Tag Archive: Millennials

Generation X and Y equals philanthropic power

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When it comes to philanthropy, Gen X and Gen Y/Millennial donors are keenly interested in personal values, measurable impact, and hands-on engagement, a new report from the Johnson Center for Philanthropy at Grand Valley State University and 21/64, a nonprofit consulting practice specializing in next-gen and multi-generational strategic philanthropy, finds.

Based on a national online survey of and interviews with young philanthropists, the report, Next Gen Donors: Respecting Legacy, Revolutionizing Philanthropy found that a relatively small group of Gen Xers (born between 1964 and 1980) and Gen Y/Millennials (born between 1981 and 2000) will inherit more than $40 trillion over the coming decades. And while they are not necessarily more charitably inclined than their parents or grandparents, the sheer volume of funds, foundations, and other types of giving by high-net-worth families is expanding to unprecedented levels, putting them in a position to wield more philanthropic power than any previous generation in American history.

The report also found that next-gen donors seem to be driven by values rather than “valuables”; that they see philanthropic “strategy” as the major distinguishing factor between themselves and previous generations and intend to change how philanthropic decisions and due diligence are conducted; that they want to develop close, hands-on relationships with the organizations or causes they support; and that, as engaged as they already are, they are still figuring out what kind of donors they want to be.

The report highlights the “practical wisdom” and insights of next-gen donors with respect to their hunger for engagement, new ways of learning, and making a difference sooner rather than later.

[Foundation Center]

How nonprofits convince Millennials to give

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Charity: water, Scott Harrison’s nonprofit organization, is at the fore of a tough task for the nonprofit sector: convincing the Millennial generation, underemployed and often dubbed apathetic compared to their predecessors, to give some of the little money to charity. For a sector overly reliant on generating money from an aging Baby Boomer population, getting young Millennials donating to nonprofits early is a key to long-term sustainability. That’s why many charities are working to develop a more interactive, customizable, and transparent giving experience.

“The Millennial generation is about identifying with a cause,” says Marc Chardon,the CEO of Blackbaud, a software developer for nonprofits that tracks giving trends. “[Donating] has become very personal and local.”

In charity: water’s case, that means encouraging supporters to be not only donors but also fundraisers. Half of the funds generated by the organization come from an online fundraising platform in which individuals create their own personal fundraising campaigns on behalf of the nonprofit. Often, people use the platform on their birthdays and ask others to donate their age in dollars instead of providing gifts. Sometimes the fundraisers are more inventive—in September a woman raised $30,000 by promising to swim across the San Francisco Bay naked, while an 8-year-old generated $15,000 by eating rice and beans for 25 days and promising her family would donate the savings made from buying cheaper groceries.

“Many charities go out and just ask people for money,” Harrison says. “We ask people for their voice.”

It’s an approach that seems to resonate with Millennials. The average age of mycharity: water’s users is 33. The fundraisers have generated almost $20 million total since the platform was launched in 2009, mostly through small donations of less than $100. The organization’s pledge to use all donated funds on fieldwork (private donors fund organizational costs) also assuages young people’s tendency to distrust formal institutions. In a post-recession environment where charitable giving has shrunk, charity: water has increased its donations each year since its founding.

TIME

Millennials move toward impact investing

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Over the next several decades, as baby boomers in the United States age and transfer their wealth to the next generation, an unprecedented $41 trillion will change hands.

These young inheritors are, for the most part, Millennials — the generation born between 1978 and 2000. As it turns out, this group’s attitudes about social responsibility, private capital, and the intersection between the two do indeed appear to differ from those of their parents, perhaps starkly.

“Think back to the great philanthropists of years past who thought of making money in the first half of their lives and giving it away in the second half,” says Justin Rockefeller, a trustee and member of the investment committee at the $739 million Rockefeller Brothers Fund, great-great grandson of John D. Rockefeller, and, at 33, himself a Millennial. “Today, that view is still pretty pervasive, that there’s capitalism and making money on one side, and philanthropy on the other. I think the younger generation is seeing that as a false dichotomy, or at least something that will increasingly become a false dichotomy.”

Data indicates that he’s right: Millennials are more likely to embrace a philosophy that financial interests and social interests ought to directly overlap, thereby ostensibly benefitting both wallet and world.

In late 2011 Deloitte Touche Tohmatsu commissioned two surveys: Both surveys asked whether business success should be based on more than just profit — 92 percent of Millennials said it should, and 71 percent of current business leaders agreed. When each group was asked to describe the purpose of business, Millennials most often said “innovation” and “societal development,” while business leaders’ top responses were “profit” and “value.”

Over half of Millennials believed that in the future, more than any other sector of society, business would achieve the greatest impact on solving society’s biggest challenges. These are no longer abstract philosophical schisms for the wealth management firms and advisers who are overseeing the massive transfer of assets from one generation to the next — the schisms are practical, and they’re starting to force changes at firms and family offices from the inside out.

A new crowd emerging on the philanthropy beat

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There’s a young, up-and-coming crowd of entrepreneurs, philanthropists, donors and volunteers who aren’t entirely like their parents or their grandparents.

The rising so-called Millennials, or Generation Y, now in their late 20s and younger, may have the same passion, commitment and concern for their communities as their predecessors. But philanthropy experts said many of these young individuals want to take more “ownership” of a cause than Generation Xers, “traditionalist” baby boomers or the “Silent Generation” of givers who have mostly been satisfied with just writing checks to large umbrella organizations for the past several decades.

While the younger generation may not have as much financial capital as previous age groups, experts and studies indicate that many of these young individuals who do or will have money later in life want to have more of a stake in where and how their dollars are spent rather than blankly giving to an over-encompassing charity.

Young philanthropists are also more familiar with technology, armed with instantaneous “crowd funding” through smartphones, social media or websites like Kickstarter.com or Gofundme.com to have a global reach.

The generational differences, however, can sometimes become a “double edged sword” and has created new challenges for managing today’s philanthropic organizations at a time when many nonprofits are in desperate need of discretionary dollars, said Jeffrey Wilcox, a certified fundraising executive and president/CEO of the nonprofit consulting firm The Third Sector Company.

“What’s difficult for nonprofits is that [young] entrepreneurs who have a lot of money don’t like to give to a lot of processes that involve committees and a lot of people in decision-making,” he said. “They want streamlined decision-making and they want a larger voice in how their dollars are going to be used . . . The younger generation, at least in my opinion, sees a lot of things that the older generation has not made possible.”

Wilcox added that young individuals are branching out with their own endeavors, goals and philosophies with the technological know-how to “create a social movement overnight” rather than pandering to bureaucracies, boards and committees. While he said “due process” is still needed in today’s society, the obstacle for many organizations, Wilcox said, is to learn how to keep young people interested in philanthropy.