 and welcome. Thanks for being here. Another episode of the nonprofit show Julia Patrick and I are excited to have with us today our guest Derek Baker and Derek is the president of Dickerson Baker and Associates. He's here to nerd out with us about a research that he recently released with his firm and we're going to talk about donor sentiment in the quarter we are currently in Q4 of 2022. So Derek before we jump into this conversation we want to remind our viewers and our listeners who we are. So hello to Julia Patrick CEO of the American Nonprofit Academy. Again I'm Jarrett Ransom your nonprofit nerd CEO of the Raven Group. We are honored to have the continued support investment trust and ongoing relationship truly with these presenting sponsors they allow us to have these conversations day in and day out and I want to mention that they are all unscripted so we are really just here for the conversation and here to learn. So thank you for believing in us. So I want to give a shout out to Bloomerang American Nonprofit Academy Fundraising Academy at National University. Be generous your part-time controller staffing boutique non-profit thought leader and the non-profit nerd. If you haven't checked out these companies I encourage you to do so as soon as we wrap up today's episode and if you miss any episodes good news you can find them. We've archived all of them they're accessible in extreme library so you can find them on Roku, YouTube, Vimeo as well as Amazon Fire TV and podcast form. So wherever you stream your podcast go ahead and queue up the non-profit show as we're going to queue up our guests today. So hello and welcome to you Derek. Hey nice to be here thanks for the invitation and it's exciting to come on with you. We're excited to have you. Very eager. So let's get started Derek. You are president at Dickerson Baker and Associates. Tell us a little bit about what you and your colleagues do in the sector. Yeah thanks I appreciate that opportunity. We are a non-profit consulting firm and we work with non-profit organizations all over the United States. There's about 30 full-time members on our team. We have an office in the Dallas area about 15 minutes from DFW and here in Raleigh where I'm located today. I'm actually heading from here to Dallas this afternoon so but we kind of are based in a philosophy that there's three factors to non-profit success and if you can get these three things right the equation is right almost endless possibilities but it comes down to abundant resources, talented people and effective strategy and so we kind of focus on those three areas. We have a staffing division that works specifically on helping organizations build their non-profit staffing. We have a whole fundraising solutions package that we do as well as strategy. So those are the kind of the three things that we work with. We principally work in the faith-based sector but not exclusively. That's fascinating. Well you've done a lot of research it seems like and we're really excited to have you come on the non-profit show to talk about something that's really incredible because we're talking about research that's applicable right now as in this quarter but even though it's right now in immediate you have a perspective that's multi-year so talk to us about that. Yeah so we've always had a strong emphasis in our practice on data and really kind of using the data evidence-based models understanding you know our team members all have kind of 20-some-odd experience and they come from a lot of different places but we really want to go into the data right so we tend to be a little bit of a data nerds ourselves in terms of you know what's happening. So we had a PhD researcher on our staff and our whole approach to clients is kind of we start with an assessment then we build a plan and then we help them deliver results and so the but during COVID the research kind of went away a little bit you know clients were we were in this period where it almost didn't make sense to do research for clients because you just everything was changing right so any any findings you would have in that snapshot would be changed by tomorrow. So we you know our researchers is Doc Burtz he's a PhD researcher so we said doc why don't we do some research on the industry and so we had done a little bit of that before but what we decided to do was do a donor study in 2020 right in the thick of COVID because all our clients were asking us what is going to happen right what's going to happen with giving nobody knew right it was crazy so we said I always say the best way to find out information about your donors is to ask them so we asked our clients you know said hey if you want to participate in this we're going to do a major research study we're going to send you all the links and everything Doc Burtz is going to create it you send it to your to your donors and we'll tell you you know what they're what they're saying and and so that was kind of the first study and it showed in the thick of all this the economy being battered and teetering due to the lockdowns and everything else that donors were telling us we're going to give more and and so we were able to tell our clients kind of in the thick of that right in the summertime saying don't panic don't be afraid donors are digging into their pockets and they're going to give more and that's exactly what happened right and we did it again the next year and they said the same thing and so this is the third year in a row we're doing this donor study we're going to do it every year because it gives us nice longitudinal picture but it's been positive to date and so this study I was really apprehensive to see what was going to happen so because the times again are changing right with the economy down and everything else everybody's thinking again what's going to happen