
[Image description: Two ridiculously adorable little bunnies. One is black and white, one is brown and white. They are munching on some little wild daisies (or maybe they are doing a bunny tango and one bunny is holding a daisy in its mouth). They both have the tiniest little bunny ears ever! I love these bunnies! Image from Pixabay.com]
Sorry about this click-bait title, but let’s just say that fiscal sponsorship, as a topic, is not the most exciting to many people. I, however, am VERY excited about it and think it is one of the most-important-yet-underused tools in our sector. So I am filling this post with pictures of bunnies to encourage you to read it. Please make sure you read the entire post, and not just glance at the pictures of the baby bunnies. It’s an honor system. I trust you. Don’t let me and the bunnies down!
Recently, Josh Sattely of TSNE MissionWorks and I wrote an open letter to tech companies

[Image description: A cute little grey and white bunny on some wood chips, holding what looks like a basil leaf in its mouth. I know my herbs. That’s probably basil. Or maybe spinach. Image from Pixabay.com]
Thank you Nonprofit Quarterly for publishing our letter. I encourage everyone to please read it

[Image description: a jet-black bunny, on the ground, staring off into the distance. It has a majestic, noble profile, looking very regal. Image from Pixabay.com]
This brings up a similar issue: Some funders still refuse to fund organizations that are fiscally sponsored. This practice is inequitable and prevents our sector from advancing. If you are at one of these foundations, I—and all these adorable bunnies—implore you to reconsider. Here are several things to think about:
Nonprofits led by marginalized communities are more likely to be fiscally sponsored: Organizations led by communities of color, LGBTQ, communities of disabilities, and rural communities tend to be smaller, and smaller organizations are often the ones seeking fiscal sponsorship. By not funding fiscally sponsored organizations, you punish these communities and continue the inequitable distribution of resources that has been a challenge for our sector over decades. Less than 10% of philanthropic dollars go to communities-of-color-led nonprofits, for example, and this only-fund-501cs policy helps to ensure that the communities most affected by injustice continue to get the smallest amount of resources to do the most urgent work.
501c tax status is not a good indication of integrity or effectiveness. In the US, there is a false belief among many funders (and tech companies) that having 501c3 status means that an org is “legit.” But let’s be honest, it is usually not hard to get 501c3 status, which is why thousands of new ones are created every year. Anyone and their cousin can get status. Heck, I could probably found a nonprofit called “Unicycles for Puppies”—Mission: To empower our canine friends to reach their full potential through the circus arts—and get status within a few months. You might be thinking, “If it’s so easy, then why is this an issue?” Getting status is easy, but it leads to a host of challenges, which is why many groups choose to go the fiscal sponsorship route. Read on, below.
Fiscal sponsorship allows nonprofit staff to focus their time on programs and services:

[Image description: The sweetest little baby bunny ever! It’s black and white and snuggled up in some tiny succulent groundcover. Image from Pixabay.com. OMG, it’s so fluffy I could die]
Fiscal sponsorship encourages nonprofits to collaborate and benefit from economy of

[Image description: A little light brown bunny in the grass next to a nest with three pastel-colored eggs. Wait, is this a bunny? It’s ears are so small. Not sure. It’s fluffy and cute, though. Image from Pixabay.com]
Fiscal sponsorship lets boards focus on mission and community-building work: Many small

[Image description: OMG, is this a bunny that wants to be a lion?! It’s tan and has a mane like it’s going to a bunny costume party and dressed as a lion. Image from Pixabay.com]
Fiscal sponsorship helps nonprofits get out of the Capacity Paradox: The Capacity

[Image description: Aw, it’s a little soft tan bunny nestled in fluffy white carpet, staring directly at the camera, with a light blue wall in the background. What a sweet bunny with perfect pointy ears. Image from Pixabay.com]
Fiscal sponsorship increases the quality of operations in each organization: By pooling

[Image desription: A grey and white bunny, asleep in the grass, with shadows from what looks like a cage falling on its soft bunny form. Image from Pixabay.com]
As our communities face increasing challenges, the way that we have been used to doing things needs to change. Fiscal sponsorship allows nonprofits to be more collaborative, effective, efficient, and helps to channel more funding into organizations led by and serving communities of color and other marginalized communities.
If you are with a foundation that has a hard policy against funding fiscally sponsored

[Image description: A little grayish-brown bunny being held against someone’s chest, probably, their fingers gently guarding the bunny. Awwww. This bunny is so cute. Image from Pixabay.com]
Everyone else, please email Techsoup at beyondc3@techsoup.org, and encourage foundations that don’t fund orgs unless they have 501c3 status to discuss this issue.
The many amazing fiscally-sponsored organizations, many of which are led by communities most affected by injustice, must be provided the tools and support they need to do their critical work. We all benefit that way.
These bunnies all agree.
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