Nonprofit Software M&A: A Founder's Guide to the 2025-26 Market

The nonprofit software market is undergoing a period of intense consolidation that has fundamentally reshaped the competitive landscape. What was once a fragmented ecosystem of specialist tools for fundraising, donor management, grants administration, and financial reporting has become a battleground for private equity-backed platforms pursuing aggressive roll-up strategies. At the centre of this transformation sit two dominant forces: Blackbaud, the publicly traded incumbent with $1.155 billion in revenue for 2024 and a long history of strategic acquisitions including the $750 million EVERFI deal in December 2021; and Bonterra, the PE-backed challenger assembled through the rapid-fire acquisitions of EveryAction, Social Solutions, CyberGrants, and Network for Good between June 2021 and January 2022.

For founders running nonprofit software businesses, this consolidation creates a paradoxical opportunity. On one hand, the market is becoming more concentrated, with fewer independent competitors. On the other, the appetite for acquisitions has never been greater. The nonprofit software market is projected to reach $7.24 billion by 2031, growing at a 7.88% CAGR, and both strategic and financial buyers are actively seeking businesses that can extend their platforms, fill product gaps, or deliver new customer segments.

This guide examines the nonprofit software M&A landscape in detail: the deals that have shaped the current market, the valuations founders can expect, the acquirers driving consolidation, and the practical considerations for a CEO weighing a transaction. Whether you have built a donor management platform, a grants management system, a nonprofit accounting tool, or a volunteer engagement application, understanding these dynamics is essential for making informed decisions about your company's future.

Market Overview

Market Size and Growth

The global nonprofit software market was valued at approximately $4.25 billion in 2024 and is projected to grow to $7.24 billion by 2031 at a CAGR of 7.88%, according to Mordor Intelligence. North America remains the largest market, driven by the density of nonprofit organisations in the United States and Canada, while the Asia-Pacific region represents the fastest-growing segment.

Growth drivers include the increasing adoption of cloud-based solutions, automation of nonprofit workflows, integration of AI-powered analytics into fundraising platforms, and rising compliance requirements around data privacy and financial reporting. Nonprofits are also investing more heavily in technology as donor expectations evolve and competition for charitable contributions intensifies.

The Software Landscape

Nonprofit software spans several interconnected categories:

Fundraising and donor management (CRM): The largest category, encompassing platforms for managing donor relationships, processing donations, running campaigns, and tracking engagement. Blackbaud's Raiser's Edge NXT and Luminate Online, Bonterra's EveryAction, Bloomerang, and Salesforce Nonprofit Cloud are the primary competitors.

Grants management: Software for managing grant applications, awards, reporting, and compliance. Blackbaud's GIFTS and CyberGrants (now part of Bonterra) are established players, with newer entrants like Submittable and Fluxx gaining ground.

Nonprofit accounting and ERP: Financial management tools designed for the specific requirements of nonprofit accounting, including fund accounting, grant tracking, and regulatory reporting. Blackbaud Financial Edge NXT, Sage Intacct, and Abila (now part of Community Brands) serve this market.

Volunteer management: Platforms for recruiting, scheduling, and engaging volunteers. Galaxy Digital, InitLive, and various Bonterra products compete in this space.

Social impact measurement: Tools for tracking outcomes, measuring programme effectiveness, and reporting to stakeholders. This is a growing niche driven by funder demands for evidence-based impact.

Key Players

Blackbaud (NASDAQ: BLKB) is the undisputed market leader, serving nearly 100,000 customers globally across fundraising, financial management, grantmaking, and social impact. Founded in 1981, the company has built its dominant position through four decades of organic growth and strategic acquisitions.

Bonterra, backed by Apax Partners, was created in 2022 through the merger of EveryAction, Social Solutions, CyberGrants, and Network for Good. The company positions itself as a modern alternative to Blackbaud, offering a suite of fundraising, advocacy, and programme management tools.

Bloomerang is an independent donor management platform known for its user-friendly interface and strong customer satisfaction scores. The company strengthened its position by acquiring Qgiv, a fundraising and donor engagement platform, in 2023, further consolidating the mid-market donor management segment.

Salesforce offers Nonprofit Cloud, leveraging its dominant CRM platform to serve larger nonprofits. While not a specialist, Salesforce's presence creates both competitive pressure and integration opportunities for smaller vendors.

M&A Activity and Deal Flow

Blackbaud's Acquisition Machine

Blackbaud has been the most prolific acquirer in nonprofit software over its four-decade history, completing approximately 17 acquisitions in total. The company's largest and most notable recent acquisition was EVERFI for approximately $750 million in December 2021, extending its reach into social impact education and corporate social responsibility technology.

Blackbaud's acquisition strategy focuses on expanding its product suite across the nonprofit lifecycle: from fundraising and donor management to financial operations, grants management, and impact measurement. The company's investor presentations consistently highlight acquisitions as a key growth lever, supported by strong free cash flow generation and "financial flexibility for future acquisitions."

