- Color of Change recently announced significant cuts to its budget and staff.
- Dozens of interviews and a review of internal documents show a pattern of lavish spending.
- The Color of Change Education Fund’s board chair called last year’s fiscal budget “too ambitious” but said the organization was on “solid financial footing.”
Color of Change touts itself as the US’s “largest online racial justice organization” and says it has over 7 million members. Since 2006, the pioneering group has weighed in on issues from bias in Hollywood to the recent killing of Jordan Neely on a New York City subway car.
Its public profile grew substantially following the wave of demonstrations in the summer of 2020 after the police murder of George Floyd. The organization partnered with Airbnb to address racism on the platform, and it worked with The Recording Academy to “promote positive social change within the music industry.” Its president, Rashad Robinson, became a regular media presence, including an appearance with Oprah and a profile in Forbes.
The increased attention drove a significant uptick in funding. Color of Change collected over $30 million in donations between its two nonprofit arms in the first six months of 2020 alone — more than it had raised in any prior full year.
But the organization’s leadership appeared ill-suited to handle the rush of cash. Color of Change dramatically increased its spending in 2020, and it continued burning through its cash even as revenue declined.
Documents show that tens of millions of dollars were spent on executive salaries, high-profile events, consultants, and projects with dubious connections to tangible impacts on social justice. Staff members say directionless leadership and scant board oversight contributed to the spending as leaders apparently hoped their expenses would be covered by funding that was just over the horizon.
Now, the civil-rights organization is facing financial turbulence, according to interviews with more than 30 current and former staff members, managers, directors, executives, and contractors across almost every team at Color of Change, as well as meeting recordings, internal communications, and other documentation reviewed by Insider.
At a May 12 board meeting, an outside financial consultant suggested that one option for the organization could be filing for bankruptcy, according to two people with direct knowledge of the presentation.
In a Medium post published after Insider sent over the results of its reporting, the board chairs wrote that the organization was cutting its budget by $20 million, going back to pre-2020 levels. Their post, published June 22, served as the first official communication to most staff members that budget and staff cuts were imminent. A week later, 49 staffers were laid off, according to staff and a list of eliminated positions reviewed by Insider. Those cuts came on the heels of two rounds of layoffs this spring.
—R.Nicole (@scholar_auntie) June 29, 2023
Documents obtained by Insider show board-approved annual budgets of about $43 million a year for the past two years, despite annual cash receipts of about $26 million.
A November 2021 financial report found the organization spent $1.52 for each dollar raised through the summer to fall of that year. And according to one report submitted to the board in February, the organization spent more than a million dollars more than it brought in each month during the second half of 2022.
Though its revenue has remained above 2019 levels, it’s down from 2020, and the organization hasn’t been raising enough money to pay its bills, according to staffers and documents. It has begun to dip into its limited financial reserves — about $4 million — to meet its current obligations and payroll. And it is still millions behind in payments due. Some vendors who weren’t paid on time have cut off their services.
“I think culturally, internally, we’ve been very used to being kind of the big fish, and like having the money,” one manager told her staff during a recorded meeting in December, emphasizing the need to reduce spending. “I almost compare it to, like, the music industry in the ’90s, like when everybody was like Champagne-popping on boats and the videos.”
A high-level staffer with direct knowledge of the organization’s finances said that after accounting for the reserves and other funds on hand the organization was at least $4 million in the red.
“What I will say is that in our last fiscal-year budget, we did set a budget that was too ambitious,” Andre Banks, the board chair of the organization’s 501(c)(3), the Color of Change Education Fund, said in an interview. “Our projections and our finance infrastructure actually failed us a bit here, in both capturing some of the challenges and in working to quickly pivot.”
Banks added that the organization had never considered filing for bankruptcy.
“Color of Change is on a solid financial footing and will be going forward,” he said. In the Medium post, the board chairs wrote the organization recently “instituted new systems to proactively address emerging financial challenges.”
