 and welcome another episode of The Nonprofit Show. Julie and I are excited to have a super nerdy conversation with Neil Sinclair, and Neil serves as the co-founder and COO at Be Generous, so welcome to Neil. And he is here to talk to us about attracting millennials and Gen Z donors. So excited to have that conversation. Julia Patrick is here, CEO of the American Nonprofit Academy, and I'm Jared Ransom, your non-profit nerd CEO of the Raven Group. We are so very honored to have the continued partnership and relationship with amazing presenting sponsors. So a huge shout out goes to Bloomerang, American Nonprofit Academy, also the fundraising academy at National University, Be Generous where Neil joins us from today, your part-time controller, non-profit nerd, non-profit thought leader, as well as staffing boutique. So please check these companies out. They're here to elevate you, your team, your mission across your community. So thank you to our sponsors that keep us growing. Thank you also for allowing us the opportunity to place all 700 plus, in fact I think it's like 725, episodes on Roku, YouTube, Amazon Fire TV, as well as Vimeo. And for those podcast listeners that are like me and listen to a lot of things via podcast, go ahead and cue us up there too. You can listen to the non-profit show wherever you stream your podcast. So thank you to all of our presenting sponsors for that. Neil, welcome back. We are so glad to have you here. Thank you. I think it's been a month or two, so it's been too long. Yeah, you know, we're excited to have you back to talk with us. I thought that you had the most interest, you have a lot of content on your website. You had a really interesting blog post about millennials and Gen Z donor reactions and profiles and strategies. And so we're really excited to get you back in today to talk about that because I think that we're all, we talked about it, but we don't really engage with it. And so I'm really excited to have you talk to us. So first and foremost, what is a millennial donor behavior? I mean, aren't they all the same? Yeah, I think that's the big common misconception is there's two misconceptions. And I think folks here might remember my back from the last one, not only my co-founder and COO of Be Generous, but I ran a non-profit for several years in the child sexual abuse prevention space that was focused on the so-called millennial donors. So millennials, I would typically define them as kind of your current 25 to 45 year old set. There's some variations on that theme where you can kind of be a Gen Xer or leaning a little more Gen Z, but typically generations are defined and are between like 15 and 20 years. That's sort of the standard metric that's used. So millennials are those folks that grew up in the crucible of three major financial crises, the aftermath of 9-11 and the war on terrorism, the 2008 financial crisis, and now COVID. They have been trying to build wealth against those multiple headwinds. Not great. I think maybe the generation that was kind of born right before like World War I, that's all World War I, the Great Depression and World War II, could lay claim to similar world style events. So not only are they having difficulty building wealth, but their behaviors because of that difficulty building wealth and because of the discrepancy between the wages that they thought they would be earning versus the prices of the world, just the consumer price index and variable goods, cost of education, cost of a housing have really gone inverse, right, to the previous generation. It's never been more expensive to be an American today. And so as a result of that, the ability to be philanthropic, to give your wealth away is extremely curtailed if you don't have naturally intergenerational wealth. And so I hear from a lot of folks that there is great difficulty and great trepidation within the nonprofit space of engaging with these millennial and forget Gen Z even for a second, just millennial and to an extent Gen X donors, because what they're seeing is a lesser pattern of donation. And the reality is these folks want to give a large portion of millennials, the vast majority, consider themselves by definition philanthropists. Yet less than two thirds have actually ever given even a single dollar to a charitable or philanthropic organization. And that's that great discrepancy to set aside the fact that there are some distrust of institutions layered on top of all of that, right? And they're looking more for the charity waters and the cool innovative philanthropies of the world. They don't want to give to mom and dad's Red Cross and International Rescue Committee. They want to do something a little different, right? They're very woke. They're very aware of what's going on in the world. They want to give up their time. They do want to give up their treasure, but they don't have the capabilities of generations past. So you'll see, I cite in the article that you've mentioned here, that millennials, right, which are now really coming of age where they should have some wealth, some