A while ago I attended a meeting coordinated by a major local funder. The topic was “Lessons from Game of Thrones we can apply to nonprofit work.” All right, that wasn’t the topic, although that would have made for a much livelier discussion and will be a blog post here soon enough. No, we were talking about Community Engagement. Once again we were talking about community engagement, because it is becoming more and more apparent that voices of communities of color are missing from almost every table on every issue—the environment; education; housing; transportation; food equity; employment; scrimshaw, the ancient art of carving on whale bones, etc.—and everyone is banging their heads against the wall trying to figure out what the heck is going on. Continue reading “The game of nonprofit, and how it leaves some communities behind”
Category: Funder Relations
If You Give a Board Treasurer a Cookie, and other classic children’s books about nonprofit work
Today, I want to talk about children’s books. I am so sick of these children’s books that my one-year-old makes me read each day. You try to see how charming “Guess How Much I Love You” is after the 80th time! All right, nutbrown hares, we get it, you love each other, great! And yes, brown bear, brown bear, you see a red bird, awesome, and red bird, red bird, you see a blue horse, wonderful.
But then I got this great idea! I should write children’s books! They are short as hell! And if one becomes a best-seller, I’ll be rich, rich! The conventional wisdom is to write about stuff that you know. And what do I know? Nonprofit work, of course. I can write children’s books about nonprofit work! Here are some that I’ve started working on. There is so much that children can learn from our field. Just imagine parents reading these books to their kids each night. Maybe these books might even inspire some kids to grow up wanting to be nonprofit warriors. Read these texts below, and let me know what you think, and other children’s book ideas you have.
The Runaway ED
Once upon a time there was an Executive Director, and she wanted to run away. So she said to her board chair, “I am going to run away.”
Her board chair said, “If you run away, I will come and find you and bring you back, for you are my Executive Director.”
“If you come and find me,” said the ED, “then I will become a strategic plan and hide on the shelf.”
“If you become a strategic plan and hide on the shelf,” said her board chair, “then I will become an intern who accidentally stumbles on you.”
“If you become an intern who accidentally stumbles on me, then I will become a raw piece of cauliflower on a snack platter at a community gathering, which no one will eat.”
“If you become a raw piece of cauliflower on a snack platter at a community gathering, which no one will eat, I will become a desperate hungry vegan and find you.”
“If you become a desperate hungry vegan who will find me,” said the ED, “then I will become an invitation-only foundation that is like Fort Knox to get through.”
“If you become an invitation-only Foundation that is like Fort Knox to get through, I will become the best friend of one of the trustees’ daughters and I will get through to you.”
“Aw, shucks,” said the ED, “well, in that case, I might as well stay here and be your ED.”
And she did.
“Can I have a raise?” she asked.
“No.”
If You Give a Board Treasurer a Cookie
If you give a board treasurer a cookie, he may ask who’s paying for the cookie.
When you answer that you’re using funds he approved on the budget, he’s probably going to ask to see a copy of the budget.
When you give him the budget, he’s going to ask for the latest balance sheet.
When you show him the balance sheet, it may remind him of a training he attended about the importance of opening a line of credit.
He’ll ask you to open a line of credit. He might get carried away and say he’ll go to the bank himself.
When he goes to the bank, he might notice that your signatories are not up to date.
He’ll send out an email to the finance committee asking to discuss this at the next meeting.
You’ll have to coordinate the meeting and remind everyone. And of course, you have to get snacks.
And chances are…cookies will be on sale.
The Very Tired Development Director
In the light of a fluorescent lamp, a Development Director sat hunched over an organization’s fundraising plan.
On Monday, he organized one luncheon, but the organization still needed money.
On Tuesday, he applied to two employee giving campaigns, but the organization still needed money.
On Wednesday, he launched three crowd-funding initiatives, but the organization still needed money.
On Thursday, he wrote four grants, but the organization still needed money.
On Friday, he called five major donors, but the organization still needed money.
On Saturday, he wrote 10 thank-you emails, sent out 18 handwritten notecards, went to coffee with 5 potential donors, checked the grant calendar, looked at the annual event program brochures of 9 similar organizations to scan their sponsors, called 4 board members to remind them of their tasks, emailed 3 local businesses, and led a program tour. He was exhausted.
The next day was Sunday again. The Development Director stayed at home and spent time with his family, and he felt much better.
He was due for a much-needed vacation, so he took some time off. A week later he came back and…
He was still an awesome Development Director who continued to keep the organization and its important work going.