In a written statement, Color of Change also claimed Insider’s reporting contained inaccuracies. It didn’t send any details in support of this claim, despite multiple requests from Insider. It also hasn’t provided any recent charitable tax filings or independent financial audits.
Spending was already high before Floyd’s killing — roughly $47 million from 2017 to 2019, compared with revenue of about $52 million. But despite internal reports of deficits going back to 2021, Rashad Robinson and other leaders at the organization have been slow to rein in spending. Color of Change is on the hook for more than $8 million in consultant expenses for the current fiscal year and over $1.7 million in rent for offices with custom furniture in Oakland, California; New York City; and Washington, DC, even though most of the staff has been working remotely since 2020, according to a breakdown of expenses reviewed by Insider.
Most current and former staffers who spoke with Insider requested anonymity, citing nondisclosure agreements and the risk to their professional reputations.
This year, a media production consultant lodged two complaints with New York’s Office of Labor Policy & Standards after months of unsuccessfully seeking payment. (She was eventually paid.)
The consultant, who started working with Color of Change in 2022, worked on videos that cost the organization tens of thousands of dollars, but many have only a few hundred views each on YouTube. Though they were intended for promotional purposes, some appeared to sit unused.
On multiple occasions, she said, production was delayed and money wasted because a Color of Change staffer in charge of the project would go on vacation in the middle of development.
“I think that if the donors knew how they allocated their money, they would be appalled,” she said.
Ben O’Keefe, a media producer who worked for Color of Change for five months in 2019, said spending was rampant while he was with the organization. He said roughly $25,000 was spent per episode of a podcast he produced that had fewer than 300 monthly listeners.
“Money was never an object, which sounds like a good thing until you start to understand that people are donating $5 a month, and it’s all they have,” O’Keefe said. “It’s being spent on fancy meals and extravagant offices and not much else.”
Salaah Muhammad, a former regional manager who was laid off in the spring, said he witnessed rampant spending and lax controls on accounting. He said the organization spent $200,000 on a high-profile event at Miami’s Art Basel to highlight public safety through art; still, the organization wouldn’t approve $5,000 to finance a coat drive for people without housing in Minneapolis during the winter of 2021. Muhammad and another person with access to budget information said hundreds of thousands of dollars were also spent on carnivals on Martha’s Vineyard and elsewhere in 2022 to call attention to book bannings happening around the US and to celebrate Black history. (In a written statement, Color of Change disputed these numbers, and said the event on Martha’s Vineyard “only cost $7,000 to execute.” Budget and planning documents reviewed by Insider show the organization paid at least $28,697.37; Color of Change noted that this number “doesn’t include the proper context and understanding that we were involved in multiple events on Martha’s Vineyard.”)
“For an organization that says they’re doing all of these things to make the world a more humane, a less hostile place for Black people, it seems as though they’re more aligned with wanting to throw an elaborate party,” Muhammad said.
In May, Insider reported on the internal strife that former and current staffers said had permeated Color of Change for years. They described a chaotic work environment that suffered from allegations of harassment, gender discrimination, and abuse. After HR investigations in 2022, multiple senior staff members left the organization or were fired, and emails about the issues were sent to board members and the president’s leadership team.
Throughout this turmoil, one former staff member and two current high-level staffers with direct knowledge felt board members seemed more concerned with procuring rooms in expensive hotels with posh amenities during meetings and retreats than addressing internal issues. (Color of Change disputed this.)
These staffers said they believed board members had been lax in their oversight because of their deep personal connections to Robinson. He is, for example, godfather to the ColorofChange.org board chair Heather McGhee’s child.
In 2017, the board, citing safety concerns, began paying for Robinson’s high-rise apartment in a Manhattan building and for private security. Staffers also said the organization paid for a luxury-car service.
In response to questions about payments for the apartment, security service, and luxury-car service, Color of Change provided a document from 2020 showing unanimous approval by the board to pay $7,350 a month for his residence through January 2022, along with an assessment by a security consultant. The consultant found a moderate level of risk in 2017 and had upgraded the assessment to “an unparalleled level of risk” in 2020. As support, the organization included six archived 2020 posts from 4chan in which Robinson’s name is listed with dozens of other activists with no threats of violence.