income that allows them to give away, even a small amount, are still lacking both Gen X and certainly the baby boomer generation by by Debel and even some cases, triple digits for their average gift size. And that's a result of all of these confluence of events coming together to really act against them. And then by the same token, the charities are not reacting and reaching out to them in the ways that are required because they're fearful. And I get that to go and acquire a millennial donor is an expensive proposition without the ROI. You know, if you send a mailer to a man or a woman in their 60s or 70s, there's a high ROI on that. They're going to write that check out of their checkbook, which they still balance by hand. My parents do that. Right. But the person that is doing their banking online or, you know, using crypto or whatever, that's a different nut to crack. And so who's doing that right are some of those folks that have the ability to be experimental at the very top of the threshold. You'll see folks that, you know, the Red Crosses or the United Ways that are accepting crypto and, you know, experimenting with outreach to that next generation, or it's the organizations that have nothing to lose that are already coming in and saying, listen, we have to go after the millennials because we're not going to get the 75 year old little lady who's going to write us a check because she already has a long established relationship with Memorial Sloan or one of the other biggies out there. So it's a difficult proposition, but I will tell you as a final point on this particular topic, it is not only worth it, of course, because when it will make a large percentage of population, it is necessary for the sustainability and growth of your mission to figure out how to start getting millennial wallet share. And one of the biggest pieces of advice that I give to any nonprofit, large or small in business for a year or a hundred years is, I really please do not take this analogy as truth, but I hate to do it. You have to start thinking like the tobacco companies and the beer companies, and you got to start getting them when they're young, right? Start cultivating those relationships in the early days to make them the lifelong folks, right? Why does McDonald's do happy meals for two or three dollars? Right? They lose money on that, generally speaking. They do it because that builds that relationship. So when you're an adult, you're still going to come through to their drive-through, right? And you have to start thinking of ways to get younger people involved, whether it's creating a young professionals committee or just doing outreach and speaking in their language and hiring staff that reflects that. And if you don't do that, you might find yourself in crisis or in 20 years when all of those younger donors are now 50, 60 years old and want nothing to do with your organization. Right, yeah. This is fascinating to me because I remember 20 years ago when I started in my career and one in my fundraising career and really the number one problem that my organization was facing was the growing age of the constituency base, right? And so we've kind of had this issue for the last couple of decades, right? Saying, hey, our donors are aging. Our donors are dying. Our donors are no longer our donors. And so what I'm hearing you say in this, Neil, is really it's a long game. And it is like selling a happy meal to a toddler now so that when they come to wealth and they see that brand awareness and connection and then they say, hey, I absolutely want to give to this organization because I was touched by them at some point. So is it a long game? And then what does that kind of look like? So I used to work for an exceedingly wealthy family of like 10, 11 figures of wealth. And they're the ones that taught me how to think in decades and generations. And if you're thinking global politics, you know, who does it really well, or the Chinese, right? Where we have a very short term mentality in America, the Chinese think in centuries. And part of that, their political structure and wealthy families have the ability to think long term. But there's too much short term thinking that goes on. And the reality is if you're going to be a successful charity, you have to have both mentalities. You have to think about how do I survive for the short term? And how do I sustain for the long term? And that's for your upstart nonprofits, for your longer in the tooth nonprofits, you know, your red crosses, your hospitals that have been around for 100 years, these organizations whose names we know, you have to have a similar mentality because there's a little bit at the upper end of the market, a little bit of a, I can't be touched. I'm too big to fail kind of arrogance. And the simple reality is, ask a Sears executive back in 1952, if they ever thought they'd be basically bankrupt today, right? And the simple reality is that that happened. Times change, things change. If you're setting up a nonprofit, you either have one of two goals, either you're going to do sort of