News Archives - Helen Brown Group

July 15, 2021 By Helen Brown

Shadow banks

This week I watched another fascinating/informative/alarming/stellar PBS Frontline documentary called The Power of the Fed, which I highly recommend if you want to get a well-explained idea of what is happening with US financial markets right now.

One of the phrases that came up repeatedly during the program was shadow banking. It’s one of those terms I delved into pretty intensively during and after the 2008 financial crisis, but it’s one I haven’t heard come up again until recently.

I thought it was time to explain what shadow banking is here on The Intelligent Edge because it’s becoming relevant again and is more in the news. Which maybe isn’t such a good thing, you know?

What are shadow banks?

They’re called shadow banks because, in the flow of money globally, there are some financial institutions that operate outside of (or under the radar of) traditional banking regulation because they do things that traditional commercial banks don’t do.

On a very simple level, commercial banks (like Bank of America, or Fleet Bank, or Watertown Savings Bank) exist to store money from the public, invest it, and lend it back to the public. You can go into any commercial bank and deposit money in a savings or checking account. They will take that money and lend it to others and give you back some of the interest from those loans. Or they’ll take your money and hold it for you until you spend it using your debit or credit card.

How banks do what they do is intensely regulated by federal and international laws and agreements. There are things that commercial banks are not allowed to invest in, like junk bonds for example, because they’re too risky. Also, they’re required to hold a certain amount of money in reserve and to guarantee your deposits up to a certain amount. If you give them $25,000 to hold in an account for you, they are required to have insurance that guarantees that you’ll get it back.

Shadow banking is pervasive in the world and most of the activity centers on the creation and re-selling of collateralized loans and repurchasing agreements used in short-term lending between (non-bank) institutions and broker-dealers. There are no reserves backing the investments, and there’s no insurance to cover any losses. Which is why, when deals go well, investors can make a l-o-t of money because they take on a lot of risk.

Because of their description, it sounds like the participants are hiding in some shadowy back alleys, but you’ve probably heard of (and maybe even used the services of) some of them. Some of them even have banks as subsidiaries (yes, that’s as weird as it sounds). Here’s a list of examples of shadow banks:

investment banks, like Goldman Sachs or Morgan Stanley
mortgage lenders (ever taken out a Quicken Loan? In 2018 they surpassed Wells Fargo as the largest mortgage holder in the US.)
money market funds (here’s an example of a hybrid: Schwab is a broker-investor for money market funds that also has an affiliated bank)
insurance/re-insurance companies
hedge funds
private equity funds
payday lenders
peer-to-peer lenders, like LendingClub

Shadow banks move money around in the background. They bundle and invest in things in aggregate, like thousands of mortgages, and sell them on to others. They invest in start up companies (which banks can’t/won’t do). They invest in repossessed assets, and flip them for profit. They buy, re-bundle, and sell commercial bonds (including junk bonds). Amongst many other ways, they make money from their management fees and from betting that interest rates will go up (or down) on the assets they’re buying or selling. And by making risky deals that work out.

These money-movers use short-term, quickly-raised money to fund longer-term assets, so if the market goes bust in the long-term asset area, the shadow bank needs a bailout from somewhere or it goes bust, too, since there is little regulation and no reserve funds to guarantee the investments.

Anticipating that happening (and preventing it) is one of the jobs of the Federal Reserve, and their skill in watching the mile markers whip by on this current economy’s journey (and deciding where the economy should exit or put on the brakes) is where the Frontline program was particularly fascinating. I love hearing insights from people who either are on the inside, or recently were, and Frontline’s interviews pulling out what we should see next from regulators (and what might happen instead) was a real education.

How big is the shadow banking sector?

According to the Financial Stability Board’s (FSB’s) most recent Global Monitoring Report on Non-Bank Financial Intermediation released in December 2020, the shadow banking sector accounted for almost half (49.5%) of the global financial system in 2019. Almost half of money moving around right now is unregulated. What could possibly go wrong?

The US is the global leader in shadow banking asset holdings with China not far behind; this sector makes up nearly one third (29%) of China’s total banking assets, according to a recent article in The Banker. China’s banking regulators are currently working to keep the sector in check by banning banks and wealth managers from holding sub-investment grade assets, and time will tell how effective the legislation is. The shadow banking sectors in Brazil, Canada, and India are also growing apace. Our economies are all interconnected, so it’s important for us to understand this as we research ultra high net worth prospects involved in these sectors, and estimate their future potential giving.

And not only that, of course. It’s important to understand because we may not even realize how deeply shadow banking impacts our own daily lives and personal assets. If you have 54 minutes, I recommend spending it on the Frontline documentary this week.

May 6, 2021 By Helen Brown

Musings on the digital economy and what it means for prospect research

This week we welcome HBG Senior Researcher Rick Snyder to the blog. I always appreciate Rick’s thought process and insight, and this week he shares what he’s been thinking about – about the economy, people who find themselves newly high-net-worth as a result of their investments in digital currencies, and what’s happening with all that money. ~Helen

In my last blog post I mused about my career in prospect research and the enjoyment I continue to find in learning about a broad variety of topics that shed light on how our prospects earn and spend their money.

