In Nonprofit Business, Revenue Generation Begins with Five Questions
Customer acquisition and revenue generation are two issues that cause most business owners to have sleepless nights. Nonprofit businesses are no exception. The thing about nonprofits is, unlike for-profits that have products and services to sell, nonprofits rely on their missions and the goodwill of others to stay afloat financially. The language might be a little different, but the issue is the same: just as for-profit business owners look for creative ways to acquire and retain customers, the nonprofit leader looks for new and innovative ways to acquire and retain donors. An unfortunate misconception that many new nonprofit leaders must quickly come to grips with is the fact that the money doesn’t raise itself. Despite the many benefits that being a tax-exempt 501(c)(3) corporation brings, giant sacks of money that arrive regularly, without any effort, is not one of them. So, how does a nonprofit attract “customers” (aka donors)? First and foremost, the nonprofit leader can’t be afraid to build relationships or ask for money. Both are required for successful fundraising and fiscal sustainability for a nonprofit business. I can’t tell you how many times I’ve had this conversation with both new and seasoned nonprofit CEO’s: If you’re afraid to ask for money, simply put you’re in the wrong business. Fundraising requires fearlessness, so even if it’s your least favorite thing to do, do it anyway. Practice raises money. Equally importantly, the nonprofit leader must be able to articulate their organizations’ mission, impact, goals, and how donated funds will help reach those goals. This is what we call a “case statement”. With nothing tangible to sell, the nonprofit’s mission and impact become its products. Fundraising outcomes will always fall short in the absence of a solid case statement. Think about it: if you can’t tell someone why your nonprofit is worthy of investment, or how such investment in your organization will result in positive impacts in the community, why should anyone give a dime to your cause? Whether writing a grant or sitting in front of a corporate partner or major individual donor prospect, an effective case statement will help the nonprofit leader demonstrate their organization’s value, impact, and attractiveness as a potential investment. In my experience, a good case statement answers the following five questions: 1.What is your organization’s mission and who does it serve? 2.Why and how does your organization’s work matter? 3.What are your/your board’s goals for the next 1-3 years? 4.What does your organization need funding-wise to accomplish these goals? 5.How can donors help? A good case statement will go a long way for your nonprofit business and its ability to attract revenue in the form of charitable donations, grants, and corporate sponsorships. If you can’t answer these five questions clearly and concisely – and close the deal by asking for a specific dollar amount – take a deep breath, start at #1 and build it from there. Remember: practice raises money. Launa K. Wilson is a veteran nonprofit professional specializing in governance, management & fundraising. She is the owner of Launa Wilson Consulting LLC based in Riverside, CA. Ms. Wilson can be reached at launa@launawilson.com.
Read moreMarch is Social Work Month!
Hey there, friends! Did you know that March is Social Work Month? I know I know, it’s also Women’s History Month (yayyy for women!), but I figure since I celebrate women every day, I could be justified in focusing on the part of me that is almost as fundamental to how I move through the world as my gender. Don’t Be Fooled by the Stereotypes What’s the first image that comes to mind when you read the words “social worker”? Surely the first image is not of me – a business consultant, nonprofit volunteer, city planning commissioner, or any of the other things you may catch me running around the streets of my town getting involved with. The vast majority of people I encounter for the first time are truly perplexed when I introduce myself as a social worker. The image in their minds is of the social worker stereotype that most folks know from watching just about any crime drama there has ever been (cue Law & Order SVU music). You know what I’m talking about: the child welfare worker, senior protective services worker, or other such agent of the state who comes in and saves the day (or fails miserably to save the day) when someone is in crisis. Without going off on a rant about the media’s portrayal of my beloved profession, I will simply say that the stereotypes dramatically underrepresent who social workers are and the vast array of things they do in and for our communities. A Quick Trip in the Way-Back Machine My original goal for earning a social work degree was indeed to serve in the child and family services system. I thought I wanted to do my part by helping individual children and families in crisis. I am so grateful for the required practicums (internships) that were part of my Bachelor’s studies, because these experiences quickly showed me that I had no business working with individuals and that my true calling was at the macro level. Every family I encountered during this period had significant challenges that preceded the crises that brought them into the system. Many of these challenges were due, in part, to a lack of family or community resources, and the very difficult choices that these families had to make as a result. Instead of focusing on the individuals within the family and helping them understand the need to make different choices, all I could think about were the systemic and/or policy-based issues that were so obvious to me, but that I was constantly told were not mine to worry about. Thankfully, my experience earning my Master’s degree, plus my 20+ years working in the nonprofit sector, have helped me understand the social work field more deeply and fully embrace the plethora of skills that these professionals possess. Once I understood that working on a broader scale, focused on organizational, community, and policy issues was where I belonged, I jumped in headfirst and have never turned back. Here are just a few of the things I’ve been involved with as a proud macro-level social worker. I have: Phew! I could go on, but I know you get my point. Proud Social Worker, Every Day and in Every Way! Those who know me as a nonprofit professional and consultant will surely recognize the micro-level social work skills used to engage, build trust, actively listen, connect, facilitate, and so on. Every time I engage with a nonprofit client, a donor, a community leader or politician…every time I facilitate a difficult conversation with an organization’s board…every time I broker connections to solve a pressing need in my community…every time I dive into a policy discussion and ask the human-centered questions that many others don’t….and every time I run towards people who others say I should run away from…that’s my social worker coming out. And she cannot be contained. Fact is, there’s more of us social workers out here than you know. But if you pay attention, you’ll find us. So, the next time you notice the “BSW”, “MSW”, or “LCSW” behind someone’s last name, or the next time someone like me introduces themselves to you as a social worker, try not to be confused. Instead, pull up a chair and ask them what type of social work they do. I promise, you won’t likely hear the same story twice! Happy Social Work Month, friends!
