Stuck at 2.5% for 50 Years: Why This Tech CEO Believes AI Can Finally Unlock America’s Giving Potential

Scott: Denver, thank you so much. I’m excited to meet you and excited to be here.

“So Bonterra, we’re a software company. We service the  social good sector writ large. If you look at our customer base, we provide solutions to nonprofits that help them build relationships with funders. And then we also provide solutions to funders that help them build relationships with nonprofits.”

Denver: Likewise. Well, for listeners who may not be familiar, give us a quick overview of Bonterra and what you do and who you serve.

Scott: Yeah, of course. So Bonterra, we’re a software company. We service the social good sector writ large. If you look at our customer base, we provide solutions to nonprofits that help them build relationships with funders. And then we also provide solutions to funders that help them build relationships with nonprofits.

So if you think about broadly what we’re trying to achieve, when I talk to our funders, they’re like: Our biggest problem is finding the right nonprofits to work with. When I talk to nonprofits, they say: Our biggest problem is finding the right funders that are interested in sustaining our mission. We’re trying to bring both of them together so that they can find each other and then build and grow relationships over time.

Denver: So as they say, you’re a Tinder for the nonprofit sector.

Scott: That’s right. Yeah, exactly.

Denver: In a way. Well, Bonterra has set a bold goal, and that’s helping lift charitable giving in the U.S. from about 2.5% to 3% of GDP by 2033. Now, that may sound incremental, but it is far from being incremental. What does that vision mean to you, and what do you believe, Scott, makes it achievable?

Scott: Yeah, so one of the things that I observed as I got into this industry was how stubborn the growth trajectory had been over such a long period of time. If you go back as far as 50 years, the average growth in giving has been about 2% a year for that 50-year period, which is roughly the rate of the country’s GDP growth. And even as the country has gotten wealthier on a per capita basis, seven times wealthier over that time span…And candidly, even as nonprofits have begun to leverage new tools and technologies like the software that we provide, none of that has changed fundamentally that growth trajectory. 

And so as we began formulating our long-term vision as a company where you say: We want to orient everything that we’re doing around how we bend that curve. And that’s why, back to the fundamental core problem of bringing nonprofits and funders together to help them find each other and sustain and build those relationships, that’s how we focused on that particular vision.

Denver: And you believe that’s the thing that’s going to make it achievable… is   bringing people together who were meant to be together, and therefore we’ll get that increase? Is that one of the strategies?

Scott: I think it’s really two things. It’s yes, building a network that makes it easier for a funder to find the right nonprofit and the right nonprofit to find the right funder. But making that happen– because there’s 2 million nonprofits, as you know, Denver– it’s very hard for a funder to identify the right nonprofits to work with for a given cause in a given geography.

Denver: For sure.

Scott: And so part of it is also providing technology on top of that network that enables that funder to find the right nonprofit, or the right nonprofit to find the right funder, like one… to give you a specific example, one of the things that our technology does is it will help a nonprofit evaluate all of the grant opportunities that are on our network and find those that are a good match for that particular nonprofit’s capabilities, and then help them write the grant so that they can apply for that funding.

So it’s both bringing folks together and then leveraging technology to sort of create those connection points.

Denver: Yeah, man, that’s great. And very often, all people who are giving grants are not right for your nonprofit.

Scott: No.

Denver: And the one thing that I’ve observed is that most successful nonprofits are the ones that get grants from organizations they want to get grants from, as opposed to chasing every single grant that’s out there, which again, is too habitual in the sector.

Scott: A hundred percent, focus matters, and working with the right partners that are aligned with what your organization is trying to achieve. I mean, that’s a spray and pray, or I’m just going to apply for all these different grants. It doesn’t work. And candidly, there are lots of consultants in our industry that advise that kind of approach. The more pitches you throw, the more at-bats you have. That isn’t what our data says and what our experience says.

Denver: No, the plate of spaghetti strategy has never really been that successful. You said, Scott, that freezing in the face of uncertainty, eh, that’s not an option. What are the most urgent pressures nonprofit leaders are facing right now, and where do you see opportunities for adaptation and innovation?