A year ago, I was looking at the cost of hiring domestic staff.

Fast forward to today and researching the salary of a nanny seems downright quaint compared to what I’ve been reading lately. I’ve been focusing a lot on the economy and some of the changes we’ve seen over the past year. It seems that the pandemic has not only upended many parts of our personal lives, it’s also scrambled and rearranged how people are spending their money. It’s grabbed my interest and I’m trying to make sense of it all. What I’m offering here isn’t an explanation (I don’t have one), but a few observations and thoughts about what’s going on.

A recent cover of New York Magazine captured the spirit of our current times with the title “Can I SPAC My Stonks With NFTs?” The article inside, “There’s Nothing to Do Except Gamble”, referred to the “new money weirdness” and I can’t think of a better way to describe our current economy and our increasingly strange relationship to money. I believe that we are living through a transformation of our economy that is both exciting and a little bit scary, at least to me.

The SPACs and NFTs mentioned in the magazine were covered well by Helen in these pages already, so I won’t travel that road again. Not only did she explain them better than I can, but I have to admit that, try as I might, I still can’t wrap my head around NFTs well enough to offer a cogent explanation of them. I’m also not going to dive into the world of Reddit-driven “stonks,” though that’s also intriguing and entertaining. These are relatively new phenomena and indicative of how fast our economic world (and the language used to describe it) is changing.

My personal and professional interest in today’s economy is two-fold: First, I want to understand how we’ve reached the point where a person can spend $69 million for a piece of digital art (the buyer, a cryptocurrency billionaire who goes by the name MetaKovan, said he was prepared to pay even more and thinks it was a steal since it should be worth $1 billion).

Second, I can’t help but think the indicators are flashing red that we are somewhere near the peak of a bubble economy and wonder when that bubble is going to burst.

The first interest is almost voyeuristic – I can’t tell if we’re watching the prelude to a car crash or a butterfly emerging from its chrysalis – but the second is more serious and existential.

There are scores of brilliant people who understand the economy far better than I ever will and they don’t all agree on what we’re seeing. Some are warning that we’re cruising for a bruising and others are claiming there’s little to be concerned about.

The traditional indicators – things like the U.S. Treasury bond curve or the P/E ratio of stocks – either don’t apply any longer or aren’t as reliable as they once were. Unemployment is decreasing and GDP is rising, but there are still millions of people struggling with the economic effects of the pandemic. And in the midst of all of the good news/bad news, we’re seeing the creation of new ways for people to spend astronomical amounts on things that barely existed just a year or two ago.

The easiest explanation is that the economy is awash in money and it all has to go somewhere. Billions of dollars have been injected into the system over the past year. We are still living under varying forms of COVID restrictions, but that isn’t stopping us from spending what we’ve got.

The New York Times reported that Deutsche Bank analysts have estimated as much as $170 billion from the most recent round of federal stimulus will go into the stock market. Mortgage rates are at historic lows and house prices are rising. Redfin reports that 42% of homes have been selling for more than their list price – 16% higher than the same period last year – while at the same time Google reported that the search “When is the housing market going to crash?” had spiked 2,450% in the past month.

Bitcoin was trading at $6,853 a year ago. As of writing, it is at $53,545 and by the time this posts it could be thousands of dollars higher or lower. I assume that a good bit of what is driving the NFT market is that people are sitting on mounds of crypto that has appreciated wildly since they bought in. As a personal example, a few months ago I realized that I’d forgotten about a crypto wallet I’d left a small amount of money in a number of years ago. When I looked at it, I literally laughed out loud at the value. It wasn’t enough to be life changing, but for people who invested earlier than I did and paid just a few bucks for some Bitcoin, I can easily imagine why they’d have no problem spending some highly appreciated digital currency on a piece of digital art.

I also discovered that people are breeding and selling digital horses on the NFT market – one sold for $125,000 – and they’re participating in digital races. I had to check the date on the article to make sure it wasn’t an April Fools’ joke. If this isn’t a sign that people have more money than they know what to do with, I don’t know what is.

Along with the sea of money sloshing around in the system, we’ve seen over the past year that life is short and it should come as no surprise that people are willing to make riskier financial bets than before. Might as well YOLO your stimmies into some stonk while you can.

What does any of this have to do with our work? I can think of at least several ways.

First, the top tier of earners has done extraordinarily well over this past year, so we need to keep tabs on what they’re doing – that’s what we do every day, so there’s no change there.

Second, the flow of money into SPACs, NFTs, and retail stocks shows that there are a number of new players who are spending freely. How are we finding, researching, and qualifying them? Are you developing new ways of looking at people with names like MetaKovan and Roaring Kitty? We know they have millions to spend, so how can we add them to our prospect pools?

Third – and this is what I was thinking the most about when I began writing – if we are indeed in a bubble economy, that bubble will burst at some time and quite possibly in a very dramatic fashion. Though we can’t really predict when the economy will take a downturn, it most certainly will.