foundation style management and say, listen, we're running this to solve a 20 year problem, and then we're out. I get that. That's great. You can have a much different mentality. If you're like, my goal is to set up a sustainable organization that's going to change the world for the next 100 years plus, right, to be the next Red Cross, you have to have that long term mentality. And for those organizations that already have that long term mentality, you have to start thinking about, how do I avoid being maybe the next Sears, right, or some of these other institutions that, you know, I mean, there was a Woolworth on every corner, where are they today, right? They don't exist anymore. I used to love that store. They were great, right? I'd still like to go in and get a malt for 10 cents, but you know, it doesn't exist anymore. They lost touch, and they lost reality with the changing times. And I think some of the larger institutions have done a very good job of that. And some have done a very poor job of that. And they're going to be facing a kick the can down the road crisis. We talked last time on this show about, you know, the death rate in this country, which is, you know, two, three percent, very almost sort of logarithmically tracks the inversely, the rate of individuals that are switching to online donations. If you're not going to meet your donors where they are, even if it's a slow rotation, two, three, four, five percent a year, well, 10 years, that's 50% of your donor base that is gone. And 50% of a donor base that you have no contact with. And I guarantee you, just like in the land of for-profit startups, somebody has come in and recognized that and said, oh, that organization's not being innovative. I'm going to go and do that, right? And eat their lunch. And we've seen that. I mean, Amazon came in and ate Sears' lunch, right? Because they weren't dynamic. And, you know, the CVS's and the Walgreens came in and did that to the Woolworth. And so I think nonprofits need to have that similar kind of mentality if they want to survive for the long run. Absolutely. You know, and part and parcel to that in looking at this long road and understanding that we have generations and they have their own habits and they have their own experiences and they are influenced differently by things. I mean, you talked about 9-11, the crisis of COVID and then the major global economic crisis of 2008-2009. Where does Generation Z donors, where do they fit in? Because I think this is another generation that they've been actively volunteering through their schools, like the public school system. So they get that piece of it. What about the money piece? No, it's a great question. So I'm going to show you this. Not even my Gen Z, but my Gen Alpha piece of flair. This is my daughter's bracelet. We have daddy daughter bracelets, but she lost her. So I'm wearing hers right now because I found it. So I have a little bit of personal insight, not only into Gen Z, but Gen Alpha, right, which are the children of millennials who are coming of age now. And I'm going to lump them a little bit in together because we don't quite know about Gen Alpha and we're still learning a lot about Gen Z. Gen Z and for the audience that's unaware, again, there's lots of definitions out there, but they're sort of the sub-25 year olds, right? They're coming into their age right now. A lot of them might still be in their teens. Some are kind of in their 20s, maybe later 20s, again, depending on who you ask. They grew up in a mostly post-911 world. They grew up with an extreme distrust of institutions. I don't like the word because I think it's become pejorative, but they've grown up with an extreme degree of wokeness that is, you know, your organization is not good enough, right, for them. They are very much a mentality of having a much deeper direct relationship with the organization, hence why you're mentioning that there is a lot of volunteerism, right? And so, again, it's all about the idea of meeting donors where they are. And a big part of that is saying that these folks, they don't just want to receive a mailer once a year and they'll send a check back. They want to be involved. And they don't really care about the annual report, right, to see your efficiency as an organization. They care about the mission. They care about the cause and the good work that you have done and that you lean into their values. This is a value-driven, you know, level of individual. And if you're not doing that, they will find somebody else that will do that in the way that they think, right? This is one of those generations that I think is going to create a real sea change in the way that both brands and nonprofits who are also a variation on brand need to engage or you will lose that consumer and somebody else will come in and figure out that way to speak to them very meaningfully. And on the topic of meeting them where they are, let's be very clear, they're not on Facebook, right? Especially Jen Alpha, right? My daughter has no idea what it is. She's like, that seems ridiculous. That's