The new year is rapidly approaching, but quicker still is the march of predictions and prognostications of the trends we should expect to emerge in the market once 2007 begins. According to Clara Miller, president and CEO of the Nonprofit Finance Fund, the nonprofit world will be one sector particularly disposed to new developments, as hundreds of both large and small philanthropies grapple with questions that will determine whether their organizations will thrive—or struggle to survive—in 2007 and beyond. At a conference held in early December in New York, Miller outlined four nonprofit world trends to watch in 2007. They are:
 

• The “Buffett effect” will grow. Pointing to Warren Buffett’s partnership with the Bill & Melinda Gates Foundation as the lodestar, Miller predicts that a greater number of wealthy donors will focus on pooling their capital for nonprofits, instead of fragmenting their resources. Referring to this practice as “leverage/collective funding,” Miller stated that, “this [trend] reflects an understanding that the available funding for nonprofits is small—relative to the size of the problems that organizations are working to solve.”
  
• Even more short-term thinking will be applied to the long-term nonprofit world. Miller cited this development from 2006 as one that shows no sign of tapering off in 2007—and one that does not particularly lend itself to the nonprofit world. “We will see an unfortunate movement to more short-term funding requiring short-term measurable results from nonprofits that are dealing with complex long-term problems,” she said.
  
• Wider recognition that there is a business side to nonprofits. “There is an understanding taking root that nonprofits need comprehensive funding, which includes infrastructure, replacement and organizational growth needs,” Miller said. She added that these three needs often go unnoticed by the practice of restricted funding, which, if it continues, will be a major obstacle to the financial stability of nonprofits in the future.
  
• Funding decisions less influenced by the portion of funds devoted to overhead. Miller stressed that there is no magic equation for determining the appropriate level of overhead required for nonprofits to operate efficiently. “Different services provided by different nonprofits require differing levels of infrastructure and administrative support,” she concluded.

—Elizabeth Ritter