Scott: Yeah, I mean, I think the sort of the thing that we are hearing from our customers, and this was made viscerally clear by the change in the federal government’s funding appetite earlier this year, is the imperative of fundraising diversification. And this isn’t a new problem, right?

We have recognized for a number of decades that we’re getting more and more concentrated with fewer and fewer donors. So back to that 2% growth, while the sector’s been growing 2% a year, as the percentage of people giving has shrunk from two-thirds to less than half, the percentage of people volunteering has shrunk from a third to less than a quarter.

And so one of the things that we’re focused on is: How do we enable fundraising diversification, and in particular, that means: How do we enable nonprofits to develop that sort of long tail of donors? It’s very easy to afford to invest in a large donor. You can put people in front of them and build a tight relationship with them and stay with them over time, but that person that’s a volunteer or giving a hundred dollars a year, in 10 years, that could be a very big donor if you develop and cultivate them.

We are trying to use technology and in particular, agentic AI, to amplify the fundraising capacity of a nonprofit so that they can work with those smaller donors in a personalized way that feels rich, and this nonprofit, I’m building a relationship with this nonprofit even though I’m a smaller donor.

Denver: Yeah, yeah. And speaking of diversification, I just look at it from a different angle, and that would be channels. Very often, nonprofits use one channel, maybe two channels. And often when they’re using more channels than that and they drop one of those channels, the impact can be dramatic. Talk a little bit about that.

Scott: Yeah. Well, and you, Denver, in particular are sort of the godfather of peer-to-peer is a great example of this because we have a number of our customers that don’t leverage peer-to-peer, and that has proven to be an incredibly effective channel, particularly for engaging younger donors and then growing them over time.

And so, one of the things that we always look at with our nonprofit customers is, yeah, How many fundraising channels are you leveraging? On average as we look at our data, it’s about two. And it probably needs to be more like four or five.

Denver: Yeah, yeah, yeah. Optimized Ask, that can help increase the average gift size. Tell us a little bit about that, how it works, and how it increases that gift size.

Scott: Yeah. This is a technology we developed a couple of years ago, and it’s based on the premise that as I think every nonprofit fundraiser knows, that there’s a magic number to ask for. You don’t want to ask for too much to turn off or scare your potential donor. And if you ask for too little, you are obviously leaving money on the table. Optimized Ask looks at all of the data we have, and we have lots of data. We see 500,000 nonprofit transactions every single day. And from those patterns, we’re able to derive what is the optimal amount to ask of this donor, given their behavioral and demographic profile.

And we find that when that technology is used to ask for the right amount, on average, a nonprofit is yielding an 11% increase. If we look at the 11% increase, that actually gets you halfway there to our 3% by ’33.

Denver: There you go.

Scott: And so if we could get everybody, just even asking for the right amount, we  make a big leap forward on that.

Denver: So there is a method to your madness, I see. With all the work you’ve done in AI, has anything been revealed that struck you as something you didn’t expect to challenge its assumptions… it changed how you thought about this industry? Maybe something that humans would’ve never been able to detect.

Scott: Yeah, I think one of the things about our industry, and like I said, me coming in cold, is I was struck by how resource-constrained it is. A for-profit company, even a really sort of frugal one, might be operating at, say, 35% margins. And nonprofit is expected to run at the equivalent of basically 80% margin.

So they are unbelievably resource-constrained, and I have personal appreciation for this. My wife is the executive director of a nonprofit, and so I see that it’s her and a couple other people trying to run this organization. I think what we’ve looked at as we’ve dug into the data with AI is: if I were to pick one theme, it would be the power of resilience.

And so you’re going to be told no a lot when you are selling anything, but when you’re fundraising, for sure, it doesn’t actually take that much more before that no becomes yes. I’ll give you an example, Denver. One of the things we found was… back to grants, if a nonprofit applies for a grant once, 63% of them give up after that one application.

