Nonprofit Software Security: What the Blackbaud Data Breach Means for Your Organization
In 2020, Blackbaud — the largest software provider in the nonprofit sector — suffered a ransomware attack that exposed donor data at thousands of organizations. The fallout included a $49.5 million FTC settlement, class-action lawsuits, and a crisis of trust that's still rippling through the sector.
If your nonprofit stores donor names, addresses, giving history, or financial details in any software platform, this story matters to you.
What Happened: The Blackbaud Breach Timeline
In May 2020, attackers gained access to Blackbaud's systems and extracted data from thousands of nonprofit, hospital, and university databases. The stolen data included donor names, contact information, giving histories, and in some cases Social Security numbers and bank account details.
Blackbaud paid the ransom. Then they waited months to tell the organizations whose data had been stolen.
The Fallout
- $49.5 million FTC settlement — The Federal Trade Commission charged Blackbaud with failing to protect consumer data and misleading affected organizations about the scope of the breach
- State attorney general settlements — 49 state attorneys general reached a separate $6.75 million settlement
- Class-action lawsuits — Dozens of affected organizations and donors filed suit
- SEC charges — The Securities and Exchange Commission charged Blackbaud with making misleading disclosures about the breach to investors
- Thousands of organizations affected — Nonprofits, hospitals, universities, and faith-based organizations across the U.S., U.K., and Canada
The breach wasn't just a technology failure. It was a trust failure. Nonprofits that had entrusted their most sensitive data to Blackbaud learned that their vendor had been careless with it — and then slow to tell them about it.
Why This Matters for Your Nonprofit
You might think, "We don't use Blackbaud, so this doesn't affect us." But the Blackbaud breach exposed a problem that applies to every nonprofit: your donor data is only as safe as the software holding it.
Your Donors Trust You With Their Information
Every time someone gives to your organization, they share personal and financial information. They trust you to protect it. A data breach doesn't just expose records — it damages the relationship between your nonprofit and the people who support it.
You May Be Legally Liable
Depending on your state, your nonprofit may be required to notify donors if their data is compromised — even if the breach happened at your software vendor. Many of the organizations affected by the Blackbaud breach had to send notification letters to donors, absorb legal costs, and manage public relations fallout they didn't cause.
Donor Retention Suffers
Research consistently shows that data breaches reduce consumer trust and spending. For nonprofits, that translates directly to lower donor retention. If your supporters learn their data was exposed, some of them won't come back.
What to Look for in Secure Nonprofit Software
Not every nonprofit can hire a cybersecurity team. But you can ask the right questions when choosing software. Here's what to look for.
Data Encryption
Your data should be encrypted both in transit (when it moves between your browser and the server) and at rest (when it's stored). This is table stakes — if your provider doesn't offer both, keep looking.
Data Isolation
In shared platforms, one organization's data should never be accessible to another. Ask your provider how they keep your data separate. The answer should be clear and specific, not vague.
Regular Backups
Your provider should run automated backups and be able to tell you how often they happen, how long backups are retained, and how quickly they can restore your data if something goes wrong.
Incident Response Plan
Every software provider should have a documented plan for what happens when something goes wrong. Ask: How quickly will you notify us? What steps do you take to contain a breach? Who is responsible?
One of the biggest failures in the Blackbaud breach was the delay in notification. Your provider should commit to prompt, transparent communication.
Transparent Security Practices
If a vendor can't or won't answer basic security questions, that's a warning sign. Good providers are open about their security practices because they're confident in them.
No Unnecessary Data Retention
Your provider shouldn't store sensitive data longer than needed. Ask about data retention policies and whether you can request deletion of old records.
A Security Checklist for Nonprofit Leaders
Use this checklist when evaluating any software platform:
| Question | What You Want to Hear |
|---|---|
| Is data encrypted at rest and in transit? | Yes — with modern encryption standards |
| Is our data isolated from other organizations? | Yes — each organization's data is kept completely separate |
| How often are backups run? | Daily or more frequently, with offsite storage |
| What's your incident response plan? | Documented plan with specific notification timelines |
| Have you had a data breach? | Honest answer with details on what changed afterward |
| Can we export or delete our data? | Yes — you own your data and can take it with you |
| Do you have compliance certifications? | SOC 2, GDPR compliance, or equivalent |
How Alignmint Handles Security
We built Alignmint knowing that nonprofits handle sensitive donor and financial data every day. Security isn't an afterthought — it's foundational.
- Your data stays completely private and separate — Every organization's data is isolated. No other organization can ever access your records.
- Encryption everywhere — Data is encrypted in transit and at rest using modern standards.
- Automatic backups — Your data is backed up regularly with redundant storage.
- You own your data — Export it anytime. Delete it anytime. It's yours.
- Modern infrastructure — Built on modern cloud architecture with continuous monitoring, not legacy systems from the 1990s.
- No hidden data sharing — We don't sell, share, or monetize your data. Period.
The Blackbaud breach happened in part because of aging infrastructure and insufficient security practices at a company that had grown through decades of acquisitions. Alignmint was built from scratch with modern security standards — not bolted onto legacy systems.
What to Do Right Now
Whether you use Blackbaud, another legacy platform, or newer software, take these steps today:
- Ask your current provider the questions in the checklist above. If they can't answer clearly, that's a problem.
- Review your data — Do you know exactly what donor information your software stores? Where it's stored? Who has access?
- Check your contracts — Does your software agreement include data breach notification requirements? Liability provisions?
- Have a plan — If your donor data were exposed tomorrow, do you know what you'd do? Who you'd notify? How you'd communicate with donors?
- Consider your options — If your current platform can't give you confidence on security, it may be time to look at modern alternatives.
The Bottom Line
The Blackbaud data breach was a wake-up call for the entire nonprofit sector. $49.5 million in settlements. Thousands of organizations affected. Millions of donor records exposed.
Your donors trust you with their personal and financial information. The software you choose to store that data matters. Ask hard questions, demand clear answers, and choose a platform that treats security as a priority — not an afterthought.
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- Blackbaud Alternative for Nonprofits — Modern software without the bloat
- Blackbaud CRM — Is it right for your nonprofit?
- Donor Management — See how Alignmint handles donor data
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