The Giving Nonprofit
Once there was nonprofit organization, and it loved the community and the funders supporting its work. Every year, the organization would continue to serve the people in its community. And each year, funders would provide funding so it could continue its programs. And the organization loved its funders and its community very much. And the community was happy.
But time went by, and the nonprofit and its programs grew older. The funders didn’t come as frequently, and the nonprofit was often left alone.
Then one day, a funder passed by, and the nonprofit said, “Come, funder, come to my programs and meet the kids we serve and let’s make the community better.”
“My foundation has shifted its priorities,” said the funder, “we only fund new and innovative programs. Do you do anything new and innovative?”
“I’m sorry,” said the nonprofit, “we have been building this program for several years. It is not new. But it is good, and it serves many wonderful people.”
And the funder left, and the nonprofit was sad again.
Then one day, another funder passed by, and the nonprofit said, “Come, let’s have lunch and talk about our community. Support our work and help kids achieve a brighter future.”
“We no longer fund direct service work,” said the funder, “that’s a Band-Aid solution. Do you do Collective Impact?”
“I’m sorry,” said the nonprofit, “we have been involved, but not significantly, since our community still needs direct service.”
And so the funder left and went far, far away. The nonprofit was now very tired and sad.
And after a long time, another funder came by.
“I’m sorry,” said the nonprofit, “I don’t have anything innovative, just good programs that serve people. My programs only target specific neighborhoods, not whole states, in case you want something farther reaching. The programs serve unique populations, so they might not be scalable, in case that’s what you seek. I am not sure I have anything that you might like to fund.”
“It’s OK,” said the funder, “we provide general operating grants focused on outcomes, and I heard you do some great stuff, so here is a grant so you can continue to serve the community.”
And the nonprofit was happy.
And its staff went to happy hour.
***
For more nonprofit kids’ books, read “Where the Sustainable Things Are” and other nonprofit children’s books
And also part 3, “Green Eggs and Strategic Plans” and other nonprofit children’s books
***
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General operating funds, admin expenses, and why we nonprofits are our own worst enemies
This week I was on an NDOA panel to discuss the importance of unrestricted funds. I was there with another nonprofit leader as well as two funders, and all of us, everyone in the room, agreed that general operating funds are awesome. General operating funds are like Tyrion Lannister of Game of Thrones, or Darryl Dixon of The Walking Dead, or, you know, Sophia from The Golden Girls: It is flexible, it is adaptable, and that’s why it gets stuff done.
For years I have been railing against restricted funding to anyone who would listen. I wrote a piece imagining what it would be like if a bakery ran with the same funding restrictions as a nonprofit: “I need a cake for some gluten-free veterans. I can pay you only 20% of the cost of the cake, and you can only spend my money on eggs, but not butter, and certainly not for the electricity; you have to find someone else to pay for the oven’s electricity. Also, you need to get an accounting firm to figure out where you’re spending my money, but you can’t use my money to pay for that service.” (Read the full post: “Nonprofit funding: Ordering a cake and restricting it too“). Continue reading “General operating funds, admin expenses, and why we nonprofits are our own worst enemies”
Dear business community: Please remember these 10 things about nonprofits
My friends from the business community:
As an Executive Director of a nonprofit, I want to say that I love you guys. Almost as much as we all love the Seahawks (Go Hawks!). You do so much to sustain our work—volunteering countless hours, donating funds to programs, and telling your friends about us so they can help too. We rely on you. The work is not possible without you. Whenever we get one of you on our board or development committee, it’s like Christmas.
However, there are a few things I’d love to remind you of, stuff like fundamental differences between nonprofits and for-profits and the challenges we face. I know, you probably have heard some of this already. But it’ll be really good for us to go over them again, so we can more effectively work together to make the world better:
- Nonprofit funding is restricted. That is something we repeat over and over, but I’m not sure you actually understand how restricted it is. Imagine that you have a business selling software for $100 a pop. I buy a copy, and I give you $100, but then I say “You can’t spend any of this money I’m paying you on your salary, or on your rent or heating for your business. It can only be used to for you to buy copy paper and no more than 80 binder clips.” Now have all your customers say stuff like that to you each time they buy your software. That’s how it works in nonprofit, but replace “customers” with “funders.” It is not fun trying to figure out who is paying for what and how to work within this structure, but luckily it only takes up 60% of our time.
- (Hilarious side story: Speaking of copy paper and binder clips, one of my ED friends sometimes “dumpster dives” for office supplies. On her last dive, she scored a roll of masking tape and an unopened container of poster paint (woohoo!)—and her board still complains that her organization spent over $1200 in supplies in 2013).
