Minnesota nonprofits facing declining revenue look for new ways to boost donations amid 'Zoom fatigue'

Erich Mische hopes his boat will float as he drifts 1,700 miles down the Mississippi River in a bid for money to keep his St. Paul nonprofit from sinking.

In Alexandria, Nicole Mulder is one of the few nonprofit leaders holding an in-person fundraiser instead of the online galas that have become the norm during the pandemic, hosting a show at her theater's outdoor stage this week.

And in Minneapolis, Kathleen Gavin is throwing a drive-in fundraiser and car parade, hoping to appeal to those with "Zoom fatigue."

As the fall fundraising season kicks off, nonprofits across Minnesota are banking on donations to offset revenue lost when they canceled or scaled back programs during the onset of the pandemic. Yet appealing to donors at a time of social distancing calls for unusual methods — and some are trying to go beyond the increasingly common online fundraisers.

"This idea of sitting online and watching people talk is becoming less and less appealing," said Michaella Holden, who puts on events for nonprofits. "We can only assume our guests have Zoom fatigue. [Nonprofits are] really going to need to find ways to be creative."

Half of nonprofits are seeing or expecting a drop in individual giving and philanthropic funds, according to a July report by the Minnesota Council of Nonprofits. Out of the 259 nonprofits surveyed in May, 44% say they'll be in "financial distress" in six months or less while 14 of them, or 5%, said they have closed permanently.

With furloughs and layoffs, more than 130,000 employees — a third of the sector's workers — filed for unemployment from March to June.

"This fall is a very critical time for nonprofits. There would have been hundreds of in-person events this fall before COVID," said Glen Fladeboe, a fundraising consultant. "I believe nonprofits will see strong support this fall, but it will be a more competitive and more challenging fundraising environment."

Beyond online galas

At the start of the COVID-19 pandemic this spring, Minnesotans flooded nonprofits with donations, and they boosted giving again after George Floyd's death sparked widespread unrest.

GiveMN, the fundraising website, said the number of donors and amount of donations still exceeds this time last year, even though the amount of donations has declined since the surge in April.

But some nonprofits say donors and foundations are shifting money to nonprofits on the front lines of the recent crises.

Minnesotans rally during tough times, but as months go by and the economic crisis worsens, it may be more difficult for nonprofits, Fladeboe said. Most nonprofits are sticking with online fundraisers, he added, because they're easier and don't face crowd restrictions that in-person events do. But that doesn't mean all online efforts are a success.

"It's not like you just turn on the internet and the money falls from the sky," he said.

Steve Boland, who also works with nonprofits on fundraisers, said nonprofits need to find ways to create the sense of community online that people get from attending an in-person event, not just post a webinar. Before the pandemic, some nonprofits were actually shifting away from typical black-tie galas to combat "gala fatigue" with online-only events. Now, online galas are the norm by necessity.

That can be great for donors who want to log in from their couch in yoga pants, Holden said, but the novelty is wearing thin. "As the reality sets in [that] we're not coming out of this pandemic anytime soon, it's going to be hard to get your donors' attention," she added.

Sink or float

For the first time in two decades, the Minnesota Ovarian Cancer Alliance scrapped its largest annual fundraiser instead of asking people to participate in the 5K run/walk at home like other nonprofits have done.

The Minneapolis nonprofit replaced it with a drive-in fundraiser and car parade at the State Fairgrounds on Sept. 12. Attendees will decorate cars in teal, the color for ovarian cancer awareness, and listen to a program from their vehicle about the nonprofit, which funds ovarian cancer research and supports women and families fighting the disease.

Gavin, the alliance's executive director, said the nonprofit, which has a $1.5 million annual budget, wanted to give supporters options to choose from depending on their comfort level — from the drive-in event to a golf tournament and a virtual gala. The drive-in event will be limited to 500 cars, spread out over two shifts.

In Alexandria, Mulder, executive director of Theatre L'Homme Dieu, is grateful for an outdoor stage on a 22-acre site so she can put on her fundraiser Thursday. Attendees can't mingle and tables will be spread out across a lawn for the show.

Like a lot of arts organizations, the tiny theater, which has a $350,000 annual budget, has canceled almost all performances this year; so Mulder, its only full-time employee, is relying on donations more than ever.

So is nonprofit Spare Key in St. Paul. Mische, its executive director, said it's in survival mode to last beyond the start of 2021.

"Every month, it's red ink," he said, adding that the nonprofit, which covers mortgage and rent payments for families with sick children across the U.S., faces a $500,000 deficit.

At Harriet Island, he's preparing a 24-foot pontoon he's dubbing the SS Hail Mary, topped with an altered shed and solar panels. Starting Aug. 27, he'll float two months until he reaches Louisiana, stopping along the way with a tin can and credit card reader to try to raise $250,000. (He's spending about $5,000 on the trip and the 50-year-old pontoon.)

If the nonprofit can't rebound financially, he said the organization, which has a $1.5 million annual budget and five staff members, may have to close or merge with another nonprofit. Normally, Mische said Spare Key would draw about $50,000 a month; last month, it brought in just $6,000.

"People are really looking for something hopeful here," he said. "People don't want to spend two hours watching a gala [online]. In April, that was new and fresh. There has to be a bigger spark … to ignite people's giving."

Mische, who worked for Norm Coleman, former St. Paul mayor and U.S. senator, is tapping political connections to drum up support. He says his trip is no gimmick, but he hopes it compels people to give.

"Minnesota has more nonprofits than lakes," he said. "[Small nonprofits'] future is on the line."