Fundraising: Foundations

Updated: 6.1.06

Foundations are nonprofit organizations created specifically to fund charitable causes. Foundations are an important funding source for fledgling nonprofit organizations and new programs within established nonprofits because many prefer to support new, innovative initiatives. That being said, foundations provide only 9.8 percent of the $200 billion donated annually by private sources to nonprofit organizations.

As with every other sector of the economy, the economic downturn of the past few years has affected foundation giving. Foundations invest their endowments in the stock market and must distribute a certain percentage of their earnings. By and large, their earnings have suffered dramatically because of declining stock values.

Foundations have responded in several ways:

One encouraging piece of data is a survey showing that in spite of the fact that the assets of community foundations dropped by 1 percent in 2001, their grants increased by 18 percent, totaling $2.6 billion in grants awarded.

Clearly, it is a difficult climate for grant seekers, so it is more important than ever for you to:

Learn all this and more when you download the full Developing a Fundraising Plan: Foundations.