- No one wants to pay for unsexy “admin” things. These are things like HR, marketing, fundraising, the ED or Development Director’s salary, etc. This is why we don’t have an HR department, or an IT person, or a marketing person, why our database (if we have one) may not be as cool as you want and why some of our marketing materials look like they were designed by bonobos. You’re frustrated that our infrastructure sucks sometimes. Well, we are too! Unfortunately, because of our funding restrictions, we can’t do much about it except to beg for free services from you and your friends.
- (Hilarious side story: One time I was at a conference, and a business was leading a workshop on building a website. “We asked our bosses for $25,000 to develop the website,” said the presenter, “and they said, ‘Hey, we actually have extra funding.’ So they gave us $50,000!” Back then, 50K was half my organization’s operating budget and about four times my Americorps yearly wages, so I left the workshop and cried silently in a bathroom stall).
- Our funding is unstable, and it’s not our fault. It fluctuates depending on factors such as funder priorities, the situation in Iran, the value of the Yen, and the alignment of celestial bodies. Grants are usually only for one year. So year-over-year budget comparisons are often useless, and predictions on future funding sources are educated guesses at best. Please try not to be upset when you ask us questions like “What are your budget projections for next fiscal year” and we give you seemingly wishy-washy answers like, “Well…will Mercury be in retrograde at the end of this fiscal year…?”
- The better a job we do, the more costs we incur. That’s right; it’s weird, but it’s true. If our after-school program, for example, is awesome, more kids will attend, which means more costs. But the funding does not also increase automatically, meaning we have to serve more people with fewer resources. So then we have to spend more staff time on fundraising, which, remember, is not sexy, so people hate paying for that. If your product is awesome, your business can become stable and continue as long as demands remain stable. Not so for us nonprofits! This is why we live in a constant state of stress and fear. And why we need you on the development committee!
- Our community members (the people we serve) are not economic units. As one of my ED friends says, “You can’t run a cost/benefit analysis on the worth of a human life, and every human being is a miracle worthy of respect and kindness and compassion.” That sounds very sappy, but we genuinely believe in crap like that, and it very frustrating when people forget this stuff and reduce human beings to numbers and statistics.
- Success is difficult to measure. We throw around terms like “outcomes” and “metrics,” but things are so much more complex. When we’re working with people who are homeless, or mentally ill, or kids at-risk for failure, it is challenging to define success and what part we play in it. So it gets very annoying when you come in trying to impose a business framework on our programs, or get upset when we can’t give you clear answers to questions like “What’s the impact of your programs?” We’re trying to figure all this out.
- Things can’t be “scaled” as easily as you think. Some of you are really impatient about scaling up our work. You see a great program, and you want it to be bigger, to help more people. We do too. But the clients we serve and their challenges are complex, and we work within structures that severely limit what we can do. We are constantly thinking of ways to help more people, while trying to keep our organizations from collapsing, all the while hoarding supplies for a potential zombie apocalypse (That last part–it may just be my organization that does that).
- If you want to help, roll up your sleeves. We get plenty of advice. If you want to be helpful, roll up your sleeves and actually do something. It’s frustrating when business leaders or consultants come in and provide a report of recommendations of things we should do. These reports are often left on shelves to gather dust, since we often have no time or resources to tackle them. If you want to help, take lead on a few of these things you recommend.
- We chose to do this work. That’s right, we chose jobs that are unstable, under-appreciated, challenging, low-paying, and high-stress. That does not mean we’re not as smart as people in other sectors. Once a while we meet young professionals in other professions, and their smugness and condescension are palpable, and we want to grab them by the collar and shake them. But we think of our clients and swallow our pride. Our society places much higher value on jobs like doctors, lawyers, movie stars, business owners, etc. However, most of us did not go into the nonprofit field because we failed at other professions. We do this work because we want to kick inequity’s butt, no matter how difficult it is.
- (Hilarious side story: At my organization, which serves low-income immigrant and refugee youth and families, the clients are often amazed that I do this full time. One woman at an event asked when I will find a real job; her son was studying to be a pharmacist, she said.)
