The Catalyst Fund’s new grantmaking focus

Engaging Donors, Elevating Nonprofits, Empowering Communities

The Fidelity Charitable^® Catalyst Fund, formerly the Fidelity Charitable Trustees’ Initiative, has shifted its grantmaking focus to connecting donors with promising nonprofits.

As the country emerged from a three-year COVID-19 pandemic, some alarming trends started to surface in the philanthropic sector.

Nationwide research findings and conversations with nonprofit leaders revealed that small to midsize nonprofits providing local services were being asked to do more with less. The requests for these nonprofits’ services were growing while their revenues decreased. On top of that, funding gaps for nonprofits that serve communities of color became more apparent, and organizations outside of major coastal centers tended to receive less funding, regardless of their effectiveness.

For those reasons, the Fidelity Charitable Trustees' Initiative, a grantmaking program separate from Fidelity Charitable’s donor-advised fund program, recently updated its focus to better bridge these gaps. While its purpose has been to strengthen the social sector’s resilience, sustainability, and effectiveness, we knew these findings illuminated our path toward creating a more significant impact.

Introducing the Fidelity Charitable Catalyst Fund

Rebranded as the Fidelity Charitable Catalyst Fund, the program will hone its grantmaking strategy and participation in the nonprofit sector to center on nonprofits with less access to resources.

The goal is to serve as a “catalyst” for connecting donors with promising nonprofits, increasing funding and support for the critical organizations that strengthen communities. The program also wants to open more doors for small to midsize nonprofits, connect them to more philanthropic training and resources, and provide more collaborative spaces for nonprofits so they may learn from each other. Grants support staffing, projects, training, resources, and research to help intermediaries grow their work with donors and nonprofits so communities can flourish.

While contemplating this update in strategy, we examined dozens of philanthropic articles and reports, provided funding for some of this research, and interviewed more than 100 nonprofit leaders nationally and in underfunded states.

1. There are nonprofit funding gaps that need to be addressed.

For example: 

• Nonprofits in areas with higher poverty rates have less donor support, according to nonprofit research organization the Urban Institute. 
• Nonprofits that serve communities of color with budgets under $1 million have greater challenges accessing resources and capacity building, according to TSNE and the Center for Effective Philanthropy. 
• Nonprofits in the South Central and Mountain West regions of the U.S. receive three times less funding per person than nonprofits in the Northeast and Pacific regions, according to social sector data organization Candid and the U.S. Census Bureau.

2. Additional resources should be funneled to underserved areas of the country to help donors connect with promising nonprofits.

Groups that educate donors on philanthropy or train nonprofits on fundraising are frequently underfunded or only exist in some parts of the country. Meanwhile, many national organizations working with donors and nonprofits are not focusing on the middle of the country. 

3. Donors require support to be intentional, inspired, and confident givers.   

Donors will give more if they are confident in how and what they give. For example, 65% of Fidelity Charitable donors say they would give more if they better understood the impact of their gift. Donors will also give more if they are engaged with the nonprofits they support.

4. Younger donors, women, and donors of color are well-poised to give to new organizations and those serving our communities.

These donors have increasingly more influence over philanthropic decisions and give differently. They are often more willing to give to new causes and groups. 

5. Giving circles, when individuals pool their charitable giving for more significant impact, are becoming increasingly important in funding causes.

According to the Collective Giving Research Group, about 84% of giving circles give to a local nonprofit. Giving circles offer transformative opportunities for donors to learn about philanthropy and get involved in their communities. 

6. Staff of small to midsize nonprofits need more support on how to reach individual donors, including donor-advised fund holders.

Smaller nonprofits do not typically have the resources or training to get the attention of donors and build authentic relationships. Many nonprofits are new to engaging with donors who use donor-advised funds for their giving.

7. More research is needed about how to get donors to give more effectively to organizations based in their communities.

While the Catalyst Fund and others like it have supported some valuable research with Stanford University, ideas42, Community Wealth Partners, and Indiana University, among others, much more is needed to understand how to inspire donors, including donor-advised fund holders, to give more to promising nonprofits. 

After we uncovered these findings, we asked ourselves: What if donors could develop more authentic connections to impactful nonprofits in our communities? What if more nonprofits could unlock the resources needed to deepen their effectiveness? It is with these insights and values in mind that we have committed to providing the resources needed to underpin such efforts. 

The Catalyst Fund’s strategic grantmaking focus will include:

• Engaging donors—We grow the intermediaries that help donors craft their approach to philanthropy, learn about our communities, find new nonprofits they can support, and give together.
• Elevating nonprofits—We invest in programs for nonprofits to build their confidence in fundraising, storytelling, impact measurement, and volunteer engagement.
• Field building—We strengthen the ecosystem of organizations that connect donors to nonprofits by funding research and collaboration. 

Some recent examples include an investment of $2.5 million to four major giving circle networks (Philanthropy Together, Community Investment Network, Philanos, and the Grapevine Giving Foundation) to significantly expand the number of people participating in them and support existing members with their philanthropy. The Catalyst Fund has also invested in comprehensive support for smaller nonprofits based in the South—not just one-time webinars and articles—to learn more about storytelling, marketing, volunteering, and fundraising. And we’re just getting started!

We believe we can empower donors to be more intentional, inspired, and confident in their giving. We also believe that the nonprofits improving our communities can be better supported to sustainably deliver, innovate, grow their intended impact, and flourish. That’s the change we hope to catalyze in the years to come.

The Catalyst Fund looks forward to working with new nonprofit intermediaries that build connections between donors and nonprofits. This grantmaking program carries out its mission with the support and oversight of the Catalyst Fund Committee, comprised of the Fidelity Charitable Board of Trustees and Tony Bowen, the program’s executive director. To learn more about the Fidelity Charitable Catalyst Fund, visit the program’s homepage: