Salesforce announced in late June that it’s writing twenty $100,000 checks for nonprofits led by ... [+]
The cofounder and CEO of America on Tech, Jessica Santana, says it’s rare for her nonprofit to be on the receiving end of unrestricted dollars—or funding that she can deploy, for the most part, however she sees fit.
“What a lot of people don’t know about nonprofits is that we run like small businesses do,” she says. “We have to build systems for our general operating purposes that, a lot of times, we can’t build effectively when we don’t have capital that is unrestricted.”
This is one reason why Salesforce announced a funding initiative last week that’s sending $100,00 each to 20 nonprofits mostly led by people of color—including Santana’s America on Tech—located across the United States, the United Kingdom and Australia.
Each of the nonprofits on the receiving end of a grant from the Catalyst Fund—as the initiative is dubbed—is less than 10 years old or operates with an annual budget under $2 million. All of the funds are unrestricted.
Santana says she’s using the money to expand America on Tech’s legal, financial and human resources departments—all in an effort to scale her organization’s impact with more efficient operations.
“I think we need more trust-based philanthropy,” says Santana, a 2017 Forbes Under 30 alumna whose eight-year-old organization offers coding classes to young people of color. “I don’t think people realize that in the nonprofit sector, women and people of color also get a fraction of venture philanthropy dollars.”
Santana’s right: A study published in 2020 by Echoing Green and Bridgespan found that Black-led social impact organizations, for example, had revenues that were on average 24% smaller than their white-led counterparts. The gap was even more pronounced with regard to unrestricted dollars, where Black-led organizations were 76% smaller.
Salesforce isn’t the only giver of unrestricted grants. In fact, the Catalyst Fund advances a broader trend that sees more corporations lending funds with fewer strings attached, says Rick Cohen, chief operating officer at the National Council of Nonprofits. And it mirrors the work of individuals, too, including the world’s most powerful woman, Mackenzie Scott, who has pledged to empty her bank account with billions of dollars in “no strings attached” donations.
Salesforce’s initiative is also part of a larger corporate effort to support local changemakers whose leaders are closest to the communities they’re serving, says Becky Ferguson, the company’s SVP of philanthropy and the chief operating officer of the Salesforce Foundation. Microsoft, Okta, Goldman Sachs, Google and Starbucks, among dozens of others, all form part of a growing list of companies that appear to have deepened their philanthropic commitments in the wake of George Floyd’s murder and the pandemic’s onset more than two years ago.
Microsoft, for example, announced in October 2020 that it would offer tech infrastructure and support to nonprofits serving Black communities. Starbucks has ushered more than $5 million in funding to more than 3,000 local organizations as part of its Neighborhood Grants program, which began before the pandemic.
Charitable giving experts like Cohen say Salesforce’s new initiative stands out for its focus on giving large-dollar donations entirely to smaller nonprofits. “A lot of times, funding may unintentionally go to larger, well-established organizations,” explains Ferguson, while smaller ones are left chasing funds and filing grant applications in an administrative headache that diverts resources away from the heart of the work nonprofits do.
But Cohen cautioned that singular grants like Salesforce’s often aren’t enough to spark sustainable growth. “It really is a matter of ensuring that there’s ongoing investment in these organizations, and not just a one-time contribution, which is what some companies have done just to be able to say they’ve done it,” he says.
Salesforce will unleash a second round of funding to an additional 20 organizations later this year, says Ferguson, and first-round recipients aren’t guaranteed any more. The partnerships the company has established with the nonprofits aren’t limited to dollar donations, however. Salesforce has donated its customer relationship management platform to at least some of the grant recipients, and it has offered some of its employees as pro bono consultants to others, Ferguson says.
Over at America on Tech, Jessica Santana is hoping that her partnership with Salesforce can lay the groundwork for a pathway that sends some of her students into careers at the tech company. She said she also hopes other corporations will follow Salesforce’s lead and focus their efforts on smaller nonprofits led by people of color.
“I think right now we’re in a very critical moment where philanthropists have an opportunity to ask themselves questions about whether or not their previous methods of identifying leaders have been the most effective and have been the most equitable,” Santana says. “A lot of times, leaders of color are also proximate leaders, so they are the people who are most connected to the problem that the nonprofit is trying to solve.”
