The newest Fundraising Effectiveness Project (FEP) data (https://fepreports.org/) tells a story that many nonprofit leaders and development officers have seen for a while: giving is up, but the number of donors is down. That might seem like a reasonable tradeoff. Revenue is growing, after all. But for small and mid-sized nonprofits, this trend introduces a structural risk that is difficult to ignore: increased dependence on an unsustainably small pool of donors.
The Reality Behind the Headlines
For many organizations, particularly those without large national brands or dedicated major gift infrastructure, the concentration of giving at the top can create volatility.Â
A handful of donors might sustain growth in the short term, but they can’t replace the long-term stability that comes from a broad, engaged base of supporters.
At the same time, the data suggest that smaller donors are waiting to be tapped. The report points to an estimated $52 billion potential in everyday giving. For small teams with limited capacity, that underinvestment is understandable. Broad-based donor engagement requires consistency, systems, and intentional design. Without this critical segment of donors, your fundraising efforts may be in danger.
Why Donor Decline Happens, and Why It Persists
The report reinforces a pattern we see frequently in our work with nonprofit clients. Acquisition without a solid stewardship strategy leads to attrition. First-time donors often receive a receipt and, at best, a generic acknowledgment. What they don’t receive is a clear sense of impact, connection, or belonging. The issue is how donors feel in those early interactions. For small and mid-sized nonprofits, this is where modest, well-executed changes can yield big results.
What This Means in Practice
The takeaway is not to shift focus away from major donors. Major gifts remain a critical driver of revenue. Instead, the opportunity is to build a more balanced fundraising plan where major donors are deeply stewarded and strategically engaged while at the same time everyday donors are intentionally welcomed, retained, and grown over time.
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This may require your organization to spend some time prioritizing and clarifying. You need to ensure the first donor experience includes a timely, personalized thank you paired with a clear articulation of impact. You have to create multiple entry points for engagement. And, your communications need to do more than just ask.
A Measured Path Forward
The current environment is complicated. Economic uncertainty, shifts in tax policy, and changing donor behavior all play a role. But, the data also makes clear that donor engagement is still within your organization’s control.
For small and mid-sized nonprofits, the goal is to focus on connection, clarity, and consistency. The organizations that navigate this moment successfully will not be the ones that chase every trend or dramatically expand their efforts overnight. They will be the ones that take a disciplined approach to strengthening the donor experience at every level.
If you want a plan that improves first-time donor follow-up and builds a realistic retention rhythm your team can sustain, reach out to The Development Department at info@thedevelopmentdept.com.
