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New Blackbaud Charity Index Shows Growth in Giving

By Tom Watson on June 15, 20102 Comments

Will an index replace an estimate? That may be the question with the release of Blackbaud’s new Index of Charitable Giving, hot on the heels of this year’s Giving USA estimate of charitable giving in the United States a year ago. And Blackbaud’s numbers are more likely to make development directors smile and board members sit up and take notice: overall revenue increased by 12.1 percent for the 3 months ending April 2010 as compared to the same period in 2009.

There are a couple of advantages to Blackbaud’s index. For one, it’s more current. And for another, it’s based on actual revenue statistics reported by 1,400 nonprofit organizations – as reported in the very databases compiled using Blackbaud’s widely-adopted software. Finally, it’s more like a quick snapshot of what’s happening now – and the data is fresher. As this site has lamented for years, there just aren’t a great deal of reliable metrics in philanthropy. Blackbaud’s new index will be well worth watching, in my view.

More on the method: the Index of Charitable Giving is a broad-based fundraising index that reports revenue trends organizations (and Blackbaud clients) representing $2.2 billion in yearly revenue on a monthly basis. The Index is based on actual revenue statistics from nonprofit organizations of all sizes representing arts, culture, and humanities; education; environment and animals; healthcare; human services; international affairs; public and society benefit; and religion sectors.

“Economic conditions, natural disasters, and market fluctuations have made it extremely difficult for nonprofits to make fundraising decisions informed by the latest donor behavior,” said Chuck Longfield, Blackbaud’s chief scientist. “That is why we created the Blackbaud Index of Charitable Giving – to provide fundraisers with up-to-date data on fundraising trends and to couple that information with valuable analysis by leaders in the sector.”

Keep those fluctuations in mind before celebrating around the development office just yet. Blackbaud cautioned that the first quarter numbers are likely inflated a bit by the general outpouring of funds related to the tragic Haitian earthquake – they’re not necessarily indicative of a big increase in general philanthropy. More detail from the Index:

The Index found that three-month revenue for small organizations (prior year revenue of < $1 million) increased 12.3 percent in April, while revenue at medium organizations (prior year revenue of $1 – 10 million) decreased 2.5 percent, and revenue at large organizations (prior year revenue > $10 million) increased 19.2 percent.

The data show that donations for the smaller organizations bottomed out in July of 2009, remained roughly flat throughout the second half of 2009, and turned upward starting in January 2010. Donations to large organizations may have reached bottom in December 2009, but it is hard to tell which part of the large upturn in March was due to Haiti versus general improvement in ongoing donations, especially since donations declined in April.

You can download the full report here.

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