Community-based organizations are one of the greatest levers for change. Because of their relationships in a community and deep understanding of its strengths and challenges, they’re uniquely positioned to make transformational change.
However, they’re often stuck in a loop: They’re denied grants because they don’t have the infrastructure necessary to meet all the requirements in applying for grants—for example, annual audits or extensive reporting. But they need funding to develop these very capacities and expand the scope and impact of their work.
Funders, meanwhile, tend to support programming but not organizational infrastructure building. Yet, they can play a critical role in strengthening community-based organizations by making strategic investments in nonprofits to build the necessary organizational infrastructure, resilience, and power to drive change.
Community-based organizations are one of the greatest levers for change.
In 2019, in Maryland, this is what the Prince George’s County Council and Venture Philanthropy Partners (later known as Youth Invest Partners) were doing in establishing the Nonprofit Capacity Building Program.
The Nonprofit Capacity Building Program was designed to support local Black and Latinx youth-serving organizations to provide more opportunities for children to succeed and ensure the organizations had strong management practices and measurable outcomes. In particular, the Prince George’s County Council was expecting increased fundraising capacity, leading to reduced nonprofit dependence on local government funding and greater sustainability.
Fair Chance, a social change organization that I lead, was selected to design and deliver a comprehensive three-year place-based capacity building program for small, youth-serving organizations in the majority-Black suburb of Washington, DC. The lessons below were extracted from a report of the first cohort analyzing the impact of the program on the organizations and their growth upon completing the three years.
We consider the program a success based on the outcomes achieved and the fact that the program has received continued funding, having just graduated Cohort 4.
When the program began, the Fair Chance team assumed each organization had a greater level of formal infrastructure than was actually the case. All four nonprofits were over 20 years old, had long-standing leaders, and maintained budgets of nearly half-a-million dollars. When we asked EDs to assess their own capacity across eight areas of organizational practice, they reinforced our assumption.
However, after the program began, it became clear that each organization had less infrastructure and capacity than we initially thought. For example, an organization might have an HR manual, but upon inspection it was missing critical pieces.
One ED put it this way: “People think they are doing a good job, but they don’t really know what it takes to run a nonprofit before they start one. Passion and heart will only take you so far. Most people don’t understand the need for infrastructure, and they don’t pay attention to it.”
This affirmed our experience over the years with other community-based organizations that tend to overrate their capacity.
Organizational growth isn’t linear.
Every organization is different. Over the program’s three years, Fair Chance collected data from each ED assessing their organization’s capacity in eight areas (leadership development, board development, financial management, fundraising, strategy and planning, human resource management, program evaluation, and communication and partnerships). One organization quickly improved the incorporation of new practices in year one, then saw smaller gains in capacity over the next two years. Another’s numbers consistently grew 20% each year. A third organization saw its scores decrease in the first year and rise quickly over the next two years.
Sometimes, community-based organizations experience setbacks before they leap forward.
Effective capacity-building takes time. In the cohort, each organization worked with a capacity building specialist to collaboratively develop and implement a program work plan. We learned that it can take several months for participants and specialists to establish trust and speak honestly without fear of judgment.
When we look at data across Fair Chance’s programs, 90 percent of participants in our year-long program show progress in four of the eight areas of practice. However, three of the four nonprofits made significant progress in this three-year cohort in all eight areas. This is consistent with findings from an external evaluation of our DC program, which showed an association between the duration and investment of capacity building support and stronger nonprofit outcomes.
Organizational change and growth are not short-term investments.Funders should understand that organizational change and growth are not short-term investments and that longer engagements lead to more significant results.
The program included opportunities for the four EDs to come together to learn, share, and build relationships. All of the EDs said these opportunities were valuable. They talked about how their interactions with one another made them feel “less alone,” more confident in themselves, and realistic in their expectations of others.
Providing these opportunities, in addition to ongoing coaching and training, was particularly valuable for these small organizations, where EDs—and particularly BIPOC EDs—often feel alone.
Considerations for Funders
Funders tend to prefer short-term, inexpensive engagements focused on a single issue, such as fundraising or financial management, rather than a comprehensive set of areas that can help build broad organizational resilience. As Marcus Littles has written for NPQ, “Capacity building expects transactions to produce transformational results.” And we understand why. When the world urgently needs change, it’s tempting to think of capacity as something that can be “built” quickly and yield immediate results.
Our experience with this cohort and our decades of experience with other community-based nonprofits prove that’s not possible. But meaningful change is.
At the end of the three-year cohort, all organizations showed substantial improvement in their baseline assessment, demonstrated impact, grew their budget, diversified their funding sources, decreased dependence on county funds, added an average of two staff members per year, and—most importantly—provided more needed access and opportunities for more young people in targeted low-income areas of Prince George’s County. All successfully weathered the pandemic and have grown in the intervening years.
For example, when we first met A. Toni Lewis, the executive director of the Foundation for the Advancement of Music and Education (FAME), academic tutoring and music rehearsals for the 100-plus students were taking place in the basement of her house. Today the staff has doubled, summer enrollment tripled, tutoring and professional music education for 1200 students now takes place in four middle- and high-school centers, and SAT scores exceed the county average with 95 percent of FAME graduating students enrolling in college, many with music scholarships.
Cohort member First Generation College Bound (FGCB) provides guidance, coaching, and resources for low-to-middle-income students to successfully apply for and graduate from college debt-free. According to CEO and founder Joe Fisher, “because of Fair Chance’s support and the long-term work strengthening areas of need, FGCB’s revenue has tripled and we have increased our quality college access services from six to nine high schools in Prince George’s County.”
For outcomes like these, BIPOC community-based organizations need funders to invest in comprehensive multiyear capacity building that includes peer learning. And those funders shouldn’t jump ship when results don’t immediately show transformational change.
