Four Important Trends Shaping Philanthropy in 2025

Intergenerational Wealth Transfer and Emerging Philanthropic Approaches

The baby boomers are in full retirement mode while only about half have actually retired. The U.S. Census Bureau asserts that by 2030 all baby boomers will be age 65 or older. These parents will transfer wealth at the largest scale in modern World History. As baby boomers transfer their wealth through trust and other ways of transferring wealth, those organizations need to think about continuing longstanding relationships with the next generation. They also need to build new relationships with a whole new generation of givers. It remains to be seen how the new generation will respond to this wealth infusion, but philanthropy stands to gain on the previous generation for several reasons. Many of the next generation are more likely to engage in social enterprise philanthropy and to be attached to particular passion projects related to philanthropy. This new generation will focus on systemic inequalities, climate change, and social justice.

Non profits need to start adjusting to new priorities and new relationships as this occurs. This is a pivotal time to build lasting relationships for on-going funding as opposed to one-time smaller givers. Develop infrastructure and strategies to attract these new relationships. Tell your story as you go. Develop people to make contact and invite donors to events and the day to day of the organization. Help them see themselves as a part of the organization and its mission. Too many non profit leaders are so driven by the passion of their mission that they forget to tell the story to those that will help to fund it. Invest now in that infrastructure. it could mean a newsletter, freelance proposal writers, and other philanthropic funnel development.

Integration of Artificial Intelligence (AI) in Philanthropy

Artificial Intelligence has taken on the World by storm. Most people despite their industry have likely underestimated the impact that AI will have on the entire working of the World. It will change how people approach work and it will help new non profits and new businesses to accelerate growth at a pace not ever seen before. Non profits need to think about how to use AI to mine list of potential donors, streamline operations, multiply their workforce through automation, and other strategies to adopt AI where appropriate. Non profits do not need to have an engineer on staff to take advantage of the plethora of tools being made available daily. Keep track on sites like ‘There’s An AI For That’ to determine. Hire a consultant if you are not comfortable with the tools, but this has implications for the entire organization. Just like any new technology there are early adopters, cautious adopters, and laggards. This one has been moving at lightning speed so the change of laggards being left in the dark is fairly high. If another non profit can generate news about their organization, social media, and lead nurturing for donors then they can outperform any other similarly sized organization that does not do these things. AI could help to take advantage of smaller donors but in a funnel to grow them to large donors over time.

Rise of Trust-Based Philanthropy

In the AI age, non profits will experience less administrative burden. This will create more flexibility in addressing community needs and doing more with their dollars. The need for stronger collaborative partnerships will continue to grow as more and more people will continue their skepticism about where their philanthropy is going. Those non profits that collaborate well with others either in government or other non profits will continue to develop higher levels of trust among the public and potential funders. People online continue to lack trust in what they see. Social media networks are already trying to demystify the social media free speech agenda. It remains to be seen if this will help with people trusting online content. This is relevant to non profits as many try to tell their story and attract funders through social media. Video of actual participants and benefactors can help to build trust. Organizations should pay particular attention to building trust in any channel that they tell their story. One way to do this is with newsletters. Technology to build newsletters have made this process so much easier than it was before.

Enhanced Corporate Social Responsibility (CSR) Initiatives

Corporate and social responsibility will not go away any time soon. Corporations are a good source of funding for non profits when missions align. Corporate philanthropy will likely engage more with local communities and particularly the ones where they serve customers. CSR is a way for organizations to invest in climate and social justice initiatives and some corporate entities are required to give funds out to non profits as part of the regulatory apparatus of the federal government. The innovative non profit leader will seek out partnerships to develop relationships with major corporate donors in their region. They will seek growing longer term commitments from these corporate funders and include them in outcomes evaluations, program evaluations, newsletters, and other data of success. Building these relationships could be key to the viability of a small non profit. On one hand, corporate donors want to see a viable program and a viable non profit so those that are just starting may find this more difficult, but having someone on your board and building that relationship can be key to a eventual funding stream over the longer term. The ability to address key corporate responsibility goals and objectives could make all the difference. When developing targets that are corporations or individuals, do you research on what they fund and how you can make sure that your non profit is aligned with their priorities.

Jonathan McCombs, Ph.D.

Founder of TMG, LLC, a consultant for non profits trying to grow their funding opportunities to support their mission. Mygrantwriting.org

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