For founders, Blackbaud represents a strategic acquirer with deep domain expertise, an established customer base for cross-selling, and a track record of integrating acquired businesses into its platform. However, Blackbaud's scale and complexity also mean longer integration timelines and the potential for acquired products to be folded into existing offerings.

The Bonterra Roll-Up

The creation of Bonterra represents one of the most ambitious roll-up strategies in nonprofit technology. Apax Partners, a global private equity firm, executed a rapid series of acquisitions between 2021 and 2022:

• CyberGrants: Acquired June 2021 (grants management and corporate giving)
• EveryAction: Acquired October 2021 (fundraising, advocacy, and digital engagement)
• Social Solutions: Acquired October 2021 (case management and outcomes tracking)
• Network for Good: Acquired January 2022 (donor management for small nonprofits)

The merged entity, rebranded as Bonterra, aims to offer a comprehensive platform spanning fundraising, advocacy, case management, grants, and corporate social impact. However, as with many PE-backed roll-ups, the integration has not been seamless. Some customers and industry observers have noted fragmentation in the product suite, with acquired tools requiring significant integration work to deliver a unified experience.

Community Brands and Other Acquirers

Community Brands, backed by private equity, has pursued a similar roll-up strategy in the adjacent association management and faith-based software markets, acquiring tools for membership management, event registration, and nonprofit accounting. While not directly competing with Blackbaud and Bonterra across all categories, Community Brands illustrates the PE appetite for mission-driven software verticals.

Microsoft and Salesforce

Microsoft's partnership with Blackbaud to bring AI and analytics capabilities to nonprofit software, and Salesforce's continued investment in Nonprofit Cloud, represent strategic moves by horizontal technology giants to capture a larger share of the nonprofit market. While neither company is actively acquiring specialist nonprofit vendors at scale, their presence shapes the competitive landscape and creates integration opportunities for smaller businesses.

Notable Recent Transactions

Deal	Buyer	Approximate Value	Date
EVERFI	Blackbaud	~$750 million	December 2021
EveryAction	Apax Partners (Bonterra)	Undisclosed	October 2021
Social Solutions	Apax Partners (Bonterra)	Undisclosed	October 2021
CyberGrants	Apax Partners (Bonterra)	Undisclosed	June 2021
Network for Good	Bonterra	Undisclosed	January 2022
Qgiv	Bloomerang	Undisclosed	2023

Valuation Benchmarks

Nonprofit software valuations reflect the sector's attractive characteristics: high customer retention (nonprofits rarely switch core systems), predictable revenue, and resilience through economic cycles (charitable giving is more stable than discretionary spending).

Revenue Multiples

Private nonprofit software companies typically trade at 4x to 8x ARR, with the range depending on growth rate, scale, and product breadth:

• Small, niche tools ($1 million to $5 million ARR): 3x to 5x revenue
• Growth-stage platforms ($5 million to $25 million ARR) with strong retention: 5x to 7x revenue
• Market leaders with comprehensive suites and enterprise relationships: 7x to 10x revenue

Blackbaud's public market valuation provides a reference point: the company trades at approximately 4x to 5x revenue, reflecting its mature growth profile. Private, higher-growth businesses typically command a premium to this benchmark.

EBITDA Multiples

Profitable nonprofit software businesses trade at 12x to 18x EBITDA, with premiums for:

• High gross margins (above 70%)
• Net revenue retention above 105%
• Low annual churn (below 5%)
• Multi-product platforms with cross-sell opportunities

What Drives Premium Valuations

• Mission-critical positioning: Software deeply embedded in fundraising operations, financial reporting, or compliance is extremely sticky and commands higher multiples
• Large, loyal customer bases: Nonprofits are notoriously loyal to their technology providers; demonstrated low churn is a powerful valuation driver
• Data and analytics capabilities: AI-powered donor insights, predictive giving models, and impact measurement tools represent high-value differentiators
• Recurring revenue purity: Businesses with high percentages of subscription revenue (above 80%) are valued more highly than those with significant services or implementation revenue
• Regulatory compliance features: Tools that help nonprofits comply with financial reporting, tax, and data privacy requirements create additional switching costs

Key Acquirer Profiles

Blackbaud

The dominant strategic acquirer in nonprofit software, Blackbaud targets businesses that extend its platform across the nonprofit technology stack. The company has the financial resources, domain expertise, and customer base to integrate acquisitions effectively. Founders considering Blackbaud should expect a thorough due diligence process focused on product fit, customer overlap, and integration feasibility.

Bonterra (Apax Partners)

Bonterra represents the PE-backed consolidator model, seeking to build a comprehensive platform to challenge Blackbaud's dominance. The company targets fundraising, advocacy, case management, and grants management tools. For founders, a sale to Bonterra typically involves rolling equity, performance-based earnouts, and integration into a multi-product platform.

Constellation Software

Constellation Software and its operating groups acquire vertical market software businesses across many sectors, including nonprofit and education technology. Constellation's buy-and-hold model, operational autonomy, and focus on profitable niche businesses make it an attractive option for founders who value long-term stability over aggressive growth.

