Building for the future: The donor's role in nonprofit modernization

Artificial intelligence has rapidly evolved into an essential tool across industries, and its importance in the nonprofit sector is no exception. Many organizations are now using AI to increase efficiency and expand their impact. However, this technological shift demands donor investment, and many philanthropists remain cautious about funding something unfamiliar, often due to misconceptions, high-profile misuse cases, and a lack of clear understanding. 

When properly funded, AI becomes more than a buzzword. It fuels innovation, sharpens competitive positioning, and amplifies mission delivery.

The nonprofit sector stands at an inflection point: the organizations that will drive long-term impact in their respective communities are those with the infrastructure, skills, and flexible resources to harness AI—and donors are in a unique position to make that possible. When donors direct unrestricted funding toward the organizations they care about, those nonprofits gain the capacity to close knowledge gaps, invest in new skills, and engage with emerging technology.

Kelly Fitzsimmons, founder and CEO of Project Evident, a nonprofit dedicated to helping organizations gather actionable evidence and empowering donors to consider that evidence in their charitable giving, spoke with Vanguard Charitable about how AI is reshaping the nonprofit sector and why donors play a key role in this evolution.

Q: What is Project Evident and what are its core values and motivations? 

Kelly Fitzsimmons: Project Evident is an intermediary organization that harnesses the power of data, evidence, and technology to help nonprofits and donors achieve greater impact. [We support] the use of AI and other tools to reduce costs and knowledge barriers so nonprofits can engage in more continuous learning and research and development, all with better feedback loops to their funders and other key stakeholders. 

Q: What opportunity does your research reveal for donors who want to help nonprofits navigate the rise of AI? 

KF: The biggest [consideration] for donors who read our research is that AI is an arrival technology, like electricity. We all get to participate in it. But the nonprofit sector is traditionally less able to participate in innovation and technology adaptation because we don't have the resources to close the knowledge gaps, or to do the experimentation and upskilling. 

Now is the time for donors to think: I can really help my favorite nonprofit modernize, upskill, and advance by providing more of the unrestricted support and access to the resources they need. [This will enable] them to take part in innovation equitably and productively. 

We have a saying at Project Evident, "Come for the efficiency, stay for the outcomes." We are dedicated to facilitating that ability for donors to stay for the outcomes.

Q: What has Project Evident’s research revealed about nonprofits’ usage of AI? Has it helped them operationally? 

KF: A few years ago, we partnered with Stanford Institute for Human-Centered AI after recognizing the need for more field-level knowledge and action research around what's really happening with nonprofits and their donors. We learned a handful of things, including more nonprofits were actually engaging with generative AI than their funders understood. So, there was a gap in these organizations securing funding to be able to do more. 

In many ways, the advent of generative AI has allowed us to be in conversations with donors and help them understand data infrastructure and technology adoption. Let's face it, those things haven't really been exciting to talk about when it comes to philanthropic engagement. But they’re critically important to infrastructure. 

Generative AI has [enabled nonprofits] to build a number of tools in a low-cost way. 

Through our research, we also understand that AI can be used to overcome data divides. This is incredibly exciting because our sector lags in this area as compared to the for-profit sector, and there's more that we can do to catch up. 

On the other hand, our research unearthed that for many donors, it's really difficult to understand how to make good AI investments. They don't understand the safeguards and guardrails, how to avoid or limit bias, or what ethical practice looks like.

Q: Please share a use case of when a nonprofit used AI to help drive its mission. 

KF: One example is a wonderful organization called Quill.org that helps students and young people sharpen their writing skills. We know what our education scores are in this country around literacy, and [writing] is a critical part of modern skills, not just for literacy, but for the workforce. 

Quill has harnessed AI to provide customized, [gamified] guidance to students with real-time feedback on their writing, which improves their skills. The organization has been able to build their evidence base so that they can prove [their] effectiveness. The results? Students’ scores, capabilities, and aptitudes are rising significantly at very low costs. This has become an important educational support and intervention that is beloved by students, teachers, and parents alike. 

Q: What are some of the most common myths you've heard from donors in regard to AI in the nonprofit sector?

KF: One major myth we’ve heard from donors is that AI is harmful and it can't be managed. While that is true if left unmanaged, so many [nonprofits and researchers] are investigating and exploring what can be done to provide more guardrails to better manage the downside and lean into the upside. 

We have a tremendous opportunity here to not just say don't do it because it's harmful, but [to use] the power of philanthropy to lean into it, make it safer, more ethical, and more useful for our interests. 

The last big misconception is that nonprofits, even if they're interested in engaging with AI, can't. That is not entirely true. They might have constraints, but there's a perspective that they don't have enough time, they're pressed with other things, and they don't have the data or capability. We have use cases for many nonprofits overcoming these barriers and leading with AI and advancing their impact with AI. I don't think enough donors have seen the use cases or have the understanding so that they know what's possible.

Empowering Nonprofit Innovation 

The nonprofit sector's ability to harness AI and other emerging technologies depends on donors who understand that innovation requires unrestricted capital. Our donors are often on the lookout for new charities to support, and our Discover Charities page is full of resources that can help locate and evaluate thousands of nonprofits. When you find organizations aligned with your values, consider how flexible funding can help them modernize, experiment, and ultimately serve their missions more effectively in an evolving landscape. 

For more information about Project Evident and their research on AI in the nonprofit sector, visit their website or contact them for case studies and additional resources.