like Windows 95 to her, right? It just seems silly or incarnate. It's goofy stuff. They're on TikTok. They're on Snap. By the way, they're abandoning Instagram now as well. They're in chat functions, right? They're on WhatsApp. They want real dialogue and they want short, pithy video content. It's a whole different fundraising ballgame for these folks. It's done through influencers as opposed to brands and a lot of scenarios, right? It's a lot more, again, about building personal relationships. We don't know what they're going to look like from a wealth perspective yet, right? Millennials got the short shrift on this and we don't quite know exactly what the full Gen Z size is going to be both in terms of wealth and as a segment of population, probably somewhat similar to millennials. But as they mature into their wealth and into their careers, I would augur even more than millennials, if you have not established an early relationship by having them volunteer and be proactive and coming out and meeting them where they are on the social media channels where they are, they are going to leave you behind and happily so. Jen Alpha, from the little insight that I've seen with my two kids, they're doubling down on that Gen Z mentality, both of wokeness and of sort of new avant-garde ways to interact with brands. There has to be an entire switching of mentality, maybe not today, probably about five to 10 years to think about it, right? Because they're not going to be making up the majority of your fundraising, but you do have to start strategizing about that group because maybe they won't be on TikTok by the time they can become a meaningful donor. But you do have to start thinking about how you can cultivate, right? And that's the biggest word I always give to folks. You have to cultivate relationships early on, or they will not respect you at the point at which they can become a meaningful donor, but they'll respect that small upstart organization that's been able to stick it out for these 10 years, and that's where their check's going to go. And you're going to see a lot of deficit of larger organizations and sea change of larger organizations that didn't do that prudent planning, facing a reckoning within the next 20 to 30 years. And Gen Z is going to be a real catalyst to that. You know, one of the things I heard you say in particular for the Gen Z years is, you know, they don't really care so much about the impact report, the annual report, you know, so that leads me to think about trust philanthropy, right? Trust based giving. And so really moving in that space to say, hey, I've been watching you. You are innovative. You have caught my attention and you've kept my attention. Here's my money or my time. Use it however you wish. Are you seeing that as a trend? Yeah, it's a great question. I think it's a little bit of both, right? I don't think there's a pure answer on this. Some of it is, hey, wherever it will help the most, I tend to see that more when there's a one to one model. And I would like to see more of that from more organizations, where it's like, if you give this $50, this is specifically what will happen. 90% of your donation will go to buying a goat for a person in a developing country. And this is how they'll use it. And these are the benefits of that, right? That one to one modeling, that personalization is really important. And that's where I think that trust philanthropy comes in. Hey, use it as you wish. But I want to understand that if I give 50 bucks, what is that sort of philanthropic ROI that I'm getting? But I trust that you as boots on the ground will understand that. But by the same token, some people say, I don't trust, I want to actually see and hear, I want you to do storytelling. And or I want to be involved, right? If I can meaningfully be involved in some way and come out and actually help out and then say, oh, I see where my treasure would meaningfully go to this organization, because I've actually seen the results and impact on that, right? Remember, millennials kind of started this. Gen Z has really taken up the mail. This is the show me generation. They want to be out there and get the selfie while they're doing good and show that to their friends. That social proof is so massively important. And just saying, Hey, I struck a check, doesn't do it anymore, right? You'll actually get harangued by your friends for doing that. Hey, great that you're, you know, you've got that money, like good on you. Why aren't you out there doing some, some good in the world, right? What have you done today? Right? If you ever get a chance to read the philosopher Peter Singer, he's an Australian philosopher, wrote a lot specifically about animal rights and animal welfare. And he has this sort of amazing philosophical concept out there where he says, if you're walking down the street and you see a man or a woman with a broken leg in the middle of that street, about to get run over by a car, wouldn't you go and help? He said, Of course I would. I'm a moral person. I dragged them out of the way, get the