so the economy the workforce all of that what we talked about earlier what can we expect in this q4 and just again like we're currently in it we're in q4 community right now so what can we expect well so I'm going to give the bad news first okay okay so so make sure that we stay on and get the good news here to book in but the bad news is donors are exceptionally pessimistic about the economy they are really uh only about five percent of donors responding to the survey we had thousands of folks almost almost three thousand folks that responded to the survey from across the country so high level of confidence you know 95 point something confidence ratings two and a half percent margin of error that we've gotten a big enough file size now to be able to have a very and of course doc is a professional researchers but donors are just very pessimistic the vast majority of donors close to two thirds say we are sinking into a recession others 30 percent kind of say we're already there you know only five percent have a positive view of the economy three quarters of donors are reporting pretty significant decreases in their financial security or sorry in their into financial markets and just feeling less financially secure than they have in a long time that's the bad news right here's the good news they are still telling us 85 percent of donors are still saying to us in this survey they plan to give at least the same or more in the year and season and so that's very consistent with the same with what we had in the last two studies so we're we are very cautiously optimistic that that giving is going to hold steady for this fourth quarter yeah does your study track the amount of donations like have we seen that value actually increase year-over-year what are you seeing are you seeing in that yeah so we're we're we're asking folks to kind of tell us what they are giving gently the study goes into a lot of details about what they're giving to the causes that they are supporting how much they give total right and how many different organizations they are giving to so it's like how much do you typically give in a year how many organizations does that split amongst what are your priorities what are your top priorities and so we're able to kind of parse out doc was able to basically tabulate separately giving from kind of three key segments what we would say kind of mainstream level giving mid-level giving and major giving and one of the things that we did find in that kind of parsing that out mainstream donors mass level donors they're pretty much saying we're going to hold steady right we're not going to give less very few of them only you know only about 15 only about 12% said they were going to give less this year of the mass mainstream the vast majority almost 75% said they're going to give the same where we saw the biggest intention towards giving more was in the major donor side which is I think that's that's really important from an actionable standpoint for organizations that are listening today is hey you've you've got some work to do this fall to engage your major donors because that's where you're going to see the rise if you see a lift this year. Derek, may I quantify a major donor because I'm curious if you put a dollar amount on what a major donor or what a major gift is because I know it changes from organization to organization did this study quantify that? Well the study didn't but we asked people kind of how much they gave each year and we kind of tabulated it out at $10,000 or more cumulative giving in any given year we kind of it's a fairly low threshold I think for some folks for major giving but what we find is for the mass for the vast majority of nonprofit organizations that would be considered a major gift so that's kind of where we parsed it out. That's fantastic. Derek, did you see a shift in giving by sector by sector did you see like you know you know a movement towards human services away from culture education did you have any flux that you saw there? Absolutely the by far and away the thing that people are prioritizing kind of most and I would preface this by saying setting aside kind of the religious giving right because that that always tends to come first and a big number of the folks that that that respond to this were faith-based donors but you set aside the religion like giving two places of worship or you know giving to their own church or whatever the case may be the next most by far almost double anything else was helping vulnerable people locally and so that's really kind of what's driving I think in this context of you know hey we're in a tough situation people are mindful that in tough economies there's a lot of need out there coming out of COVID there's been a lot of need and so really focusing in on helping people locally who are vulnerable and hurting in a in a in this in this economic situation. Wow now did you're given where we are in the midterms at any point does your research tag into political giving even though they're not like technically 501c3s but with some of the ways that political giving is structured did you have a sense of that at all? Yeah so we've kind of studied that in the past and what we have found is there's no correlation between elections and charitable giving if you look through the last going all the way back to the 50s so we started to dig into right giving USA data charity navigator data and there's no there's no dip at all there's no statistical difference in election years is not election years in total giving to to philanthropy and so we've asked that question we didn't put it into this survey but we kind of asked that question and answered it in previous two years ago during the presidential election and it really it's not it's not an impact the thing that impacts I think what we're finding is that the thing