Gone are the days when philanthropists would write a check, sit back, and wait to see how it was spent. Baby boomers pioneered venture philanthropy in the 1970s, and now millennials are challenging the status quo again. They don’t want to know merely what department or project they’re funding; they want to see the faces of the people they’re helping. They don’t want to just put their name on a building; they want to fund initiatives with tangible social impact.
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Gone are the days when philanthropists would write a check, sit back, and wait to see how it was spent. Baby boomers pioneered venture philanthropy in the 1970s, and now millennials are challenging the status quo again. They don’t want to know merely what department or project they’re funding; they want to see the faces of the people they’re helping. They don’t want to just put their name on a building; they want to fund initiatives with tangible social impact.
Colleges are learning that if they are to continue to rely on more than $40 billion in donations each year, they’ll need to design paths for the youngest philanthropists to give the way they want to: socially, digitally, and impact-oriented. Here’s how:
Think beyond bricks and mortar. Younger donors are beginning to diverge from the habits of traditional college philanthropy, which means that development officers are being challenged to rethink their pitches for the unrestricted and endowment gifts once embraced by older donors. Millennial philanthropists see their gifts as investments, and they place a higher value on experiences than on material possessions.
Rather than ask younger donors to fund lecture halls, savvy colleges are asking them to fund study-abroad opportunities and immersive-learning experiences. These donors gravitate toward funding mentorships, internships, or other faculty-led programs that allow students to develop working relationships with faculty members.
Many are declining to make endowment gifts at all, leaning instead toward multiyear gifts that build in accountability by requiring schools to demonstrate program success in order to receive continuing funding. Recognizing those preferences, and beginning the process by making such avenues accessible, can give colleges a leg up when vying for millennials’ donations.
Rice University, for example, is one of the growing number of institutions soliciting donations for “student-experience funds,” which go to support extracurricular activities on and off campus. Rice’s project, the Owl Edge Experience Fund, provides students with grants of up to $5,000 for summer internships and research positions. Cornell University, similarly, specifies current students and recent alumni for experience-oriented gifts through a crowdfunding platform aptly named Small Projects, Big Impact. Each year a number of extracurricular organizations and student groups get access to the platform and receive supplementary funding, while donors get the satisfaction of knowing what opportunities and experiences they are funding.
Be accountable. Millennials are more responsive to cause-based marketing than any previous generation has been. This proves true even for purchases unrelated to philanthropy — 90 percent of millennials are likelier to switch to a different brand of a product if it endorses a cause they support.
It is not enough to convince younger donors that they are helping their alma maters; they want to know that their donations are serving a broader social impact. They see their donations as investments in measurable, concrete change.
Colleges can appeal to these impulses by soliciting donations for projects or initiatives that increase access to higher education and serve millennials’ passion for educational experiences defined by close faculty relationships, extracurricular activities, or career-training opportunities. This strategy helps to position higher-education philanthropy within broader cultural conversations and enables colleges to stand out among the many charitable choices available to donors.
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Colleges can gain further by creating more-detailed donor agreements. Tomorrow’s donors might ask for site visits or students’ own stories. Naming rights and groundbreakings alone will not satisfy their philanthropic objectives.
Get social. Members of the “pics-or-it-didn’t happen” generation want their peers to know that their causes are important. The act of spreading awareness is seen as an extension of the monetary gift.
To remain competitive amid the many social-giving options available, colleges know that they must connect their digital-giving platforms to social media and make individual donations easily shareable. Many have also found success in offering donor-targeted experiences, like tailgates or other parties, that allow donors to engage with one another and promote their philanthropic agendas among their peers.
Millennials, who will inherit more than $30 trillion, have shown little indication that they will give in the same ways their parents did.
Research suggests that 70 percent of millennials make spending decisions based on the recommendations of their peers, with social-media endorsements playing a particularly important role. Colleges can create new avenues for donations with platforms that maximize the social exposure of donors’ gifts. Even more, agreements that include plans to spread awareness of the donor’s social cause through social media or college publications can, in donors’ eyes, ensure that a gift makes an even greater impact.
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Pepperdine University’s social-media manager described how the university built last year’s Giving Day around a social-media campaign, with “Social Ambassadors” across the university’s five schools, and amplified opportunities for donors to post and share the stories that motivated their gifts — making social media the university’s second-highest grossing source of donations.
Millennials will eventually inherit more than $30 trillion from baby boomers. As they accumulate wealth, they will be courted by their alma maters. While millennials have shown little indication that they will give in the same ways their parents did, their commitment to an accessible, high-quality education is evident. So long as colleges are agile enough to respond to their youngest donors’ priorities, millennials may prove to be the most generous generation of college donors yet.
Jacqueline Pfeffer Merrill is executive director of the Fund for Academic Renewal, which provides free advisory services about higher-education giving. It is a program of the American Council of Trustees and Alumni.