But what we find is on average to win a successful grant, the number of times you need to apply for that grant or from that funder is 1.24. So it doesn’t actually take that much more before you see success. And we see the same thing in terms of engagement with sustainers. The more resilient you are, the more it impacts your fundraising.

Now it’s hard because of the resource constraints, and that’s a lot of what we’re trying to do, amplify fundraising through agentic AI.

Denver: Yeah. I’ve always had a mentor who taught me that selling begins at “no.”

Scott: That’s right. That’s right. Yeah.

Denver: And that’s really true. And it’s a mythology of the sector though that still carries a burden. Overhead, 10%, 12%.

Scott: Yep.

“That’s why we are such big believers in the power of agentic AI, because the way that works is AI agents work directly on data, and instead of you interacting with a screen and software, you’re going to be interacting with a bot that can have observations about what it’s seeing in your sustainer base or in your donor base, make suggestions, and then even execute fundraising tasks on your behalf.”

Denver: Anything more than that is going to be bad. That has been debunked a thousand times, but nobody’s come up with a better metric, so everybody continues to use it. And when I started my career, technology was a cost center. And we tried to keep it down.

Now everybody realizes it’s not a cost center, but too often we still treat it as a cost center because we have that shadow of a century hanging over our head.

Scott: Well, and look, if you’re going to use software like a for-profit company that buys a major software package like a CRM, they’re dedicating somewhere between five and 10% of revenue to their IT infrastructure. A nonprofit cannot do that. That’s half their budget.

And so, candidly, one of the things that we’re constantly thinking about is a different approach to solving these problems. Software’s super helpful, but software takes work. It takes users that need to train: They have to learn the software, they need to enter data, they need to follow workflows. That’s part of that capacity that gets used up.

That’s why we are such big believers in the power of agentic AI, because the way that works is AI agents work directly on data, and instead of you interacting with a screen and software, you’re going to be interacting with a bot that can have observations about what it’s seeing in your sustainer base or in your donor base, make suggestions, and then even execute fundraising tasks on your behalf.

That’s the world that we’re trying to create, and we think that is going to be transformative for our nonprofit customers.

Denver: Paint that picture for our listeners, your three-year vision for how that will transform nonprofit work.

Scott: So today, if you wanted to apply for a grant, say, you might do a bunch of research, and then you might use grant management software where you’re going to be following a bunch of workflows and entering applications, and then putting submit, and then tracking that, and it’s work.

Three years from now, I believe the way it’s going to work is you’re going to have an agentic grant writer that will scour the universe of available grants, identify those that it believes match your capabilities the best. It will craft those grant applications for you to review, and then it will submit and track those over time, just almost like a human with an immense amount of capacity, right?

And so, yeah, I do think back to my wife’s nonprofit, where there’s two or three of them today. I think in the future there’s effectively going to be two or three humans, but then another 20 agentic grant writers and individual giving fundraisers and whatnot.

Denver: What is that going to mean for the sector in terms of employment? I mean, I can ask this about any sector, but why don’t we stick with our sector for a moment. What’s going to happen to the jobs, and how will those jobs change?

Scott: Yeah. Well, the unfortunate good news about our sector is things are so resource-constrained that this is all going to be about increasing capacity. So instead of having two or three human fundraisers, you’re going to have two or three human fundraisers managing 10, 20, 30 agentic fundraisers who will be out largely focused on your small dollar donors.

And those big relationships will still almost certainly be managed by humans. And the combination should be that you’re now able to, back to fundraising diversity, develop that long tail of donors because they’re going to get that kind of deeper, richer, more personalized interaction that today only the larger donors get.

Denver: Got it. You recently released Bonterra’s 2025 Impact Report, so instead of asking any questions about it, when you read that for the first time, what was your aha moment, the one that you just sort of sat up and said, “Wow!”?

Scott: Yeah. Yeah. I mentioned one of them, which was sort of the 1.24 on the grant applications.

Denver: I love that number, by the way. Thank you.

