There was a really interesting interview last week in the Nonprofit Quarterly with Bill Ryan, author of Governance as Leadership, who recently led a study on coaching in the nonprofit sector. Coaching is a form of management consulting where a leader is given one-on-one strategic guidance.
An executive director can be coached to grow an organization, to build a stronger board, to revamp their financial model. Or as Ryan puts it, coaching answers the question: “If my organization wants to get to Point X, what do I, as a leader, need to do to build on my strengths and manage my weaknesses to help it get there?”
The concept of coaching is fascinating to me because, as Ryan points out, in corporate America coaching is much more commonplace than in the nonprofit world. If a CEO needs management counsel, they are encouraged to find a coach, whereas coaching for nonprofit leaders is often deemed a luxury. But, I think coaching is even more necessary in the nonprofit world. Nonprofit leaders, unlike their for-profit counterparts, often lack a management background having made their way to the top through program expertise.
The reality is that coaching for a nonprofit executive director can be absolutely transformative. It can make the difference between a program that is just getting by and a program that becomes financially sustainable and grows dramatically, with an engaged, committed board behind it.
Such is the case with ACE: A Community for Education, a nonprofit early childhood tutoring program. I have coached ACE Executive Director, Mary Ellen Isaacs for over a year since we completed an ambitious strategic planning process. They are now working to triple the number of students they serve and diversify and grow their financial model.
Here’s what Mary Ellen has to say about the coaching experience (or if you are reading this in an email click here to watch):
I believe coaching can be hugely transformative for nonprofit organizations, helping their leaders build the skills they need to grow their solutions far and wide. If you’d like to learn more about how I coach nonprofit leaders, check out the Coaching page of the website.
Photo Credit: wikimedia
There is something pretty interesting going on in Illinois around nonprofit overhead costs. I have written many times (here and here for example) about how the distinction between “overhead” and “program” costs in the nonprofit sector is meaningless at best, and destructive at worst.
I’m really excited to see that the Donors Forum in Illinois is starting to host real conversations between nonprofits and philanthropists about the Real Costs (including administrative costs) necessary to create effective social change.
With the help of the Bridgespan Group, in March the Donors Forum brought nonprofits and philanthropists together for a one-day discussion about real costs in the nonprofit sector. They want funders to understand that it is not enough to fund only nonprofit programs. In order to create effective social change, nonprofits must also be able to fund the infrastructure, staffing, space, tools, and research costs of their work.
The image above is a graphic facilitation of the March session. The Donors Forum has also developed a great website with resources for nonprofits and philanthropists about real costs, including Ann Goggins Gregory and Don Howard’s seminal article in the 2009 Stanford Social Innovation Review “The Nonprofit Starvation Cycle,” reports and resources about nonprofit fiscal fitness, Grantmakers for Effective Organization’s study on how philanthropy is changing, and much more.
As part of their efforts, the Donors Forum has also put together this video that helps to explain, in very clear terms, the critical importance of funding ALL of a nonprofit’s costs:
I’m excited to see where this conversation goes and whether more nonprofits and philanthropists start having open, honest conversations about what it really takes to create lasting social change. I’m hoping to interview Valerie Lies, President and CEO of the Donors Forum, later this year about this initiative and where they hope to go from here. So stay tuned.
But it doesn’t have to be that way.
If you can recruit the right people, get very specific about the skills they bring, and work with them to put their assets to use for your nonprofit, you can get even the most fundraising-shy board member to start bringing money in the door.
And this month’s Social Velocity webinar will show you how.
The Getting Your Board to Raise Money webinar will help you:
- Excite and engage the board in bringing money in the door
- Put every single board member to their highest and best use
- Set up a structure for effective board involvement in raising money
- Give you creative jobs for fundraising-shy board members
- Set up systems for tracking and rewarding board involvement
- Overcome board fear and inertia
This is one of our most popular webinars, and each time I’ve offered it, it sells out. Here’s what some past participants in this webinar had to say:
“This was one of the best and most helpful and informative webinars I’ve been on. It was exactly what I was looking for in terms of beginning to get our board energized and on track and I will use the slides
to help me prepare for our upcoming board retreat.”
“The webinar was very concrete and actionable – gave specific suggestions regarding
engaging board members. This was very useful. Well done.”
“This really opened my eyes to new possibilities – thank you so much!”
