What’s the secret to unlocking the philanthropic spirit of the millennial generation?

 For many nonprofit leaders, this may be the million dollar – or perhaps billion dollar – question. To be sure, successive generations of nonprofits have struggled with the challenge of how best to engage the 20s and 30s crowd. The expression “these kids today” has surely been muttered in some form or other throughout recorded history.

But the generation born between the early 1980s and the early 2000s really does seem unique – with habits and patterns of behavior dramatically different from what came before. This cohort was raised online and on social media and grew up able to consume media anytime, anywhere. At the same time, many millennials have been saddled by student debt and have, as yet, been unable to replicate the success and upward mobility of their Baby Boomer parents. Millennials thrive in micro-communities, display strikingly little loyalty to institutions, and may be even more suspicious of traditional sources of authority than their rebellious parents. Calls for members of this generation to support the hard-to-define “greater good” based on a sense of obligation will likely fall flat.

There is a strong temptation to write off this group temporarily and focus more on potential donors aged 50 and above. After all, those aged 50 and over have had a chance to achieve career success, acquire wealth, and accumulate enough life experience to formulate a philanthropic philosophy. Our advice: resist the temptation! We cannot ignore or fail to engage younger donors or potential donors. Individuals in their 20s and 30s represent the future of American philanthropy and the nonprofit sector. If they aren’t engaged now, there is no reason to think they will suddenly become philanthropists in 20 or 30 years. This is a group overflowing with ideas, energy, and passion. They believe they can change the world. The job of more seasoned leaders is to empower them!

The recently released 2015 Millennial Impact Report “Cause, Influence & The Next Generation Workforce offered some insightful nuggets regarding the mindset of millennials:

  • 84 percent of millennial employees made a charitable contribution in 2014
  • 30 percent of respondents donated through an online giving platform
  • 11 percent had their donation deducted from their paychecks
  • 63 percent of millennial employees would be more likely to give in their company offered to match part of their donation
  • 37 percent of millennial employees volunteered up to 10 hours in 2014
  • 45 percent said that some of the time they spent volunteering was either offered or promoted by their company.

Perhaps the most important thing we can learn from this report is that millennials are giving and volunteering. (We know that volunteering is a gateway to giving.) It is also clear that one way to reach millennials is through their employers. This calls for a rethinking of corporate outreach: Nonprofits should not only be looking to employers for direct donations, but should approach businesses – especially those that employ a strong cadre of millennials – regarding volunteer opportunities and other ways to spread awareness among employees.

Regarding the percentage of respondents who made an online gift, I was surprised the number wasn’t higher than 30 percent – but that is certainly still a figure worth paying attention to. It is no secret that many millennials live and breathe on social media and its evolving platforms are often the best way to reach them. As a general rule, millennials are spurred to action by their peers, not by authority figures. Last year’s Ice Bucket Challenge epitomized peer-to-peer fundraising and, to some extent, peer pressure. People were called out online, in a public forum.  If someone challenged you, you were almost duty bound to accept – or live with a certain digital awkwardness. While no one quite knows how to galvanize the next Ice Bucket Challenge, there are any number of ways to craft a peer-to-peer program that can be shared through Facebook, Twitter, Linked-In, and other social media platforms. The trick is to come up with projects that resonate. Your organization must offer your potential champions appropriate tools and the freedom to be creative. Peer-to-peer fundraising is not about your organization, it is about supporters, it is about the cause. If supporters can turn an organizational fundraising drive into something personal, they will embrace it as his or her own.

Clearly, there is always a danger of oversimplification when one generalizes about groups. There is an element of arbitrariness in categorizing people based solely on their birth years. That being said, I have often found it helpful to think about two kinds of Millennial Donors: impulse donors and investor donors.

The impulsive donor, who is probably less successful than an investor donor, is swayed by emotions and often makes on-the-spot decisions about where to donate. Impulsive donors are idealistic and care deeply about the state of the world, but perhaps feel overwhelmed by the complexity of the world’s problems. (Don’t we all!)  A powerful tweet or Facebook post from an organization may be all that’s required to get this type of donor to give. We might be talking about $20, but don’t discount the power of small donations. Again, small online donations helped turn the Ice Bucket Challenge into a $200 million fundraising drive for the ALS Association. The trick is to follow up and engage with these donors and deepen the relationship.

Donors of all ages are increasingly viewing themselves as investors, but many millennials – especially those who have made it big in the tech industry – have taken this line of thinking to a whole new level. For this group of young donors, request for support must be accompanied by data, facts and measurable benchmarks. This is a group that accepts as an article of faith that solutions exist to complex problems, if only the task is approached in a comprehensive and strategic manner. Investor donors will surely have their own ideas about how to solve a particular problem. They may be impatient with organizations that fail to deliver results quickly.

Fair or not, I think of Sean Parker as the quintessential millennial investor donor. He was born in 1979 so he’s technically a Gen Xer. Yet the co-founder of Napster – any song, anytime, for free! – and first president of Facebook – embodies the millennial ethos like no one else. (Justin Timberlake played Parker to memorable comic affect in David Fincher’s 2010 film, The Social Network.) Parker recently told The New York Times that he plans to give away the bulk of his $2.8 billion fortune to pursue solutions to big problems, such as eradicating malaria within 20 years, developing immunotherapy to treat cancer, and curing allergies.

In a recent Wall Street Journal essay, Parker wrote that philanthropists should emulate the hacker culture. “While philanthropists like to talk about impact, they seldom have the tools to measure it,” Parker wrote. “This has led to a world in which the primary currency of exchange is recognition and reputation, not effectiveness. These incentives lead most philanthropists to favor ‘safe’ gifts to well-established institutions, resulting in a never-ending competition to name buildings at major universities, medical centers, performing arts centers, and other such public places.
“Hackers,” Parker continued, “have shown themselves to be less interested in this conventional form of philanthropy. Instead, they want to know that they are having an impact that can be measured and felt. This is where the hackers’ ability to spot problems that are solvable gives them a decisive advantage. It’s easy to find problems—we see them everywhere we look—but it is something else entirely to find ‘hackable’ problems. Those are the ones that have viable solutions.”

Parker’s attitude is both a breath of fresh air and a little concerning. Fundraisers approaching investor donors should encourage the potential donor to offer input. These are smart people who are overflowing with ideas. However, a fine balance must be struck. We don’t want to kowtow to every idea spouted by the Sean Parkers of the world. I believe that, despite the mass democratization of information, there is still such a thing as an expert. Nonprofit professionals and experts in the field may know more than a particular donor about how to approach a problem. We don’t want to dismiss ideas, but we don’t want to give away all the power either. Philanthropists and nonprofit leaders have long been engaged in a delicate dance: Who holds the power and who shapes the agenda? The push-pull can and should be healthy and productive, leading to the questioning of assumptions and the pursuit of bold ideas. But philanthropists with a similar outlook to Parker come with a danger of upsetting that balance and taking over the agenda. Always remember, the end goal is not raising money but fulfilling your organization’s mission. If dealing with a certain donor takes your organization off mission, it might be best to walk away, but only after all efforts at education, dialogue, and trust-building have failed.

The best piece of advice I can offer regarding millennials of all types: Don’t ever grow comfortable. Neither the mega-philanthropist nor the $20 donor will give to your organization simply because they have done so before. Your nonprofit must demonstrate why it is doing essential, meaningful work, and inspire donors to keep on giving. After all, millennials are just like the rest of us: They want to be inspired and to make a real difference.