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Skoll Foundation

Financing Nonprofit Growth: An Interview with Susan Comfort

In this month’s Social Velocity blog interview, we’re talking with Susan Comfort from KaBOOM!, a national non-profit dedicated to saving play and building community engagement. KaBOOM! helps communities across the country build playgrounds for their neighborhoods. As the VP for Philanthropy at KaBOOM!, Susan has a unique perspective on the next generation of sustainable philanthropic support for nonprofits. Before KaBOOM! Susan worked for environmental groups like EWG and 1% for the Planet. KaBOOM! is a darling of the social innovation world because they have figured out how to scale their idea (a playground within walking distance of every kid) in a financially sustainable way.

You can read past interviews in our Social Innovation Interview Series here.

Nell: How is it fundraising two years into a recession? Have you found that your approach has had to change because of the recession? If so, in what ways?

Susan: The recession brings good and bad news for fundraising. The good news is, if you are a nonprofit that delivers results, you will stand out to donors for getting great bang for their limited bucks.  KaBOOM! has made its reputation this way, not only delivering a tangible, needed asset to an underserved community, but doing it efficiently, in a way that brings people together in the short- and long-term.

The bad news is, as we work to diversify our revenues beyond corporate-funded-playgrounds, breaking into the foundation community during a recession is challenging. Foundations, coping with reduced payouts, can’t fund all their previous grantees, much less new ones. Plus, “play” is regrettably not yet understood by foundations as something that fits their guidelines, even though lack of play is harming kids intellectually, physically, socially and emotionally, and is linked to so many other pressing issues.

KaBOOM! launched its “Going to Scale” plan just before the bottom dropped out of the market, so our approach continues to be developing our organization and program offerings beyond building playgrounds. We aim to achieve our vision of a great place to play for every child in America, but we can’t build every play space ourselves!

Nell: KaBOOM! has grown tremendously since it was founded in 1995. What do you think enables some nonprofits to grow their solution significantly while others can’t? What are the characteristics, if there are any, of a growth-oriented nonprofit?

Susan: One characteristic is strategy. If you engage in direct service, you can always find more people to serve…then organizational growth is about funding and efficiency.  If you engage in lobbying Members of Congress, however, you will have a limited number of people to lobby, with a limited number of opportunities…so your organizational growth is about the message (did it resonate? And who was the messenger?), or effectiveness (did you win?) or scope (where does this get addressed next—in state houses or internationally?).

Another characteristic of growth is your Theory of Change. First you have to define the problem, so you can rally around a collective cause. The problem we aim to address is the declining health of both children AND communities. At KaBOOM! we structure programs that lead to Achievable Wins, which in turn lead to what we call “Cascading Steps of Leadership”. The KaBOOM! model of community-built playgrounds allows our project managers to match up funders and nonprofits, then facilitate a 10-week process starting with a kid-led Design Day and ending with Build Day. But it doesn’t end there…

Our project managers keep in touch after the big Build Day with 1-week, 1-month and 6-month follow-up calls, each designed to propel the planning committee to take on another defined problem in their community, and take steps to achieve more “wins” for themselves. In essence, this model allows us to work in any part of the country, so KaBOOM! can grow and serve any number of communities. If your Theory of Change is focused on one community, as a traditional community organizer’s would be, you might not grow beyond that community – nor should you – but your roots there will be much deeper than ours, by design, ever will be.

Nell: You have raised a good bit of growth capital to achieve this growth. Beyond the capital you’ve raised from venture philanthropy funds, that are all about growth capital, how have you convinced other funders, who were maybe not as versed in the ideas of growth capital, to fund growth as opposed to just direct programs?

Susan: The only venture philanthropy funding that KaBOOM! has received is from the Omidyar Network, and we are incredibly grateful for their $12 million investment over 7 years.  It gave us a long runway to get our engine revved up for take-off, in this case open-sourcing over a decade’s worth of playground-building expertise so that Do-It-Yourself activists could freely download what we’ve figured out and apply it to their own communities (per our Going To Scale plan).

At the same time, we started educating our closest friends in the corporate community about our other organizational needs, and some were willing (even in a recession!) to fund us beyond playground builds. So we started a “National Partner” program where we asked companies to build multiple playgrounds annually, plus contribute six figures in general support. Today, our national partners are Dr Pepper Snapple, Foresters, Kraft and MetLife.