- Finally, just because you’re really successful in one area, it doesn’t mean you are automatically great in another area. If you’re an amazing heart surgeon, it doesn’t mean you’re automatically a great singer. If you’re an awesome dancer, it doesn’t mean you’re now a really kickass chef. And yet we meet so many of you who are successful in the business sector who now think that you automatically know how to run a nonprofit, or lead an education reform movement, or counsel us nonprofit folks on how to do our work. One of the most irksome things we experience is when business people, after a limited time trying to understand the organization, start giving advice. We’ll try to be thankful, since you’re a potential donor and volunteer, but seriously, the you-guys-should-do-this and you-guys-should-do-that are often irritating and not helpful at all. We don’t go to your business and tell you how to…run…quarterly reports…or, uh…improve assembly line efficiency…
At a meeting a month ago, a bunch of people and I were providing input and advice to Seattle’s new mayor as he starts his administration. A community leader stood up and said, “You have to remember that poor people are not just rich people who don’t have money. And black people are not just really dark white people.” Ahaha, that’s so true, everyone thought. They laughed. (Each of those profound statements deserves to be discussed in its own post later). I want to use the same line of thinking to remind you all that nonprofits are not just chaotic businesses with really nice employees. Until we have the same flexibility and stability of essential resources that successful businesses have, comparing one with the other is like comparing an apple with a porcupine.
Thank you for reading, and for all that you do.
Go Hawks!
***
Related Posts:
Nonprofit’s ultimate outcome: Bringing unicorns back to our world.
The sustainability question: Why it is so annoying.
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10 psychological principles I learned from getting conned out of money
Happy new year, everyone. I just came back from visiting in-laws in Louisiana, in a little town called Greensburg, which is so small that the local newspaper’s front page headline read “Man arrested after bar fight.” I probably could have made the headline too, something like “Seattle man tries to recycle, gets laughed at by locals, faints from lack of vegan nourishment.”
There was not much to do in Greensburg, so we took a day trip to New Orleans, which was two hours away. We were walking down Bourbon Street, which is a magical lane filled with food and drinks and strip clubs, when a lady from a balcony called to us. I looked up. She was holding some beads. “You gotta do something to get these,” she said, winking. So I did what anyone who wanted cheap plastic beads would do. I lifted up my shirt and flashed her.
All right, I didn’t do that, since no one wants to see eight vegan ribs, except a 60 or 70 people on Craigslist. We blew her some kisses, and she tossed down the beads, which I wore proudly while I drank my 20-ounce Hurricane adult beverage, sauntering down the sidewalk.
On the way back, we stopped for gas. It was New Year Day, and there were barely any people around. I saw one of those carnival game stations with giant stuffed toys hanging all around. It was the only one there. It looked empty, sad, the stuffed bears and alligators staring into the cold air with vacant, empty expressions, the kind that we see on EDs when they get grant rejection notices. It was here, at this game station, that I got conned out of money. It still haunts me till now. At night and on long drives I think back at what happened, wondering what I could have done differently.
Upon reflecting back, I realized that this gas station game booth was a very sophisticated machine, designed to swindle people out of their hard-earned cash. They deployed psychological principles proven to work on people, even smart, sexy people who direct nonprofits. Since there is no way I’m getting my money back, I might as well use this opportunity to learn something, so I am going to dissect the psychological tricks they used and how they could be applied to our nonprofit work. I know, I know, we’re not con artists and it’s crass to compare our work to this little con game, but I lost money and I must make some sense of it.
Principle 1: Hook them in with something free. “Here, honey, maybe you can win a toy for the baby,” said a lady who hovered around the parking lot. She handed me a card that said “1 free play, no obligation.” Free, I thought, I love free! That was how it started. Application to nonprofit work: Figure out something free that could pull in potential board members or donors or volunteers. Tickets to events, for example. I am tempted to go around with cards saying, “Help 1 low-income kid for free, no obligation.”
Principle 2: Humanize yourself. I walked to the station, where a twenty-something blond kid popped up from napping. “Hey, I’m Bobby,” he said, setting up the game, “what’s your name?…Vu? That’s a cool name. What do you do, Vu?…Work for a nonprofit? That’s noble, man, helping people.” Application to nonprofit work: In our rush to get people to donate money and stuff, we sometimes pass over getting to know them. Especially during the beginning of relationship building, slow down, ask about their kids, tell them how and why you got into the field, tell them about that rash that’s been bothering you, etc. People are much more likely to invest in your organization if they see you as a human being. A human being with a weird rash.