“We forced him to move out of his home,” Banks, the Color of Change Education Fund chair, said. “He did not ask for this. It was something that we pushed him to do in order to secure his safety.”
Two years later, in 2019, the board increased Robinson’s base salary by $114,000 and awarded him a $73,000 bonus, giving him a total compensation above $458,000 — nearly $125,000 more than the president of the NAACP for that year — according to Color of Change’s 2019 charitable filings. (Color of Change didn’t report executive salaries on its 2020 charitable filings and hasn’t released its 2021 or 2022 filings.)
Many current and former staffers said they found Robinson to be more concerned with using Color of Change resources to advance his personal brand than with promoting racial justice. Color of Change staff members and consultants were assigned to work on his social-media accounts and a personal book project that has cost the organization hundreds of thousands of dollars, and a former member of senior leadership said a photo shoot was once scrapped because there wasn’t a fedora on hand that suited his tastes. (Color of Change disputed this.)
When the organization hosted an event during Fashion Week in February 2022 meant to highlight Black designers, Robinson refused to wear clothing provided by one of the designers unless it was tailored for him. “I’ve been doing my best to make it clear that it is impossible for me to get a suit off the rack,” he wrote in a coordination email chain after daily inquiries about his outfit.
A sizable chunk of spending also went to white-led consultant groups. Nine current and former staff criticized this decision and said these groups dominated Color of Change’s messaging.
Millions went to the public-relations firms Fenton Communications and Berlin Rosen, and extensive resources were given to Ryan Senser, a white man who helps draft Robinson’s opinion pieces, speeches, and book chapters and contributes to many aspects of Color of Change’s strategic mission.
Senser’s consulting company was paid $118,000 in 2018. By 2022, the contract had grown to $265,000. Documents reviewed by Insider show that it was contracted for at least $295,000 in 2023 and has been paid at least another $15,000 by the Color of Change PAC this year, making his work some of the longest-running and best-compensated at the organization.
Half a dozen current and former workers, all of whom are Black, said they witnessed or experienced Senser putting down the work of the mostly Black staff, and suggesting that he was more skilled at communicating to communities of color. Three of the workers, all women, also said he had singled out Black women.
“He very frequently made it clear that he thought he knew how to talk to Black people better than Black people,” the media producer O’Keefe said.
“Like any consultant or PR firm who works on communications, I contribute to content at the direction of Rashad or other staff, based on their input, ideas, goals and strategy,” Senser told Insider in an emailed statement. “Saying or even implying that I wholly ‘write Rashad Robinson’s opinion pieces, speeches, book chapters etc. is not true and is not only defamatory but also reinforces a deeply racist trope that there’s a white person behind a Black leader’s vision, ideas or success.”
“Not only would I never ever tell any Black person on staff that they don’t effectively communicate to communities of color (and have never done so), I am not even involved in shaping those communications,” he wrote. (Emails and other exchanges obtained by Insider show that he helps draft messages to funders and helps shape Color of Change communications.)
Senser was also behind a major push for Storyworld — an amorphous multimillion-dollar project seeking to “drive conversations that will change the rules of storytelling for scripted and unscripted TV & film, podcasts, music videos, video games, TikTok houses, infotainment, news media, advertising and more,” according to a project proposal acquired by Insider.
In February, the organization leased a Hollywood warehouse to house the project’s 19 offerings, such as interactive workshops, exhibits, and event spaces. The rent totaled $14,000 a month, and $76,000 was a deposit paid at signing, according to a breakdown of expenses and two staffers with direct knowledge of the organization’s financing. The project is on hiatus, however, because of insufficient funds, and three staffers said the building was set for demolition.
Nevertheless, the organization has tried to put a positive spin on the financial struggles. In its recent Medium post, the board chairs wrote, “We hope Color Of Change’s story can serve as both a lesson and an inspiration to other organizations.”