Private Equity Firms

Multiple PE firms are active in mission-driven software, attracted by the sector's resilient revenue characteristics and fragmented competitive landscape. Founders should expect PE buyers to focus on EBITDA margins, growth potential, and the opportunity to build platform value through add-on acquisitions.

Consolidation Drivers

Market fragmentation: The nonprofit software market remains highly fragmented outside the top few players. Hundreds of small vendors serve specific niches: faith-based organisations, educational institutions, healthcare nonprofits, environmental groups. Each represents a potential acquisition target.

Platform expectations: Nonprofits are increasingly seeking unified platforms rather than assembling disparate point solutions. This drives acquirers to build comprehensive suites through M&A.

AI and analytics: The integration of artificial intelligence into fundraising, donor engagement, and impact measurement is creating new value pools. Acquirers are buying AI capabilities and data assets to enhance their platforms.

Generational succession: Many nonprofit software businesses were founded in the 2000s and 2010s by entrepreneurs who are now approaching succession planning. This creates a natural supply of acquisition targets.

Cloud migration: Nonprofits still running legacy on-premise systems represent a significant migration opportunity. Cloud-native acquirers are purchasing legacy providers to capture these customer bases.

Data privacy and compliance: Increasing regulatory requirements around donor data privacy (GDPR in Europe, state-level privacy laws in the US) are creating demand for compliance-ready platforms. Software that helps nonprofits manage consent, data retention, and reporting obligations creates additional switching costs and stickiness, making it attractive to acquirers seeking defensible market positions.

The professionalisation of philanthropy: As charitable giving becomes more sophisticated, with impact investing, donor-advised funds, and corporate social responsibility programmes all growing, the technology requirements for managing these relationships increase correspondingly. This professionalisation drives demand for more advanced software and creates opportunities for acquisitions in adjacent categories.

What This Means for Founders

The market heavily favours sellers with strong retention: Nonprofit software customers are famously loyal. If your annual net revenue retention exceeds 105% and gross retention exceeds 90%, you are well-positioned for a premium valuation.

Niche positions can be valuable: You do not need to compete directly with Blackbaud or Bonterra to attract acquirer interest. Specialist tools for grants management, volunteer engagement, impact measurement, or specific nonprofit subsectors (faith-based, higher education, healthcare) are attractive add-on targets for platform builders.

Prepare for the integration question: Acquirers will evaluate how your product fits into their existing suite. Demonstrating clear integration pathways, whether through APIs, data interoperability, or complementary functionality, significantly strengthens your position.

Consider the cultural dimension: Nonprofit software companies often have mission-driven cultures that may not align with every acquirer's approach. Understanding a buyer's post-acquisition philosophy, whether Blackbaud's strategic integration, Bonterra's rapid consolidation, or Constellation's operational autonomy, is critical for founders who care about the long-term trajectory of their business and team.

Timing considerations: With Bonterra still integrating its acquisitions and Blackbaud maintaining acquisition flexibility, the near-term pipeline of potential buyers is active. Founders who engage now can benefit from competitive dynamics between strategic and financial buyers.

Emerging Opportunities and Adjacent Categories

Beyond the core fundraising and donor management market, several adjacent categories present M&A opportunities for nonprofit software founders:

Impact measurement and outcomes tracking: Funders increasingly demand evidence-based reporting on programme effectiveness. Tools that help nonprofits measure, analyse, and communicate their impact are in growing demand and represent attractive acquisition targets for platform builders.

Digital engagement and advocacy: Platforms that enable nonprofits to mobilise supporters for advocacy campaigns, petition drives, and grassroots organising (a category EveryAction served before its Bonterra integration) continue to attract interest from acquirers seeking to offer end-to-end constituent engagement.

AI-powered fundraising: Predictive analytics for donor behaviour, AI-generated communications, and intelligent prospect research tools represent the next frontier in nonprofit technology. Blackbaud's partnership with Microsoft on AI integration, and the broader sector trend toward data-driven fundraising, signal strong acquirer interest in this category.

Faith-based and education-specific solutions: Subsector-specific tools for churches, religious organisations, K-12 schools, and higher education institutions serve large, loyal customer bases with distinct requirements. These niches are attractive to both Community Brands and Constellation Software.

Capturing Value in a Consolidating Market

The nonprofit software market is consolidating rapidly, with Blackbaud and Bonterra leading a wave of acquisitions that is reshaping the competitive landscape. For founders who have built valuable tools serving the nonprofit sector, this environment offers strong exit opportunities, particularly for businesses with high customer retention, recurring revenue, and defensible market positions.

The key to maximising value in this market is understanding where your business fits in the acquirer landscape and preparing accordingly. Whether your ideal outcome is a strategic acquisition by a market leader, a PE-backed platform play, or a sale to a permanent-hold acquirer like Constellation Software, the current market supports a range of transaction structures and valuations.

Founders who act with informed strategy and the right advisory support will be best positioned to capture the full value of what they have built in service of the nonprofit sector.