This has been an extremely eventful year for philanthropy--nationwide, here in Massachusetts, and with the Catalogue. This letter cannot possibly do justice to it all, but here are some high points.

For the Catalogue, there are three major developments to record--historic in the sense that they are changing our own institutional history, and will possibly affect you as a participant.  In chronological order they are: first, moving into production, for launch in 2009, our Directories of all Massachusetts charities with budgets below $3 million (90% of all charities); second, the publication of our book, Philanthropy Reconsidered; and third, moving the print Catalogue entirely to the Web.

All three of these accomplishments address philanthropy nationally--the Directories, because they are intended for licensing to other philanthropic markets nationwide; the book, because its content and markets are intrinsically national; and the web-based Catalogue/Directories system, because it anticipates the future of philanthropy itself, now in nationwide paradigm-shift. Massachusetts is still our home base and experimental laboratory, but everything we do here now has strategic, national, ramifications.

What we are doing with the Catalogue locally exemplifies and anticipates the current transformation and direction of philanthropy everywhere.  Paradigm-shifts always involve a burgeoning of experimentation, improvisation, and innovation, as the old order dissolves and elements of the new order are created, emerge, and connect, to supersede it.  Since 2000, when we first identified as a paradigm-shift the structural and strategic changes then just beginning in philanthropy, it has seemed that the number and variety of experiments, mostly web-based, have steadily increased.  2008 has been the most lively year yet, owing to plans laid in 2004-5 that are just now coming to public fruition. We and others used to list interesting new web resources for our readers; now there are far too many, so everyone lets search engines do the work. Not all of these innovations, of course, will succeed--the market will test and sort them out.  What's a donor to do?  Help with the sorting!  Just keep your antennae out and be very selective. Your vote will count.

As for the economy--or what's left of it after its corrupters have done their work--now in its own paradigm-shift, we discuss its impacts on philanthropy under Charitable Giving. We should emphasize that for small- to mid-sized charities, hard times raise issues of survival.

Many small charities-e.g., small land trusts, performing arts ensembles, and inner-city athletic teams--are characteristically marginal, run by volunteers, with no paid staff and hardly any expenses at all.  They are accustomed to operating on shoestrings, and in hard times they simply suspend operations, to resume later when things improve (if they still have the heart).  Their institutional lives are always hard--'twas ever thus, and we should be grateful to them.    

Many other small charities are so simply because they are young--the sector has been expanding rapidly for decades.  Through no fault of their own, gaining traction to grow takes various times in various fields or locations, and growth is almost never easy or automatic.  Hard times can stop them in their tracks, but it would be a strategic error to let them fall by the wayside--nipping them in the bud and losing their otherwise larger and more significant futures. 

Still other small-to-mid-sized charities are neither marginal nor new and growing, but hardy perennials that do their jobs year after year, operating competently in a steady-state. Research has shown that economies of scale are not always obtainable in philanthropy, especially in some fields of culture and human services, or with certain types of activities.  

In other words, smallness is in most cases not evidence of mismanagement, nor of a problem to be solved; if small charities are in greater danger in hard times, intelligent and strategic philanthropy on the part of donors and grantmakers will focus especially on them, to ensure their survival. 

Over the past twelve years, foundations and donors have made selection and listing by the Catalogue a positive accreditation--something we neither intended nor sought, but which happened because our choices have been highly regarded. The Catalogue family of charities now numbers over 900, selected from perhaps 3,000 eligible charities, statewide, in all fields, of general philanthropic interest (i.e., addressing broad public issues and raising funds from the general public).   

If, therefore, you want your giving in this difficult year to have the greatest possible benefits, focus on these excellent small charities, and spread your giving across all five basic fields: Nature, Culture, Human Services, International, and Promoting Philanthropy.   These charities, in these hard times, represent strategic philanthropic investment opportunities, and we commend them especially to your support.