Category: Funder Relations

Nonprofit funding: Ordering a cake and restricting it too

Posted on by Vu

cake-486874_960_720For the past few months one of staff has an eye that’s been twitching. “It’s this grant!” she says, “it’s for our after-school program. It pays for instructors’ teaching time, but not their planning time! How can they teach when they can’t plan?! How? How?!”

“Psst,” I whispered, “let’s talk in the conference room. Since they are dedicated they will plan anyway even without getting paid,”—I paused, looking around—“why don’t you just increase their hourly wages?”

“This grant capped the hourly wage, so I can’t pay them more. The other grant might pay for planning time, but they don’t pay for employer taxes! ” She started pulling at her hair, and both of us collapsed on the floor, weeping and beating our chests in anguish and despair.

OK, I might have exaggerated that last part a bit. But unfortunately, this sort of restriction is not an exaggeration. This challenge that we in the nonprofit sector face daily is historic and pervasive. And very, very frustrating and counterproductive.

Imagine if other businesses ran like this. Funders and donors are basically customers who buy products, not for themselves, but to give away to other people who need them (I’ll talk about the weaknesses of that system in a future post). Imagine what a bakery would be like if it had the same funding restrictions that we have on nonprofits:

Baker: Welcome to the Dusty Apron Gluten-Free Bakery. Can I entice you with a cake?
Customer: Yes, a chocolate cake. It’s for some gluten-free veterans.
Baker: Excellent! We specialize in gluten-free cakes. We can make a delicious flourless chocolate lava cake that was once featured in Tasty Pastry magazine. How does that sound?
Customer: Ooh, the gluten-free veterans would love that. They always get fruit for dessert. How much does it cost?
Baker: For a cake serving 20 people, it’ll cost about $100.
Customer: OK, well, I can only give you $20, so you’ll have to find the other $80 elsewhere
Baker: Well, luckily, we have other customers who want to help make a cake for gluten-free veterans. At least three of them said they’ll pitch in, and we’ll ask some others too.
Customer: Excellent, so here’s $20. However, you can’t spend the $20 on sugar. You can only spend it on chocolate and up to one egg. It’s spelled out here in this cake baking plan.
Baker: What about vanilla? It’s hard to make a delicious cake without good vanilla
Customer: You can spend $1 of the $20 on vanilla, but if you decide you need more vanilla, you have to email and talk to me about changing the baking plan.

One week later:

Customer: We ordered a gluten-free chocolate lava cake from you guys, and it was awful. It was too dense and not nearly sweet enough.
Baker: I’m sorry, but other customers also had their own conditions. One customer said he would pay for sugar, but not butter. Another said she would pay for chocolate, but we already had you paying for chocolate, so we asked her if she would pay for butter, and she said no. Our oven’s thermometer also broke down, but none of the customers would allow their cake payments to be used to fix it, saying that fixing it does not directly benefit gluten-free veterans. I emailed you to ask if $5 of your $20 could be used to buy a temporary thermometer, since we didn’t need so much chocolate, but you said it would take three weeks to change the original cake baking plan.
Customer: Well, I’m not buying any more cakes from you guys. You obviously don’t have enough baking capacity. Goodbye.

Meanwhile, another customer heard the exchange:

Customer 2: Sheesh, I’m sorry about that. If it makes you feel better, I and a bunch of other customers got together and ordered a blueberry bundt cake from you last month, and it was delicious.
Baker: I’m glad to hear you enjoyed it! I hope we’ll see you around more often?
Customer 2: Absolutely not. We only pitch in to buy a cake from any bakery once. If we keep buying cakes from you, you’ll just become dependent on us, and that’s just madness—madness, I tell you!
Baker: Well, I’m sorry to hear that. How can I help you today?
Customer 2: I just formed a committee to explore why there is such a high rate of nervous breakdowns among bakers, and since you guys were featured in Tasty Pastry, I thought I would ask you to join.

Two weeks ago I was out to lunch with a potential new corporate sponsor, who got very excited about a program we did a while ago, where we provided computer training classes in Vietnamese to parents so that they could learn to check their kids’ grades online through Seattle Public Schools’ Source program.