And of course — near and dear to my heart — we also started a Philanthropy program (which I direct). Our goal is to engage foundations and individuals to invest in KaBOOM!, both its online programs and its organizational growth. With regional foundations, for example, we show what playgrounds we’ve built in their area thus far, and request support for our Playful City USA program. If play can be institutionalized in mayor’s offices and with local activists, so much more will be accomplished than we could have done on our own.

With individuals, it’s human nature to want to fund something very specific and/or tangible, so the growth fundraising is certainly a challenge. But it’s also human nature to extrapolate meaning from a single story, so when a donor sees how one child’s family benefits from a fantastic play space, they understand how millions of children and families would benefit just the same. We’ve had individuals support playground builds…we even have a wedding build lined up in Connecticut in June 2012…but we are also asking people to support the broader cause of play.

Nell: KaBOOM! recently took a fascinating spin on growing to scale by realizing the only way they were going to get to every area that needed a playground was to make playground plans downloadable on your website. That has the potential to undermine your financial model since you won’t receive any money for those playgrounds built. How do you balance the desire to reach everyone with the need to sustain a large organization?

Susan: Well, it’s a challenge, and honestly, we haven’t figured out the answer yet. But we have a few irons in the fire in addition to some of the foundation efforts I described.

We are hoping individuals will “Play it forward” to KaBOOM! after they’ve served as playground build volunteers, or Do-It-Yourselfers, or recess advocates. We are also figuring out the best way to help others raise money for their playground projects using a platform similar to Donors Choose or GlobalGiving, where donors give a small percentage “tip” to help with operating costs. Of course, we are also reaching out to high-net-worth individuals who have the potential to underwrite our mission.

In addition to our individual and foundation outreach, we are developing less-traditional revenue streams. Imagination Playground is a unique LLC, formed between KaBOOM! and the non-profit arm of David Rockwell’s architecture firm. Once that enterprise begins making money (we’re not there yet) KaBOOM! will get half of the proceeds. Another new revenue streams is KaBOOM! founder Darell Hammond, who is contributing all author proceeds from his new book, (an Amazon best-seller) How One Man Built a Movement to Save Play, to the organization. Back in the day, we also used to scoop ice cream down at the Ben & Jerry’s on Free Cone Day, which eventually got us a limited-run ice cream flavor featuring white-chocolate-coated pop rocks…called KaBerry KaBOOM! Too bad that’s in the Flavor Graveyard now.

Nell: What is your sense of how philanthropy is evolving in terms of the distinction between buying services and building organizations? Do you think more philanthropists are understanding this distinction and stepping up to fund building organizations? And what will encourage more to do so?

Susan: Some of the forward-thinking philanthropists are certainly making this distinction. Venture Philanthropy Partners. The Social Innovation Fund. Omidyar Network. Skoll Foundation. These tend to fund “social entrepreneurs” which are not just business-like non-profits. Jim Collins says “We must reject the idea.. well-intentioned, but dead wrong.. that the primary path to greatness in the social sectors is to become ‘more like a business.’ Most businesses…like most of anything else in life…fall somewhere between mediocre and good.”

Jim Collins has many fans at KaBOOM! – in fact, every staff member receives on their first day his Good to Great in the Social Sector so that we can embrace the universal principles of being GREAT.

But the reality is, the traditional KaBOOM! funding model sits squarely in the fee-for-service column, and corporate-funded playgrounds still dominate our budget. To fund everything else, we are making the transition away from venture philanthropy (Omidyar) toward a diversified organizational funding model (foundations + individuals).

Both entities are still tempted to fund a particular geographic area, or program area. And that’s okay—it’s good work.

But so many organizations are running around chasing 1-year grants for a program, for which quarterly reports are due, that you need a permanent development staff to keep track of all those proposals and reports and such. Which keeps people like me employed, but it’s not great for all of our social change movements who are spending time chasing money when they could be growing their organizations and serving the public more efficiently.

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10 Great Social Innovation Reads: March

In our ongoing blog series, 10 Great Social Innovation Reads, below are my picks for what really stood out in the world of social innovation in March. These are the discussions, posts, articles, etc. that I think added real value to the emerging world of social innovation over the past month. You can read January’s and February’s picks as well.

As always, please add your picks to the list in the comments.

