, thoughtful convening is catalytic.
Bridging the Sector for Greater Impact
At Capacita, we support both nonprofits and funders—helping to build capacity and equip leaders to act with clarity, courage, and impact. Catalytic leadership isn’t about having all the answers. It’s about showing up with humility, cultivating deep relationships, and taking bold action.
We love partnering with funders who want to be part of the solution—those willing to reexamine long-held practices, streamline burdensome processes, and prioritize trust over paperwork. It also means acknowledging and addressing power dynamics by listening deeply, providing flexible, long-term support, and moving beyond short-term, project-based funding.
In a moment of immense challenge, philanthropy has a real opportunity: to lead with boldness, equity, and commitment to those doing the work on the ground. Let’s keep listening, learning, and leading—together.
Curious to learn more about what we’re hearing and seeing across the country? Reach out—we’d love to talk.
About the Author
Adriana Cosgriff is the founder and CEO of Capacita, a mission-oriented management consulting firm.