“That’s excellent!” he said, “that aligns really well with our priorities this year. You should apply for our employee giving grant.”

“Cool,” I said, “I did see that on your website. I’ll review further and follow up with you.”

“One thing you should know though,” he said, “we don’t fund staffing. We hate paying for people’s wages. We can pay for the computers and software for this program, but only for client use.”

I know he’s just a messenger for his company, but at that moment, I wanted to unleash the fury of a thousand ED’s and Development Directors on this poor man. I would stand on the table and my eyes would glow white, and a terrifying cyclone of meeting minutes and financial statements would swirl around me, knocking everything over. People would cower under their tables as hundreds of business cards rained down from the heavens. “Who,” I would say in a low voice that would reverberate through the restaurant, “who would make the program happen then? Elves?! UNICORNS?!!!”

I calmed down, thinking of how awesome that scene would be if we had a show about nonprofit work that combines The Office with X-Men. But yeah, seriously, who would manage this program? God, that would make our work so much easier, if we could just summon some multilingual elves to come out and plan programs and fill out paperwork. That would cut down on costs, and I’m sure the elves would have a better grasp on the advanced algebra and calculus required to figure out which funder is paying for what by when.

The sad reality is that we nonprofits spend way too much time navigating the complex maze of funding restrictions, time that could be better spent delivering and improving on services. We should all focus on the final outcomes and allow nonprofits the flexibility to do their jobs. Though restricting funding in the name of accountability has been a standard practice that stemmed from good intentions, in the end, it is the gluten-free veterans who will be eating fruit again.

How Nonprofit With Balls got its name; it’s more complicated than you think

Posted on by Vu

 

balls 2Recently, a new nonprofit came to meet me at the VFA office, which I appreciated, since I’m a very busy person, and meeting at my office allows me to watch a second episode of “The Daily Show” on hulu.com. This particular advocacy organization was trying to advance education in Seattle, and they wanted to see about collaborating with VFA. “Luke” came on time and was very friendly.

“Two separate people mentioned you, Vu, as someone we should talk to,” he said, beaming. He went on to present his concept, which was not altogether a horrible idea for advancing education. But I had this sinking feeling in my stomach. He was going to ask VFA to pull together a focus group.

“We’re trying to really engage communities of color, so we’re hoping you would do a focus group of 15 or 20 people for us to listen to.”

Every week, VFA gets some sort of request to rally our community members: “Vu, the seawall is breaking! Can you recruit several immigrants and refugees to give input?” The following week: “Vu, the combined sewers are overflowing! We want to get the Vietnamese community’s thoughts!” It is rarely anything fun: “Vu, a delegation is going to Hawaii to study the effects of hula and mild inebriation on nonprofit executives’ burnout rates, and we’d like you to come.”

“To be frank,” I said, “we are at capacity. We have only three full-time staff here at VFA running several programs and projects. I’m afraid that unless there are resources provided, I cannot ask my team to tackle any additional responsibilities.”

Luke looked perplexed and started talking about the importance of the effort he is trying to advance. I told him that if he wants effective collaborations, he should go to his funders and advocate for a more equitable financial support of organizations that are out there on the ground doing direct work so that we can have more capacity for advocacy. He became irritated and extremely defensive.

“So basically,” he said, “you want me to go back to my funders and say ‘Vu won’t play ball unless we give him money.’ I can’t do that.”

Luke must be new to Seattle. In a city known for process and indirectness, it was rather refreshing to hear him talk so bluntly. It had a certain symphony, like a wrench thrown into a blender.

“Play ball? Listen, we small ethnic nonprofits are knee-deep in balls! We have balls flying at us from every corner, from the City, from the County, from the School District, from organizations like yours. Usually without any funding to support our operations. We can’t juggle your balls for you!”

