SVP Blog

Statement #10 - I have a great idea for a new program - I’ll start my own nonprofit.

It’s the last time we’ll say it – just don’t!  Or certainly make it your last option. There has been a proliferation of non-profits over the last 10-20 years, some of them quite valid and needed.  This also means there are more and more small organizations struggling to get enough resources to reach some level of sustainability and organizational capacity.

In short, it is much easier to start a non-profit than a for-profit company, but it is much harder to effectively sustain a non-profit over the long-term. When you have a new idea, please be sure to look around to see if anyone is already doing the work you care about; or if there is someone to partner with or someone that might want to take on a new “line of business.”

Paul S.

Lesson #9 - “I want to be sure our family foundation is around for a long time to come so I need to be sure to spend only as much as I have to every year”

There is nothing wrong with that approach, but you might want to consider what more and more philanthropists and foundations are doing now ( i.e. giving away their full corpus within a stated time frame.) Bill and Melinda Gates said 50-100 years, Warren Buffet said 10 years! Whatever the amount, the decision is driven, in part, by the good ol’ time value of money--a dollar spent today often has more value than the same dollar spent in the future.  If that economic concept applies anywhere, it should really apply to the application of philanthropic funding to social needs and problems.

Some causes and non-profits  might deliver more positive good in the world if they had the same amount of money sooner vs. spreading it over a longer period of time.  Again, this certainly is not a “mandatory,” but it is worth your strong consideration if you are creating a family foundation or some kind of permanent corpus.

Paul S.

Lesson #8 - “I have a great idea for a new program that XXX could try for kids. I just want to run it by them”

Whoa! Slow Down! Or more accurately, be very cognizant of what you know and what you don’t know.  

Be sure your suggestions are within your expertise, relevant experiences and interactions with nonprofits.  Given the range of pressures a non-profit faces from a myriad of funding sources, they have “big ears” and sometimes listen to and even act upon a lot of suggestions and “ideas.” Just be mindful of that.

Paul S.

Lesson 7: “Non-profits move so slowly; it takes forever to make decisions”

Yes, there are some non-profits that are inefficient, just like some for-profits. But more often than not, the pace and decision-making style of a non-profit is more consensus-driven because of its constituencies, communities, and clients.

Their missions and decision makers are, on average, more diffuse and varied and the goals more numerous. It is just a different context in which works gets done and goals achieved.  It dictates a different kind of strategy and tactics. This does not mean that any organization, non-profit or for-profit, should accept mediocrity, unnecessary bureaucracy, or ineffectiveness. It does mean that, as a donor, you need to know you are working with a different “industry” with a different set of norms and rules.

Paul S.

Lesson #6: “I joined that Board because I was invited by a friend and it looks good on my resume”

Just don’t :-)

If you look across the non-profit/philanthropic sector, probably the #1 challenge is Boards that do not understand their roles and do not carry out their goals. Given that, we must have committed, focused, high quality people join Boards.  Not people who do it to pad their resume or because they are only doing a friend a favor. If your time and energy is limited, join one Board and do it great rather than joining two or three Boards marginally.   Or, if you want to be helpful to a non-profit, but not sure you are ready to step up to a leadership role, find another entry point-- like a lower-intensity volunteer role.

We feel so strongly about this that we are co-developing a new curriculum series later this spring at the Evans School at UW on “Advanced Board Leadership” (details to follow). Boards own the organization. They are its stewards and governors. Don’t take on that vital role unless you are committed to acting on and believing it. 

Paul S.