When it does, it will affect charitable giving* and that affects each of us in our jobs as researchers. When development budgets shrink, prospect researchers may seem to some as an extravagant expense to some managers. It behooves us all to be proactive in researching or at least giving some thought to those in our donor pools who work in sectors that fare better than others in a down economy. Helen wrote about this in blog posts in April and December of last year, as well as in a white paper. They merit re-reading as you ponder economic trends.

* The Lilly School of Philanthropy and Vanguard Charitable wrote a 2019 report, “Changes to the Giving Landscape” [PDF], that shows a decline in charitable giving that began in 2000, but the drop accelerated at the time of the 2008-2009 recession. From 2000 to 2008, roughly 65% of households reported giving to charity. Total giving dropped by 7.2% in 2008, then by another 8% in 2009.

April 22, 2021 By Helen Brown

The FEC ruled. (Not really)

Back in 1971, the US Congress ruled that information published by the Federal Election Commission containing political donations by individuals could not be used “by any person for the purpose of soliciting contributions or for commercial purposes.”

Over the years, many special-case exemptions have been made to allow certain companies to be exempt from that ruling, and it’s always been slightly unclear whether Congress meant for the purpose of soliciting just political contributions or if charitable fundraising was also under that prohibition.

Regardless, over the years every wealth screening company in our sector added political giving into their product, and most of us used it as a lookup service because:

political giving has been a great indicator of someone’s philanthropic propensity
FEC data includes the tantalizing tidbit “Occupation,” which sometimes can be very hard to find
lots of times you can find a home address and
spouse name

FEC data is just gold sometimes. It’s publicly-available, and it’s free.

But using it is prohibited.

In January of this year, a vendor to nonprofit organizations called ALUMinate asked the FEC to re-look at the question, specifically to ask if they could use FEC data in their product to identify donors already in an organization’s database – not for new prospect identification. The donors were already there, they just wanted to use the information to help nonprofits segment people.

This request was backed up by a fascinating support letter (and if this stuff interests you, it’s worth a read) written by Tyler Hagenbush and Shanna M. Reulbach, attorneys at the law firm of Perkins Coie. They argued that lots of companies had already gotten the FEC’s blessing to use the data for far more commercial purposes, and that this use-case was at least consistent – if not even more limited – that those uses.

The FEC’s final response on this request came down on the last day of last month, and it’s done absolutely nothing to shed light on the topic.

The FEC couldn’t come to a conclusion, so we go back to assuming that they mean ALL forms of fundraising but nobody really knows.

Our professional association, Apra, has issued advice (See “List collection – FEC Data) for those of us in prospect development to strictly avoid using FEC data in our work in order to comply. That’s a safe interpretation of the law and one that we follow here at The Helen Brown Group.

And yet

It sits fine with me when we’re talking about using it for prospect research purposes. I get it. Sometimes it takes effort to convince clients why they should ignore an honestly valuable resource in a wealth screening product. But that’s the way we have to roll.

Where it really bothers me is when we talk about due diligence research. Particularly when we’re looking to see if someone is a politically exposed person or if they may have supported candidates with extremist views or have made political donations that go in direct opposition to the mission of the nonprofit we’re helping.

Due diligence is all about protecting a nonprofit from harm, whether it’s avoiding association with unsavory people, avoiding financial harm, or mitigating reputational risk.

By not using key FEC data for due diligence research, which at the end of the day is being used for fundraising purposes, we’re purposefully hindering our ability to protect a nonprofit organization from harm.

I’m not suggesting that we should violate the law to do due diligence. What I’m saying is that vendors asking the FEC for permission to use this data isn’t going to be the solution to the question of whether nonprofits can use it or not.

I don’t know who the correct body is. A professional association? A consortium of nonprofits that do a ton of due diligence?

The bottom line from the recent non-ruling, though, is that we still can’t use FEC data for fundraising purposes. And that includes due diligence.

Here’s ALUMinate’s press release on the Advisory Opinion: https://www.aluminateus.com/fec/

April 8, 2021 By Helen Brown

Don’t miss these 3 things – International Research, Justice, and Seismic Fundraising Shifts

Hi there! Thanks for coming by the blog today. There are three really interesting and important things that I’d like to amplify this week because I really didn’t want you to miss them.

New newsletter!

The first is a brand-new newsletter by a prospect development colleague I recently met, Nan Nielsen Zhang. Nan is a due diligence / prospect research expert building a relatively new consulting business called Astra Due Diligence focusing on Asian individuals, companies, trusts, and foundations. Nan speaks Chinese (Mandarin and Wu dialect), Japanese, and Korean, (as well as English, Russian, and Spanish) and has built a thriving business because of her talent and unique access to due diligence/research resources in those languages. You can sign up for her free bi-weekly newsletter, China Philanthropy News, at the bottom of her company’s web page.

Bold article

Veteran fundraiser Armando Zumaya has written an important op-ed that was published in the Chronicle of Philanthropy last month. The article, To Achieve Racial Justice in Philanthropy, We Must Invest in Fundraising and Make It Inclusive, provides a roadmap with 5 key on-ramps of action, including making a long-term and deep investment in fundraising, and working to build diversity in the whole nonprofit ecosystem: staff, board, and donor base. In the article, Zumayo boldly and publicly poses a question that many in our sector have been reluctant to ask because of the power differential between donors and recipients: Why don’t foundations make grants that support a nonprofit’s infrastructure – including fundraising?