Kidding, I would never say that; at least, not while sober. What I said was, “The traditional ways of engaging communities of colors do not work. If you want to rally a few people to ‘listen’ to, then I am sure you can succeed in the short term. If you want long-term impact, I am telling you that you and others will need to shift your traditional way of doing and funding things. You can either hire a multicultural team of outreach staff, or you will need to work with cultural organizations; either way or preferably both, it will take resources because it takes much more effort to reach communities of color.”

He was visibly annoyed. “I am not looking for a handout, Vu,” he said, “you know what, if you just write down how much it’ll cost to pay for a few hours of someone’s time to call up people and how much facilities and food and other expenses will be, we’ll figure out a way to pay for them.”

I told him I didn’t have time to sit down and figure out his budget for him. And that even when there are resources, sometimes we have to turn down great projects because they do not align with our strategic plan.

“That really saddens me,” he responded, “and when this effort is huge and successful, and the Vietnamese community’s voice is missing, we’ll both understand why.”

I smiled. There was no point arguing further with him.

“All right,” he said, “how about this? We get lunch, you and I, and you bring just one Vietnamese client. Just one. You know what they say, the journey of ten thousand steps begins with one step, so can you do that? Just one client.”

“Luke,” I said—

“Just one!”

“Do you know what it takes to coordinate even something as simple as that? First I have to figure out which clients I know, then I have to call up four or five of them to see if any are interested. If one is interested, I have to find a slot that works with your schedule, my schedule, and this other person’s schedule. Also, I’d be more than glad to have lunch with you, but I am 90% certain that a client will not join, because they work during the day.”

Our time was up. I started feeling a pang of guilt. Perhaps I was a little too harsh. “Listen,” I said, “I want to be sure there is no misunderstanding between us—”

“Oh, there’s not,” he said, smirking, “I heard you loud and clear.”

“I don’t BS,” I said, staring him in the eye, “if you want real community engagement, help change the traditional way of doing things.”

I walked him out and sat down at my computer to write my follow-up thank-you email. Was I out of line? Was I taking out some sort of unconscious frustration on Luke? I don’t doubt his or his organization’s intentions. Perhaps he just came at a bad time. Every month, we get a dozen similar requests, usually from well-meaning and well-funded organizations. My staff work ridiculous hours managing programs and several capacity building and other projects. I’ve never worked with a more dedicated team. Is it unreasonable then for me to feel protective and to get annoyed at people like Luke, who seem to think we ethnic nonprofits have unlimited time and that we are selfish when we refuse to “collaborate” and “play ball” with mainstream organizations vastly better funded than we are?

Luke responded back, and we are having lunch in a couple of weeks. I’ll keep you updated. [Read Part 2, my lunch with Luke]

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Collective Impact: resistance is futile

Posted on by Vu

honey-bees-326337_960_720In the past few years, the concept of Collective Impact has covered lots of ground, with great results. Concerted efforts can kick some serious butts. Look what Strive has accomplished. Characteristics of CI are a common agenda, shared measurements, mutually reinforcing activities, constant communication, a backbone organization, and monthly happy hours.

However, like taking naps at work, Collective Impact should be done strategically and sometimes not at all. Recently, I’ve started seeing it become more and more like the Borg in Star Trek, a species that assimilates other life forms in a quest for dominance and perfection. Controlled by a hive mind that neutralizes any sort of individualism, and comprising billions of annexed individuals, they are strong and terrifying, like an army of zombie robots, each with one eye that has a laser beam. Resistance is futile, since any entity that tries to put up a fight is either assimilated and loses its identity, or else destroyed.

That, unfortunately, is what it feels like sometimes by those of us on the ground, the nonprofits that work directly with individuals and families. While no one is arguing with the importance and effectiveness of collective impact, it can be a little frustrating. Three or four times this year, we were told by various funders we need to align with The Borg. (There are several great CI efforts all around, so by “The Borg,” I am not referring to any specific one). Program officers, who are the Sherpas on the oftentimes Everestian slopes of foundation applications, have seen this shift in paradigm and have been trying to be helpful. Once a while, I get a call like this:

Program Officer: I’m calling to provide some feedback on your proposal. Are you in a secure location?

