The Crystal Ball: Grants in 2021

Where are foundation grants going in 2021? Let’s look into the crystal ball. The difficult part about foundation grants is that all of the data we have on foundation giving is often 18 to 24 months old. Foundations file their IRS Form 990 that outlines their contributions months after the end of their fiscal year. That is then the primary document we have for research for a whole additional year. It is very hard to predict what a foundation might give with data that is up to two years old. A lot can change in two years!

This is especially difficult as a lot changed in 2020, with the COVID-19 pandemic and the corresponding economic and social upheaval. The “silver lining” in these very dark clouds is that this has had foundations shift away from funding primarily large universities and museums to give more to emergency assistance, employment, social justice, healthcare, and education.

The other “silver lining” is that the stock market is continuing to rise. At the end of 2020, the Dow Jones Industrial Average was 21% higher than in January 2018. The markets–and foundation portfolios– have recovered from the brief downturns they had for 2019 and then for COVID in 2020. With higher foundation portfolios, there is more money that foundations will be required to give in 2021. And they will be giving to the causes we care about!

So what have I seen most foundations do in their communications with my clients or to the community? Where do I think foundation grants are going in 2021?

1. COVID-19 Relief: This is an obvious shift. Many foundations poured their 2020 giving into COVID-19 relief, including support for employment, basic needs, education, and supporting essential workers. Many foundations have created pooled funds to address these community needs as well.

2. Equity: Many foundations are offering opportunities to address racial equity, especially in education, employment, criminal justice, and health. Foundations are also increasingly interested in serving “underserved” communities. While this is what I have hoped foundations would focus on for a long time, we don’t know how long it will last. We also have to carefully frame these issues since you do not know the political affiliation of foundation boards.

3. Innovation: Funders are still interested in innovation to effectively solve problems in new ways. One aspect of innovation that funders are very interested in right now is around equity, diversity, inclusion, and improved outcomes for minority communities.

Unfortunately, we cannot predict how long this improved stock market will continue, or how long foundations will continue their focus on these causes before returning to majority gifts to major universities and major museums. The time to get “in” with these foundations is now.

The key right now is to position your programs within each funder’s area of interest and make your requests relevant by fitting them into these three trends, if possible. If you need help, Millionaire Grant Lady can help you to position your programs for success and write winning grant applications.