How the coronavirus outbreak has upended the financial outlook for nonprofits.
In her nearly 18 years in the nonprofit world, Erin Reeser has never witnessed anything like this. “Literally, the entire fundraising season has been canceled, postponed, rescheduled,” she says. “There’s a lot of revenue being lost right now and it’s a tough time. March, April, May — I can’t imagine the millions of dollars that was expected to come through that’s now gone.”
As the coronavirus crisis has rapidly escalated, so has the list of abandoned engagements. Organizations with springtime fundraisers that account for a good chunk of their budget have been hit especially hard, with potentially long-lasting repercussions.
Reeser is the events and corporate sponsorship manager for San Francisco’s Raphael House, which supports low-income families and families experiencing homelessness. Its One Home, Many Hearts Gala was pushed from May to September. Speaking in mid-March, she assessed the situation: “Typically, in less than eight weeks, we’d have over $800,000 coming in, and now we don’t.” Last year’s black-tie affair raised $815,000; about half was tallied the night of, through activities such as auctions.
Most guests haven’t requested refunds, opting to convert their tickets to the future gala. And while postponing means paid-out deposits aren’t sunk costs, it still means there’s less money on hand. Those expenses are realized during this fiscal year, which ends in July for Raphael House, and any fundsraised by the rescheduled gala will be reported for fiscal year 2021. “From a cash flow perspective, we expected that $800,000, at least, and had budgeted in that way,” says Erin Goldfarb, director of development for Raphael House.
Along with a website that offers links to donate and purchase from an Amazon Wishlist, Raphael House is proceeding with an annual spring fundraising appeal, which usually brings in around $40,000. In addition, the privately funded nonprofit is contemplating receiving public funding. “We are open to changing our model if we have to — to make sure that the organization is still here next year, and still here in five years,” says Goldfarb.
Dress for Success’ San Jose and San Francisco chapters delayed a March luncheon and a June gala, respectively. The nonprofit — which helps women achieve economic independence by providing professional attire, a network of support, and development tools — anticipated raising $65,000 from the luncheon and $325,000 from the gala. Without the funds, Dress for Success’ expansion into Contra Costa County will likely be hampered.
Last month, Erin Badillo, executive director of the local branches, was about to sign contracts for the gala. With corporate sponsors hesitating, however, she determined it was best to hold off until fall. “It’s nerve-racking because it is our biggest event,” she says. “My board has been pretty smart and we have enough that if we raise no money, we could keep operating for a year. But probably no more than that.”
While the group’s revenue is primarily corporate-driven, “we’re trying to build up support from individuals,” says Badillo. “Individuals think of us to donate clothes, not money.” Clothing donations, which have been temporarily halted, directly impact only one of Dress for Success’ five programs, she adds. Hence, monthly donation subscriptions are encouraged.
The Humane Society Silicon Valley called off its 2020 Fur Ball, which was slated for March 28. Ten percent of the nonprofit’s annual funding is derived from the gala. In recent years, it raised north of $1 million; this year, the goal was $1.8 million. “We were shooting for the stars because we had completely reformatted the event,” says Amy Winkleblack, senior director of development for HSSV.
For the first time, the Fur Ball was to be held at Levi’s Stadium to accommodate a larger crowd of a thousand or so, with two experiences: a sit-down gala in a tent on the field and more casual dining in a field-level clubhouse. The retooled benefit and stepped-up fundraising goal reflect the HSSV’s increased expenses as its mission work has broadened to include under-resourced and overcrowded shelters beyond the Bay Area.
Fortunately, payments made to Levi’s Stadium will be applied to the 2021 event. Still, based on her team’s analysis, says Winkleblack, “we’re trying to close what will be a $850,000 to $870,000 net revenue variance as a result of canceling.” To that end, the silent auction will soon happen online. Winkleblack suggests bidders go a little higher than they might have if the gala had taken place, for items like a Sip and Sail package; an art print of a fight poster autographed by Muhammad Ali, Joe Frazier and LeRoy Neiman; and a Pamper Your Pet bundle. An annual campaign, where the money raised is matched by HSSV’s board members, is also on tap for April.
The day before its Fellini-esque gala on March 10, the Berkeley Art Museum and Pacific Film Archive announced it was pivoting to a virtual gala. Streamed live on YouTube, it featured the world premiere of a commissioned short film. Additionally, the auction and Fund A Need shifted online.
Last year’s gala netted $720,000 and included a matching grant. “It’s our biggest fundraiser,” says 2020 gala co-chair Carla Crane. “We count on it enormously for the bottom line.” This year, the gap between projections and what transpired was staggering. Instead of 385 revelers, BAMPFA estimates its virtual gala drew 100 viewers. The auction’s seven lots had expected to garner as much as $140,000; they ended up fetching $43,000. A bright spot: Right now, thanks to a generous gift, donations and memberships to BAMPFA are matched, up to $5 million.
Last year’s San Francisco Ballet Auxiliary Luncheon and Fashion Show grossed $330,500. This year’s edition was slated for March 18; an early fall date is now being eyed. An April dinner to celebrate principal dancer Yuan Yuan Tan’s 25th season has been postponed, too, and SF Ballet cut its 2020 season short. “We will weather this, but the impact is going to be huge,” says Danielle St. Germain-Gordon, the organization’s chief development officer. “The numbers — we’re not sure yet, but it’s multi-multimillion dollars. We’re still trying to get our arms around it.”
Now through June 30, SF Ballet is holding a crowdfunding campaign to raise $5 million. St. Germain-Gordon has also been brainstorming creative alternatives to boost coffers. One idea she’s toying with: couture consignment. “Once someone is photographed by Drew Altizer at an event, they probably won’t wear that outfit again,” she says. “Now that we’re all stuck at home, cleaning our closets, why not put that Dior, Chanel, Gucci, Prada, aside to donate to the ballet?” The garments would be sold through a high-end consignment firm, with proceeds benefiting SF Ballet. “It could be a significant source of revenue for us,” St. Germain-Gordon notes.
In the meantime, Raphael House’s Reeser hopes that as people adjust to their new normal, they start to think about giving again. “Even if it’s $5,” she says. “If you can, even $5 towards whatever non-profit you want to support will make a big difference. For nonprofits, every dollar that comes in is absolutely crucial to their mission, to carrying out their programs, to helping the people they serve who are greatly in need. Once you have that moment to give, please do, so that the community can continue on.”
Helping the Helpers
Local organizations whose major fundraisers have been affected:
Berkeley Art Museum and Pacific Film Archive (Fellini-esque gala), https://bampfa.org/support
California Academy of Sciences (Big Bang Gala), calacademy.org/donate
Dress for Success (Silicon Valley luncheon and San Francisco gala), sanfrancisco.
Humane Society Silicon Valley (Fur Ball), hssv.org/furballfundrecovery
Lifehouse (Great Chefs &Wineries), lifehouseagency.org/donate
Raphael House (One Home,Many Hearts Gala), raphaelhouse.org/give
Red Cross (gala), redcross.org/donate
San Francisco Ballet (Auxiliary luncheon/fashion show and dinner celebrating Yuan Yuan Tan), sfballet.org/support-us
UCSF Benioff Children’s Hospital Oakland (Notes & Words concert), notesandwords.org