Seismic shifts

It’s a question that’s critical to the long-term… well, not even growth, but viability of our sector, and that Ford Foundation head Darren Walker is actually doing something about. In this 60 Minutes interview with Lesley Stahl, Walker makes a statement that probably wouldn’t have been uttered 5 or 10 years ago, and even now has not bubbled up into the consciousness of many foundations:

“It is both arrogant and ignorant to believe that you can give money to an organization for your project, and not be concerned about the infrastructure that makes your project possible.”

As a self-described capitalist and former bond trader, Walker views philanthropy from a business perspective, but he is also philosophical about philanthropy’s role in inequity, politics, and ultimately in the future of our country. But it’s not all talk – the Ford Foundation has made bold, extraordinary changes in the past few years to try and change that power differential between the foundation and the nonprofits it supports. Don’t miss the interview – it’s worth your time.

Thanks for letting me share those important and helpful voices with you today – please do check them out. Have a great rest-of-the-week!

March 26, 2021 By Helen Brown

Fundraising data privacy goes before the Supreme Court next month

Photo of a square boulder leaning on another on Stanage Edge.

Stanage Edge boulder. Photo by Julie Kahn

Maybe you already knew about this but it was a total surprise to me this week: Right now at this very moment there’s a case in front of the US Supreme Court that directly impacts the amount of information – private information about our major donors – that nonprofits may have to share in order to be able to raise money in the state of California.

The Association of Fundraising Professionals (AFP), four of its chapters, and more than 120 nonprofits have filed an amicus brief in the case to prevent this from happening, and there are at least 35 other amicus briefs filed on behalf of 275 more nonprofits country-wide.

If that weren’t enough action, 22 state attorneys general, Senate Minority Leader Mitch McConnell, and the U.S. Solicitor General have also filed briefs in support of the petitioners.

So yeah, this is kind of a big deal. Here’s what’s at stake:

The background

As you probably know, nonprofits have to file an audited income tax form called a Form 990 each year with the Internal Revenue Service (IRS) which outlines (among other things) that nonprofit’s mission, its board members, and its income and expenses. This form becomes part of the public record about the nonprofit so that the government (and any potential supporters) are provided transparency into the nonprofit’s finances.

What you may not know is that one part of the form is the “Schedule B,” on which the nonprofit is required to share the names and addresses of all of its donors who have given more than $5,000 or 2% of that nonprofit’s income over the year. This information is usually redacted from the public record when it’s shared with searchable sources like the Foundation Directory Online or ProPublica’s Nonprofit Explorer, which is why it’s generally not seen.

The hitch

Nonprofits are required to register in every state where they raise money. In 2013, the California Attorney General’s office ruled that every nonprofit from that moment forward would have to share their Schedule B (in confidence) as part of their registration process.

There are at least three problems with this:

1) By sharing confidential information about supporters with their contact information, nonprofits could potentially subject their donors to political reprisal based on the change of political opinion and/or incumbent attorney general. Before the middle of the last decade we might not have thought too much about this, but since then nonprofits and causes previously thought of as relatively apolitical suddenly became so.

2) Data gets hacked. Even if it’s kept in confidence, there’s no guarantee that information stored electronically by the California AG’s office won’t be accessed illegally by bad actors and published (or used for other nefarious purposes).

3) Accidents happen. The state of California has already disclosed more than 1800 donor names accidentally from Schedule Bs that it published on its website. Once it’s out, you can’t put that toothpaste back in the tube.

California has no logical reason to need this information, particularly for nonprofits outside of its legal jurisdiction. And as AFP president and CEO Mike Geiger has said, there’s a real fear that major supporters won’t want their home addresses and gift amounts shared electronically, so they could stop giving. (Or, alternatively, it could push them toward making gifts through donor advised funds).

These cases, called Americans for Prosperity Foundation v. Becerra and Thomas More Law Center v. Becerra, have made their way to the U.S. Supreme Court and very soon we’ll see what the Supremes have to say about nonprofits, politics, and donor privacy because it’s going to be argued a month from now – April 26^th.

Stay tuned and watch this space (Scotus blog) and the AFP website for more information.

February 3, 2021 By Helen Brown

Honoring Black History Month

Illustration by Daniell Langford

It’s tricky for a white woman to write about Black History Month because I don’t want to come off as being more knowledgeable than I am or be accidentally disrespectful. But it’s important to me that I honor this month and show up as the ally I want to be, so here I am, sharing what I’ve found with you.

I have long thought of myself as a person who rejects racism, but I’m becoming a little better schooled in my own accidental disrespect. I got started a little early on Black History Month by reading the bestseller The Black Friend; On Being A Better White Person by Frederick Joseph last month. Quite a few parts of the book were revelations to me, and I honestly can’t recommend it highly enough.

I learned after reading it that it was written with a young adult reader in mind, but, except for some musical references that flew over my head, I’d say that its message resonates clearly to all ages.