medical attention. And he says, Well, there's another person a thousand miles away with the same broken leg and same peril. How was your moral obligation to that person changed just because of distance? Right? And when you start to think of it, it's like, it really hasn't, right? It hasn't because then you can just substitute that person in a sense of urgency with someone in an impoverished situation, someone dealing with an emergency that just because there's an arms length distance between you and them has not actually diminished your moral obligation to them. And I think that Gen Z and certainly Gen Alpha as well have that kind of moral framework. And that kind of global, I must help mentality and I must show up mentality. And so even more so than, Hey, you're a great nonprofit, go out and do your good, where yes, some of that will play in. It's gonna be a lot of, I've got to show up and actually do something more, they kind of mock the millennials, right? And me being one of them, when we like, post about like, Hey, I put a frame on my Facebook. So like, I'm like against anti-Semitism, right? What did you do? Right? What else did you do? Yeah. What did you do? The black scramb, no, it's like, great, you posted a black frame, you know, now what, what are you gonna do about that? You know, this is so interesting, Neil, and I think our children are probably similar ages. There is not a single scent that comes home for my son for anything because he's donated it to some, you know, box that's in front of the cash register or given it to someone who needed something more. So, you know, I'm seeing that age and he's 12, very giving, he is very giving. And maybe some of that's because of, you know, I've, I've modeled this through my work career and he's seen that certainly as have your children. And he's a very, you know, very astute to technology, which brings me to, you know, the, the by now, pay later mentality and that impact of, you know, consumer behaviors. How have you seen this for the be generous platform, you know, change philanthropy today? Yeah, no, it's a great question. So the simple reality, as I mentioned earlier, is there's a huge disconnect between the economic reality of millennials, Gen Z's, probably Gen Alpha's and their, their ability to earn income and wealth, right? Sustainable wealth and their ability to then give that away against the headwinds that they've faced. And just the fact that the world is so much more expensive. That's why we've seen a lot of an uptake towards those high net worth individuals towards those major gift donors making up more and more of the share of overall giving. Well, corporations have remained steady at six percent discussion for a different day. By now, pay later, what we call donate now, pay later is a necessity within the philanthropic space. There's a reason that by now, pay later, right, in the consumer space, what some people call reverse layaway has done so well. A, the millennial and below generations do not trust credit cards or banks, right? The financial crisis of 2008 shied us all away from that. They don't like institutions. So there are some recent reports that at two thirds of all millennials and even more of Gen Z don't actually own or utilize a credit card on a regular basis as a major seed change. They're using alternative forms of payment. They're trying to live a little bit more within their means because they have to. And on top of that, credit isn't being extended to them in the same way. So by now, pay later if you want to buy a dress or a TV or whatever it is that's outside of your means is becoming more and more popular, but out of necessity, not necessarily out of avarice and desire to be acquisitive, right? It's just, I have to have that in order to get the things that I need because I'm paying $6,000 a month for a one bedroom, 300 square foot apartment in New York, right? Some of the realities of the world. So that model need be cross-applied to these millennial and certainly Gen Z donors as well because they don't have the financial capability to pop down a credit card and spend $1,000 on an auction item and then materially meaningfully pay that off because their income is greatly constrained and they're paying back student loans in a way that our parents and grandparents generation didn't have to. And I appreciate, you know, $20,000 of student loan help that might be coming if it gets out of the court scenario. But if you've gone to law school, right, making a good living as a lawyer, right? If you've gone to a top sort of, you know, 20, 30, 40, 50 law school, $200,000 in loans just for that, right? Unless you have that intergenerational well. Do you know how much on even on a 25 or 30 year payback basis servicing $200,000 of loans, even with a de minimis interest rate is, we're talking $2,000 a month sometimes to service that loan. And you're maybe making a starting lawyer salary between $150,000, take taxes out of that. You're working in a major city because that's what the major law firms are. That $10,000 a month of take home is already one