that impacts giving and as we do this study we're trying to figure it out a little bit more but you've heard of the consumer confidence index right I think that there's kind of a what we kind of are starting to kind of begin to formulate as this donor confidence index right kind of overall confidence about you know we're how they're feeling about financial security and the markets and other things but you know other factors and we're we're not there yet but we're we'd love what we're hoping to do as we do this study year by year is kind of come up with something that we can quantify as this is the right this is the donor confidence index and here's how it compares to last year I can't wait to get my hands on this so yeah I mean you're talking my language my love language in fact I mean this is like this is some good stuff I am actually presenting I think it's Wednesday with one cause on a webinar that's all about going beyond the ballroom and it truly talks about engaging with the constituency base at different levels so I'm curious your study Derek does it go into generational giving and you know just how we're seeing this trend yeah this this one did not but we've done previous we've done prior research that has looked into that it was it was it was marked it was remarkable I think to us during COVID in particular kind of how some of that forked in the road right how you know traditional donors and I think that we're still finding right we were asking questions about willingness to meet and how they prefer to meet one of the things that we are finding in the study though and I think that what I read an article some time ago I don't know if it was in Wall Street Journal somewhere but how they talked about this article talked about how COVID was not just a disruptor COVID was an accelerator of certain trends right yeah if you read about that right but it's like here we are on zoom and everything else and we're finding in our business for instance feasibility studies right for capital campaigns pre-COVID we couldn't do any feasibility study interviews outside of in person but now folks are so open to virtual and I think in the industry and we're seeing this we just did a major study for a large client at Houston and I'm actually going there tomorrow to present it to them and so we asked kind of their donors kind of how they like to be engaged with and so we're really seeing a movement in in that in those donor responses towards moving away from visits right they are much less interested in personal visits only I think 6% of the folks that we interviewed including the major donor we did major donor interviews and we did tens of thousands of surveys fewer than 6% said I want to visit they most of them said I don't want to visit right I like a phone call a text like keep me posted invite me to events invite me to conference calls informational meetings but only come and visit me if you have something meaningful to to discuss right and so I think that's a significant trend and I think COVID opened that door because we had to we had to find other ways to engage donors from just the kind of traditional sit down and visit with them. We definitely have talked about how you know COVID has been a silver lining in some ways you know we we've looked at the return on relationship now and really looking at just that human connection more over and then also the acceleration of technology that definitely is a surprise what other surprises did you and your team uncover during this study. You know I think the big surprise to me here's the fear I kind of had in the back of my mind as as I was looking at kind of the trends we saw during COVID and how donors were responding during COVID I was asking myself is this basically a disaster relief funding happening in slow motion right because we see that during the disasters like Hurricane Ian and right other hurricanes we saw during Hurricane Harvey there's this surge in spike in giving when people respond and this is one of the biggest disasters kind of we've had as a country since maybe 9-11 or you know other things but COVID was COVID was that kind of a you know historical moment and a major disaster so in my mind I'm thinking is this functionally this surge in giving that we saw in the last two years is that functionally a disaster happening in slow motion and now that disaster's kind of passed right Joe Biden says the pandemic's over and all that sort of stuff and we're you know we're we're not wearing masks on airplanes anymore and people aren't feeling it day to day like they aren't been feeling it so our donors kind of pulling back and saying okay that disaster's over now you got this massive kind of news all the time about the economy inflation and all this bad news in the bear market and I'm thinking to myself are we going to see a major pullback in that context and what surprised me was that donors are stepping up regardless right it surprised me that they're not slowing down and and that's a to me that's just a really positive thing about right the culture of generosity and giving we have in this country particularly in right in the philanthropic circles and I just I just it just warms my heart right it makes you feel good about America right that that ultimately hey why do people give right I mean it's not just for the tax deduction but we give away hundreds of billions of dollars in this country and it's not just the wealthy it's people across the board are reach out to help others in need and it's like across the board of the political divide and everything else and and and here we are we're coming off of this major kind of surgeon giving where people dug down deep and now we're seeing this economic downturn and people are still digging deep into their pockets to help the neighbors in need and I love that yeah I love that too I