What next-gen donors look for when giving

“So Lane, what do Millennial and Gen Z donors care about?”

I get asked this frequently by Boomers, Gen Xers and other organizations when they find out that 70% of All Access members are Millennials and Gen Z.

As a millennial, I have assumptions about the answer to this question. But to be sure, over the past year I have analyzed donor surveys and asked some of our next-gen members this same question. What do we care about, and what is it about All Access that encouraged them to join? This article shares what I have learned.

To set the context, Millennial and Gen Z donors hate injustice. They hate it. But they also don’t always trust charities, and for good reasons. This leaves them in a pickle. They really want to help solve the big problems in the world, but they don’t really trust the organizations who claim to solve those problems. So, what are Millennials and Gen Z donors looking for when giving? From my research and experience at All Access, here are the four main attributes they’re looking for, some ways organizations can align with these attributes and how Boomers and Gen Xers can engage with their next-gen kids about giving.

1. Transparency

By far the most important characteristic that next-gen donors are looking for is transparency.

Millennials, and especially Gen Z donors, want to know exactly where their money is going and why.  In fact, a 2019 survey found that 87% of Millennial donors consider transparency to be one of the most important factors when deciding where to donate. I bet that percentage is much higher for Gen Z. We [speaking as a millennial] are generally skeptical of… everything, especially when it comes to our money.

So, how can organizations attract next-gen donors? By gaining their trust, and you do that by having nothing to hide. Raised in the digital age, next-gen donors expect easy access to any information they desire, including your organization’s financials and impact. If an organization isn’t transparent, they’ll assume that it’s for a reason. Is it?

That’s why at All Access, we’re committed to being as transparent as possible. We link all of our financials, including an itemized and justified list of all of our expenses, directly on our homepage. We send donors detailed reports with honest and real-time program updates and financials so donors know exactly where every dollar goes and the impact it does and doesn’t make.

If you want next-gen donors to care about your cause, be as transparent as possible. Share as much as you can in as few clicks on your website as you can. Your 990’s and financials need to be easily accessible (less than 3 clicks) on your website or you can forget about attracting next-gen donors. 60% of all donors in 2022 researched a nonprofit’s website before making a donation, and I would argue that 90%+ of Millennials and Gen Zer’s do.

So, if you want to attract Millennial and Gen Z donors, strive for greater transparency.

2. Efficiency

With a deeper sense of social responsibility but less purchasing power than previous generations, Millennial and Gen Z donors place a high value on financial efficiency. Remember, next-gen donors start their assessment of organizations from a very skeptical perspective. They desire to hold organizations accountable for their use of resources. They’re asking questions like:

“How do they value their time? Do they feel responsible to the donors with the use of their time and budget? Are they zealous toward accomplishing the goal of the organization, whatever it takes, or does the organization staff seem content with the status quo? How much does it take the organization to do what they do? How does that compare to other organizations? How do they categorize that on their 990?”

Don’t think donors care about your 990? Think again. And they care about more than just the typical “What percent goes to overhead?” question. What they really want to know is whether an organization’s staff will use their donations diligently towards helping those in need as if it were their own money. Or, are they “profiting” off the generosity of donors and the pleas of the needy. Very few things make next-gen donors more angry than that. To avoid this, a good question for your organization to ask is, “Are we spending our donors’ dollars towards accomplishing our goals better than they could, and are we communicating that?” You may know you do, but do they?

For All Access, this is why even though 100% of donations to our pooled fund go to the programs in our portfolio and not our operational budget, we still list and justify every operational expense we make and post it on the homepage of our website. Every time I make an expense, I know I will have to justify it not just to our donors, but to everyone on the world wide web. This holds us accountable and encourages us to make the most of their dollars. We also analyze and compare the cost-effectiveness of hundreds of organizations to ensure the programs in our portfolio make the most sustainable impact per dollar in those communities.

One way to increase our financial efficiencies is with our fundraising efforts. 82% of next-gen donors say they are willing to raise money for their favorite organizations by asking friends and family. That’s 3X more likely than older generations. I encourage organizations to consider peer-to-peer fundraising or what we call a “member-driven” fundraising model. With this model, members (donors) of your fund and campaign know they are responsible for its growth, and just like any other membership structure, members are inclined to invite more members. It just has to be worth inviting others to!

If you want next-gen to care about your cause, strive for greater financial efficiency. It’s their money, so let’s use it responsibly.