It was certainly an I-can’t-put-it-down book, and I read it in a weekend. I saw my well-intentioned (yet misguided) self quite a few times in its pages; for example, “I don’t see color” is a phrase I will never think, much less say, ever again.

It’s not enough to just be allies or non-racist ourselves

Another thing I learned is that it’s not enough not to be racist (although it’s a pretty great start). We need to actively and proactively chip away at all of the racism we start to recognize when we educate ourselves through generous books like Joseph’s, and call out racist behavior when we see it. I’m incredibly grateful that Joseph was willing to be a guide, and that imprint Candlewick Press saw value in this endeavor.

I’m moving on next to How To Be An Anti-Racist by Ibram X. Kendi which I have no doubt will be another useful guide on my journey.

What are nonprofits doing?

How wonderful it is that we work in a sector whose sole focus is to lift people up and make our world a better, more just place! We do our own work on the individual level, this month and hopefully for each month afterwards, to understand our own biases and break them down. We do it on an institutional level, too, because in my research personally and for this article I found that there are so many organizations in the nonprofit sector sharing knowledge and/or providing a stage for the arts and culture during Black History Month! It’s impossible to name them all, but I wanted to feature a few that I thought you might want to visit virtually with me.

Fascinating Finds in America’s Attic

For example, speaking of Ibram Kendi, thanks to the Smithsonian’s National Museum of African American History and Culture (NMAAHC), this past Tuesday I watched a wonderful celebration of the new book that he and Dr. Keisha Blain edited called 400 Souls; a community history of African America 1619-2019. What an amazing concept: they asked 90 contributors to provide a work each describing a five-year period between 1619 and 2019. Through essays, short stories, personal histories, and poetry each contributor brings each half-decade to life.

In Tuesday evening’s discussion, four of the contributors were featured with Kendi and Blain to discuss the book. I was riveted by Pulitzer-Prize winning professor Annette Gordon-Reed’s discussion of her contribution about Sally Hemings: enslaved by Thomas Jefferson, Hemings was taken by Jefferson to Paris when the French Revolution broke out. As she heard cries of freedom, equality, and liberty shouted in the streets, Hemings weighed the awful choice of staying in Paris as a free woman – and leaving behind the rest of her family enslaved in Virginia.

You can listen to the recording of this wonderfully entertaining evening discussion here. I highly recommend it. (and there’s another book that’s going on my to-read list!)

As you can imagine, the NMAAHC will be sponsoring a wide range of virtual events this month for all ages, too. I’ll be back again with them later this month because my eyes tracked directly to the word “probate” on their events page. If you’re someone who has a side hustle or interest in genealogy, certified genealogical lecturer LaBrenda Garrett-Nelson will share her knowledge on using probate records to find enslaved ancestors and those who were slave holders in this free lecture.

The National Portrait Gallery is partnering with other Smithsonian museums to discuss how historical objects from their respective collections speak to today’s social justice issues. This month their focus is on race and medicine, and in this free event (among several works of art and artifacts) they’ll highlight a portrait of Charles R. Drew, a renowned African American surgeon and researcher in the field of blood transfusions who developed large-scale blood banks for use during World War II.

What on Earth would we do without public media?

There is a host of great media highlighting Black innovators, entertainers, and leaders, and as you’d expect PBS is a great place to find them. Their Black History Month-dedicated web page features a ton of limited series, films, and documentaries for free. And it’s not just non-fiction, either: as part of its 50^th anniversary celebration, Masterpiece is featuring The Long Song, a 3-part mini-series based on the award-winning novel by Andrea Levy about the end of slavery in Jamaica.

If you’re a member of your local PBS station, there’s even more on their site and available through Passport, the PBS streaming service that’s free to members (I’m sorry, I know that sounded like an ad, but I’ve been a PBS fangirl since I was six. Maybe younger. I can’t help myself.)

Also, set your reminders and tune into the NPR “Tiny Desk Concerts” this month! There’s a week each per musical genre: week one is Jazz (Wynton Marsalis!); week two is R&B (Meshell Ndegeocello!); Week 3 is Hip Hop (Rae Khalil!); and the last week is “Wildcard Week” (sorry, not familiar with the featured artists but I’ll be tuning in!).

Universities

Most colleges and universities are celebrating Black History Month with at least a lecture or event or three. I love how Tuskegee University is celebrating the month with an expansive and free Zoom lecture series on topics ranging from “The Color of Baseball” and “Reggae and Resistance” to “Covid-19 and the African American Community.”

Check out the website of your own alma mater to see what they’re doing, or perhaps a college or university near you. You’ll find celebrations, interesting lectures, discussions, music and more from Oregon on the Pacific to the North Shore of Boston and every place in between to understand exactly why recognizing African American history in America is so important. (And if you don’t find any activities at the website of your alma mater, maybe send them a note of encouragement/expectation.)

What else?

Parents and educators, are you looking for a broad-spectrum, well-researched resource guide to teach kids about Black history and anti-racism? The Center for Racial Justice in Education has put together a gorgeous web page that includes hotlinks to books, films, newspaper and magazine articles, activities, and government resources.

