Top 6 Takeaways from New DAF Research Collaborative Report
- Mitch Stein
- Apr 10
- 7 min read
DAFRC released an in-depth survey of Donor Advised Fund Managers. We’ve pulled out some key takeaways for nonprofit fundraisers in this breakdown.
The Donor Advised Fund Research Collaborative (DAFRC), a leading group of academic and nonprofit researchers, put out their second of three reports in a four-year effort to better understand the DAF ecosystem from all angles. As they say in the report, “One of the initiative’s main goals is to gather and analyze information about DAFs that is not available from publicly accessible data sources.”
The newest analysis “The National Survey of Donor Advised Fund Managers”, provides an unprecedented level of insight into the perspectives and practices of DAF programs. The findings of this report were derived from a 30-question survey that 128 distinct DAF sponsors participated in.
While we recommend everyone download and review the report for yourselves, we also wanted to call out our top 6 takeaways that are most relevant to nonprofit organizations trying to better understand DAFs to maximize their DAF fundraising.
One important note about the report is that the participating DAF provider group is heavily skewed toward community foundations (86%). Community foundations tend to have fairly different donor demographics and behaviors compared with the large national sponsors that make up the majority of most organizations’ DAF donations. While these insights are useful, note that they are most applicable to DAF donors working with a community foundation.
1. “Ease of Use” is a DAF’s top value proposition to donors
DAF managers were asked to rate various features or benefits of DAFs as to how important they are for their fund holders. The highest ranking answer, by far, was DAFs “Ease of Use”, with 91.2% of respondents rating it as “Very/Extremely Important.” Other top benefits were local philanthropy, building a legacy of giving and strategic philanthropy.
Why this matters to nonprofits: Many organizations are working to improve their understanding of DAFs so that they can more effectively discuss the topic with donors. It’s valuable to know which DAF benefits are most resonant with fund holders so you can highlight them prominently in your communications related to DAF giving.
If you’re looking for an easy way to explain DAFs to your supporters, check out this 1-pager you can adapt for your own donor engagement.
2. DAF donors underutilize philanthropic advisory services
While 96% of respondents say they offer philanthropic advising to their fundholders, when asked how many fundholders utilize those services, the median level was 50%. There is a persistent misunderstanding among nonprofit fundraisers that DAF providers play a heavy role in DAF donors’ grant decisions. Even among community foundations (the primary audience of this survey), which tend to differentiate themselves from the national DAFs with their local-knowledge and philanthropic advising service, most donors aren’t utilizing those services.
Why this matters to nonprofits: While it’s certainly useful for a DAF Provider, especially a community foundation in your area, to be familiar with your work, most DAF donors are making their giving decisions like any other donor and the DAF is just their preferred method of giving.
An effective way to get on the advisors’ radar at your community foundation is to apply to their general grant process. Even if you aren’t selected, you’ll be on the program officer’s list and when donors inquire about your cause area, there’s a greater likelihood you’ll be on their mind.
3. Most DAFs have an inactive account policy, but enforcement varies
A top concern about DAFs among nonprofits is the lack of a legally binding payout rate, like private foundations have. DAF advocates point out that the actual pay out rate far exceeds the 5% requirement imposed on foundations (at over 20% for the industry since they began tracking, according to National Philanthropic Trust’s annual DAF Report - breakdown available here). It’s also true that most DAFs - especially the largest ones - have their own internal policies to deter inactive accounts. The nation’s largest DAF Provider, Fidelity Charitable, begins intervening after 1 year of inactivity. The typical deadline for intervention among participants was if 36 months went by without a grant, their policy would kick in. However, the enforcement and effectiveness varied.
79.4% of respondents said they agree with the statement “we closely monitor grantmaking to identify inactive accounts.” 7.8% said they neither agreed nor disagreed and 12.7% disagreed. What was also interesting was how “most sponsors (70%) agreed that their procedures improved donor relations, and 68% felt that their procedures successfully reactivated grantmaking.”
The researchers also pointed out that the enforcement of these inactive account policies is highly correlated with their available tech budgets to monitor grant activity, which signals that the sponsors not enforcing are likely on the smaller side anyway.
Why this matters to nonprofits: While most DAF sponsors do have a policy on this topic, it’s worth pushing all sponsors to be more transparent about the policy and their enforcement protocols. Especially since it’s proven to result in better donor relations! It’s an easy tip and request to share with DAF providers you end up speaking with, especially in your local community.
4. Only 36% default to sharing donor name & contact information
The default setting in any product is an incredibly important decision. One study on how many Microsoft Word users had changed any settings found that 95% stuck with the default. The exact numbers will vary across product experiences, but the fact remains that humans generally want to take as few steps and make as few decisions as possible in a product or check out flow.