also love reminding people the definition of philanthropy and being a philanthropist and that nowhere in the definition I'm sure you know this Derek is a dollar amount right nowhere is a dollar amount it all comes from that true act of giving and I love that you know one of the things Julie and I we've said from the very beginning of these shows March of 2020 is if you had a crystal ball right what would the future look like and I'm curious if you can share some more hopeful signs for our future yeah I think that you know I I think that we are really seeing some changes in the philanthropic sector I think that COVID accelerated some of them I think that we really have to be mindful of technology and how technology is giving us the opportunity to change our game I I think that you know as we look at the generational wealth etc you know we have to really rethink how we do fundraising and how we engage donors for these younger generations and new generations you you mentioned philanthropy right generosity and philanthropy if you you know survey millennials millennials will actually self-describe as being more generous than any other generation in almost history right and and yet as as you said it's it's not in giving right because they don't necessarily not in that part of their life cycle where they can give you know you know they're still saving for college and they right the millennial generation has had some setbacks you know over the years first of all with the big recession in 2009 and then COVID and other things so but but but the generosity right the generosity that kind of you know is kind of I think it's a gift right I mean as a as a faith-based guy I think it's a spiritual gift but everybody has it right just to a different degree but when you've got the generous heart and that that's a generation that has a generous heart and so learning how to tap into that differently finding ways to tap into that differently but I think that's you know I think people fret a lot about you know the millennial generation but you know that sense of generosity that the younger generations have if we can find a way to really tap into that I think that we're going to see just a real expansion of giving in and like said how do you define giving sometimes a little different for different people but I think it's going to be across the board giving and I think that's very I think that's very helpful for the future you know it's it's an interesting aspect of this because I always think about the millennial generation you know they've had public education that has actually had philanthropic endeavors required as part of their education even in in grade school you know it's not just selling Girl Scout cookies or or whatever but it's like you know entire school systems that are like we close early on Fridays because we expect our students to to volunteer the second half of the day to these major drives that come in throughout the school system and I think that's really changed the trajectory and then you couple that with you know the digital access where these these kids can and now they're starting to move into their 40s but they can access you know smaller amounts very quickly towards solving a problem and that's first of its kind it'll be really interesting to continue to track that generation in particular because it is such a big you know generation as they enter kind of those you know kind of those peak giving years because the reality is a lot of people have been tracking them right in the early years but you know in those early years you haven't reached your peak earnings you haven't you know you're still saving for college you're still saving to buy a house you're right you're saving for retirement and so you know those peak giving years tend to be you know typically 55 and up you know I mean it's and and and as this generation gets older and begins to hit those kind of kind of peak giving years it'll be interesting to see a what they prioritize right because you know you know remember that yuppies used to be hippies right and back in the day and so they're you know priorities change things change but but how they you know how they engage with the nonprofits they support I think is key and I think that's something we just have to as an as an industry be so on kind of kind of kind of on target for you know that's why I'm such a believer in data in evidence and talking to donors surveying donors to understand how how donors interests are changing and the way that they want to give is changing you know that's really interesting I talked in the I don't know I want to feel like 2021 my brother ironically does very similar to work for me as me he works at the University of Georgia so I'm actually from the Carolinas Derek but he definitely is a bulldog and he closed his largest gift in 2021 over the telephone and it was a multi-million dollar gift and this was not with the younger person this was with an older you know woman and it did not matter that they were not in person that they were not over a cup of coffee and to hear all that you've uncovered in this research and to know that you know you're going to do it again next year see how these trends compare to one another this is just fascinating Julia I saw your mind blown as well I well you know I mean this is the world I live for I I'm always so fascinated by this and I think that you know Derek I love that you and your associates have embraced this concept because so often we we talk about oh you have to be passionate you have to do this and you have to do that and we don't load in knowledge or research to understand why we are doing something right especially where we are now I mean to your point I mean Jared and I are on every single day and we have seen phenomenal change and we are continuing to see change within the sector and