Whether it’s automating administrative tasks, personalizing donor outreach, or boosting fundraising efforts, artificial intelligence is becoming a game-changer for mission-driven organizations.
But where do nonprofits stand today in adopting AI? And how can your organization use these tools to grow its impact?
The 2025 AI Benchmark Report — a collaboration between TechSoup and Tapp Network — dives into these questions and more.
Why AI Matters for Nonprofits
For nonprofits, AI isn’t about replacing people but rather empowering them to do more with less. Imagine freeing up hours weekly by letting AI handle repetitive tasks like drafting emails or pulling donor reports. Think about the difference it would make if your fundraising campaigns were automatically tailored to each donor's preferences.
According to our survey, nonprofits that use AI are already seeing benefits in a number of areas:
- Grantseeking and fundraising: Organizations tell us that they're saving time by automating grant applications and donor outreach.
- Outreach and marketing: Nonprofits find that they are able to engage with supporters more effectively through personalized messaging.
- Data analytics: According to our survey, AI is helping organizations glean better insights from their data. This is allowing them to make smarter decisions, like where to focus fundraising efforts.
These efficiencies can mean the difference between surviving and thriving for organizations with stretched budgets and limited staff.
Where Nonprofits Are Today
The good news? Interest in AI is high across the sector. Ninety-six percent of those surveyed feel that they have at least a basic understanding of what AI can do. Tools like ChatGPT and Otter.ai are becoming household names for nonprofits looking to streamline their operations.
AI isn’t about replacing people but rather empowering them to do more with less.
But here’s the challenge: 76 percent of nonprofits don’t yet have an AI strategy. If you’re in this group, you’re not alone. Many organizations are currently in the exploration phase, with questions about cost, expertise, and where to begin.
Our findings show that larger organizations with annual budgets over $1 million are adopting AI at higher rates than smaller ones. But that doesn’t mean smaller nonprofits are out of luck.
For smaller nonprofits, AI adoption remains a challenge. Many organizations with annual budgets under $500,000 are hesitant to implement AI due to financial constraints, lack of technical expertise, and uncertainty about where to start. In fact, nearly 30 percent cite financial limitations as a primary barrier, and more than 75 percent still do not have a formal AI strategy in place.
Despite these challenges, interest in AI is growing. More than 60 percent of nonprofits under $1 million are exploring AI for tasks like grant writing, donor outreach, and administrative automation. However, concerns around cost, ethics, and data security remain key barriers, with a quarter of small nonprofits worried about AI’s broader social impact. With most organizations lacking clear policies on AI use, education and strategic planning are critical first steps for smaller nonprofits looking to explore AI in a way that aligns with their mission and resources.
How Nonprofits Are Using AI Right Now
Nonprofits already experimenting with AI are seeing early wins. Take grant writing, for example. Nearly 25 percent of surveyed organizations use AI to streamline this process, which allows staff to focus on other priorities. Others are leaning into marketing automation tools like HubSpot to improve donor engagement, while some use AI-powered transcription and summarization tools to make meetings more accessible.
If you’re unsure where to start, consider the most time-consuming tasks on your team’s plate. Could AI help? For example:
- Consider tools that automate email sequences if donor follow-ups are slipping through the cracks.
- If your staff spends hours summarizing meeting notes, AI transcription tools like Otter.ai might save the day.
- If your website could use a personal touch, AI can help tailor the experience for different visitors.
The key is starting small and building from there.
Breaking Through the Barriers
Of course, adopting AI isn’t without its hurdles. Budget constraints are a real concern, especially for smaller organizations. Ethical considerations — like data privacy and bias — are also at the top of many nonprofit leaders' minds.
How do you overcome these challenges? The first step is to build a clear plan. The report found that nonprofits with a defined AI strategy are better equipped to navigate these barriers and align AI initiatives with their mission.
If your organization doesn’t have a strategy yet, start by identifying one or two areas where AI could make the biggest impact. Focus on tools that are affordable and easy to implement and identify areas of your operations that could stand to gain from the added efficiency.
Another critical piece is education. You don’t need to be an AI expert to use these tools effectively, but knowing the basics can go a long way.
If your team needs support, consider partnering with experts or consulting services like TechSoup’s AI Starter Package.
What’s Next for AI in Nonprofits?
Based on survey results, nonprofits plan to adopt even more advanced AI tools, from predictive analytics forecasting donor behavior to chatbots improving supporter engagement. If you’re already experimenting with AI, now is the time to think about expanding those efforts. How can you integrate these tools into your broader operations to grow your impact?
For smaller organizations, the future of AI doesn’t have to feel out of reach. Many tools are now designed to be user-friendly and cost-effective, making them accessible even if you don’t have a dedicated tech team.
The good news is that AI is more accessible than ever. Affordable solutions like free AI writing tools, marketing automation platforms, and open-source analytics software make it possible for even the leanest teams to get started. These tools allow nonprofits of all sizes to streamline operations and make data-driven decisions without needing large budgets or technical expertise.
Your Next Step
Whether you’re new to AI or ready to expand your use of these tools, the message is clear: Now is the time to act. Start by identifying one process or challenge that could benefit from automation or data-driven insights.
Explore free or low-cost tools that align with your needs. And don’t hesitate to seek help — partners like TechSoup and Tapp Network are here to guide you every step of the way.
AI isn’t just a trend — t’s another tool in your nonprofit’s toolbox that can help free up time and resources so your team can focus on what matters most: your mission.
Want the full story? Download the 2025 AI Benchmark Report on Adoption, Impact, and Trends today and gain deeper insights into how nonprofits adopt AI, overcome challenges, and plan for the future.
Thumbnail image background: Shutterstock