The decision a DAF sponsor makes on their default setting for information sharing between a fundholder and a nonprofit is crucial. Unfortunately, only 36% have the option to share full name and contact details as the baseline default setting. Even then, the contact detail is only a physical mailing address - never an email. The good news is that only 1% of respondents had completely anonymous as the default.
The authors described the impact perfectly in their conclusion to the research:
“The various levels of donor information associated with DAF grants has created considerable confusion among professional fundraisers (Heist et al., 2025). An industry standard with full contact information as the default for acknowledgement would greatly improve the ability of charitable grantees to accurately process DAF grants and build meaningful relationships with DAF donors.”
Why this matters to nonprofits: Donors often don’t realize that you’re getting more limited information because of how easy and intuitive it is to follow the default process in their portal. They often get frustrated when they don’t hear from the organizations they support through their DAF. Here are three suggestions to curb this phenomenon:
Remind donors to share more information in your appeals
Don’t be afraid to educate your donors on your experience with DAF gifts and how they can help improve it. Especially if you’re including a specific CTA for DAF giving, or even a dedicated outreach for DAF giving, it’s ok to provide some short, clear suggestions. Here’s an example mailer The Public Theater recently used that incorporates a DAF giving CTA.
Prioritize research on DAF gifts
Even if you only get a fund name, it’s critical to dig up any more information to get ahold of that donor and thank them if possible. That can include periodic team meetings to review “unassigned” DAF gifts received or outreach to the DAF - a full list of DAF donor stewardship suggestions is available in this guide.
Add DAF giving as a payment option in donation forms
DAFpay, Chariot’s express checkout for DAF giving, captures a DAF donor’s email every time and lets the donor complete their gift in 15 seconds without leaving your website. See if your fundraising platform already has a DAFpay integration, or reach out to learn more.
5. These DAFs view competition among DAFs as their biggest barrier to growth
When asked to rate a few different factors as to how strong of a barrier they are to improved performance of their program, by far the most significant item was “Competition from other DAF providers.” 24.8% rated this as “very much a barrier,” 34.9% as “somewhat of a barrier” and 32.1% as “a little of a barrier.” That adds up to over 90% of respondents viewing industry competition as their biggest obstacle to growth.
This mindset is a little perplexing in such a fast-growing industry where awareness and utilization of DAFs among target demographics overall is still so low. A report by Bank of America showed that while wealthy individuals are most likely to have a DAF, only 4.9% of affluent households used one in 2022. Another survey of the general public found that the awareness of DAFs has actually gone down to 17%!
We’re in a moment where DAFs could be collaborating to increase market penetration as a whole group and attract net new DAF users to the vehicle vs. focusing on competition over existing DAF users. There are an estimated 3 million people using DAFs today, a mere fraction of the 60 million households that give to charity each year or 70 million people who have a 401k… the opportunity is immense!
Why this matters to nonprofits: It’s important to recognize that there is some competitive tension among DAF sponsors. Think strategically about how you might be able to partner with a DAF sponsor, especially locally, to advance their goals and foster a closer relationship. One idea is to collaborate on a donor education session on DAFs with a DAF provider or financial advisor.
6. DAFs are incredibly powerful for donor relationships
96% of respondents said that offering a DAF program provides additional means to engage existing donors. 90% say it provides a means to engage new donors with the organization. 71% say it provides a means to engage a more diverse set of donors. Clearly this is an incredibly powerful tool for any organization that has an existing audience or community of supporters.
Why this matters to nonprofits: DAF usage is proven to deepen fundholders’ engagement with their giving. That benefits the organizations they donate to and the organization that runs the DAF program. This adds to the reasons why nonprofits might want to be more proactive about educating their donors on DAFs, and maybe even encourage their use for anyone where it makes sense (disclaiming that they should discuss with their financial advisors).
It also makes a compelling case for larger nonprofits themselves to think about hosting their own DAF program! Folks like The Nature Conservancy or Stanford have already taken this approach, and the tech offerings to manage these programs have become a lot more accessible.
Check out the full report, and DAFRC’s other research, here to dig into all the details and insights!
Thank you to the DAFRC team that led this work:
Dr. H. Daniel Heist, Assistant Professor of Nonprofit Management and Social Impact at the George W. Romney Institute for Public Service and Ethics at Brigham Young University.
Dr. Danielle Vance-McMullen, Assistant Professor of Public Policy and Nonprofit Management at Depaul University.
Rachel M. Sumsion, Masters Degree student in public administration at Brigham Young University.
Dr. Jeff Williams, Director of Consulting Services for the Dorothy A. Johnson Center for Philanthropy at Grand Valley State University.
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