Category Archives: Nonprofit Management

#SUSConf2013 – Social Impact Investment Totally Rocks

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Screen Shot 2013-03-28 at 10.49.10 AM

You know, about a year ago I was having breakfast with a good friend over at Services for the Underserved - a well established nonprofit social services provider and affordable housing developer (Hi David!) – and we got to talking about corporate social responsibility.  I mean, there are an awful lot of good intentions out there, and a lot of self-serving hoo ha to go right along with it.  Where, we asked, could we have a substantive dialogue that advanced our little sector while addressing the needs of the most vulnerable?

Thus was #SUSConf2013 born: the SUS Social Impact Investment Conference.  And it’s happening next Wednesday, April 3rd, generously hosted by Bank of America.  There are a few (and I mean a few) tickets left.  Don’t wait.

Thanks to our amazing Advisory Committee and the wonderful board of SUS, we’ve pulled together a really compelling group of presenters.  Speakers and panelists include (in order of appearance):

We’ve been reaching out to lots of very smart folks to create content that’s meaningful, and we’ve heard a bunch of really great ideas.  I wanted to share with you just a tiny bit of the thinking that’s gone into this conference.

Why is SUS hosting this conference? Innovation and change are all around us. SUS strives to play an active role in the trends that shape our collective efforts, and the emerging social impact investment sector holds both promise and challenge.

Nonprofits like SUS are becoming more complex. SUS manages both for-profit and nonprofit entities; makes regular use of structured finance in its work; draws upon management best practices from both the nonprofit and corporate sectors; has earned revenues as an important part of its plan for growth and stability; and can deploy larger capital allocations.  These are all the hallmarks of an emerging class of complex nonprofits that blend a mission orientation with a sharp nose for business and the ability to operate at much greater scale.

For-profit social benefit corporations are both partners and competitors. There are a number of areas (affordable housing, education, healthcare, economic development) where for-profit corporations are taking on work previously provided by nonprofits.  So you’ve got complex nonprofits intersecting more and more with social benefit corporations, or even traditional corporations seeking to meet needs closer to the bottom of the pyramid.

Convergence: It’s Cool

Convergence is good for social impact investment. Where complex nonprofits and social benefit corporations converge investors can frequently find revenue models capable of repaying principal, and even generating returns.

Social impact capital is no panacea. In spite of the opportunities of social impact investment, we must also carefully balance these against the need for grants, contracts, technical assistance and other resources.

Nonprofits need to drive more of the conversation. Nobody understands the needs and challenges of nonprofits better than the nonprofits themselves. By placing the voices of nonprofit leaders front and center on this issue, we’re advancing the entire sector.

We view this conference as a beginning. We hope to carry the ideas, alliances, and aspirations of this conference into an ongoing conversation with you and our collective stakeholders.  We hope to see you there, and thereafter.

The (In)Efficiencies of Scale

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When scale goes wrong. Catsonholiday / Instagram

ArtsBlog (the blog of Americans for the Arts) recently hosted a forum called:  “So, Does Size Matter?”  The short answer is hell yes it does, but I disagree with most of the writers about why.  I found the best piece in the series was penned by the whip-smart Ian David Moss (Economies and Diseconomies of Scale in the Arts – Take Two), and it was his post that inspired both me to both write an initial comment, and then to take on the subject more fully below.

You see, Dear Reader, like many of my fellow funders and financiers I’ve often touted the benefits of moving toward greater scale:  improved operational efficiencies, greater programmatic reach, increased access to resources, heavier political punch.  But I’ve also struggled with the oft recognized but seldom addressed reality that scale is not an answer in and of itself, and that sometimes scaled solutions leave even larger problems in their wake.  Thanks to Ian, I think I got the mental kick in the epiphany I needed.

