Capacity-building grants have long been a staple in philanthropy, designed to help nonprofits improve effectiveness and sustainability. These grants usually focus on strengthening infrastructure, skills, and systems to support an organization’s mission. However, recent critiques suggest the traditional framework needs a significant overhaul, especially to better serve Black, Indigenous, and People of Color (BIPOC)-led nonprofits.
Traditional Capacity-Building: Meeting All Nonprofits’ Needs?
Traditionally, capacity-building equips nonprofits with tools and strategies to operate effectively. This includes activities like strategic planning, leadership development, technology upgrades, and improved communication to help nonprofits better fulfill their missions. However, as the field evolves, questions are being raised about whether this model truly meets the needs of all nonprofits.
Alece H.M. Montez, co-executive director of the AJL Foundation in Denver, said this traditional approach has allowed funders to sidestep their responsibility to improve systems where nonprofits need support. For instance, offering grant writing support without simplifying applications or setting realistic goals for annual grants.
Power Imbalances in Capacity-Building Grants
Melissa DeShields, CEO of Frontline Solutions, a Black-owned consulting firm, raised concerns in her article “A Capacity Builder’s Crisis of Conscience: What Does Capacity Building Mean?” She noted that current practices often reinforce existing power imbalances. Funders and consultants impose their own metrics, overshadowing the needs of community-based organizations. This forces nonprofits to meet external expectations instead of focusing on what benefits their communities.
The Pressure to Adopt White Standards
DeShields also pointed out that despite the growing focus on racial justice in capacity-building efforts, some nonprofits feel pressured to adopt white standards, acting on foundation priorities rather than addressing community needs. This creates a disconnect, as foundation staff may not fully appreciate the expertise and lived experiences of these nonprofits.
Shifting the Narrative: From Deficits to Strengths
The term “capacity building” has come under scrutiny for its emphasis on deficits rather than strengths. Marcus Little, a colleague of DeShields, argued in his article “Should We Cancel Capacity Building?” that the traditional framework treats development as transactional, ignoring deeper structural inequities. It often overlooks the unique challenges faced by organizations led by or serving communities of color, failing to address cultural, systemic, and power dynamics.
Reimagining Capacity-Building: A Path Towards Equity
Calls to rethink capacity-building practices are growing. According to the report Reimagining Capacity Building: Navigating Culture, Systems & Power by Grantmakers for Effective Organizations, “Although capacity-building efforts have generated many positive outcomes for nonprofits, we must also recognize that in many ways capacity-building practices in our sector have fallen short in addressing and advancing equity considerations, causing particular harm to Black, Indigenous, and People of Color (BIPOC)-led organizations and to BIPOC nonprofit staff and constituents.”
GEO stresses the need for tailored initiatives that take into account each organization’s size, budget, and unique needs. The report offers questions to help practitioners reflect on the roles of power, culture, and systems in capacity-building efforts.
Collaborative Solutions for Nonprofits
Montez shared that the AJL Foundation is convening grant partners to ask about their biggest challenges. By listening more closely, they’ve adjusted how they support nonprofits. Since “capacity building” means different things to different organizations—like grant writing or managing volunteers—they’ve realized one foundation can’t meet every need. To better serve nonprofits, they’re partnering with other foundations.
In Southern Colorado’s San Luis Valley, for example, nonprofits need help with bookkeeping, HR, marketing, and communications. Many small nonprofits struggle with bookkeeping costs, which can run into the thousands. Without proper bookkeeping, they can’t apply for grants. To address this, Montez said they are exploring a bookkeeping co-op to offer affordable services under $50 per month. They are also considering collective marketing support, shared grant writers, and other solutions.
Toward Equity and Resiliency in Nonprofit Support Models
Little suggested moving away from traditional frameworks that perpetuate white-dominant norms of effectiveness. He advocated for principles like truth, strategic disruption, strength, and love, as outlined by the Black Equity Collective. The group has replaced “capacity building” with “organizational resiliency,” a shift that could guide funders and intermediaries working with BIPOC-led nonprofits.
The Black Equity Collective: A New Approach to Supporting Nonprofits
The AJL Foundation was the only funder outside California to join the Black Equity Collective’s pilot program, which focused on centering love, Black wisdom, and other core values, Montez said.
As part of the program, they created a rubric. This rubric includes questions for funders to reflect on their intentions, how they partner with grantees, and ways to improve these relationships. It focuses on key areas:
- Truth: Encourages funders to create a trusting environment where grantees can express their needs and address systemic injustices.
- Strength: Emphasizes investing in organizational infrastructure, leadership development, and coalition building.
- Strategic Disruption: Focuses on supporting political and economic engagement, ensuring fair wages, and helping organizations prepare for leadership transitions.
- Love: Promotes self-care, community care, and preserving Black culture and history. Funders are encouraged to build long-term trust and mutual respect with grantees.
See the Principles of Black Equity Framework rubric »
A New Path Forward
As the social sector evolves, it may be time to retire conventional capacity-building models. Embracing new approaches that align more closely with the needs and values of diverse nonprofits could lead to more meaningful support. By shifting to practices rooted in equity, authenticity, and respect for the unique strengths of BIPOC-led organizations, funders can help these nonprofits thrive and drive lasting social change.
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Yikes. The issues described here seem like threshold ones every funder should have well resolved before engaging in any type of grant making, not just capacity building.
If funders are “impos[ing] their own metrics, overshadowing the needs of community-based organizations,” and do not “take into account each organization’s size, budget, and unique needs,” then capacity building grants are probably the least of their problems.
In my personal opinion, the greatest trait any funder can have is being a good and generous listener. If you’re listening to yourself more than the community you’re seeking to assist, you’re probably squandering both opportunities and dollars.