One of my favorites was “5 Things Not To Do During Black History Month.” There were a couple of real cringe-worthy examples in the article, but it wasn’t all “yikes!” There was also some very reassuring advice at the end of the article for folks who are eager for examples on how to be good anti-racism advocates.

When a door closes, a window opens

There are sooooo many things that COVID-19 has taken away from us, but one of the things it has given is the opportunity to take advantage of things we never would have been able to before because of geography.

You may not be anywhere near Detroit, but that doesn’t mean you can’t take advantage of the Black History Month activities offered by the Detroit Institute of Arts. Listen to a concert by singer-songwriter Chantae Cann; hang out with Black chefs and mixologists as they put together their favorite foods and drinks; or sign your child up for a free celebration of Black photographers through a series of interactive exhibit/experiences just for kids.

This is just a teeny tiny slice of what I found and I’m really eager to hear about more. Please share below what your nonprofit (or your favorite nonprofit) is doing to celebrate Black History Month, and help steer the rest of us to more great content.

October 29, 2020 By Helen Brown

Not just a drop in the bucket

Recently I read a report from the Pew Research Center that 15% of people they surveyed said they don’t vote because they feel that their vote is just a drop in the bucket and doesn’t make a difference.

I’ve heard the same thing from people who were concerned about their small donation to a nonprofit. But all of us in fundraising know that that’s not true at any time, and especially now.

In fact, small donations are incredibly important. At a time when the leaders of 30% of nonprofits are reporting to CAF America that they don’t know if they’re going to be open a year from now, those small donations are absolutely critical to keeping the lights on. It’s not hyperbole to say that, for some nonprofits, those “drops in the bucket” are going to be the difference between providing services and closing for good.

Other small drops have incredible power.

A speck of dirt or a wayward eyelash can cause a surprising amount of irritation. That drop of eye wash packs a wallop of relief, doesn’t it?

A little drop of polio vaccine on a child’s tongue can make the difference between a normal life and an iron lung.

A tiny drop of the nerve agent Novichok on a water bottle was all it took to send Russian dissident Alexei Navalny into a life-threatening coma.

Small drops are powerful. So is one vote.

Did you know that in 2018 Rep. DJ Johnson won his seat in the Kentucky House of Representatives by one vote? It’s true.

The same thing happened – in the same year! – in the Alaska House of Representatives: Bart LeBon defeated Kathryn Dodge by one. little. vote.

One vote can make a huge difference. Your vote.

If you haven’t yet voted…

Check to see if early voting is available in your area. More information can be found at https://makeaplan.com/. Go to your town hall or wherever your voting location is tomorrow and vote.

If early voting is not an option for you, please vote on election day, next Tuesday November 3^rd.

If you’ve voted but you know someone who hasn’t yet, please contact them and urge them to do it.

Thanks.

July 30, 2020 By Helen Brown

Silver linings

So here we are, week nine hundred and twenty-whatever, working from home, wearing a mask when we’re out, socially distancing, all that good stuff. We’re w-a-a-y past the novelty and deep into the “Seriously I cannot binge-watch yet another series” portion of this Pandemic-a-thon. And that’s if we’re lucky.

[PSA: Now is the time when it’s really easy to break down and do something that honestly doesn’t seem like it would be that risky but three months ago would have freaked you out. Don’t. You’ve made it this far and we’re all counting on you to keep being a strong link in this virtual chain. Also you’re awesome and cherished].

But, yeah, this is still 17 kinds of awful. I’ve been trying to keep a gratitude list to stay positive, and I wanted to share with you some positive things I noted that wouldn’t have happened if it weren’t for this pandemic.

For one thing, no one is saying “It’s impossible for prospect development folks to work from home!” anymore. There is an element of “be careful what you wish for” here, but if you’re one of the millions who’ve discovered that working from home really is a wish come true, well, there’s good thing #1 to come out of this.

Another good thing happened a couple of weeks ago. My university held a virtual stewardship event for donors to the student COVID emergency relief fund, and one of the speakers said “of course, we’d ideally be all together now so we could thank you in person.” Since my university is across an ocean, the likelihood of my being there in person would be approximately nil, but because the event had to be virtual, there I was, one happy square among many on several pages in a Zoom room. How many great opportunities will nonprofits be able to take advantage of to engage with distanced constituents (who want to be more engaged) because we’re separated?

And speaking of the benefits of virtual gatherings, here’s another good thing: All of the free and low-cost webinars this spring were great, right? Especially in the beginning when we were trying to figure out how permanent or temporary this was all going to be. But if you’re like me, right about now you’re longing to be part of a real discussion again with other prospect development folks. Conversation. Back and forth, not just being talked at.

We’re not alone. Coffee talks are springing up everywhere. Last week Apra-MN had a great coffee hour conversation featuring Janna Lee and Mark DeFilippis on the topic of the legality of using FEC data in prospect research. Lori Lawson (who helped write the guidelines on this for APRA) was able to chime in from her home in Florida. Bonus!