  1. 2011 State of the Nonprofit Sector Surey Results: The Nonprofit Finance Fund’s third annual State of the Nonprofit Sector survey results are out. It’s very interesting to see how the sector is faring 2+ years into the recession.
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  3. How Non-Profits Are Utilizing Facebook: From the Social Earth blog comes a great infographic that demonstrates how nonprofits are using Facebook.
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  5. An In-depth Interview with Sally Osberg, President and CEO of the Skoll Foundation: Sally takes a look back at the last 10 years of social entrepreneurship in this fascinating interview.
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  7. 4 Core Approaches to Philanthropy: Sean Stannard-Stockton from the Tactical Philanthropy blog wrote a pivotal blog series in March on 4 core approaches to philanthropy.
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  9. When you want to quit because it’s just not worth it: True social innovation requires an undying determination to keep going, keep building, keep creating in the face of seemingly insurmountable hurdles, so from the A Smart Bear blog comes a reminder to never give up.
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  11. Google Launches ‘Google for Non-Profits’: Google launches Google for Nonprofits this month. Is this a revolution or an innovation? I’m not so sure. Maybe it’s the start of bigger plans down the road.
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  13. Social Impact Bonds Will Fail Without Solving the Evaluation Problem First: From Full Contact Philanthropy comes a caution about getting too excited about the next shiny thing in social impact finance, the social impact bond, which allows people to invest in nonprofits and receive a financial return if outcomes are met.
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  15. 2011 Bright Ideas: The Harvard Kennedy School Ash Center announced its annual list of the 36 brightest ideas and programs in government. If you think government can’t be innovative or create real change, take a look.
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  17. How Many Points Does it Take?: From the Nonprofit Finance Fund blog comes Craig Reigel’s argument that “nonprofits need a whole range of capital solutions.” I completely agree!
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  19. 22 Nonprofit Mobile Websites: Are nonprofit orgs jumping into the world of mobile to build support? Slowly but surely. Here’s a list of the best nonprofit mobile sites from Nonprofit Tech 2.0.

Photo Credit: aithom2

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Discussing the Future

So this is kind of interesting, and I’m not sure yet what to make of it.  Independent Sector, a coalition of 600 charities, foundations, and corporate giving programs working to strengthen the nonprofit sector, has launched an online forum, called FutureLab to answer the question: “What can we do right now, as a nonprofit community, to create a better, more vibrant 2020?”  They are attempting to spur a “national conversation to explore the challenges and possibilities that will affect the nonprofit and foundation community for years to come and to develop groundbreaking strategies that will shape our future.”  Those are massive questions and a massive undertaking.  But didn’t I just say that the nonprofit sector needs to be more bold?  Perhaps this is a step in the right direction.

FutureLab has broken this broad conversation into nine discussion areas which are:

  • Diversity
  • Global Engagement
  • Integration with Religious Groups
  • Leadership
  • Responsibilities of Government and Nonprofits
  • Technology
  • Civic Engagement
  • 21st Century Economy
  • Impact

And they also have a “coffeehouse” area where people can contribute ideas that don’t fit into those categories.

Through social media and other channels they are encouraging anyone connected to the nonprofit sector (volunteers, staff, board members, consultants, etc.) to contribute their ideas for what could make the sector better.  You can comment on existing ideas, submit your own ideas, or vote on contributed ideas.

It doesn’t look like many people are contributing yet, and you have to wonder what the end goal is and what will be done with the volume of ideas and information they are hoping to gather.  Will anything come of it?  Will anything change? Independent Sector’s goals for the project are a bit tenuous:

Members of the nonprofit and philanthropic community are encouraged not only to review the content posted during this discussion, but to draw on relevant insights to inform their own planning and decision making. Independent Sector…will produce a summary of highlights that will be made available to nonprofits and foundations. Independent Sector may also identify ideas from the conversation to pursue as part of its ongoing work.

But there are some heavy hitters involved.  The funding for the project comes from major foundations like Gates, Annie E. Casey, Skoll, Kellogg Foundation, Rockefeller Foundation, Sea Change Capital.  So something interesting has to come out of it, right?  Anyway, it will be interesting to watch.  If you’re interested, join the discussion.


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Friday, October 16th, 2009 Nonprofits, Philanthropy 1 Comment

Profile of a Social Entrepreneur: YouthBuild

Social entrepreneurial organization YouthBuild rebuilds lives and communities by helping disadvantaged youth work toward a high school diploma or GED while they build affordable housing for their community.  They are simultaneously solving two problems facing communities across the country:  poverty and homelessness in an innovative way.  And they’ve seen great results.  In the 14 years they’ve been in operation, YouthBuild has worked with 76,000 kids to build 17,000 housing units in 226 of the country’s poorest communities.  And they have grand growth plans.  They want 50,000 youth enrolled in their program each year.  It’s an impressive story.  Watch this Skoll Foundation Uncommon Heroes video about them:

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Monday, December 15th, 2008 Innovators, Social Entrepreneurship 1 Comment

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