The registration fee will get you:
- A link to a recording of the webinar, which you can watch as many times as you like
- The PowerPoint slides from the webinar
- The ability to ask additional follow-up questions after the webinar
Download Now – $39
Photo Credit: buddawiggi
April was all data, all the time. From big data, to performance data, to how donors use data to improve programs, to whether donors even care about data. It’s enough to make your head spin. But many people were cautioning to keep the end goal in mind. Data is only data, its ultimate use is to create social change.
Below are my 10 favorite social innovation reads in April. But let me know in the comments what I missed. And if you want to see my expanded list, follow me on Twitter, Facebook, LinkedIn, or my newest addition, Google+.
You can see the 10 Great Reads lists from past months here.
- Writing on the Full Contact Philanthropy blog, David Henderson argues that we must understand the limitations of data, as he says “Decisions we make should be informed by data, but data does not make decisions for us.”
- Daryn McKeever from the Gates Foundation seems to agree arguing that we need to move from Big Data to Big Wisdom, using data to make better decisions. And David Brooks writing in the New York Times seems to fall into the same camp.
- The Stanford Social Innovation Review is celebrating their 10 year anniversary and as part of the festivities are running a series of essays about how social innovation has evolved and where it’s going. Part of that series is Tim Ogden’s controversial (I think) post claiming that contrary to growing belief donors don’t care about impact any more than they ever did.
- As a counterpoint, the recent NextGen study from the Johnson Center on Philanthropy found some pretty significant changes in how the newest donors, Millennials, do philanthropy. Michael Moody and Sharna Goldseker, authors of the report, break down how they think donors are changing.
- And adding to the conversation about whether donors care about outcomes, a debate raged between William Schambra from the Hudson Institute and Ken Berger from Charity Navigator. William argues that moving the nonprofit sector to outcomes measurement would lose other, more important and less tangible benefits (civic engagement, social bonds) that the sector promotes. But Ken argues that measuring outcomes is absolutely critical to helping the nonprofit sector create more change.
- During April’s annual Skoll World Forum a new Social Progress Index launched, a measure for comparing different countries abilities’ to “provide for the social and environmental needs of their citizens.” The hope is that the index will help guide social investment decisions. It will be interesting to watch how it evolves.
- For a really interesting case study on use of data, The National Center for Arts Research interviews Kate Levin, Commissioner of the New York City Department of Cultural Affairs about how they use data to make the case for investments in culture.
- I have been fascinated to watch New Orleans’ renaissance via social innovation in the years following Katrina. Two recent articles (here and here) highlight exactly how the city is coming back and the role social innovation is playing in that comeback.
- Albert Ruesga, Chair of Grantmakers for Effective Organizations and editor of the White Courtesy Telephone blog, writes a fairly scathing (but in a nice way) post about how philanthropists need to start having more difficult, honest conversations in order to move the sector forward. His post was in response to Caroline Preston’s February Chronicle of Philanthropy article in a similar vein and the impetus for a panel discussion in DC along the same lines. They promise to keep this conversation going. Let’s hope, because we need more cruelty, or at least honesty, in the sector.
- As I said last month, crowdfunding is apparently the next new shiny thing. And April continued the drumbeat with many more articles, the most interesting of which was Dowser’s list of 10 New Platforms for Crowdfunding.
Photo Credit: o5com
A big topic of conversation lately has been whether donors really care about impact, or whether they simply just give based on less scientific things like their emotions, or their friends recommendations. Which is why I’m excited to announce that I’ll be participating in a Google Hangout April 30th about using data to attract donors.
Writing in the Stanford Social Innovation Review, Tim Ogden claims that donors have never really been interested in impact. And Ken Berger from Charity Navigator and William Schambra of the Hudson Institute debate (here and here) whether moving the nonprofit sector toward performance management helps or hurts social change efforts.
To add to this conversation, David Henderson and I are hosting a Google Hangout, “How to Use Real Performance Data to Raise More Money,” on Tuesday, April 30th at 2pm Eastern. David is a super smart guy who runs Idealistics, a consultancy that helps nonprofits learn from their outcomes data, increase impact, and demonstrate results to funders and stakeholders. David’s professional focus is on improving the way social sector organizations use information to implement higher impact poverty interventions. He has been quoted in the Chronicle of Philanthropy and has written for Change.org and the Huffington Post. You can read my interview with him from a year and a half ago here.
David and I thought it would be interesting to host a conversation with nonprofit leaders about how nonprofits can use real performance data to raise more money. We’ll kick off the hour-long conversation with a couple of points and a case study or two of nonprofits that are using data to raise more money, but then we’ll open it up to you for questions. You can send us your questions ahead of time (via email to firstname.lastname@example.org or email@example.com) or simply post them to the Google Hangout here as you watch.