Read moreWhat Does Nonprofit Sustainability Look Like?
I often hear community leaders and elected officials pontificating about the importance of a “strong, sustainable nonprofit sector” as a way to enhance overall community health. They talk about the business and municipal communities partnering with the nonprofit sector to better address problems and bring a more holistic approach to the collective work. Unfortunately, I have rarely, if ever, heard any of these people exhibiting any true understanding of what a strong, sustainable nonprofit organization actually looks like, or the resources that are needed to accomplish this. So, what does a sustainable nonprofit organization even look like? And, how can we work actively to help the sector be as sustainable as we say we want them to be? In the environmental sphere, sustainability means ensuring that we are using our natural resources wisely and in ways that don’t totally deplete them. The same is true in the business sector – sustainability means ensuring that a company has sufficient resources to survive, maintain, and grow over time. For the nonprofit sector, sustainability can seem more precarious simply because of the nature of their structures and funding sources. But at the end of the day, a nonprofit is a business first, and the same fundamental principles of sustainability apply whether we’re talking about a for-profit or a nonprofit business. So, what are the primary components of nonprofit sustainability that its leaders must be attentive to? And, how can the community leaders, who verbalize their commitments in the most well-meaning of fashions, ensure that these organizations can continue their important roles in our communities for many years to come? Component #1 for Nonprofit Sustainability: The Strategic Plan A strategic plan is the road map for any business’s success. Without a plan that looks ahead 3 to 5 years, a nonprofit is at risk of stagnation, mission creep, and all sorts of other preventable issues. Strategic planning should be a top priority for any nonprofit leader and board member, as it sets the vision and charts a measurable path to accomplish organizational goals. Not only this, a good strategic plan puts accountability in place with clear, measurable objectives and outcomes that can be revisited at the end of each year to determine progress and impact. As a former nonprofit executive director and current, active board member for several organizations, I understand deeply the value of a strategic plan and the importance of keeping it at the forefront of the work. Anyone who gets involved with a nonprofit should read and become familiar with the organization’s strategic plan…and advocate for the creation of a plan if there isn’t one. Also, it’s always best practice to revisit the plan each year to check in on its implementation and make any tweaks that may be needed along the way. Component #2 for Nonprofit Sustainability: Adaptability The most successful and sustainable nonprofits are highly adaptable and attentive to fluctuations and changes in their broader ecosystems. These are the organizations that understood how to “pivot” long before the COVID-19 pandemic popularized the word and forced us all to figure it out (or go bust). Sustainable nonprofits tend to be headed up by fearless, information-driven leaders, people who pay attention to trends and resist the urge to maintain programs or activities strictly due to tradition. Some of these dynamic leaders seem to operate by instinct, but the most thoughtful of this group actually do a lot of homework behind the scenes. Analyzing data, having conversations with peers, staying informed about current or upcoming issues that could impact their organizations. For those who serve on the boards for these nonprofits, it’s imperative to not leave all the adapting to the executive director while board governance stagnates. True partnership between a board and its leadership team requires strong communication. This is the only way to be sure that shifts and pivots are well thought out, that consensus is built, and that implementation occurs organization-wide instead of in silos. Let’s be open to change and adaptation, and deliberate and thoughtful about its implementation! Component #3 for Nonprofit Sustainability: Planned Succession Most nonprofit leaders I know are pretty good at succession planning for their boards of directors. If their bylaws require board turnover via term limits, succession planning gets baked into how the organization functions. However, succession planning for staff and leadership is also super important for building a sustainable nonprofit. Not only should the leader be thinking about the skills and/or representation needed to maintain a healthy board, he/she should also be planning for their own eventual departure from the organization. For every nonprofit I have been involved with, whether as a board member, a staff member, or an executive director, I have operated under the philosophy of “leaving it better than I found it”. In my experience, this means taking the board development and succession planning process seriously, and it also means taking deliberate steps to improve the organization’s structure, operations, programs and staff to prepare for the day when I will no longer be involved. This type of succession planning may seem difficult, especially when there is so much to do on a day-to-day basis. But it’s so important to any nonprofit’s long-term health. We must always operate with a long-range vision for our organizations – whether we are board members or paid staff – and take incremental steps that move our organizations towards greater sustainability while we are involved. Component #4 for Nonprofit Sustainability: Diversified Funding The fourth and final component I’ll share related to nonprofit sustainability is also the most difficult to achieve: a diverse funding model. Building a funding model of any sort in the nonprofit sector is difficult enough but establishing funding diversity is extremely tough…and also extremely important for long-term organizational sustainability. Financial sustainability requires sufficient resources to pay for overhead, staff, and programming. It also requires a build-up of reserves for unforeseen challenges. This should be enough to cover at least 3 months of the operating budget. Lastly, financial sustainability requires