quarter gone. Now you layer in your basic living expenses and you've got almost nothing left, right? Bonuses don't exist in the way that they were less millennials and Gen Z are able to engage in sort of other wealth building activities like buying homes or getting involved in the stock market. A lot of things that are coming against you. So donate now pay later, you know, in our scenario interest and fee free spread out those payments over time three, six and nine months. It's a wonderful thing. We would be doing this even if this wasn't a financial reality because it is always helpful to be able to pay over time, but we are also a necessity in order to engage those younger generations. And so what we encourage a lot of our clients to do is not only market, donate now pay later to your current audience, but if you're a little fearful of going after those millennial donors right now, offer them donate now pay later, show them that you're not saying I need $1,000 in my pocket today to go out and do good in the world. Be like, I'm still going to get the $1,000 from be generous amazing. They pay me up front, but I want to make sure that I'm being respectful of your wallet, right? And the other difficulties that you're facing. And I feel like a lot of nonprofits, you know, I'm Jewish, so I can say this, they go to the Jewish mother route, right? And they go to you a little bit. Oh, come on, can't give $1,000 today. There's dogs, there's veterans without meals. What are you doing? And you do it. And it's painful to do that. And the reality is that nonprofits have to be a little more respectful of the fact that as much as we want to help as millennials and Gen Zers, sometimes we just can't, we can give up our time, we can't give up our treasure. So that's why donate now pay later really fundamentally has to exist. Now, interestingly, I will tell you, our typical donor is much younger than the average donor, which, you know, the average donor, depending on your organization can be 60 to 65 years old. Our average donor is actually around 48, 49 years old. So much younger, but it's not still necessarily that a 25 year old, right? Not yet. Not yet. But that is because a lot of nonprofits are fearful of marketing to the young generation because they don't think the ROI will be higher. And I have to encourage you, you're missing out on opportunity for like 20 to 25% of the population by going directly to them to have this dialogue and conversation with them very little to lose a lot to gain. They're already sort of behaviorally institutionalized to this type of, you know, sort of buy now pay later, you know, sort of mentality and behaviorism, donate now pay later makes sense to them. And so I would encourage all folks, whether you're just offering a sustaining giving program, or you're offering, you know, sort of, you know, donate now pay later as we do to really lean into that or the acquisition, the donor acquisition equation for the sub sort of 40 year old donor. And then you'll get some really material ROI. You know, this is so amazing. I, you know, as soon as I heard from Dom, your co founder in Be Generous, I was, I was on board, like I love what you're offering through Be Generous, the donate now pay later talk about innovation. So this is just fantastic. I hope that all of our viewers and listeners will certainly check out the website. It's be generous.com and co founder and COO, you heard from him directly today, Neil St. Clair. Julia mentioned the blog that's on their website. So definitely check that out. It has just a wealth of information and dives, dives deeper on this conversation. So Neil, thank you. It's always a fantastic conversation. And I cannot wait to see where this platform goes. Thanks so much. I really appreciate you having me on. It's been a lot of fun. Hey, everybody. Again, I'm Julia Patrick, CEO of the American nonprofit Academy been joined today by the nonprofit nerd herself. These are the things that we love for, we love these conversations. And we are so fortunate to have a sponsorship of Blumerang American nonprofit Academy, your part time controller, be generous who we had Neil today on fundraising Academy at National University, Steph and boutique nonprofit thought leader and nonprofit nerd. You know, this is the type of discussion that we have a lot on the nonprofit show, not just talking about those things today, but really expanding, you know, the horizon and looking that we do have a trajectory to follow if we want to be sustainable. And so Neil, thank you so much for giving us a new insight onto that. My pleasure. Thank you again. Thank you. Hey, Jared, since I flubbed up so much on our exit last week, I'm going to let you take us out. Well, we have a lot going on this week. It was a wonderful opportunity to kick off with Neil today with be generous. We invite you to join us each and every day this week for another hot topics that we have on the lineup. So until then, we ask you encourage you remind you to please stay well, so you can do well. Thanks, everyone. And we'll see you here tomorrow.