Principle 3: Make sure the objective is obvious and attainable. “The game is simple,” said Bobby, presenting a small board with a hundred holes in it, each hole marked with a number from 1 to 5, “you scatter these 10 balls, see which holes they land in, then add up the numbers.” The sums correspond with squares on a chart, most squares having numbers, some positive, some negative. “The goal is to reach 100 points, and you can win one of these prizes, or $100, up to you.” I rolled, he added up the numbers, and I got 15 points. Application to nonprofit work: Make sure stakeholders know clearly from the beginning what your organization’s mission and goals are, and make sure the goals are measurable and sane.
Principle 4: Start with low stakes, then ramp up. “That was free,” he said, “the next roll will cost you a dollar.” I paid a dollar and rolled again. I got 50 points for a total of 65 points!! Application to nonprofit work: Hook in potential volunteers, donors, and board members with something simple and low-stake, such as helping out with a small one-time project or buying a “Men of [your organization] Calendar” or something. (What, you don’t do an annual calendar? You should. It works for firefighters).
Principle 5: Provide frequent rewards, small and large. “Let’s see,” said Bobby, counting up the balls I just rolled, “that’s 25, and that corresponds to 15 points as well as a 2-for-1 on the point chart.” I looked puzzled. “That means you have a total of 80 points, AND I give you back double what you bet,” he said, “so here’s 2 dollars!” 2 dollars, I thought, I’m rich, rich! Application to nonprofit work: Provide stakeholders with rewards for their efforts, such as newsletters or mailings detailing successes your organization has achieved thanks to their help.
Principle 6: Provide a sense of safety. Since I had made a net profit of 1 dollar, I wanted to continue playing. I rolled, and the numbers added up to 28. “You got 28!” said Bobby, “That is the insurance number! That means from now on, your points can’t be taken away if you ever land on a negative square on the point chart.” Application to nonprofit work: Make sure you have director and officer insurance to cover your board members, and an umbrella insurance policy to cover volunteers and everyone else.
Principle 7: Get them close to the goal. I had gotten up to 80 points. So close! Soooo close! Only 20 points away! It would have been foolish to quit! “OK,” said Bobby, “but the following rolls are now 5 dollars each.” (See Principle 4 about ramping up the stakes). Only $5 more for a chance to win $100! I didn’t realize it, but I was addicted. Application to nonprofit work: We use this principle all the time, such as during annual dinners where we say “We are only $5,000 from meeting our goal of raising $100,000.” People like to achieve goals, so make sure you keep everyone updated of your organizations’ measurable goals, especially at the end, when things are down to the wire, e.g., “We have 93 bone marrow donors registered out of our goal of 100! We just need 7 more!”
Principle 8: Play nonchalant. With the last roll, I got 5 point, for a total of 85. So close. I knew I was in dangerous territory. Stop right now, my brain was telling me, this is obviously a con…but wait, what if it isn’t? What if I am just lucky? I could earn a hundred bucks today! That’s a lot of vegan dark chocolate with at least 70% cocoa mass…“I think I’m done,” I said, reason winning out. Bobby wasn’t fazed. “Suit yourself,” he said, “but I don’t know why you would quit with a score like that, plus insurance.” I sighed, then handed him another $5. Application to nonprofit work: Sometimes we get way too eager and thus overwhelm people. For instance, one time we were doing a Saturday morning program tour with 4 potential donors, and we had 3 board members there along with 4 staff. I think being outnumbered like that freaked out the potential donors. It’s a great program, we should have just let it speak for itself.
Principle 9: Distract and confuse. On that cold January day, holding my little 9-month old baby at the empty gas station, I reached into my pocket for another $5…I had gotten a negative 15 points, but thanks to the insurance card, I didn’t lose any. I was so close. Only 15 more points. Only 15 more points. I played until the horror set in, and I finally looked Bobby in the eye and said, “I’m done for sure this time.” But by then, it was too late.
Now, days later, thinking back on it, I realized that I never added up the balls’ values myself. I scattered them, but it was always Bobby who added them up. I never double checked his math. He counted fast, and I was too trusting. I am sure he manipulated me using the numbers, making me think I was lucky. Application to nonprofit work: There is none. We must never distract and confuse people. We must always be transparent with our supporters and community.
It was a bitter, painful lesson, this experience. It feels awful to think that you are a sucker. It haunts me till now. And now I realize there is a terrible Principle 10: Exploit people’s compassion. I only came to the booth because it was New Year’s Day, and I felt bad for that family, probably not making much money at all. We shouldn’t apply this principle to nonprofit work either.
So I got conned. It feels awful, but I have learned some great lessons, and life goes on. You might be wondering how much money I lost in total. It was $10. Yeah, 10 dollars, which may not seem like a lot of money, but remember, I work for a nonprofit.