Fewer restrictions, greater impact: How Candid shifted to unrestricted support 

Candid did something bold in 2023: We asked that funders put their trust in us by providing unrestricted grant support for our planned mission-critical work—projects we believed would make the biggest impact for the sector at large. This strategic pivot meant that we had to make the difficult choice to stop actively seeking programmatic support that had, until that point, made up a chunk of our contributed revenue. Here we share how, in undergoing this shift, we managed to exceed our fundraising targets while gaining more flexibility to do our core work. 

Often, the tightly restricted support we received was for niche projects, which we saw real value in, and which clearly benefited the partners requesting the work. But at times, taking on these projects prevented us from focusing on how we could create broader value for the sector as a whole. To do so, we needed to take a fresh look at the undeniable opportunity cost of engaging in donor-driven initiatives. As we streamline Candid’s operations, we continue to think long and hard about our priorities and how to maximize our impact bang for donor buck.   

Studies show that nonprofits need flexible dollars to succeed. The Trust-Based Philanthropy Project states: “the work of nonprofits is long-term and unpredictable. Multi-year, unrestricted funding gives grantees the flexibility to assess and determine where grant dollars are most needed, and allows for innovation, emergent action, and sustainability.” At Candid, we couldn’t agree more. Not only do we hear this time and time again from the nonprofits we serve, our own experience bears it out. 

To make this shift, we began by fundraising around existing initiatives that could deliver the greatest impact to create a win-win scenario. At Candid we refer to this as “lightly restricted funding”—funding for the strategic programs we already have planned and budgeted, so that the grants we receive are budget-relieving. One such initiative is Demographics via Candid, a national campaign to address the surge of interest in nonprofit demographic data. With Demographics via Candid, donors reduce the data request burden on their nonprofit grantees while gleaning more insights into their grantmaking portfolios and the progress they’re making on their own priorities to advance equity in the sector.  

We took a similar approach for our research agenda, where we leaned into fundraising for topics important to the sector at large. Here, we raised “lightly restricted” dollars for a research partnership with ABFE, a philanthropic organization that advocates for responsive and transformative investments in Black communities. Our first collaborative effort resulted in a joint report, Philanthropy and HBCUs: Foundation funding to historically Black colleges and universities. The report highlights declines in philanthropic support for historically Black colleges and universities. Clearly the sector—and the general public—was hungry for this information, as articles about the report were syndicated nearly 600 times. It was also the most downloaded Candid report in 2023. 

We are delighted to report that we’ve raised nearly $2.8 million in less restricted funding for such impact-focused initiatives, often in the form of multi-year grants. In prioritizing the best opportunities to surface valuable insights for the sector, rather than creating projects tailored to individual donors, we met not only our own strategic objectives but also a sector-wide need.  

While Candid’s pivot paid off, there is, of course, a risk in making such a move. We acknowledge that Candid is fortunate to be in a position to experiment with our approach to contributed revenue, while most nonprofits don’t have the financial cushion to take such a risk. We hope our experience can inspire other nonprofits and funders to explore taking similar risks—to the degree that is practical.  

We encourage our fellow nonprofits to consider being direct with grantmakers about funding the work you know is best for your constituents and causes. Of course, not all funders will be open to this approach, and we do understand that funder-driven projects can also be impactful. But if you’re a fundraiser and you have established relationships, there’s no need to wait for the grantmaker to make the move. Ask for less restrictive, multi-year funding if you can. Talk to them about your work and how it aligns with their missions, seek their advice, and, once you’ve secured their support, ask them to leverage their connections to bring other funders on.  

The myriad problems the sector is working to solve are only growing, in scope and urgency, necessitating shared exploration of innovative solutions. Funders, we encourage and urge you to be increasingly curious and invite perspectives from nonprofits closest to the work on how funding can best be provided and deployed. Demonstrate your trust in their ability by funding with as few restrictions, in multi-year grants, as much as possible. 

Candid will continue leaning into this pivot—focusing on how we can best serve the broader sector, first and foremost, and seek funding directly for that work. We extend our sincere gratitude to the funders who supported us in this shift, trusting us to prioritize the allocation of their funding, and who have collaborated with Candid to explore how we can better deliver on our mission and support the sector.