3. Effectiveness

Millennials and Gen Z donors don’t just want to make a donation, they want to make an impact. If they don’t think their donation will make an impact, they probably won’t make a donation. If you want to attract next gen donors, your cause needs to not just be transparent and efficient, but it has to be effective. Next-gen donors have asked me questions such as:

“How do I know the impact their reporting is accurate? How do I compare the effectiveness of different organizations? Is the impact sustainable? Couldn’t they do more with their budget? Are they actually addressing the root cause? How do their outputs affect the data provided by experts?”

They want to ensure that every dollar they contribute is maximized towards making a significant and sustainable impact. They won’t buy the “3,768,391 lives impacted in 2022” nonsense. [What does that even mean?] They want to see evidenced-based activities that produce high quality and quantity outcomes.

That’s why, at All Access, we deeply evaluate hundreds of organizations to find the most impactful programs in the most unreached and impoverished places. We analyze data, study technical reports and consult poverty experts, missiologists, economists, cultural anthropologists, practitioners and even beneficiaries themselves to ensure the programs in our portfolio are highly effective and sustainable. We obsess over ensuring that we’re helping as many people as possible the way they want to be helped, whatever is in their best interest. We then provide our members with cost-equivalency approximations so they know about how much impact they can make for every dollar given.

If you want Millennials and Gen Z to come alongside your cause, do your best to prove that it’s making a real and measurable impact.

4. Clarity

The fourth and final attribute that Millennials and Gen Z donors are looking for in organizations when giving is clarity. They want to know exactly what the organization actually does, how they do it, why they do it that way, the impact it made and how their donations were used to do that. But here’s the kicker: They want to know all of that… as quick as possible.

It reminds me of Kevin’s philosophy from The Office: “Why waste time say lot word when few word do trick?” Kevin knows next-gen donors. Use less words, use more concrete words and make it quickly comprehendible and convincing. In other words, how can you encourage a next-gen donor to believe in your cause enough to affiliate themselves with it and give sacrificially with it… in as few seconds and clicks as possible.

To do this, avoid using abstract language like “impacting lives”, “enhancing capacity” or “building resilience”. Instead, use clear and concrete language: “This is the problem… Here’s what we do to solve that problem… This is why… Here’s the impact we have made… This is what it cost… Here’s why you can trust us…” Can the audience visually see what you’re describing?

It’s also important to next-gen donors that the organization they give to is… cool! From the website to the social media platforms, next gen donors are subconsciously thinking:

“How does their content make me feel? Is it professional and high-quality? If not, are their programs professional and high-quality? What does it tell me about the organization’s values and culture? How does it make me look to be affiliated with this organization?”

Like it or hate it, social media presence is pretty important, too. 69% of next-gen donors expect their organizations to be active on social media. According to Qgiv’s survey, poor social media presence is the #1 reason Millennials and Gen Z donors decide not to donate. Remember, next gen donors are looking for giving opportunities they can trust, and social presence and clarity is all about building trust. Since they might not know the organization personally, next-gen donors begin to feel that personal relationship through their social presence.

That being said, these ‘clear and cool’ organization attributes are unique in that it must go along with the other three I mentioned above. It helps to be cool, but just being cool doesn’t cut it. Remember, they don’t trust you, so no matter how cool your website is or moving your videos are, wise next-gen donors don’t trust you until they see how impactful your cause actually is and the financials behind it. If an organization is clear in what they do and looks cool online, but they aren’t very transparent, efficient or effective, next-gen donors may begin to feel like their emotions are being played for their donations. Are they?

Root Motivator: Authenticity

These four attributes can be boiled down to one characteristic: Authenticity.

Millennials and Gen Z donors are looking for organizations that have high levels of authenticity, integrity and a genuine drive to fulfill their mission in the most effective and honoring way for both the donor and the beneficiary. Not that Boomers and Gen Xers don’t care about this, next-gen donors just really care about it. What the organization does is important, yes, but how and why the organization does what they do is even more important.

If your organization wants to come alongside the next generation of donors, continue to strive for greater authenticity. If you’re a Boomer or Gen Xer that is worried about how the next generation will manage their (or your) philanthropic interests, I hope this article was helpful for you and your family.

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Become a member of All Access with us by giving to our pooled giving fund. 100% of your donations go to the high-impact programs in our portfolio. We find, evaluate and monitor these programs for you. Every 90 days you’ll receive an impact report with content and financials.

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Author: Lane Kipp, ThM

Lane is the founder of All Access, a non-profit organization dedicated to helping end spiritual and physical poverty by helping you give effectively. Lane is a graduate of Dallas Theological Seminary with a Master of Theology (ThM) degree and a graduate of Texas A&M University with a B.S. in Ocean Engineering. Lane and his family live between Dallas and Fort Worth.

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