Not using AI for nonprofit fundraising? You’re leaving billions on the table

The paradox that’s causing AI paralysis

The summit, hosted by our friends at Stratovation Partners, crystallized one thing: nonprofits are caught in a brutal paradox. They're terrified of AI risks — data privacy concerns, job displacement fears, and ethical implications — while simultaneously hemorrhaging potential revenue because they're not meeting the expectations donors have for a seamless user experience.

But even the willing are hindered by day-to-day challenges that can be a roadblock to progress.

Jamie Perez, Senior Vice President for the Center for American Progress, laid out the brutal truth about trying to innovate in the nonprofit space: dealing with approximately “35 crises in the first 26 weeks” due to changes in funding at the start of the new administration earlier this year. As a result, a project that should have taken one month stretched to eight months, with results still pending.

This is the nonprofit reality. While tech companies can move fast and break things, nonprofits operate in crisis-driven environments where the next emergency can instantly redirect all resources away from innovation efforts. The emotional and practical tolls are real — months of planning can get derailed with no warning by urgent mission needs.

Nonprofits don’t operate in a vacuum — and some are operating against a backdrop of chaos more often than not. To get ahead of the cacophony, organizations have to make some shifts in practices, but more importantly, mindsets.

Create a culture of innovation

To make the best use of technology, nonprofits need to have their houses in order. Pam Trzop, Managing Director of Firefly Partners, made a crucial point: "If your systems aren't connected, AI hits walls… If your technology and culture aren't aligned, AI just makes noise, confusion, and chaos faster."

She noted that nonprofits that see success with AI share a few characteristics:

• Leadership actively participates in transformation rather than just approving budgets
• Teams are trained on ethics, data, security, and privacy before tool implementation
• Governance frameworks exist before experimentation begins
• Data foundations are solid enough to support intelligent automation

Trzop also mentioned that The Rockefeller Foundation took a novel approach — they gave AI adoption to their Culture Department, not IT, recognizing that transformation was fundamentally about people and organizational change.

Prepare your teams: plan first, then add the tools

Rachel Kimber, Managing Director of Full Circle Impact Solutions, consults on nonprofit AI adoption and shared a blunt assessment: most organizations skip the “101-level” conversations and jump straight to tool implementation. This creates several risks:

• Rogue usage without policy frameworks
• Inconsistent approaches across teams
• Missed opportunities for strategic implementation
• Potential ethical and privacy violations

Her recommendation? Start with collaborative AI governance committees that include voices from technology, HR, communications, legal, and operations.

What it means to you

The path forward requires nonprofits to find a way to balance legitimate concerns while adopting these transformational tools. Strategic use of tech by nonprofits can reverse the negative trends you might be seeing and amplify the positive ones.

In practice, that’s going to look a little different for each organization. But the general steps are the same.

1. Build a foundation first

Before you enter your innovation era (if you didn’t know I’m a Swiftie, now you do), make sure you’ve nailed the basics. AI works best if your systems and processes are already working well.

• Audit your current donor experience ruthlessly. Or, start with just making a donation to your own organization if you haven’t before. If you’re tempted to abandon your own donation process, fix it before even thinking of adding AI.
• Connect your systems. CRM and email platforms need to be integrated before AI can optimize across touchpoints.
• Establish governance frameworks. Form collaborative committees before experimenting with tools. There’s a great toolkit you can download from Microsoft, or look at Fundraising.AI for guidance.

2. Start small, but be strategic

Doing “all the things” may seem tempting if you feel like you need to make up for lost time. But it can be a path to even more chaos. Instead:

• Choose one high-impact but simple tool or workflow for initial AI implementation — donor research, content personalization, or meeting summaries work well.
• Implement with collaborative teams that include both technical and mission-focused perspectives.
• Track concrete metrics: revenue impact, time savings, staff satisfaction. You need these numbers to justify expansion.

3. Scale thoughtfully

Again, you’re not going to jump from a Geocities-era website to the bleeding edge of technology. Focus your earliest innovation steps where they make the most sense — and can have the most impact.

• Use AI to automate tasks nobody wants to do — data entry, report generation, administrative workflows.
• Focus on personalization that improves donor experience rather than just internal efficiency.
• Maintain the organization’s ethical guardrails while pushing operational boundaries.

4. Measure what matters

With more tech and more automation, you can quickly find yourself drowning in data — of varying levels of usefulness. Especially at first, focus on the figures that are most impactful. At most organizations, that’ll be:

• Revenue per donor contact
• Conversion rates across channels and demographics
• Staff time allocation between administrative and mission-focused work
• Donor retention and engagement metrics

Nonprofits are at a crossroads — which path will you choose?

There are billions of dollars in potential funding sitting out there waiting for organizations brave enough to balance legitimate concerns with transformational opportunity. The tools exist and the playbook is being written by the early adopters.

The only question left is: Will you be one of them?

Learn more about how you can improve donor experience and boost revenue using Fundraise Up’s AI capabilities.