Next month Apra-MN will host another interactive kaffeeklatsch on the topic of New York real estate, and they’re also doing evening happy hours just for conversation. Apra-Carolinas and Apra-PA are also hosting social gatherings…maybe your chapter is doing something, too? If not, volunteer to lead one yourself! It’s great that distance doesn’t have to be a factor – we can share a beverage and talk to peers everywhere! (oh, and hey: chapter membership chairs? Members don’t need to be in your geographic area anymore! Just saying.)

What other good things are happening because of this very bad thing that you can think of?

July 23, 2020 By Helen Brown

The other side of furlough

I’ve been watching the nonprofit space with increasing concern lately, hearing stories of colleagues – friends – getting laid off or placed on furlough, or under the cloud of potential furlough. Considering what’s happening, I know objectively that in some cases it’s the only logical financial decision some charities can make, but it’s still a constant heartache. I know that many colleagues will come out of this just fine – or maybe even better – in the long run, but in the moment it can be hard to summon hope. That’s why I wanted to make sure you saw this article from Apra-IL’s blog written by Joan Ogwumike and Beth Inman. It’s more than just a journey story – Beth shares great perspective and practical coping techniques, too. Thank you to Joan, Beth, and Apra-IL for granting permission for your article to be re-shared here. ~Helen

Joan: Hi Beth, can you share with our readers where you believe your heart and mind is right now?

Beth: Name an emotion and I’ve felt it over the past few months. Worried, scared, angry, optimistic, hopeful, to name just a few. Right now, I’m feeling grateful and my heart and mind are in a good place considering all the changes over the past couple of months (being furloughed, long distance move, and starting a new job). I’m grateful for my fantastic new job opportunity and for our prospect development community which has been so supportive. I have received emails, texts, and dm’s checking in, and those gestures have made a huge difference in keeping my spirits high.

Thank you for mentioning the prospect development community, can you share why community matters (you state that their outreach made a huge difference in keeping your spirits high) can you share more on that?

Community matters because it’s important to have a connection. That connection could be familial, professional, spiritual, etc. but it’s that connection or being a part of something that contributes to our overall sense of wellbeing. Our prospect development community on Twitter, for example, is so interesting because I’ve only met a handful of them in person. That said, I know they’re there when I’m frustrated about our work and I also know they’re there when we’re going through something like COVID and it’s affecting all of us in some way. Even when the “there” is virtual, it’s still so helpful!

Where would you say your heart and mind were as you waited to find out your furlough status?

Some days I was sure I would be furloughed and other days, I had a glimmer of hope that the work I was doing was important enough to not be furloughed. We knew a week ahead of time that furloughs were coming but we had no idea how many staff would be affected or what criteria would be used to determine who would be impacted. That was a really long week. That level of worry is exhausting and it affects every aspect of your life.

As many are going through this exact situation, what can you say matters?

2020 has been a rough year for everyone and we have all had very different experiences related to COVID-19 and its effects on our industry, our communities, and our families. I am a planner and I am a worrier so the past 5-6 months have been really tough for me. What I’ve realized is that I spend a lot of time worrying about things I don’t have any control over and asking for help is OK. What matters to me right now is understanding that it’s alright to not have a plan and to recognize when I should ask for help – that I don’t have to do it all myself.

I believe you just spoke to so many of us who are planners and worriers, to break away from this ingrained piece of us would be difficult, how are you doing it? Is this a process or an overnight shift?

Oh, it’s definitely a process and one that I have to consciously work on! My therapist has helped me with ways to counter my worrisome thoughts when I start to go down that “what if” rabbit hole and it takes practice to do that, but it’s worth it. One of things I learned is to counter a negative thought with a positive one. This helps me think about the different ways a situation could go and options I need to consider. For example, when I was worrying with thoughts that “my house wouldn’t sell”, I flipped it and asked, “what if the house sells,” that helped me think about what I’ll need to do when it sells.

Ever since the quarantine started many have shared advice on working from home, and ways to stay busy and productive aside from their work; what did you do to keep yourself whole, sane, and happy?

For me, once I learned I was furloughed, I made a to do list and came up with a schedule (albeit a not very structured one) for the weekdays, which was really helpful. I had been working full time for 20+ years so to learn on a Thursday that I was no longer working was a really odd and scary feeling. I kept thinking, “what am I going to do?” That’s where the to do list and schedule came in. They helped me structure my day in a way that helped me stay on track and feel like I had some control over the day. My to do list was everything from clean out the pantry to exercising to reviewing my resume and even what Netflix shows I wanted to watch. When I made the schedule, I wanted to start the day doing something that made me happy which was drinking coffee and reading. (I have read a lot over the past few months and if you need any book recommendations, let me know!)

Do you have any advice for people experiencing the fear of being furloughed?

In talking to friends and colleagues about furloughs, I have learned that organizations have handled their furloughs differently. For example, some organizations continue to keep in touch with their furloughed employees; they are part of regular meetings and they are provided updates on their furlough status. This was not my experience, so my advice is to think about questions to ask your supervisor if you are furloughed. For example, how will the organization communicate with those who are furloughed? Will you have access to your files/emails/intranet (your org’s HR site, for example)? If you’re going to file for unemployment, it wouldn’t hurt to research what you will need to apply in your state so you have an idea of what to prepare. In some cases, it can take weeks for the benefits to kick in, so filing sooner rather than later is a good idea.

