Dec. 18, 2018 – Nonprofit Finance Fund (NFF) welcomes a new evaluation that found significant benefits to both nonprofits and funders from training in NFF’s full cost framework.

NFF has long worked with both nonprofits and funders to forge critical, common understandings of what it really costs to deliver essential services, and to bridge the power dynamic that often hinders open dialogue about covering these costs. This complex challenge requires nonprofits and their supporters to change their mindsets, and operations, to account for significant costs that are central to achieving their missions but too often overlooked in funding conversations.

For example, a nonprofit that works to end homelessness might find funders who want to support a street outreach program. But the nonprofit and its funders might not be accounting for costs such as the salaries of people working to develop the program before it launches, time and money spent to report results, or vehicle maintenance.

Philanthropy California, an initiative of Northern California Grantmakers, Southern California Grantmakers, and San Diego Grantmakers, engaged NFF to help its members better understand and apply full cost approaches. Philanthropy California asked community research firm Harder+Company to closely evaluate the results of 10 workshops that NFF conducted across California in 2017 and 2018, in which almost 300 leaders from nonprofits, philanthropy, and government met as peers to learn about full costs.

When Harder followed up with participants via surveys and interviews, they found that 95 percent of the nonprofit leaders felt better equipped to explain their full cost needs to funders, and 98 percent of funders said they were more informed and aware of the full costs of running a nonprofit. In one example highlighted in Harder’s report, a government funder “created a new expedited process to get grantees a 10 percent advance to support immediate operating needs while maintaining momentum until the main grant money starts flowing.”

Philanthropy California and NFF are currently designing the next phase of the Full Cost Project, informed by evaluation findings. 

"We’re clear now where this effort is gaining traction, and where the opportunities lie, so we can better support philanthropy in the skills and practices to move toward the critical changes we know the entire social sector is hungering for,” said Kate Seely, Director of Leadership, Culture and Community at Northern California Grantmakers. “This full cost movement can truly succeed as funders across the country move forward, one step at a time, toward funding that covers the necessary resources for nonprofits to deliver on the missions that the funders so deeply believe in."

A Report on Philanthropy California’s Full Cost Project for Funders and Nonprofits across the Golden State