Unrestricted funding supports Black-led nonprofits


Cloud-based software company Salesforce recently announced $1 million in grants to 10 nonprofits across the United States and Canada. The grants come from the Salesforce Catalyst Fund, which provides critical, unrestricted funding for nonprofits led by underrepresented leaders. The grantees are nonprofit organizations led by Black leaders that offer innovative programs to increase educational attainment and increase the chances of professional success for young people of color in the United States.

“To improve the future of our Black youth and close the wealth gap, we must invest in leaders who are delivering breakthrough solutions in their own communities, with flexible capital that allows those leaders to take risks and explore new ideas,” he said Ron C. Smith, vice president of philanthropy at Salesforce, in a public statement.

As income and wealth inequalities have widened, improved access to capital for nonprofits led by black and underrepresented groups is critical to closing the wealth gap, Echoing Green and the Bridgespan Group found in a 2020 report entitled “Racial Equity and Philanthropy.” Black and Hispanic nonprofit leaders receive only about 4 percent of philanthropic funding in the United States, despite making up about 10 percent of nonprofit leaders nationwide.

This capital gap is even more pronounced when it comes to unrestricted funding that nonprofits can use to support operational expenses and innovation. The unrestricted net worth of black-led organizations is 76 percent less than their white-led counterparts, ultimately contributing to systemic underinvestment in these communities.

“One critical step we can take to help close this gap is to focus unrestricted funding on smaller, younger nonprofits led by people of color,” Smith told TriplePundit. “The Salesforce Catalyst Fund aims to reallocate cash flow to empower and catalyze these organizations.”

Catalyst Fund grantees are free to use the funds as they see fit, unlike traditional donations, which often require nonprofits to demonstrate intent to do their work in alignment with funder priorities. Too often, this creates a power dynamic “where the funders drive the solutions,” Smith said.

“By distributing unconstrained funding, Salesforce reduces the administrative burden on nonprofit executives who spend significant time seeking funding and reporting to funders on their progress,” he continued. “It allows them to focus on what really matters — delivering innovative solutions to communities in need.”

The 10 organizations receiving grants are:

“We’re honored to work with these 10 incredible leaders who are driving change in their communities — from recruiting Black educators to empowering Black youth to pursue careers in technology,” said Smith.

While the Catalyst Fund fully supports nonprofit organizations, they must meet certain criteria to be eligible. First, they must align with the Salesforce Foundation’s focus on addressing racial inequalities in education, economic opportunity, and community resources. They must also be led by people of color or from underrepresented groups, and make a specific effort to serve underrepresented populations. In the US, Salesforce specifically targets Black, Hispanic, and Indigenous leaders. And as Smith noted, they must be relatively young and small, less than 10 years in operation, and have an operating budget of $2 million or less.

“Our students kept saying we need black teachers. And we need to invest in Black leaders who are paving the way so that all Black students can have a quality education and a prosperous future,” said Sharif El-Mekki, founder and CEO of the Center for Black Educator Development, in a public statement.

The Salesforce Catalyst Fund was created in June 2022 to address systemic racial inequalities in philanthropic funding that impede nonprofits led by and serving people of color. The grants are designed to empower leaders and organizations closest to the problems by providing unrestricted funding to improve the development of new solutions and increase their impact.

The grants to these 10 nonprofits are the second round of funding from the Catalyst Fund, which awarded grants totaling $2 million to 20 nonprofits in the US, UK and Australia in 2022.

Credit: RODNAE Productions/Pexels

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