Common Misconceptions About Community Foundations

September 15, 2023

By La Crosse Community Foundation

A look at the misconceptions and realities of community foundations

surreal optical illusion, man changing his point of viewWhen it comes to community foundations, misunderstandings and misconceptions are common. Community foundations, which play an essential role in promoting local philanthropy, are often misunderstood, even by those within the nonprofit sector. Here are some of the most common misconceptions—and the realities.

Misconception 1: Community foundations only accept large donations.

Understanding the diversity of donations

Many believe that community foundations only accept large donations, often in the millions. This is a myth. Community foundations, in reality, accept a range of donation sizes. They exist to encourage all forms of philanthropy, regardless of the gift size. Some foundations even offer programs to facilitate small, recurring donations, making charitable giving accessible to everyone.

Misconception 2: Community foundations have limited impact.

The real influence of community foundations

Community foundations have more influence than most people credit them with. They have a unique understanding of local needs and can direct funds where they can have the greatest impact. The organizations’ influence shapes community policy, promotes social justice, and fosters collaboration between sectors. Community foundations can profoundly affect area residents’ health, vitality, and future.

Misconception 3: Community foundations are only for the wealthy.

Philanthropy for all

While many high-net-worth individuals do use community foundations, they are not the only ones. Many community foundations, including La Crosse Community Foundation, aim to democratize philanthropy, enabling all community members to contribute. They offer flexible giving options, and some even run programs specifically designed for modest-income donors. At La Crosse Community Foundation, we often have match donations to advance specific initiatives in the region.

Misconception 4: Community foundations don’t support start-up nonprofits

Nurturing new nonprofits

Another common misconception is that community foundations only fund established nonprofits. In fact, many community foundations provide funding, support, and guidance to new start-up nonprofits, helping them navigate the complexities of the nonprofit sector. At La Crosse Community Foundation, for example, we offer the Nonprofit Resource Center, providing a bevy of tools, education and programs to lift all nonprofit organizations and is especially helpful for newer entities.

Misconception 5: Community foundations are impersonal

Personalizing philanthropy

People commonly believe that community foundations are impersonal entities, simply pooling and allocating funds with little regard for individual donors. This couldn’t be further from the truth. The La Crosse Community Foundation, and many others, pride ourselves on providing personalized service and engaging closely with donors to align their philanthropic goals with community needs. This may involve working with individuals, families, businesses, or other groups to develop tailored giving strategies. In reality, community foundations can and do provide a highly personalized philanthropic experience and build meaningful relationships with donors.

Understanding the role of community foundations

Community foundations play a pivotal role in fostering local philanthropy and strengthening communities. They’re an avenue for all types of donors, catalysts for significant community impact, launchpads for start-up nonprofits, and architects of personalized philanthropy. Understanding how community foundations really work allows you to make more informed choices about where your gifts go and how they’re used, ensuring the maximum possible impact.