I hope you’ll join us!
How to Use Real Performance Data to Raise More Money
A Google Hangout with David Henderson and Nell Edgington
Tuesday, April 30th, 2013
Can nonprofits that use real performance data to raise more money? Are donor increasingly interested in impact data? How can nonprofits communicate their program data to donors? And how should nonprofits respond to questionable performance claims by other organizations? Join David Henderson from Idealistics and Nell Edgington from Social Velocity in a Google Hangout on Tuesday, April 30th at 2pm Eastern to discuss these and many more questions about how nonprofits can use real data to raise more money. We’d love to have you participate in the discussion, so send your questions ahead of time to Nell or David, or leave a comment at the Google Hangout here.
Photo Credit: 401(K) 2013
The majority of nonprofits struggle to bring money in the door. And they often don’t know why. When you are on the inside of an organization that is used to doing things a certain way it can be nearly impossible to see new opportunities, to understand what you could do differently. There can be many reasons why a nonprofit doesn’t bring enough money in the door.
But here are the top 5 reasons a nonprofit struggles financially:
- Too Many Programs Drain Money From Your Organization. It sounds like a truism — you struggle with money because your programs cost money. But the reality is that few nonprofits analyze their programs to determine each one’s individual impact on the bottom line. Often they will add a new program because it has an impact on the mission (or because a single funder wants the program), without understanding how the new program fits into the organization’s overall financial picture. The end result is an organization that is stretched to the breaking point. Nonprofits must analyze all of their programs to understand their impact not just on mission, but also on finances, then they can make decisions about where to more sustainably focus resources.
- You’re Leaving Money Up to One Person. The financial engine of a nonprofit must be a team effort. Yes, it is important, if you are large enough, to have a staff member whose sole job is to think about money, but you cannot leave it all up to her. The entire organization, from the front line program staff all the way up to the chair of the board must understand the critical importance of money and what role they individually play in securing it. Although program staff won’t actively solicit donors, they can still share client stories with donors, write blog or newsletter articles, participate in program tours with donors, and even suggest new ideas for tying money to their programs. And there are countless ways for board members to bring money in the door, but you have to make sure they are aware of and doing their part.
- You’re Not Effectively Telling Your Story. It is so common for nonprofit staff and board members, who believe so passionately in their cause, to think that it’s obvious to outsiders why they should get involved. But it isn’t. And in an increasingly crowded social change marketplace it is more important than ever that nonprofits be able to articulate, in a compelling way, what value they are providing a community.
- You’re Doing What Everyone Else Does. It drives me crazy when a nonprofit that is struggling financially witnesses another nonprofit’s fundraising activity and tries to replicate that perceived success, without analyzing if it makes sense. Just because it looks like a recent gala or a new thrift store rakes in the money doesn’t mean a) that it did actually make a profit for the nonprofit and b) that it would make a similar profit for your nonprofit. The key is to make the best use of your specific assets as an organization. Think about what value you have to offer and who might be interested in paying for that value. For example, a homeless shelter could financially partner with local businesses to move people away from storefronts and into more stable and life-changing accommodations. You have to analyze what you have to offer and who specifically would be willing to pay for that value.
- You’re Not Investing In Your Money Raising Function. If you don’t have enough or the right kind of staff in place to raise money it is little wonder that you struggle. And if you’re not giving them effective tools they will be at a loss. Think about your financial engine and the various revenue streams you employ. Do you have the technology, staffing, systems, materials, space you need to raise money well in those ways? For example, if you want to raise money from individuals you need an effective database system that tracks contact information, interactions, history, interests. Whatever ways you bring money in the door, you need to ensure you have enough and the right kind of tools to do it well.
If you’d like help to both assess why your nonprofit isn’t raising enough money and create a plan to raise more, join us for the Financing Not Fundraising E-Course. I’ll analyze how your organization brings money in the door, give you ideas for increasing your financial engine, and help you put together a new financing plan. You’ll also get to hear from and work with other nonprofit leaders in your shoes. Find out more about the Financing Not Fundraising E-Course here.
Photo Credit: tuppaware_001
I’ve been talking lately about nonprofits needing to make more investments in their organization, in their sustainability, and in their future. Well, I have the perfect opportunity for you to do just that. I’m excited to announce the newest Social Velocity tool — the Financing Not Fundraising E-Course. Over the course of two months I will be leading a group of 15 nonprofit Executive and Development Directors to determine what’s holding them back from raising more money and create a comprehensive financing plan for their organizations.