Scott: Yeah. Another one was, we have this notion in the nonprofit world of sustainers being someone that gives year after year. And if they don’t give in a given year, we think of them sort of as a lapsed sustainer. But one of the things we found is the donors don’t really think of themselves that way. They aren’t sort of monitoring the calendar as such, and so fully 20% of the donor base is giving outside that sort of normal sustainer window.

And if you start treating them like they’re a lapsed donor, just because they happen to slip a few months into the next year, you’re undermining your ability to build those relationships. And so having a more nuanced view of what constitutes a sustainer that isn’t strictly calendar-driven, and making sure you’re treating someone that has exhibited consistent giving, if not annual giving, like they’re a donor, that transforms the ability of the nonprofit to grow those relationships.

Denver: Well, that’s a great insight into human behavior. This is somewhat related, but when I was working with the New York City Marathon, Mercedes-Benz was the lead car.

Scott: Okay.

Denver: And they did that for years and years and years. And then they finally gave it up. I think 98% of people had a recognition of that. Ten years later after they stopped doing it, the recognition was about 96%.  Still thought Mercedes was the lead car in America.

Scott: That’s amazing. Power of brand, right?

Denver: It’s kind of the same type of thing… that people are not thinking about: 13 months have gone by, and I’m getting scolded now because I dropped it.

Let’s move on to corporate philanthropy. You got about 50% of the Fortune 100 corporations that use your platform. How is corporate social impact evolving? And are there any trends you’re seeing in employee giving?

Scott: Yeah. I think the most interesting thing that we are seeing, which actually benefits nonprofits, is if you look at Gen Z employees for these corporations, their interest is to typically engage more with those smaller grassroots nonprofits that are operating perhaps in their hometown community in a particular cause of interest.

So they’re less interested in doing things like giving to the United Way… nothing against the United Way… but less about those sort of large nonprofits, and more about those specific, hyperlocal opportunities, where they’re feeling like their activities, volunteerism, money can make a difference.

And so increasingly, we’re seeing corporations trying to figure out: Okay, how do we open up the giving to a broader swath of these nonprofits so that we can engage our employees accordingly? And we’re working quite a bit with our corporate partners on trying to help them do that.

Denver: Yeah. And Gen Z and others, it’s more of an intellectual engagement than an emotional one. Would that be correct?

Scott: I think that’s a fair point. Yeah. There’s an element of problem solving to this that I think we see, for sure. Yeah. I think that’s a great observation.

Denver: Yeah. And  I’ve observed they care much more about the issue than they care about the organization.

Scott: Absolutely.

Denver: I come from a generation that cares about organizations because we created them, maybe… I’m old enough… But now it’s sort of: it doesn’t make any difference. We’re solving the problem, and who gets credit and who the organization is, is not as important as it would be to my generation.

Scott: Spot on.

Denver: For sure.

Scott: Spot on. Yeah.

Denver: Okay. I’m a nonprofit. We got three staff people. We got no tech budget or a minimal budget. What’s the single highest return on investment step I can take to start modernizing?

Scott: Yeah, I think one, the thing that I would do if I were a small nonprofit is make sure that I was collecting and organizing good data. So on all of my donors, on all of my donor transactions, and even if you didn’t do anything with it right away, having good data as these new AI applications come online, is going to be the secret sauce to enable everything. Because if you’re collecting all of that data, there are tons of insights in that data…behavioral insights that AI is really good at pulling out.

And then those behavioral insights can be leveraged to grow your relationship with those existing donors, as well as identify new donors that look like them. So that would be the thing that I would invest in first– get a structure for collecting good, clean data.

Denver: Yeah. And you guys can help with that, right?

Scott: We absolutely, yeah.

“I think the future looks really, really bright for nonprofit tech because of the rise of AI. It’s going to help every industry, but it’s really going to make an impact, I think, in nonprofit, again because of those resource constraints. This isn’t about trying to drive efficiency among humans as we were talking about. This is about amplifying capacity, and that is really going to help.”

Denver: That’s for sure. Because that is the biggest problem that I see with most nonprofit organizations. I say over half that I work with, their data is a mess and… maybe 60%. And even to find out what they raised last year can be the simplest question. And it can be like: Whoa, you’re throwing me a curve ball! And they really just don’t have a handle on it.

