How Literary Nonprofits Got By in Tough Times—and What They Hope to See From Donors Now
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On March 12, 2020, the board of directors of PEN America, a literary nonprofit dedicated to promoting free expression and literary culture, met in New York to discuss a fundraising campaign around its centenary in 2022–2023. “It was ‘all systems go, we have to do this,’” recalled Suzanne Nossel, chief executive officer. “And then, of course, the whole world shut down.”
Similar scenes took place last March at the hundreds of publishers, writers centers, residencies and educational organizations that make up the nonprofit literature and writing sector. The last year and half was a challenging time for these groups, as the pandemic disrupted typical fundraising efforts across the country.
Despite a general slowdown in support over the past year, many organizations reported to IP that they were able to survive thanks to emergency funding from government and philanthropy, as well as a pivot to virtual fundraisers and Zoom meetings with donors. And while there remains a scarcity of major funders that prioritize literature, development staff we spoke with noted some encouraging developments and trends in both fundraising and grantmaking that they hope will bode well for the future.
With rare exceptions, literary nonprofits are unendowed and must raise their operating budgets each year, primarily from institutional and individual gifts. Even presses and literary magazines, which generate more earned revenue through sales and subscriptions than other literary nonprofits, normally rely on philanthropic support for 30% to 70% of their budgets depending on the strength of sales. A survey of nonprofit literary organizations that applied for emergency funding during the pandemic reported nearly $28 million in losses as of September 2020 and projected an additional $48 million in losses in 2021.
While key national funders such as Lannan and Mellon foundations continued to support literature during the pandemic, some local foundations shifted their giving to other areas.
“We have noticed that some funders have gone in the direction of more direct support for COVID-related services, which we completely understand,” said Joel Arquillos, executive director of 826LA, a nonprofit that runs creative writing programs in the Los Angeles area. Individual donations also slowed down and some organizations limited their asks, given the health crisis.
“This time last year, we weren’t really asking anybody because people were in such disarray and pain,” said Fiona McCrae, executive director and publisher of the nonprofit press Graywolf.
Emergency funds offer a lifeline
Emergency funding from the government did help stabilize nonprofit literary organizations. Many received forgivable loans from the Paycheck Protection Program (PPP). The National Endowment for the Arts (NEA) provided grants of $50,000 to organizations that had previously received an NEA award. Arts organizations also gained more financial flexibility after Congress allowed the endowment to change project-based grants awarded from 2019 to 2021 to general operating support.
Funders of literature stepped up with emergency grants, as well. The Mellon Foundation set up a $3.5 million fund for struggling literary organizations that was jointly administered by Academy of American Poets, the Community of Literary Magazines and Presses, and the National Book Foundation. Nearly 300 nonprofit literary arts organizations received grants that ranged from $5,000 to $50,000.
The emergency funding provided by government and philanthropy was a lifeline for many literary nonprofits. “We didn’t have to lay anybody off, we didn’t have to shut anything down, and we were able to pivot pretty quickly digitally thanks to this influx of emergency funding,” said Jafreen Uddin, executive director of the Asian American Writers’ Workshop. For Graywolf, funding from Mellon’s Literary Arts Emergency Fund and the NEA helped offset a slowdown in donations to its fundraising campaign.
Fundraisers adapt to a new normal
The pandemic led some literary nonprofits to reframe and shift their programs so that their organizations could remain essential.
“It was a really fast pivot to think about what are our essentialities in a world defined by pandemic,” said Nossel of PEN America. One focus for the group was expanding its existing emergency fund for writers, made possible by larger-than-usual gifts from the two foundations that support the fund. The organization also focused its free expression program on encroachments on free speech imposed by governments under the cover of COVID-19, and produced a newsletter as part of its prison writing and justice program that provided a glimpse of the life of the incarcerated amid the pandemic.
“That’s what allowed us to stay relevant and to help people see why continuing to invest in a literary organization, even at a time of historic public health crisis, remained important,” Nossel said.
