August 2025

Mohammad Anas Wahaj | 26 aug 2025

As the US government reduces funding and grants to nonprofits there is a transformational shift that the giving and charity sector is facing and organizations have to adapt to this reality. According to The Urban Institute, 90% of nonprofits with over US$ 10 million in annual expenses receive government support (half of their total revenue) while smaller nonprofits with budgets under US$ 100000 rely on government grants with only 13% of their revenue. All will be affected in some ways with the policy change. Alexander Puutio, academic and author, explores the challenging future of giving and philanthropy and brings views of other experts to utilize models that will last in the uncertain world. He says, 'The economic and political volatility is putting Schumpeter's (Joseph Schumpeter) creative destruction on steroids across the entire philanthropic landscape, and one result of the shakeup will be that outdated models are rapidly being discarded in search of more agile, resilient approaches that are emerging in their place. What's rising in the aftermath is a new breed of giving that is leaner, faster, and built on the principles of decentralization, distribution, and data.' Karen Kardos, Head of Philanthropic Advisory at Citi Wealth, says, 'There’s pressure, yes, and that is forcing nonprofits to stay squarely on mission to generate impact...One thing we are seeing is the acceleration of a cultural shift that has been long in the making. The old model was report-based. The new model that is quickly becoming the must-have is iterative, responsive, and grounded in outcomes, not just expenditures.' Lurein Perera, co-founder of GiveCard, who built a direct-to-recipient philanthropy model designed to cut out layers of bureaucracy, says, 'We build and maintain the infrastructure by which nonprofits are giving money directly to people, including those experiencing homelessness, via our debit cards. It's traceable, fast, and goes straight into the hands of those who need it.' Clay Dunn, CEO of VOW for Girls that operates on a model allows 100% of public donations to go directly to the field, something that's only possible through rigorous operational design, says, 'Some of the most effective campaigns we've run have been through small business networks and grassroots ambassadors. People want to give. They just need to feel like what they give matters...The cause is as important as it ever has. But now what matters even more is how you deliver on that cause and how the donors and beneficiaries perceive you in the process. Trust is the new currency without which nonprofits can't operate.' Mr. Puutio suggests the use of decentralized giving models with digital technology as an enabler and data-driven giving with human-centered design as the way forward. He says, 'Digital platforms are enabling new forms of donor engagement, localized disbursement, and transparent impact tracking. It's now possible to decentralize not just funding decisions but the entire value chain, from vetting organizations to measuring outcomes in real time...As data and dashboards become central to philanthropic decision-making, leaders must ensure that people stay at the center of the work...real impact starts with inclusion.' Read on...

Forbes: What's Next In Philanthropy? Decentralized Models And Smarter Giving
Author: Alexander Puutio

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