Balancing the Mission Checkbook

We can all agree that 2009 has been a very tough year for nonprofits. Have any of you ever worked so hard, or navigated through more uncertainty?

While we may all be eager to leave this year behind and hope for more signs of turnaround in 2010, there have been some remarkable highlights. Here is my personal list of the top five reasons for Nonprofits Assistance Fund to celebrate 2009.

1. Real Collaboration: We learned a lot about collaborating to provide some great resources, training, and customized assistance to help nonprofits this year. Collaboration requires openness, communication, and trust. With wonderful collaborators in ArtsLab and the Resilient Organizations Fund, and a partnership with Minnesota Council of Nonprofits to develop Recession-Year Financial Leadership, I learned a new way to work.
2. Enlightened funders: The financial challenges faced by foundations has been well covered by Minnesota Council on Foundations. Many local and regional foundations have been bold and creative in meeting urgent needs to maintain services, re-imagine delivery, and energize community. Special recognition to the Pohlad Family Foundation and the Blue Cross and Blue Shield of Minnesota Foundation for launching special projects this year. And kudos to the Minnesota Community Foundation and the Saint Paul Foundation and other partners who created GiveMN. Every nonprofit needs a boost of both funds and confidence.
3. Information, Opinion, and Inspiration: I needed a lot of all three this year, and found plenty from good journalists and bloggers and from the Twin Cities extraordinary arts community. If you agree that these are important, you need to do three things - subscribe or donate to your news sources, comment on and share blog posts, and buy tickets or memberships for arts events.
4. The resilience and guts of Minnesota’s nonprofits: Wow. What else can we say about the Herculean effort and accomplishment of thousands of nonprofits this year as they helped people and communities make it through one of the toughest years imaginable. The data in MCN’s most recent Current Conditions Report tells the story of both hardship and endurance.
5. The people: The biggest celebration is for the staff of Nonprofits Assistance Fund, who revved their engines this year as never before to deliver advice, guidance, training, and crucial financing to organizations doing important work. We often talk about the good work of our clients. I celebrate the great work of Janet, Sandra, Phil, Michelle, Matt, Ashley, Amanda, Michael, and Steve. What a year.

There are other year-end lists of interest for nonprofits at Nonprofit Quarterly and PhilanTopic. As for 2010, I trust in the leadership, vision, and continued resilience of nonprofits, though I think it will be another hard year. More on that later, I’m sure.

Happy New Year.

I have not had the H1N1 flu.  I hope to keep it that way. However, this flu is starting to really affect me because of the number of people who are not so lucky.

As an example, in just the last week:

• I attended two important meetings where key participants were missing in action.
• Three training events and webinars were canceled.
• A professional associate stayed home with his son for several days.

Two days ago we had to scramble to replace the speaker for one of our own training events.  That really brought this home.

Scramble really describes the activities. There were many emails sent looking for a replacement, and the reply often was “I’m already scheduled for another training, meeting, travel…” Fortunately, a replacement was found (who did a great job) and I am grateful for the size and quality of the network of consultants in the Twin Cities.  But it’s clear that none of us have any slack in our schedules anymore. All the reductions in staff and hours in the past year have taken their toll, removing any elbow room (if there ever was any to start with).

Contingency Planning

The whole process got me thinking about contingency planning. This is going to happen again and again this year and we all need to be prepared. We have a Disaster Recovery Plan, but it wasn’t developed to address this situation. We need to have a plan for deciding when to cancel a meeting or training, when to use a backup plan, and who to call on for reinforcements. We might need to look around for some elbow room again by scaling back a little on commitments for the next few months.

How are you adjusting to more and more absences caused by this flu? Do you have a clear agreement on priorities and steps to take when you have multiple staff members all sick at once?  The Nonprofit Risk Management Center has a number of useful resources and tools, including a list of contingency planning resources and a tutorial on business continuity planning.

As with any planning process, agreeing on the priorities and responsibilities is step one. We’re starting today.

Update: Here is an H1N1 Flu Preparedness Toolkit from the National Council of Nonprofits.

You may have heard that there was quite a ball game last night (coverage here, here, and everywhere).

The state of Minnesota (including yours truly) is celebrating a playoff berth for a plucky squad of baseball players, assumed out of the running after All-Star slugger and 2006 AL MVP Justin Morneau’s season ended on September 16th.  But contributions came from unexpected places and the Twins went 17-4, winning their last 5 games including last night’s tie-breaker.

Yesterday, looking forward to the game, I started thinking about what nonprofits could take away from this transformation. 

Put On Your Rally Cap

At Nonprofits Assistance Fund, we have been encouraging organziations to consider new ways to generate revenue and/or trim expenses to build a sustainable business model in this economy.

Morneau was a major run producer (or income source).  And even with him in the lineup, the Twins were barely hanging on.  How could the team adjust their strategy (business model) in order to be successful? 

On twitter and facebook, I asked what nonprofits could learn from this turnaround, and here are some responses:

• What about an angle on hanging in there like the Twins tied to [nonprofits] in tough times and tackling new approaches.
• That even superstars need to be surrounded by great teams for success.
• Bench strength rules. Always play hard.
• We shouldn’t be overly dependent on one [income] source.
• Lean…They run that org lean. Plus, they’re great with crisis management aka injury replacement moves.