Nonprofit literary organizations also replaced in-person programming with virtual activities. Finding a suitable format for online events required some adjustments, particularly for educational programs.
“We were built on the idea of face-to-face and one-on-one interactions and creating a space where children feel relaxed and safe,” said Arquillos from 826LA. To allow instructors to give more individualized attention to students, 826LA cut back on the number of students participating in each virtual session. Despite that change, he noted that some families suffered from “Zoom fatigue” and were reluctant to have their children join online after-school activities after a day of virtual school.
Fundraising moved online, too, with virtual events and galas and Zoom chats with major donors. The transition was difficult for nonprofits that rely on events for a large share of their fundraising. PEN America, for example, typically holds 50 small-scale author evenings annually in the homes of authors or supporters.
“Our question was, ‘can this possibly translate into the virtual realm with ticket prices in the low to mid three figures?’” said PEN America’s Nossel. “Luckily, it has worked. We have done more than 50 virtual events, and they’re shorter, but they’re also very intimate.”
Switching to online events has also helped literary organizations reach a wider audience. PEN America typically holds an annual gala at the American Museum of Natural History in New York City. The 2020 Literary Gala, scheduled for May, was postponed twice before it was finally canceled. Instead, PEN America hosted an online event in December, headlined by former President Barack Obama in conversation with presidential biographer Ron Chernow.
“We had to learn how to produce a virtual event and we tried to make lemons into lemonade and to take advantage of the fact we could get someone like President Obama,” said Nossel. The event had an audience of 17,000 viewers instead of the 900 supporters who would have attended the in-person gala. “That was a huge opportunity for us to reach a much wider audience than we ever could within the four walls of the museum.”
Online events also allowed nonprofits to reach individual donors across the country. Graywolf, based in Minneapolis, held author readings and a series of events open to the general public, in which members of the editorial and marketing teams discussed upcoming books. In addition to providing an inside look at the workings of a publisher, the events led to new donors. “We had more donations last year from places around the country rather than Minnesota, because of the virtual events,” said Josh Ostergaard, senior development officer at Graywolf.
Expanding their presence nationally has long been a priority for some literary organizations. This trend is particularly true for nonprofits such as publishers, which may have a strong local fundraising presence, but whose work also has a wider reach.
“To me, it never made sense that it’s just this little corner of America that’s funding Graywolf,” said McCrae. Around 2001, Graywolf developed a National Council, an advisory board of supporters from across the country. The council serves as a network for Graywolf and also engages donors outside of Minneapolis. Similarly, PEN America has opened chapters in seven U.S. cities. “We have become a more national organization over the last several years,” said Nossel of PEN America.
The next chapter
Some sense of normalcy and stability has now returned to literary organizations. Nossel from PEN America says she has been able to meet with donors in person again and resume the planning for the centenary campaign. “In the last month or two, it felt as though it could come back to something that ambitious.”
Despite the reopening and some positive fundraising developments that emerged from the pandemic, leaders of literary nonprofits remain concerned about fundraising prospects. Their worries include being overlooked by national funders of arts and culture, as well as local funders perceiving their impact as insufficient on the community.
Other than Lannan and Mellon, there are few large, national foundations supporting literature. Some smaller foundations, such as Whiting, exclusively support writing and literature, but they are also few and far between. Local foundations and state arts councils often support literary organizations, but those funders may favor other arts organizations that have bigger budgets and a more visible presence in the community.
“Literary groups and literary organizations often get put into this bucket of arts and culture and they end up getting a little bit lost,” said Uddin of the Asian American Writers’ Workshop. One notable exception to this trend are literary organizations that have educational missions and host literacy, creative writing, or spoken word programs. Those organizations can typically access a wider range of foundation grants and receive more support from community foundations and local governments, as well.
