Not-for-profits rely on technology too – so where’s the funding?

Posted on 31 Jan 2022

By Stefanie Ball, the Funding Centre

Grantmakers are not keeping up with the demand for funding for information and communications technology (ICT) from not-for-profits as the Covid-19 pandemic continues, according to a new report from Our Community.

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Increased demand for funding for tech tools and training reflects the shift to remote work by a vast number of not-for-profits.

The Future of Funding drew on eight years of SmartyGrants data to examine funding flows and approval rates from 2013 to 2020. It found approval rates for ICT grant applications decreased between 2019 and 2020, while application numbers tripled during the same period.

That’s not to say that grantmakers aren’t funding technology – in terms of the overall proportion of funding allocated, ICT went up in priority – but demand outstripped supply.

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Our Community’s The Future of Funding, published in January 2022, tracks the flow of funding from grantmakers using SmartyGrants data.

Right now, popular keyword searches on the Funding Centre, Our Community’s website for grantseekers, include “technology”, “information technology”, “information services”, “digital”, “organisational capacity”, and “capacity building”.

Other reports in Australia and internationally have uncovered a similar trend.

Infoxchange is an Australian not-for-profit providing technology services and tools to boost the capability of the social sector. Its report Digital Technology in the Not-for-Profit Sector 2021 found that the top tech priority for not-for-profits is building the digital skills of employees, even though less than a quarter of organisations surveyed have a digital transformation or IT improvement plan.

The philanthropic arm of SalesForce,, released its fourth Nonprofit Trends Report in early 2022. The report, based on a survey of not-for-profit employees worldwide, including in Australia, found that the shift to a virtual workforce is top of mind for many not-for-profits, with the implementation of new technology tools and solutions one of the top issues of concern.

Where’s the support?

Though few and far between, some grants programs do fund capacity building. The New South Wales Department of Communities and Justice offered a Social Sector Transformation Fund in 2021 to fund better digital service delivery, remote working capabilities and improved business strategies. Applications were restricted to organisations working in health and social service.

In the same year, the Victorian Government offered the Small Business Digital Adaptation Program, providing rebates for digital tools for businesses, including business management software Xero and MYOB, website and e-commerce platform Squarespace, and legal services from Lawpath. The program was aimed at businesses, but not-for-profits were eligible to apply if they met the criteria.

One Victorian council provides grants of up to $2,000 for capacity building projects, including technology and systems, capacity training, the development of governance strategies and plans, and more. Murrindindi Shire Council, north-east of Melbourne, says the Goverance, Skills and Capacity Building category “supports not-for-profit community groups and organisations, social enterprises and individuals to meet their governance requirements, develop new skills and build their capacity.”

The program was established in 2018 and is part of the Grants and Contributions Program. Applications are open on an ongoing basis and are assessed and awarded no fewer than three times per year.

Murrindindi Shire Council’s director of community engagement, Shivaun Brown, said the council introduced the category because of community feedback that highlighted some of the issues local groups were having with volunteerism, governance, and their ability to keep up with advancing technologies.

“Council was keen to help tackle these common issues, which we see in communities everywhere, by supporting community groups to access training, new technologies and professional services to enhance their operations and increase the capacity and capabilities of their members,” said Ms Brown.

“While we’ve seen a decrease in the number of applications we’ve received through the Grants and Contributions Program due to covid-19 lockdowns, the Governance, Skills and Capacity Building grant stream has delivered some fantastic outcomes for local community groups and has helped them remain relevant. Council is pleased with the impact of this grant stream and we’re happy to see members and volunteers add new skills and achievements to their already fantastic repertoire.”

The Social Impact Measurement Network Australia (SIMNA), a not-for-profit that aims to help foster the emerging practice of social impact measurement, is one example of an organisation with relatively advanced IT capability inhouse, but the problem remains that time spent on tech is time not spent on the mission.