Here are some additional takeaways:

• Use your lineup: The Twins are carrying three catchers because they think that gives them the best chance to win. What do your staff, board, and volunteers bring to the table? Take advantage of your in house skills.
• Be flexible: I think I’ve seen Nick Punto play every position.  Jason Kubel, the designated hitter,  is now playing full time in the outfield. Are there ways to be flexible with program delivery, fundraising, or communications? Are there expenses that you could defer?
• Play smart defense and don’t commit errors: Make sure that you have the systems in place in order to be successful. Good management systems can prevent and minimize some challenges.
• Swing for the fences: Other players stepped up to produce runs in Morneau’s absence.  Make your case to donors, foundations, and the community.
• Be a good sport: Take a note from Brandon Inge and Jim Leyland when things don’t go your way.  If another organization receives a sought after grant or contract, be gracious. Focus on the good work that will be done in the community, rather than your disappointment.
• Don’t give up.

One last thought, from Harvard Business’s Tip of the Day - 3 Survival Lessons from Small Business:

Planning. Plans are often outdated as soon as they come out of the printer. Small businesses tend to focus more on planning and less on plans. They watch their surroundings and act accordingly.

Let’s play ball.

This blog is cross posted at Nonprofit Harvest.

The reports of success for online giving are still pretty mixed.  It’s likely that a significant shift from other payment forms will take several more years.  However, there are a number of positive experiences in online giving.

Here are three examples of innovative and creative ways that nonprofits are raising money online.

1. Modest Needs

Modest Needs offers an online forum to make direct contributions to individuals or nonprofit organizations to address a very specific, and usually modest, request for help. It’s kind of like Kiva’s direct lending model - but with direct contributions instead. Through Modest Needs, donors can see the very direct impact of their gift.

If it sounds too good to be true, I have a testimonial from Susie Brown, Executive Director of Child Care Works that they were able to pay for a capacity building project very quickly with funding through Modest Needs.

2. United Way’s Give 5 Now

You may have already read about the United Way’s Give 5 Now campaign. Watch their YouTube video about the importance of supporting urgent needs now. I hope that you can’t, and don’t, resist the urge to give at least $5.

3. Social Media

Social networks have exploded in the last year. I love Facebook, and was impressed by a recent fundraising campaign that Pillsbury House Theatre launched on their Facebook page. After giving a small amount, the updates and status reports that I received made me feel like a part of the campaign.

Give List uses blogging and Twitter to spread the word that there are ways to give even if you don’t have extra cash. The list starts with 71 ways you can give and then spreads and multiplies through an online community.

Even if it takes a while for online giving to match the dollars of more traditional forms, these example show ways that online strategies are different, fast, and direct.

Don’t be a Scrooge - give online now.

For those of you who are not familiar with Alltop, it’s a place that gathers and posts stories on a particular topic, in this case nonprofits. You can visit Alltop and see the most recent posts from a range of news sources and bloggers, as well as find new sources of information to expand your online resources. In their own words,”You can think of an Alltop site as a ‘dashboard,’ ‘table of contents,’ or even a ‘digital magazine rack’ of the Internet…we are trying to enhance your online reading by both displaying stories from the sites that you’re already visiting and helping you discover sites that you didn’t know existed.”

We’re pleased and honored to be featured on Alltop. We’d like to thank our readers for their support and participation – we would not be a part of this exiting project without you. A special thanks to Guy Kawasaki and Nononina, Nedra Kline Weinrich, and everyone else at Alltop for including us in your site.

For more information on the story behind Alltop, to see their full list of categories, or to browse the latest top stories, visit http://alltop.com/.

How should I answer the question, “How do I start a nonprofit?” I need an answer because it’s a question I hear pretty frequently. The common scenario is a phone call to our office looking for assistance to start a new nonprofit organization. (We are the Nonprofits Assistance Fund, after all.) The person on the line feels a personal call to action to address some need in their community – tutoring for kids, beds for the homeless, treatment for victims of abuse, and many other important and urgent issues. The question, though, shouldn’t be “how do I start a nonprofit”. The question should be, “How can I help to address this important community need?.” I try to help them step back a little and consider the real problem, not the conclusion they’ve already reached. If they can think about the bigger picture of how they can add their energy and talent to a community need, the options are vast. The answer is not always (in fact frequently is not) to incorporate another nonprofit organization. Time Magazine has a terrific article in the March 5, 2007 issue on this topic, “Rethinking Nonprofits”. Dan Kadlec boils the question of whether or not to start a new nonprofit organization down to three essential questions: Am I cut out for this?, Is my idea different?, and “Is a start-up necessary?”. The reality is that starting a new nonprofit corporation requires focusing the initial time, effort, and money on the start up rather than on the important community need. If someone is absolutely set on starting a new organization, we always send them to the Minnesota Council of Nonprofits web site for all the basic steps required. Note that the very first section of the “How to Start a Nonprofit” section at MCN is titled “Alternatives to Starting a New Nonprofit”. For a longer, more comprehensive resource about starting a new nonprofit, download the publication “Get Ready, Get Set” from the Center for Nonprofit Management in Los Angeles . The guide discusses how to conduct market research on the community need and available funding, and the legal and organizational steps. The Exempt Organization Division of the IRS also has several helpful publications and a new on-line training program.

The phone callers asking about starting a nonprofit tend to fall into categories. One group are of people who are deeply committed to helping their community and they just don’t know about the alternative ways to get involved. A second group are people who are ultimately trying to create a job for themselves and they believe the myth that there are “millions of dollars in grants available for you today!.” I don’t have much patience for them. The last group are those who have already started an informal program or project and want to find a way to get some money or help to continue or survive. These calls are the most complicated and the toughest to help. I can only hope that they have put some effort into the basic research and needs review as described in Dan Kadlec’s article. Otherwise they will confront the harsh reality of funding, boards, and the steep learning curve of a start up.