Some leaders believe that the grantmaking process used by arts and culture funders is ill-suited to literary organizations. “A lot of forms that you fill out as an arts organization are all based on the fact that you are gathering people under one roof: how many people come to your events, how are they changed at your events, what do they tell you at your events?” said McCrae from Graywolf. “Foundations are sometimes looking for an easier narrative than we can give them.”
As a result of those challenges, literature and writing nonprofits often do not spend as much time as other cultural organizations researching and applying for grants. Instead, they prioritize personal relationships with foundation staff, which allow them to explain the importance of their work in a more nuanced way. Those relationships, in turn, can lead to funding over multiple years. “We have been the beneficiaries of long-lasting relationships, and we are a known quantity for many of these larger foundations,” said Uddin. “It’s who you know as much as what you’re doing.”
Similarly, in his first few years at the helm of 826LA, Arquillos recalled that establishing relationships with local foundations was challenging, but that those same funders know and trust the organization. “In the beginning, it was about sending out blind proposals, a lot of calling, and being annoying at times,” he said. “After a while, you build trust and you build partnership with these groups.”
Beyond foundations
Corporations and corporate foundations are not significant sources of support for nonprofit literary organizations. The two exceptions have been Amazon and Target, although the latter is phasing out its support of literary programs as it shifts funding priorities.
“Corporations can be hard to engage,” said Arquillos. Uddin of the Asian American Writers’ Workshop agrees. “I know that corporations obviously have a process for determining where certain charitable dollars go, but how the beneficiaries of those funds are determined is a bit opaque,” she said.
Typically, support from corporations comes in sponsorships for galas and other large events. Sponsors of PEN America’s 2021 Literary Gala include commercial publishers like Penguin Random House and entertainment industry players such as the Walt Disney Company and Creative Artists Agency.
Corporations, however, sometimes engage with literary nonprofits in informal ways. Arquillos says that employers have reached out to 826LA to arrange special opportunities for employees to help with its work. Sometimes, these relationships may evolve into funding opportunities. Uddin says that employee resource groups (ERGs) have reached out to the Asian American Writers’ Workshop to propose partnerships such as special book events for members of the group.
Literary nonprofits we spoke with have seen only a modest increase in donations from donor-advised funds (DAFs). “It’s becoming more common, but I haven’t seen a big shift,” said Nossel of PEN America. She occasionally receives an unsolicited gift through a DAF. “We always want to know, if possible, who the person was and what prompted them to give so we can develop a personal relationship.”
Nonprofit leaders, however, have found it difficult to develop relationships with DAF managers and to be added to their lists of potential grantees. “Our relationships are with the donors rather than with the funds,” said Ostergaard from Graywolf. “We’ve found that to be a challenging sector to grow nationally unless there’s a relationship with the donor already in place.”
Given the relative scarcity of institutional funding for literary nonprofits, individual donors, who are often passionate readers themselves, have become important contributors. Million-dollar gifts are less common in literature than in the other arts, where donors sometimes make large naming gifts, but high-net-worth individuals may donate $10,000 or $20,000 each year. Those donations typically come in around events or during end-of-year appeals.
Small-dollar donors typically make up a small percentage of the overall budget, but nonprofits are seeking to grow those donations to diversify their fundraising. All Asian American Writers’ Workshop events are free and open to the public, but the organization solicits donations at the start of each event. The nonprofit also has a “fan club,” a recurring donor program in which donors give as little as $5 a month.
Graywolf created a subscription program called the Galley Club that costs $15 a month. Every other month, subscribers receive a copy of an unpublished book, along with some fun literary swag. In 2020, the Galley Club grew to more than 300 members and brought in approximately $40,000. These programs also allow the organizations to get to know their supporters better and build relationships with those who can give at higher levels. “We have people in the National Council who joined us first by buying a Galley Club membership several years ago and then got to know us and started to get more involved,” said Ostergaard.
Will encouraging trends continue?