This e-course will take you from Fundraising to Financing. We’ll start with a fundraising assessment of where your organization currently is in your efforts to bring money in the door, and we’ll end with a comprehensive, actionable financing plan to move your organization forward.
Here’s how it will work:
- We’ll kick off with a webinar to help everyone understand what a fundraising assessment looks like and what it includes.
- Everyone will be sent away to complete the detailed fundraising assessment I will provide them.
- I will then analyze each individual fundraising assessment.
- The 15 participants will be split into two groups. I will lead a 90-minute coaching session with each group to go individual-by-individual to explain what their fundraising assessment revealed and where they should focus their change efforts.
- After the coaching sessions I’ll host an informal Google Hangout where participants can discuss questions, hurdles they are encountering, where they need help.
- Then I’ll lead a second webinar to explain how to create a financing plan.
- I’ll give everyone a Financing Plan template and detailed instructions on how to create their own financing plan.
- Then I’ll analyze everyone’s completed financing plan.
- We’ll do a second round of coaching sessions where I will go individual-by-individual to explain where their financing plans can be improved.
- We’ll end with a final Google Hangout where everyone can discuss, ask questions, get support and move forward.
- And throughout the process you can always reach out to me via phone and email with additional questions or for guidance.
The registration fee for the e-course is $499.
Of course I’m biased, but to me this investment just makes sense. With this e-course you can set your nonprofit on a path to a much larger, more sustainable financial engine. This is about making an investment now in order to enjoy a much larger payoff down the road.
If you’d like to join us, register soon. The e-course is limited to 15 people, and it’s already filling fast.
I hope to see you there!
I wrote last month about the crippling nonprofit fear of investment. Related to that, nonprofits need to understand and embrace the concept of Return on Investment. Nonprofit leaders often exist in such a world of scarcity that they don’t recognize that an investment today can have a huge payoff down the road. And not recognizing the value of a return on investment, particularly when it comes to a nonprofit’s fundraising function, can keep nonprofits in starvation mode.
One of the ways I consult with nonprofits is coaching a development director or executive director to increase money flowing to the organization. We work on getting board members to bring money in the door, identifying new donors, crafting a compelling message, launching new revenue streams, developing an overall financing plan.
This work could have a huge future payout:
- Board members no longer sit on their hands but actively recruit new donors to the organization.
- New donors are acquired through a thoughtful, strategic major donor campaign.
- A compelling case for investment convinces foundations and major donors to invest at higher levels and for longer periods.
- A new earned income stream brings in unrestricted revenue.
- An effective financing plan puts scarce resources to their highest and best use.
If you think of this in terms of return on investment it’s a no-brainer. You have two options:
- Continue to struggle day-to-day for the foreseeable future, or
- Make an investment today in order to dramatically increase funding and sustainability tomorrow
Let’s do the math. If a nonprofit with a budget of $1 million were to spend, say $5,000 on hands-on coaching to develop a financing plan, create a compelling case for investment, get their board engaged in fundraising, and launch a major donor campaign those elements could translate into well over $100,000 of new money annually for the nonprofit.
- A financing plan clarifies and marshals resources so staff and board know exactly where the money flows and who will do what to make it happen. The very act of creating and monitoring a financing plan could increase funding by 5%, or $50,000.
- A case for investment, when done well, becomes the backbone of any and all money-raising efforts. It can be integrated into your website, your social media efforts, your donor letters, your presentations. Telling a concise, compelling story makes donors sit up and take notice and adds perhaps another 2% increase, or $20,000.
- If your entire board starts (in their own unique ways) bringing money in the door that could increase your bottomline as well. If each member of a 15-person board starts to increase their own giving and/or the giving of those in their network by $1,000 each, that’s another $15,000.
- A major donor campaign charts a logical, strategic way for you to identify and acquire new donors. Getting strategic about how you find and recruit those donors will ensure much greater success, perhaps a 5% increase, or $50,000.
So with very conservative estimates the original $5,000 investment in coaching translates to $135,000 in new money every year thereafter.
My favorite example of this is when I helped KLRU, Austin’s PBS station use $350,000 in capacity capital to do many of the above things. After 3 years of implementing a new financing plan, using a new case for investment, and more, they were raising $1.6 million in NEW REVENUE each year. That’s a huge return on investment.
If you make a smart investment in improving the money engine of your nonprofit, that investment will pay off many times over, creating a more secure financial future for your organization.
Photo Credit: MeckiMac
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