The Mindset that Shrinks Nonprofits

I’m noticing a trend in nonprofits that causes them to shrink - or even close their doors.

It’s a freeze response to change.

As soon as anything unexpected happens - a staff member quits, there’s an economic downturn, an annual event’s revenue declines - we stop all progress. Especially fundraising progress.

That major gifts pipeline? “We’ll revisit it in a month or two”.

A new monthly giving campaign? “We need more clarity before moving forward”. 

Asking the prospect you’ve been cultivating for that big gift? “Let’s circle back when things settle down.”

A gifts-in-Will program that could raise millions? “Let’s wait and see how this year goes.” 

This feels thought-out and responsible on the surface. Afterall, you’re conserving resources and managing risk - but it’s usually the opposite. 

These are fear-based decisions driven by emotion, not data, and you could be harming your charity.

If you’re in an unstable place, backtracking on your progress and doing fundraising “as it’s always been done” will only keep your revenue inconsistent (which means your ability to carry out your mission will be inconsistent). 

At the start of the 2020 pandemic many charities completely paused all fundraising activities and let Development Officers go. Yet overall charitable giving actually increased that year. 

The charities that got ahead (like the one I worked for at the time) focused on staying the course and had record-breaking revenue. Later in 2024 as a Fractional Fundraiser (i.e. a “done for you” individual giving fundraising consultant) I helped multiple charities dig themselves out of the hole left behind after abandoning fundraising in 2020. 

It was jarring to go from being an in-house staff member with a charity that increased their revenue by 15% to ones that shrank by more than 30% in that same period.

Whenever a fundraising leader says “now isn’t the right time”, there’s a false underlying belief that things can simply restart later. 

That donors will still be there and ready to give when things stabilize.

That pausing fundraising work doesn't really cost them anything.

But the opposite is true. 

Fundraising success comes from consistency and momentum. Every month you're not building relationships, you're losing momentum and revenue. 

I managed to course-correct each charity I worked with as a Fractional (I increased their individual giving by 50-240%), but I can’t help but wonder how much more revenue they would have today if they didn’t shut everything down the moment the world was uncertain. In some cases it could easily be double - they still haven’t caught up. 

The 2020 pandemic was a massive crisis and fortunately those are rare. 

You might not be faced with a world-shattering event that would lead you to stop all fundraising, but these lessons apply to seemingly smaller decisions. Things like investing in growing a major gifts pipeline, trying a new monthly giving campaign, or yes, even Planned Giving.

If every uncertainty or change causes you to slam the breaks, you could be costing your charity a lot. 

I get why the “freeze response” happens. Nonprofit leaders are already stretched-thin and it’s hard to keep fundraising progress going when something unexpected happens. 

Unfortunately, dealing with a “hitch in the plan” is part of running any organization, nonprofit or otherwise. It’s almost guaranteed something like a staff member leaving, a funder changing priorities, or an unexpected political event will happen at least once a year. If your response to dealing with these situations is to stop crucial revenue-generating work, you’ll only be worse off when an unexpected event happens next year.

So instead of shutting down, I want to gently challenge you to explore how you can continue your momentum through the unexpected.

If you’re noticing that a critical fundraising project keeps getting put off, start to think about what your revenue might look like now if it hadn’t. 

Then ask yourself, are you protecting your organization or shrinking it?

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