Scott: Yeah, no, it… absolutely. And we offer, and our competitors offer a good entry-level fundraising and donor management system that’s intended to be simple and get you the basics, enable you to structure the data. And once you have that, then all of the AI and agentic capabilities can run on top of that and start helping you answer all these questions.

I think the future looks really, really bright for nonprofit tech because of the rise of AI. It’s going to help every industry, but it’s really going to make an impact, I think, in nonprofit, again because of those resource constraints. This isn’t about trying to drive efficiency among humans as we were talking about. This is about amplifying capacity, and that is really going to help.

Denver: Well, I always kind of look at it too… that the sector that is farthest behind and has a long way to go, they can make up the most ground.

Scott: No, they can. They can, yeah.

Denver: And they really can. And it is so inexpensive, relatively speaking, compared to what it was even five years ago.

Scott: No, it is. Yeah. And agentic AI, I think, is even going to be more inexpensive.

Denver: Yeah.

Scott: So, yeah.

Denver: Now as far as agentic AI is concerned, do you use it in terms of the way you operate? And how do you use it in your day-to-day business, or even in your personal life?

Scott: Yeah, so we deploy it internally. So, to give a specific example, one of the things we do with our salespeople is we collect all of the data on sales conversations. And those sales conversations are embedded in an AI agent that essentially becomes a sales expert.

And so if you are hearing a particular question or objection from a customer and you want to get what is proven to be sort of the most salient answer, you can ask Eleanor, as we call our agent.

Denver: Yeah.

Scott: And she’ll give you some advice on what to say. So, yeah, we use it. I am a big ChatGPT person, personally. So I am asking it everything, from what restaurants to go eat at this weekend, to…

Denver: Oh, sure, sure. Yeah.

Scott: Yeah.

Denver: Okay. Here’s a different kind of question. Why are all these agents women?

Now I hear Amazon’s going to have Alex come out of the lab, I guess, and he’s going to help out Alexa or something like that. But they’re always women.

Scott: Yeah.

Denver: And they’re very good. Maybe it’s very efficient.

Scott: It’s an interesting observation. Honestly, I expect it’s because one of the things that everyone’s worried about, and I think this is of a pronounced concern in our industry, is ethical AI and making sure that we’re giving good advice, and we’re not hallucinating, and trying to come across in sort of a softer and more thoughtful way.

And so obviously, a lot of that is being super careful with the tech and making sure that we’re putting all the appropriate safeguards in place. But I expect some of it is also the branding as well.

Denver: Yeah. Yeah. Scott, getting back to the beginning of our conversation, I am so excited by your 3% by 2033. What does the tangible change look like in communities in 2033 if we achieve that number?

Scott: Well, interestingly, as you pointed out, it doesn’t sound that dramatic, but if you’re compounding at 3% instead of 2% to 2.5% over a 10-year period, the end number is twice as big.

Denver: Right. It’s like over half a trillion.

Scott: Yeah. So you’re talking about…

Denver: $583 billion or something, it’s nuts.

Scott: Exactly. And so you’re talking about… I mean, that size number, I mean, enables you to tackle some pretty meaty problems. And we’re working on some pretty meaty problems with some of our customers around community violence and homelessness.

And those numbers are big enough to be able to really tackle it in certainly a number of major cities. It will have an impact.

Denver: For listeners who want to learn more about Bonterra and the services you provide nonprofits or corporations, where would they go to find that out? And also, if listeners want to join this 2033 effort, what do they need to do today to be able to be part of it?

Scott: Yeah. They can go to our website, bonterratech.com, and you’ll see information there. We have thought leadership content there. We also have descriptions of all our different solutions, the Bonterra Network, and how to get involved in that. And so I think that’s the best place to go, Denver. 

Denver: Well, Scott, I want to thank you so much for being here today. It was such a delight to have you on the program, and thanks for a vigorous and enlightening conversation.

Scott: My pleasure, Denver. Really enjoyed meeting you and talking to you.