Is Capacity funding Alone Missing the Bigger Picture?
Why an Ecosystem Approach Benefits Nonprofits
The Infrastructure Behind the Impact
By: Eric Phamdo, Senior Program Officer of Non-Profit Support & Innovation
October 2026
In The Infrastructure Behind The Impact, Eric Phamdo, the Ralph C. Wilson, Jr. Foundation’s Senior Program Officer of Nonprofit Support and Innovation, explores why strong nonprofits need strong, connected systems of support. Through this mini-series, he shares insights from the Foundation’s first 10 years of partnership and makes the case for investing in the infrastructure that helps nonprofits build capacity and sustain their impact.
The Ralph C. Wilson, Jr. Foundation’s Nonprofit Support and Innovation (NPSI) work began with a hypothesis: Investing in capacity-building organizations could help nonprofits access the expertise and support they need to strengthen their work. But through our relationships with partners across Southeast Michigan and Western New York, we came to understand that the capacity of individual support organizations was only part of the story. No single organization can meet every nonprofit need, and the connections among them matter just as much. These organizations already bring deep expertise and trusted relationships to their communities. Our role has been to build on those strengths, help fill gaps and support greater coordination so that wherever a nonprofit turns for help, it can find a path to the right expertise. For funders, an important lesson is emerging: Strengthening the sector means investing not only in the capacity of support organizations, but also in the relationships and infrastructure that allow them to coordinate and respond as needs evolve.
Like a small business or entrepreneur, what a nonprofit needs changes over time. A nonprofit can need different kinds of support at different stages: leadership development at one point, financial or operational expertise at another, and fundraising, technology or strategy somewhere else. No single organization is built to provide all of it. So the question remains: Can a nonprofit walk through any trusted door and reach the right support without first learning the whole landscape? When the strengths of different support organizations are connected, finding help stops being the nonprofit’s burden alone
Direct support for an organization’s capacity is an important part of the equation. Research from the Center for Effective Philanthropy found that 82% of nonprofit leaders who received capacity-building support alongside multiyear general operating funding rated that support very or extremely helpful in strengthening their organizations. But in the long run, strengthening nonprofits individually may not be enough. A nonprofit can be well led and well resourced and still hit a wall it can’t get past alone. Sometimes it’s a problem. Sometimes it’s growth, and the organization has simply outrun its own expertise. Either way, the answer isn’t asking every nonprofit to build everything in-house. It’s making sure a strong system exists for them to turn to.
In Southeast Michigan, the Transforming Solidarity Collective (TSC) makes that approach tangible. Formed in 2020, it brings together five nonprofit intermediaries with distinct areas of expertise around the shared goal of making it easier for nonprofits to enter through one trusted relationship and connect to the support they need across the network.
In Western New York, the Nonprofit Support Group (NSG), a collaborative of funders, works with intermediaries and service providers around the same underlying idea. Through shared learning, joint initiatives and nonprofit-informed responses, the group helps identify gaps in the support landscape and respond collectively.
That networked approach then raises the question of who sustains the system itself. If we expect intermediaries to hold expertise, relationships and coordination for the sector, their own capacity can’t be an afterthought. Capacity builders need capacity, too. They need the resources to sustain staff, expertise, technology, learning and coordination, and treating that work as optional or episodic leaves the whole system more fragile.
The past decade has reinforced for us that supporting nonprofits and supporting the system around them are not separate strategies. As a limited-life foundation that will close its doors in 2035, our goal is to help strengthen organizations, relationships, and infrastructure that can continue serving nonprofits long after our grantmaking ends. We are encouraged to see other funders investing in this work, and we hope more will join in supporting the infrastructure a healthy nonprofit sector depends on.
Over the course of this series, I’ll share more of what our partners have taught us as we have tested that idea, where our assumptions held, where they changed and what those lessons may ask of philanthropy.
Eric Phamdo is a senior program officer at the Ralph C. Wilson, Jr. Foundation, where he supports nonprofit capacity building and place-based economic development across Southeast Michigan and Western New York. Through the Foundation’s Nonprofit Support & Innovation initiative, he works with intermediary organizations and fellow funders to strengthen the resources and connections nonprofits rely on to serve their communities.
Eric’s work centers on expanding access to capacity building support and encouraging collaboration across the Foundation’s two regions. He holds bachelor’s and master’s degrees from the University of Rochester, where he studied cross-cultural psychology, sustainability and business administration, and a Public Leadership Credential from the Harvard Kennedy School.