Understanding gaps and opportunities in youth mental health funding

The pandemic amplified a long-standing decline in youth mental health, sparking much-needed conversations across the field and society at large. Yet, this increased visibility has not translated into access to effective care. In 2023, nearly 60% of youth with depression did not receive mental health treatment. The youth mental health system remains fragmented, underfunded, and difficult to navigate, especially for rural youth and youth of color, who are less likely to receive services.

Recent federal budget cuts have widened existing gaps, placing renewed attention on philanthropy’s role in building a more impactful, inclusive mental health care ecosystem. But effective action requires a clear picture of where funding is currently flowing and where unmet needs persist.

Our team at New Profit, a venture philanthropy organization, partnered with human-centered design firm People Rocket to conduct a comprehensive landscape analysis of the youth mental health system in America and the nonprofits and funders addressing this issue. Our findings reveal that while philanthropic giving is rising, it’s still far below what’s required and heavily concentrated among a narrow set of approaches and geographies. As a result, many innovative, community-rooted solutions are left under-resourced.

A fragmented and uneven funding landscape

While foundation giving to youth mental health grew from 0.32% of total giving in 2019 to 0.43% in 2022, the field continues to receive less than 1% of philanthropic dollars overall. Moreover, the report finds that this funding is unevenly distributed, concentrated primarily on the West Coast and in the Northeast, reinforcing regional disparities in access to philanthropic support. Although more than 6,000 private foundations support youth mental health nonprofits, most grants are under $100,000, with an average contribution of $23,000—often insufficient to sustain or scale effective programs.

This mix of limited, short-term funding and geographic imbalance reinforces fragmentation across schools, health care providers, and community organizations, leaving youth and families to navigate a maze of disconnected services.

As we look to better understand how and where the philanthropic sector can fill gaps, the nonprofits working closest to young people offer three valuable lessons.

Understanding the breadth of youth mental health support

1. It does not have to be therapy to be therapeutic.

Young people benefit from a broad spectrum of support: community-based interventions, peer support, art programs, and digital tools. Yet, many of these approaches remain underfunded because they fall outside traditional health care systems. Evidence shows that collaborative care, integrated models, and family therapy can improve adolescent mental health. At the same time, nontraditional approaches are often more accessible and relatable for young people navigating complex social and systemic barriers. For many, the first step toward wellness starts with developing trust, creating space for creativity, and building culturally affirming environments.

As Rob Jackson, founder of Beats Rhymes and Life in Oakland, CA, shared: “What’s therapy vs. what’s therapeutic? There are programs we run that don’t involve clinicians…yet those programs still bring the same amount of healing and transformation.”

2. Why aren’t we funding prevention?

Early intervention offers another critical opportunity to reduce barriers and build resilience, connection, and well-being before issues escalate. Nonprofits such as F.L.Y. Girl Institute in Nashville, TN, and the Ever Forward Club in Oakland, CA, emphasize the need to support youth mental health before a crisis point. These preventative programs include providing training and support for educators and school staff, fostering youth identity, and adopting youth-centered approaches, yet many still lack sustained or flexible funding.

3. It’s not really a system. It’s a fractured patchwork set of services.

Schools, health care providers, and community-based organizations often operate in silos, placing an unfair burden on youth and their families to coordinate care. Fragmented or short-term funding makes it difficult to build durable solutions.

Organizations like Ohio School Based Health Alliance and Rural Opportunity Institute in North Carolina are building coordinated infrastructures, such as cross-sector partnerships or shared care plans that can support young people across settings, reduce friction and stigma, and provide continuity of care. These efforts demonstrate what becomes possible when systems align rather than operate in silos.

Insights from the field

The research and these featured stories underscore how philanthropy can reshape the youth mental health ecosystem by investing in what communities know actually works. That includes supporting leaders who reflect, understand, and are deeply embedded in the communities they serve; funding programs that meet young people where they are, including before a crisis emerges; and strengthening models that bridge across sectors and systems.

By shifting where and how we invest, funders can build a youth mental health ecosystem where young people have the support they need to thrive.

Photo credit: Ever Forward Club, Katrina Thompson