What We're Reading: Most Black-led nonprofits operate on less than $500,000, study finds

A majority of Black-led and Black-benefiting nonprofits operate on less than $500,000 a year, a report released by the Young, Black & Giving Back Institute finds, said Candid.

Supported by the Nielsen Foundation through its Data for Good grant program, the report, Grassroots, Black & Giving: How Philanthropy Can Better Support Black-led and Black-Benefiting Nonprofits (25 pages, PDF), found that Black-led and -benefiting nonprofits are often grassroots, hyper-local, and founder-led, with deep connections to the communities they serve.

About 76.8 percent of such nonprofits are operating on a budget of less than $500,000 a year, and nearly one-third operate with just $30,000 a year. Largely made up of volunteers, 43.5 percent of the organizations operate without any paid, full-time employees, and 45.65 percent have no paid, part-time employees.

According to the report, Black-led and Black-benefiting nonprofits also face unique fundraising challenges, with 86.5 percent always or often having trouble accessing a large, diverse number of funding sources, and 72.7 percent always or often challenged to identify or cultivate new funders. Moreover, nearly 53 percent of organizations indicated they would shut down if they lost one or two key funders.

The report calls on philanthropic institutions to fuel the work of Black-led organizations by centering their investment on these organizations, providing them with capacity-building support, and trusting their expertise in pursuing authentic social change strategies.

“It is time for philanthropy to center and abundantly resource Black-led and Black-benefiting social change,” said Ebonie Johnson Cooper, founder and executive director of the Young, Black and Giving Back Institute. “Our survey uniquely highlights the needs, experiences, and attitudes of Black-led and -benefiting nonprofits and the critical role they play in Black communities across the country. Philanthropy must address the funding gap for Black-led social change and recognize that a strong, localized, Black-led nonprofit sector is essential to thriving Black communities.”

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