knowledge is power and so to borrow a phrase from Jared Ransom the non-profit nerd kudos to you for you and your team advancing this information Derek Baker president Dickerson and big Dickerson Baker and associates really doing some amazing work check out Dickerson Baker dot com and I'm going to spell that out for our listeners d-i-c-k-e-r-s-o-n-b-a-k-k-e-r dot com and you can check out so much of their information okay now this is the the big question Derek how do we get our hands on this information well actually if you go to that website Dickerson Baker dot com and by the way we bought multiple URLs with all kinds of different spellings so if you spell it wrong you're probably going to end up where you need to get I bet you did that was very smart we've done that with the American non-profit academy I got to say every wish me somebody could misspell it we almost so it'll redirect but yeah go to the website there's actually a there should be a streamer right on the top of the website where you can click on its download and share it you know share on your social media share it with others I think it's really good news that I'd love to see it kind of get shared widely around the industry because I think it's going to be hardening you know it's great and we all need that now I I love that you've done that now what can we look for in the future from you what other type of research is coming down the pike well you know we do two big studies a year we do a lot of studies for clients right that are that are that are commissioned by clients we get a lot of information from that we kind of gather those up and try to track that and some of that we sometimes put out to white papers or articles of blogs about what we do two big studies a year one in the spring and one in the fall and the one in the spring is a non-profit leaders study and the one in the fall is a donor insight study and so we're starting to talk about what our study is going to be in the spring the last one was on education the one before that was on staffing and so we're we're trying to identify what are some of the big kind of hot topics in the non-profit industry and if folks have any suggestions or things that they kind of want to suggest that we kind of focus that study on it's a pretty big survey of non-profit leader attitudes and we try to usually hone in on a particular hot topic issue we're going to be starting that study probably in November starting to plan it and it'll be in the field in January February and we'll be we'll be publishing it in in March April so hope to have a chance to come back on but if anyone has any suggestions send them our way you can you can go to the contact us on our on our website okay I would say right off and I'm going to jump ahead of you Jared but I would love to know the correlation between this new segment of education in the non-profit sector the universities are now offering and how that is influencing our sector and how that's being welcomed and and stewarded and cultivated because look at who's who's been running the non-profit sector for in this country for more than 200 years well intentioned people but not always people educated in our sector and so I think that's like such a big issue and anyway I that's like a hair on fire moment for me I jumped ahead of you what no that's okay I'm going to submit submit mine online for sure but it is definitely fascinating all of this is fascinating to me and you know we we also have said in the very beginning we think data is sexy so having this back up our decisions making informed educated decisions you know that is definitely something that we need to do more of in our in our community in our sector you know I feel so often we run from passion and we let passion make our decisions right and you know there there really is a lot of a lot of data a lot of statistics and and you're right I love that you said and I just want to echo it you know if you want to know something ask your donors ask you know have conversations with them and and if we can just elevate that more and more you know I'm here to raise that flag with you Derek so I know we got a couple of minutes here but I would add one thing to that if you only have one of the things that we're finding in our studies is this donors don't want to necessarily meet as much if you only have one opportunity to meet in person I would make it an interview I would not make it an ask because you can ask if you build the relational currency you can ask on some texts etc like you're saying that you know get to know your donors number one yeah get to know them I like that I like that as an interview yeah Julia Patrick and I thrilled to have you here Derek thank you so very much for joining us yeah fantastic yeah and and see travels to Texas I know you're you're heading out here briefly and thanks for having lunch with us as well thanks good to be here Julie I'll let you take us all hey Jared thank you it's always wonderful um to start the day with as as we always say data is sexy so we we got a good start to the week reach it sister yeah really we're into this so thank you so much and our sponsors are into this as well and we want to make sure that we reconnect our viewers and our listeners to bloom meringue American nonprofit academy your part-time controller be generous fundraising academy at national university staffing boutique nonprofit thought leader and nonprofit nerd these are the organizations that are with us day in and day out coming up on almost 650 episodes um most of these folks have been with us from day one so um we want to make sure that everyone understands how grateful Jared and I as well as our teams are for this so hey as we like to end every episode we want to remind everyone ourselves our viewers our listeners even our guest stay well so you can do well thanks