“Fortunately, we have IT skills across our board and staff members, but it does divert us away from other work we could be doing. It would be great to have some funding available to pay for IT uplift,” said SIMNA board member Sarah Barker.

Which technology should be funded?

What do we mean exactly when we say technology? In Infoxchange’s Digital Technology in the Not-for-Profit Sector 2021, technology is broken up into five categories: tech foundations, information systems, digital marketing, digital technology management, and cybersecurity.

The term covers a range of tools and systems, including cloud-based file sharing software, digital marketing and website management, cybersecurity, client and case management, PCs and other equipment, as well as the processes (and additional costs) of implementing them and training staff and volunteers to use them. See the table below for more information.

Infoxchange NFP tech needs
Infoxchange’s report Digital Technology in the Not-for-Profit Sector 2021 divides the technology needs of NFPs into five categories. Source: Digital Technology in the Not-for-Profit Sector 2021.

How funders can help

There are multiple ways funders can support their applicants, according to Tech Impact, a US-based not-for-profit that provides tools and resources for both funders and grantseekers to help boost their technology skills.

In 2020, Tech Impact released a report titled Future-proof your Grantees: 10 Ways to Fund Non-Profits for Long-Term Success. The report covers different ways technology uptake can be supported, including some common objections from funders. We’ve summarised some of these below. Download Tech Impact’s full report here.

Common objections from funders, according to Tech Impact

Supporting technology costs too much

Funders can provide links to resources and other means of support besides financial assistance, according to Tech Impact.

One example is Infoxchange’s Digital Transformation Hub, launched in 2021, which offers guides, technology discounts and tailored advice to help not-for-profits to build their digital capability.

Technology isn’t part of our mission or grant guidelines

If your mission is to support not-for-profits, and technology is important to them, then it should be part of your mission, says Tech Impact.

At SIMNA, Ms Barker said that support from funders would free up time for the organisation to focus on its core work. “We’d prefer to spend this time pursuing new partnerships, improving our programs and services, and growing and strengthening the network,” she said.

We tried it before, and it didn’t work

To this, Tech Impact says there are multiple approaches you can take. If one didn’t work, perhaps try another.

The landscape has shifted dramatically since 2019. Organisations that might not have been open to change before the pandemic might see the need for a technology uplift now.

Not-for-profits don’t know what technology they need

You could suggest or provide training, resources or both to help them figure out what their needs are, says Tech Impact.

Data science and data technology is one example of an aspect of tech that some not-for-profits are reluctant to dip their toes into because they don’t know what they need, or they don’t know where to start. Developing Data Capability in Your Not-for-Profit offers an easy-to-digest framework that not-for-profits can use to identify the kind of data their organisation might have, and what they can do with it. Then there’s Data Projects from Go to Whoa. Both resources have been produced by Our Community’s Innovation Lab to help organisations grasp the importance – and usefulness – of harnessing their data.

Data resources are one thing, but there are other guides that contain information about just about any technology tool or system that an organisation might need. Check out Infoxchange’s Digital Transformation Hub (mentioned earlier).

Not-for-profits have more direct needs

In other words, the objectors say, it’s more important for not-for-profits to help more clients, or plant more trees, or provide more services, than it is for them to purchase a new computer system or a new database. This may be true for some organisations, but funding for tech capability should be considered just as important as funding for any other capability, according to Tech Impact.

Different sized organisations are going to have different requirements. Here are just some examples of why organisations might need access to better technology and/or increased digital capability now:

  • They need to be more agile to respond to changes in demand for services
  • They need better protection for their data
  • Their systems need to be user friendly, and they need to consider change management as their workforce changes
  • They need to collect, store, process and analyse data more effectively to monitor programs and services, measure their impact and make more informed decisions.

It’s not likely we’ll ever return to something resembling pre-2020, which means the increased demand for technology funding is not likely to die down, either. For more on how to help the organisations you support to build their technology capacity, download Tech Impact’s report here, and check out the links below.