Making the Right Software Choices in a Rapidly Evolving Nonprofit Tech Market
Today’s nonprofits cannot thrive without a solid technology foundation and a strong technology strategy. According to a 2020 Nonprofit Trends Report by Salesforce, 85% of nonprofits agree that technology is key to their long-term success.
But finding the right technology for your organization and implementing it in a way that supports your short-term and long-term goals can be challenging.
If you’ve walked into the exhibit hall (virtual or in-person) at a nonprofit industry conference in the past few years, you’ve probably noticed something: There is an overwhelming number of vendors selling nonprofit technology. So, if you’re in the market for new technology, the experience can leave you wondering how you can even begin to choose from the sea of options.
There’s not a magic answer to this question. However, when you’re setting your nonprofit’s technology strategy and making individual software selections, it can help to know some basics about today’s nonprofit technology landscape. Here are some essential ideas to consider as you think about your nonprofit’s technology choices.
The nonprofit technology landscape is growing and changing — rapidly.
More than a decade ago, one of the things you’d often hear in the nonprofit sector is that selecting a technology product built by Blackbaud was a safe choice. While there were other nonprofit technology options available, Blackbaud was widely considered to be the leader in nonprofit technology.
Since then, a lot has changed. There are more nonprofit technology choices now than ever before, and the options just keep growing and shifting (Check out the latest episode of the NonProfit Voice for more on the changing nonprofit technology landscape).
Salesforce and Microsoft now have multiple offerings for nonprofits.
In the past two years alone, Salesforce.org has developed six of its own products for nonprofits, including the Elevate online fundraising solution. Last year, Microsoft launched Microsoft Cloud for Nonprofit, which includes functionality for fundraising, volunteer management and program management.
Mergers and acquisitions have heated up, leading to consolidation in the market.
For example, Blackbaud has purchased multiple companies over the past decade, including Convio and JustGiving. You can now find eight different categories of products on the company’s website.
EveryAction — a fundraising software platform — has been on a buying spree, acquiring six companies between mid-2018 and mid-2021, including GiveGab and Salsa Labs. In August of 2021, EveryAction merged with Social Solutions and CyberGrants after being purchased by a global investment firm. That same venture recently added Network for Good to the yet-to-be-named-and-branded organization.
Mid-sized nonprofit technology companies continue to consolidate and change as well.
In 2018, NeonCRM and Rallybound joined together to form Neon One. The same year, the mobile fundraising platform, OneCause acquired the Great Feats peer-to-peer fundraising product. Meanwhile other companies in this category that have been around for some time, but continue to evolve. For example, Virtuous CRM has increased the focus on integrations and expanding their nonprofit support footprint.
New nonprofit software options are popping up every day.
There are pros and cons to the evolving nonprofit tech landscape.
On one hand, more choice in the marketplace is good for the consumer. Competition among vendors makes companies work harder to win business through stronger products and better pricing.
On the other hand, more choices make the process of selecting the right software products and using them effectively long-term more complex. Larger companies that have made multiple acquisitions might offer all of the products you need, but those products don’t always integrate well, and you never know for sure if the company will continue to invest in all of the products they purchase. Newer, smaller software companies are often more innovative with their solutions because they can be focused and nimble in their software development to meet market needs. However, they aren’t time-tested solutions and might end up being the next acquisition target.
Finding the right solution is not the same for every nonprofit.
If only there were a single answer to the question, “What’s the best nonprofit technology out there?” But there’s not.
The truth is that finding the right solution(s) is different for every nonprofit. It depends on multiple factors, including:
- Technology strategy. It’s important to start with your organization’s overall technology strategy. For example, do you want an all-in-one solution, in which you purchase a single integrated solution from one vendor? Or, do you want a core customer relationship management (CRM) platform, such as Salesforce Nonprofit Success Pack, that you can add best-of-breed solutions and apps to as needed for various functionality? (Tip: There are pros and cons to both of these approaches.)
- Functional needs. The solutions you choose must support your organization’s goals. They also must help you accomplish what you need to do on a daily basis while supporting other factors, such as your organization’s current (and projected) number of constituent records and employees.
- Staff. Your technology solutions must align with the level of technical expertise on your staff. This applies not only to the day-to-day users of the technology, but also to your IT staff, who must maintain software updates and troubleshoot support issues.
- Budget/cost. Of course, the technology solutions you choose must fit within your budget. But keep in mind that the cost of the software doesn’t always end at the initial purchase. It’s important to consider the lifetime cost of software, including implementation of the products, product upgrade costs, maintenance costs and any custom development you might need in the future.
A thoughtful technology evaluation process is a must.
Sorting through the complexity of technology options isn’t easy. The technology landscape is changing rapidly. There are multiple pros, cons and other factors to consider. And there is a lack of objective data available to compare products (though, as a side note, some products are so fundamentally different in how they work that they do not lend themselves to apples-to-apples comparisons).
While technology decisions might be challenging, your choice of technology is too important to your nonprofit’s future to make a rushed decision. You might work with a nonprofit technology consultant or go through an internal process to establish a technology plan and make software selections. Either way, be sure to take the time and effort needed to sort through your options and make a solid decision that will work for your organization’s specific needs.
Here’s one final thought: Whether it’s time to replace some of your older technology or completely rethink your entire technology mix, remember that your nonprofit’s software technology plan and choices won’t necessarily look like everyone else’s. It all depends on your overall strategy and multiple factors that are unique to your organization. No matter how large or small your organization might be, taking the time to develop a technology plan and go through thoughtful technology selection processes will help your organization survive and thrive for years to come.
Mark founded Cathexis Partners in 2008 to help nonprofit organizations get the most from their existing technology tools, implement new technology to address gaps and find the best overall approach to using technology to support their missions. He previously served as director of IT consulting at a fundraising event production company focused on nonprofits.
Mark also serves on the editorial advisory board for NonProfit PRO, where he contributes monthly to his blog, “Nonprofit Tech Matters.”