And here’s why I think scale sometimes, well, stinks up the joint.  Continue reading →

Disaster and Recovery – Part II

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The Great Wave off Kanagawa: Katsushika Hokusai

The Great Wave off Kanagawa: Katsushika Hokusai

Shortly after hurricanes Katrina and Rita in the Gulf Coast, I was dispatched to New Orleans by the corporate foundation that I worked for to figure out how to deploy our philanthropic disaster recovery commitment.  It was a heartbreaking experience, compounded and complicated by the entrenched challenges New Orleans had struggled with for many years.

As with all natural disasters, the poorest suffered most in the immediate aftermath.  What I, in my ignorance, learned for the first time was how the vulnerable continue to suffer long after the initial damage: tucked away for too long FEMA trailers, or separated from family, friends and vital supports, unable to access medical care, or shuttled from one temporary shelter situation to the next.  Over the weeks, months and years following the storm there were dramatic and terrible increases in elder mortality, child poverty, murder, and mental illness.

Compared to the process of recovery in the Gulf Coast, and in spite of the many frustrations we feel with its pace in our region, New York City, New Jersey and Long Island have done remarkably well.  For most of us, life is essentially back to normal:  the kids are in school, we’re back at work, our homes have power, heat and hot water, and holiday shopping is underway.

But there remains a grave and nearly inevitable danger, as in all natural disasters, that we will “move on” without fully resolving the impacts on those most vulnerable, and inflict the mistakes of the past on our neighbors and fellow citizens tomorrow.  Continue reading →

The Art$ – Part III (Some Easy Fixes)

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Art – it makes life more funner.

In my earlier posts on this subject, dear reader, I first endeavored to put a finer point on the more than thousand-fold revenue variation between the largest cultural organizations in NYC, and the median cultural organization. Holy stromboli you say? Yes! While the very largest nonprofit culturals have revenues of more than $300 million annually, more than half the groups in my most recent study had revenues of less than $250 thousand. What’s more, the top five very largest organizations received nearly half of all city funding (their share being a whopping $133 million).
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It’s a Bird! It’s a Plane! It’s… What the Hell Is That?

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Also posted in my guest blog on Rooflines.

It’s a bird! It’s a plane! It’s… What the hell is that?

In my last blog post I spent a good chunk of time talking about the trend toward “complexification” in the nonprofit sector.  There are plenty of small, scrappy, neighborhood based nonprofits around (as a matter of fact, that number continues to grow), but we’ve also seen the emergence of nonprofits with $100 million plus in annual revenues, hundreds of staff, sophisticated operational structures, and highly complex financial instruments built to conduct their business.

I argued that we’re past due in borrowing some tools from our for-profit colleagues, including stronger staff development and retention regimens, the ability to access substantial capital for opportunistic growth, shaping board relationships that focus on organizational development and not just fiduciary oversight, and developing a nonprofit sector trade association to lobby on the collective needs and issues of our sector.

We’re clearly entering a new era that will continue to blur the lines between for-profit and nonprofit.  And let’s be honest:  it’s a little scary.  Why?  Because we’re all very worried that we might somehow become like, you know, them.

Continue reading →

The Complexification of the Nonprofit Sector

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This post also available on Rooflines.  

“Substrate” by Jared Tarbell

Intuitively, just from being around the nonprofit sector for a stretch, it’s easy to tell that things have gotten more, well, complicated.  Organizations are bigger, operations more tentacled, financial tools more wonky, budgets bigger and bigger.  And don’t just take my word for it.  Thanks to the lovely folks at the Standford Social Innovation Review you can enjoy this whole, provocative article: “Why More Nonprofits Are Getting Bigger.”  

The problem is, I don’t think we’ve really done a good job of keeping up with our own complexification.   Continue reading →

How to Hire a Consultant

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Reposted from my guest blog on Rooflines.

Did you ever feel like you need a consultant to help you figure out what you need your consultant to do?  Believe me, you are not alone.  As a recovering executive director (and boy is that going to make a juicy blog post one of these days), I’ve employed many consultants to help with everything from designing the company logo to dreaming up structured finance solutions for distressed homeowners.  Dear Man About Town, you ask, how ever did you do it?

Well, now a consultant tells all:  here’s how to hire someone like me.

Continue reading →