Literary nonprofit leaders hope that the pandemic may prompt some funders to make changes implemented during the pandemic permanent, such as streamlined application and reporting processes and more opportunities for general operating support. They are also optimistic that a greater focus from funders on social and racial justice will create funding opportunities for existing initiatives such as fellowships for underrepresented authors and prison writing programs.
In response to the pandemic, many institutional funders simplified their grantmaking applications and reporting requirements. Some foundations also allowed nonprofits to convert grants tied to specific projects into general operating support. Unfortunately, some funders have already rolled back these changes.
“I’ve heard from partner organizations that, already for this next round of funding, it’s back to the way proposals and reporting were done before the pandemic,” said Uddin of the Asian American Writers’ Workshop. She hopes that funders will take this opportunity to rethink their grantmaking processes. “If it is possible to have a fundraising process that is streamlined, that does prioritize general operating funds, why do we need a pandemic for that to happen? Why can’t that be the case just generally?”
Uddin believes a more streamlined approach would particularly benefit smaller nonprofits like her own, which effectively has a fundraising staff of one. “Situations like that are very common for a lot of nonprofits, so whatever can be done to streamline the grantmaking process always works to the advantage of the grantees,” she said.
Arquillos from 826LA has noticed that in recent years, more foundations have moved in the direction of offering general operating support. But others in this space said these opportunities are still rare.
“Most funding opportunities are tied to specific programs, and it’s not always the case that it’s worth our staff’s time to try to cram or redefine our book list in a way that fits with a specific program,” said Ostergaard of Graywolf. “It would be a dream come true if there were more opportunities for general operating support from foundations that recognize the value of literature.”
Some nonprofit leaders have seen encouraging trends from funders, including a greater focus on establishing partnerships between nonprofits. “I’ve noticed that there’s a lot of interest in collaborative work,” said Uddin. “I think it helps fight against the scarcity model that organizations often find themselves in when it comes to funding, being pitted against each other.” A prominent example of collaboration between literary nonprofits is the Poetry Coalition, a group of 25 poetry organizations funded by the Mellon Foundation and administered by the Academy of American Poets.
Another encouraging trend is more funding for programs and initiatives related to social justice. Many literary organizations believe that social justice has long been core to their work and that the growing interest from funders around the issue will open the door to more funding opportunities.
“We had done a lot of work in the prison and justice writing program, our emerging voices program focused on writers in communities traditionally locked out of the literary world, our literary awards program that every year honors a diverse array of voices,” said Nossel of PEN America. “All of that really came to the foreground amid the racial justice protests and a sense of reckoning in society, including within the literary community.”
Social justice is also central to the mission of the Asian American Writers’ Workshop. “We talk about our work as operating at the intersection of the arts, race and migration,” said Uddin. “Those aren’t just buzzwords for us; that’s a very lived reality for our community of writers.”
Still, some nonprofit leaders remain concerned that the funders will overlook the connection between literature and social issues. “Where I get frustrated is where I feel like we do have common ground with a foundation, but they don’t necessarily see that,” said McCrae of Graywolf. “We have authors like Eula Biss on immunity, Maggie Nelson on trans families, Paul Kingsnorth on climate change, Anna Burns on Northern Ireland and #MeToo. Again and again, our books are dealing with these contemporary social issues, but we are losing funding by people who seem to be interested in social issues.”
Recently, however, some major funders have signaled that they see literature and writing as powerful forces for social change. In early 2020, the Mellon Foundation announced it would prioritize the funding of initiatives, including in literature, that advance social justice. Philanthropist Agnes Gund attributes her interest in social justice to reading books like Michelle Alexander’s “The New Jim Crow” and Bryan Stevenson’s “Just Mercy.”
It is unclear whether other funders will follow suit, but in a fundraising landscape with so many competing priorities, literary organizations may need to make a stronger case for their importance. “Arts organizations were constantly fighting for scraps even before the pandemic,” said Uddin. “Does that scarcity increase after the pandemic, when people are maybe thinking about more advocacy funding or more community organizing funding or more things they view as more of a direct response to societal situations versus the arts?”
