2025: A Year to Rise and Serve in the Nonprofit Sector
- mykcfundraiser
- Jan 2
- 5 min read
As the new year begins, the nonprofit sector faces unprecedented challenges and opportunities. From navigating funding uncertainties to addressing the growing needs of marginalized communities, nonprofit leaders, staff, and volunteers must remain steadfast in their mission to create positive change.
Nonprofit Challenges in 2025
Nonprofit organizations across the U.S. are working tirelessly to feed hungry families, provide shelter for the unhoused, and offer sanctuary to underserved communities. However, the road ahead is not without obstacles:
• Funding Concerns: Economic instability, inflation, and shifts in corporate and governmental priorities threaten financial stability for many nonprofits.
• Political Uncertainty: Polarization has stalled progress on affordable housing, education, and social services, making it harder for nonprofits to fill these gaps.
• Staffing Shortages: Burnout and workforce challenges continue to strain the sector. Low salaries and the high demands of the job are out of balance.
Despite these hurdles, nonprofits remain the backbone of communities, proving time and again that resilience and collaboration can overcome even the toughest challenges.
Emerging Nonprofit Trends in 2025
To navigate these challenges, nonprofits are embracing new trends that promise to shape the sector’s future:
1. Corporate-Nonprofit Partnerships
Companies are increasingly partnering with nonprofits to create meaningful change. These collaborations provide critical funding and resources while helping businesses align with their social responsibility goals.
More and more corporations are directing nonprofits to their corporate foundations for funding. Most have links to their corporate foundations on their websites but don't give up if you can't find one there. Search their site or Google the company name and the words "foundation" or "corporate giving". Banks often use trusts to distribute funding to nonprofits and usually have regional offices that can direct you. Don't forget to research banks that may also have donor advised fund affiliations.
The trend is to earmark annual dollars to affiliated corporate philanthropy with predetermined cause silos and interests. This creates self limiting requests and drives internal community culture. However, it's important to keep in mind traditional funding streams via requests or marketing dollars. Companies allot resources to marketing that can be used for events, vendor booths and naming rights along with in kind contributions. Strategize which is best for your organizational needs and always be ready with a plan B in the event they decline your first approach.
2. Equity-Focused Strategies
Nonprofits are prioritizing diversity, equity, and inclusion in their leadership, programs, and fundraising, ensuring that marginalized voices are heard and represented. We see this happening simultaneously, as large corporations and universities eliminate DEI initiatives. I am steadfast in my view that critical to the mission of nonprofit organizations, nonprofit leadership should reflect the constituency you serve.
Without being political, an easy example is organizations focused on women's rights. If your organization serves women needing healthcare, safe spaces from domestic violence, or reproductive rights, your leadership should reflect that perspective. While this goes without saying, it is important to consider this when dealing with issues of homelessness, education, food, housing, substance use or violence prevention, as well.
Making sure that your team as a whole is diverse across different life experiences is of fundamental value to serving our communities. This ensures that your organization's perspective does not become siloed and monolithic. It also attracts diversified funding which I will address below.
3. Tech-Driven Innovation
From virtual events to artificial intelligence tools, technology is enabling nonprofits to reach larger audiences, optimize fundraising, and enhance program delivery. Like it or not, AI is here to stay. Create policies for your organization and staff as to what is and IS NOT appropriate use of these tools. It is better to address this head on than to ignore them until you have a an issue. Personally, I find AI extremely helpful in getting projects started, but nothing can replace your personal input and creativity. Both can exist together and even thrive if you develop policies that work for your orgs core values and in tandem with your policies.
4. Community Collaboration
Cross-sector partnerships between nonprofits, governments, and private entities are becoming more common, addressing systemic issues like poverty, mental health, and education through collective impact. There are two main reasons this is a stand out trend:
Collaboration saves money, pooling resources from more than just your budget.
Funders are focusing on orgs that show sustainability and collaboration. If they can support two organizations in one grant proposal or event, they get more "bang for their buck". It may feel uncomfortable to think of it this way, but at the end of the day, funders are looking at their bottom line and how they can do the most good.
5. Diversification of Funding
In 2023 Americans gave $557.16 billion, a slight decline from 2022. However, corporate giving increased to $36.55 billion—a 3.0% increase from 2022. (Giving USA 2023 Annual Report) What does this mean? Simply stated, as corporate profits rise, the desire for tax breaks comes with it. Corporations happily contribute more dollars to the nonprofit sector annually because it's good for their public profile and the contributions are far less than the rate of their increased profits.
The sector trend says that an estimated 60% of nonprofit funding comes from individuals. This trend is on a slight decline and not accurate for every organization. I have seen a vast number of organizations since 2020 with virtually zero individual donors and total funding from federal, state, and city grants. Human services orgs have relied heavily on government funding since covid in order to stay afloat. Some organizations will have 50% Government grants, 15% foundation grants, 20% from individuals, and 10% from events. There are many models out there depending on your mission. It's different for different organizations.
Considering all of these things, the message is to intentionally take a look at how diverse YOUR organization is across funding sources including, individuals, corporations, government grants, foundations, events etc. Determine some small steps to improve here. As new administrations come and go, priorities change across all sources above and you do not want to suddenly remove a vital program your community needs, or worse, close the organization. Creating a fundraising strategy across various funders will help you make adjustments when outside priorities shift.
How to Build a Better Future for Nonprofits
The key to a thriving nonprofit sector in 2025 lies in collaboration, innovation, and advocacy. Here are actionable steps to strengthen your organization and build a brighter future:
• Leverage Technology: Invest in digital tools for donor management, storytelling, and program evaluation to enhance efficiency and impact.
• Foster Partnerships: Build relationships with corporations and community groups to diversify funding sources and share resources.
• Advocate for Change: Use your platform to champion policies and initiatives that support your mission and the communities you serve.
• Prioritize Equity: Continue to ensure that equity is central to your decision-making, creating an inclusive culture within your organization and the broader community.
Hope for 2025 and Beyond
As we navigate the complexities of 2025, I am inspired by the unwavering commitment of nonprofit professionals. These individuals are heroes, providing hope and opportunities to those who need it most. By continuing to rise to the occasion, we can create a more equitable, compassionate, and thriving world.
Let this year be a testament to the power of service, the strength of community, and the resilience of the human spirit. Together, we can overcome challenges, inspire change, and ensure that every individual has the chance to achieve a brighter future.
Coeli Baker
Founder, Baker Development Strategies
Current Director of Development & Community Outreach at a Philadelphia area nonprofit organization.
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