New phase of funding reaffirms foundation’s commitment to flexible, trust-based grantmaking amid new challenges for nonprofit sector
Amid a challenging financial environment for nonprofits, Houston Endowment (HEI) is expanding its commitment to flexible, trust-based giving with a new phase of its HEI Collaboration Fund, providing local grantee partners $15 million to support their leadership and resiliency and strengthen the nonprofit sector in Greater Houston.
This latest round of funding builds on the success of the 2024 Collaboration Fund launch, which provided grantee partners $5 million to help strengthen organizational capacity.
“Nonprofits are navigating extraordinary demands right now including growing community needs, staffing challenges, and financial uncertainty,” said Ann B. Stern, President and CEO of Houston Endowment. “We believe the best way to support them is to provide flexible dollars that can be used where they decide matters most. We’re saying to our grantee partners: ‘You know best what your organization needs, and we are here to back you.’ This fund is a vote of confidence in the leadership of our highly effective partners and their vision for building a stronger, more resilient Houston.”
The new program offers eligible grantee partners $100,000 to invest in ways that strengthen leadership and improve organizational resilience, such as strategic planning, professional development, succession strategies, fundraising capacity or other critical needs identified by the organization itself.
Like the original Collaboration Fund, the application and reporting process will be intentionally minimal to reduce the administrative burden on grantees.
Up to 150 current Houston Endowment grantee partners are eligible, including those supported by the 2024 Collaboration Fund. Organizations must have substantial operations in Greater Houston or Texas and an ongoing funding relationship with the foundation. Eligible grantees were notified July 17.
In keeping with the foundation’s learning-focused approach, Houston Endowment is partnering with a third-party evaluator to assess the impact of this new phase of funding and compare findings with last year’s Collaboration Fund initiative.
“As we explore new and innovative ways of grantmaking, we also want to learn about the short- and long-term impacts on grantee partners. With this evaluation, we aim to deepen HEI’s understanding of how to better support nonprofit health and will share those findings back to the funder community to help inform their grantmaking practices,” said Brita Blesi, director of Learning and Evaluation at Houston Endowment.
Launched last year, the original Collaboration Fund awarded $5 million in flexible, low-barrier grants to 65 Houston-area nonprofits. Rather than fund programs, the grants were intended for nonprofits to invest in themselves. Each organization received $75,000 to use across three broad areas: investing in people, investing in work environments, and accessing technical expertise.
The program also includes nonmonetary support. Through ongoing peer learning cohorts, organizations can share insights, resources, and strategies and access an online hub, topic-specific workshops, and small, cross-sector meetups.
Meeting a critical moment for nonprofits
The Collaboration Fund emerged from listening to grantee needs—through frequent check-ins and a survey administered by the Center for Effective Philanthropy—and a recognition that traditional funding models often fail to meet the urgent needs of nonprofits.
Nonprofits have faced compounding challenges in recent years—including COVID-19, natural disasters, rising costs, and funding uncertainty—and continue to stretch their budgets to meet growing community needs while managing staff burnout. Research from the Center for Effective Philanthropy shows that flexible support not only improves organizational sustainability but boosts leadership confidence, sparks innovation, and reduces burnout.
Stern called the research “validation that flexible funding can be a valuable tool for all funders” during a recent Center for Effective Philanthropy webinar.
“These are grantees who are our partners—are already amazing organizations—so the goal was: What do you as an amazing organization need to be even more amazing and carry our shared work forward?” she told the panel. “Our grantees are incredibly careful stewards of the resources they have, and they know where they need the dollars the most. They know what they need to be financially sustainable.”
With this renewed investment, Stern hopes the Collaboration Fund will encourage other funders to explore more flexible grantmaking that meets the critical needs of nonprofits today.
“There is no one-size-fits-all approach, but even small steps toward more flexible support can have a big impact and lead to stronger, more resilient organizations over time,” said Stern. “It starts with listening to your grantees, treating them as partners, and trusting them to know what they need. This isn’t about stepping back—it’s about stepping up, alongside them. When we fund in a way that prioritizes trust, we create the space for leaders to do what they do best: serve their communities.”