Why the Recent Demand for Nonprofits to Create Revenue-Generating Activities?


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Slides that were inspired by a workshop I gave at the Amuta21c Conference in Jerusalem on March 18, 2012 (already available on Slideshare).

Stay tuned for "Part 2: The 3 Components to a Successful Strategy" that is/will be uploaded to Slideshare, as well.

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Why the Recent Demand for Nonprofits to Create Revenue-Generating Activities?

  1. 1. Strategies for Analyzing & Implementing Revenue-Generating Activities in Nonprofits Part 1: Understanding the Recent DemandShuey FogelThe Nonprofit Banker@nonprofitbanker
  2. 2. In the past few years, nonprofits have been hearinga lot of the following
  3. 3. There is a New Age Dawning in PhilanthropyPhoto Credit: “Sunrise on Phu Chi Fa” by Tom Bkk
  4. 4. Our Funding Models Are BrokenPhoto Credit: “Collapsed House” by JHF
  5. 5. those that fail to understand this and adapt will cease to existPhoto Credit: “Tombstone” by A.M. Kuchling
  6. 6. Why the RecentDemand for Nonprofits to Create Revenue-Generating Activities?
  7. 7. #1 The Economyincrease in unemployment + bleak forecast = decrease in donations = need to diversify
  8. 8. Charitiesdo not want to relyexclusively on donations.Photo Credit: “Collecting Money” by Mwiththeat
  9. 9. Donorsdo not want to be the solesource of revenue.want to support what theyfeel is a financially viableorganization. Photo from “Meet the Investor” panel from recent Amuta21c conference for Israeli charities & nonprofit professionals, www.amuta21c.com
  10. 10. #2 The “New” Funder Self-made wealth. Seeks philanthropic opportunities that allow for personal involvement & not just a cash infusion.Photo Credit: ”Money and Magnifying Glass” by Images_of_Money
  11. 11. This Modern Donorpursues sustainability.uses similar investmentstrategies to financenonprofit & for-profitventures.Photo Credit: ”Money and Magnifying Glass” by Images_of_Money
  12. 12. This Modern Donoruses phrases, such as… …Return On Investment …Venture Philanthropy …Philanthropic Equity …Double-Bottom LinePhoto Credit: ”Dictionary Definition: Work” by Jaboney
  13. 13. #3 Hybrid For-Profits Legal structures that allow for socially-minded business entities.Photo Credit: “Red and Blue Liquids Inside Graduated Test Tubes” by Horia Varlan
  14. 14. Investorsbelieve it is possible topursue a double-bottomline: impact & profitability
  15. 15. Someone Even Told Me “I don’t even know why people start charities anymore. Any cause can be opened up as a business.”Photo Credit: ”Stock Exchange” by Travel Aficionado
  16. 16. the demand for revenue- generating activities doesn’t require nonprofits to abandon proven funding models & methodology!Photo Credit: ”Stop Sign” by LadyBeames
  17. 17. Don’t GetBlindedBy the Nothing canHype! substitute philanthropy. Donors are different than customers.
  18. 18. And don’t forget:• Charities have always pursued a double-bottom line.• SSIR Study: Fee-for- Service alone is not a funding model of any USA “big” nonprofit.
  19. 19. Nevertheless, the potential for enhancing financial stability throughearned income is toosubstantial to ignore.
  20. 20. When ImplementingRevenue-GeneratingActivitiesCreate a strategy thatcompliments the vision &mission of your charityIn short, see Part 2 Photo Credit: ”Construction Vehicle” by Roberto Verzo
  21. 21. Why do you think charities are being pushed to create revenue-generating activities? /nonprofitbanker @nonprofitbanker #nprevenueStay Tuned for The 3 Components to Part Two! a Successful Strategy