Read moreFive New Year’s Resolutions for the Nonprofit Leader
Happy 2023, friends in the nonprofit sector! If you’re anything like me…and pretty much everyone else on the planet…you’re working hard to step into the new year with intention. Whether you’ve resolved to lose a few pounds, or train for a marathon, or finally get your household budget together, please know that we’ve all got something we want to get handled in the new year. Personal goals and resolutions are a great way to start a new year, and it is also true that the personal tends to cross over into the professional for many of us. So, I’m here to offer a gentle reminder that our professional intentions are just as important as those personal resolutions. How we as nonprofit leaders show up at the start of the year can really make or break the type of year our organizations have. I’m talking about how well we care for ourselves, our teams, and our boards. Remember, friends: we can’t fulfill our missions and serve our clients unless the house is in order! Here’s five quick tips to make sure you’re starting the new year with intention: 1. Find (and Protect) Your Balance – of course this is the first thing on every professional’s to-do list, right?! Prioritizing work-life balance is of utmost importance, especially for those who work in the nonprofit sector where there are never enough resources or hours in the day to accomplish all that needs to be done. Just remember, friends, you can’t take care of anyone else unless you are taking care of yourself. One thing I’ve learned in my long nonprofit career is that almost everything can wait until I have had a good night’s sleep. Another thing is that there is no organizational priority that should cost me my health. Period. So, start now: find some boundaries and set them. Say no when no is what needs to be said. Go home at a reasonable hour. Let a few of those emails and to-do lists wait until you’ve had some sleep (and exercise). Just do it. You’ll be better off for it, and so will your productivity. 2. Ask for What You Need – leading a nonprofit organization is a calling. The people who answer this call are among the hardest working, kindest, and most generous people I’ve ever met. They are also the folks who will work themselves to the bone, taking responsibility for everything from managing organizational finances to running programs to scrubbing floors if that’s what needs to be done. But, the fact is that most nonprofit leaders do have resources that can be used – human resources, financial resources, technology resources – we just have to remember how to identify what we need and ask for it. Start the new year resisting the pull of the hero complex, friends! “Doing more with less”, while noble, is also the quickest way to burn out. Figure out where your time is best spent and where you need additional hands and/or expertise. Then, have a conversation with your board and ask for what you need. It sounds simple because, well, it is. 3. Support Your Team – setting your nonprofit up for a successful year should always include investing in your team’s professional development. Speak to your team members about their professional goals and what you can do to support them in the immediate term. Listen to their words and do your part to give them what they are asking for. Do you have a team member with significant growth potential? Maybe they’re ready to take on a new responsibility for the organization. Do you have someone who want to learn a new skill that will help them do their job better? Send them to a conference or hook them up with a mentor who can help them grow. Nobody wants to be stagnant, friends…not you, and certainly not your team. Invest in their growth and you will definitely see results! 4. Nurture Your Board – a new year is an excellent time to revitalize your relationships with your board members. After all, the board of directors is the most important group of volunteers any nonprofit organization has. So, it behooves the nonprofit leader to nurture these relationships to ensure that board members remain engaged and committed to the mission and their important work. Try offering an annual refresher course in board governance. Extend a board meeting by 30 minutes to allow a bit of camaraderie. Connect with each board member personally over coffee or lunch. Ask board members how they’re feeling about their service. Solicit their feedback and ideas. And, always thank them for all they do to support you and the organization. 5. Create (and Follow) Your Plan – in a perfect world, every nonprofit has a robust strategic plan that they follow to a tee. In the real world, most nonprofits are lucky if they have a simple annual roadmap to help focus their work for the year. Whatever form your plan takes, just make sure you have something that will help keep you focused for the whole year. A good annual plan will include at least one organizational and programmatic goal. It will also include a financial goal to help drive fundraising efforts to help accomplish the organizational and programmatic goals. And no plan is complete without the ability to evaluate success, so be sure yours includes responsible parties and measurable outcomes. It’s going to be another fantastic year of nonprofit excellence, friends! Hope these tips are helpful, and please be sure to share your tips in the comments for starting the new year with intention!
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