Now is also a good time to review your resume, cover letter, and LinkedIn profile and make sure it’s up to date. If you decide to start a job search, it’s good to have these documents in their best shape. And, if you start applying for positions, reach out to your references to confirm they’re still willing to be a reference and give them a heads up if you learn an organization is contacting your references. If you use your work email for Apra and other professional listservs, make sure you update it to your personal email to ensure you continue to get important information.

And, finally, practice self-care and utilize the Apra community! Self-care looks different for everyone but it’s so important! The Apra community is helpful and compassionate and we want to see our colleagues succeed.

Thank you again, Joan and Beth. Dear readers, do you have any advice to share? Please share in the comments .

July 9, 2020 By Helen Brown

Exciting Announcement: HBG Data Insight!

I hope you had a safe and relaxing Fourth of July weekend! Our town cancelled its annual fireworks show this year, but various neighbors randomly filled the gap in their own way (ahem) so we still got to peep some here and there. Same with you?

The celebration here at HBG continues this week: We’ve been working on something very special over the past year, and today I have some exciting news to share – cue more fireworks!

As we all retool and strategize to be successful in this new normal, the project we’ve been developing could not have been ready at a better time. We are delighted to announce a new initiative here at The Helen Brown Group specifically designed to help nonprofits identify and get the information they need on their best donors.

We’ve formed a new unit called HBG Data Insight (DI).

While the unit is new, you’ll definitely recognize the DI team as long-time HBG talent. Tara McMullen-King is the new unit’s Lead Consultant, and senior staffers Kenny Tavares and David Hargadon are the DI Consultants filtering and transforming data into insight.

Why HBG Data Insight? Why now?

Over the years we’ve been frustrated seeing nonprofit colleagues unintentionally left stranded by talented specialists who provide analytics services…but then move on. The nonprofit pays a lot of money for the work and they may get a fantastic group of new prospects, but when the analytics consultant goes away to their next job, then what?

Circumstances change quickly – especially these days – and algorithms have a very limited shelf life.

And all of the AI and machine learning and data science and screenings in the world won’t tell you which living, breathing, human being amongst the list of hundreds is genuinely interested in your cause and has a personal connection to your nonprofit. Or which ones have family wealth. Or have made multiple philanthropic gifts through a DAF. Data insight and screenings alone just can’t do that.

We decided it was time for a practical, integrated, affordable, solution.

So over the past year, we partnered with a group of our dedicated consulting clients to beta-test a unique service: data insight married with prospect development:

Data insight plus research.

Data insight plus due diligence.

Data insight plus prospect management.

We found that most wanted all four woven together: insight, research, due diligence, and prospect management to take advantage of new opportunities and ideas as they arose.

We’ve helped our clients use their own data to answer these questions (and quite a few more):

Who are our most likely donors right now?
How should we prioritize our prospect pools?
How can we segment our wealth screening results to find top prospects faster?
Do we have the right people in the right portfolios?
Are we allocating our frontline fundraisers in the right way?
Can we better predict what our fundraising goals should be next year?
If we can’t do events now, what is our next-best option of engagement?
Where are our best planned giving prospects?

Our insight services range from descriptive analysis projects and RFMV analyses, up to and including predictive modeling. For some we have integrated wealth screening information that they had; for others we helped them get the most out of a new screening. We’ve even gathered a proprietary set of additional data to help us surface more prospects.

When you work in an integrated way, insight questions like the ones above can rotate and be added to continuously as new questions arise.

Marrying ongoing data insight with the rest of prospect development and the frontline team makes sure that you’re introducing the right – vetted – prospects into the pipeline continuously.

Don’t just take our word for it, here’s information from a survey of nonprofits done by IBM.

78% of nonprofit leaders with analytic capabilities reported higher effectiveness in performing their missions.
Nonprofits using analytics had more efficient operations and increased staff productivity.
However, the survey found that 48% of non-profits indicated that technology was a primary barrier to advancing analytics, and 41% indicated that talent was their primary barrier.
Nearly three quarters said that budget was one of top three barriers to using analytics.

Honestly, that last bullet point just floors me. It doesn’t have to be that way.

What does partnering with HBG Data Insight look like?

As I mentioned, our goal is to help clients affordably make data-informed decisions. To do that, we primarily use an integrated, dedicated, prospect development approach, which is something we’ve specialized in since 2005.

We provide expert consultants for a contracted number of hours each month for at least three months. That commitment allows us to keep our price-point lower and bring clients real value. It also allows us – together – to customize what happens during those hours to exactly what you need.

Don’t need the whole burrito of data insight plus prospect research? No problem.

If you already have internal prospect research capacity, that’s great. Our data insight team can work with you on a project basis, too, and we’d be happy to partner with your researcher (or research team) to provide results they can build on.

Check out our website to see more detailed information on the services we’re offering. If you have an insight project in mind that isn’t listed there, we’d be happy to talk it through with you.

HBG Data Insight: Practical. Integrated. Affordable.