Me: Yes. I just walked into the bathroom.

PO: You need to mention a little bit more about your work with the Borg. The review team is looking for projects that really align with the Borg’s strategy.

Me: All right, we can expand that section. Thank you.

PO: I never called you. This conversation never happened.

Sometimes, we actually align with the Borg, in which case I’m happy to expand on how wonderful it is to be assimilated into the Borg hive mind. But occasionally we do not align. Heck, once in a while it makes no sense to be. As powerful as the Borg are in Star Trek, they were never able to assimilate members of Species 8472, which looks kind of like bugs, but that’s neither here nor there. Species 8472 is just so biologically different and incompatible, assimilation would only lead to disaster. A parallel can be made with collective impact efforts that try to involve communities of color, who have unique strengths and needs. Oftentimes, the first instinct is to assimilate everyone under one umbrella, and that could work. However, sometimes it does not work, and it may not necessarily be anyone’s fault. Several umbrellas may be needed.

Another frustration I’ve seen is funders’ shifting the funding priorities from direct service work to collective impact efforts and backbone organizations. Queries about support for direct impact programs often come back with “Sorry, we are now prioritizing funding the Borg’s work. Maybe you should go talk to them.” This is extremely frustrating. While the push is for everyone to align with CI efforts, the funding is not equitable. Direct service organizations, especially the ones that focus on communities of color, can only be involved in these amazing, region-wide efforts if we are strong and stable and have credibility with our clients. VFA has been getting requests to join various CI efforts and we have become more and more involved. If we were to shut down our after-school, leadership, parental engagement, and community-building work, no one would approach us, because we would have no connection or credibility. In order for these major collective impact efforts to succeed, funders must continue funding direct service organizations in parallel.

Much more importantly, however, is that clients may not be able to afford the time that it often takes for Borg-like efforts to achieve perfection. CI usually takes years. A kid who is failing school or an elder who needs food doesn’t have years. I just talked to a principal of a school with 90% low-income kids of color. She would love a common agenda and shared measurements and fully supports the work in this area. But right now her school desperately needs an after-school tutoring program because many students are several grades behind and they go home to empty houses and get no support.

In the Star Trek universe, there are few things more terrifying than a Borg invasion. They sweep through and assimilate or destroy everything. They absorb all resources. Collective impact should not have to be like that. The premise for collective impact is that we can do things much better by working together than by working in isolation. This is a premise that all of us on the ground fully believe in. But funding must be equitable and direct service must be simultaneously supported.

Being a nonprofit with balls, part 2

Posted on by Vu

balls 1Two weeks ago I had lunch with Luke, whom you may recall from “Being a Nonprofit with Balls.” Luke had come to VFA a couple of months ago asking us to rally 15 to 20 community members for a focus group. I had just woken up from my daily ED power nap and was kind of groggy and in no mood to be accommodating, so we got into a fistfight. Of course, this the nonprofit field in Seattle, so by “fistfight” I mean that we threw big concepts, hoping to wound each other with phrases like “authentic engagement” and “equity.” I told him that we small ethnic nonprofits are overwhelmed with similar requests from well-meaning organizations who are trying to be “inclusive” and that we just didn’t have staff capacity to do it and that he should go back to advocate for more equitable funding if he really wanted to authentically engage the communities of color.

We decided to have lunch, and I was looking forward to it. While I thought Luke’s approach was ineffective, I appreciated his refreshing directness. He arrived on time at my favorite restaurant. Since he was technically my elder, I poured him tea.

“So, how did you get to where you are?” I asked. He told me of his journey and of his philosophy on life, which is basically that if you serve others selflessly, the Universe will reward you.

“I moved up here, didn’t have a job. I was at this event, and I met Ted, who is a millionaire. He told me about this thing he’s trying to do to improve education, so I said that sounds great, how can I help? And he gave me a job.”

“That’s great,” I said, wishing that I knew more millionaires so I could be selfless around them.

“Listen,” he said, “that thing with asking you to put together a focus group, that was garbage.”

“It’s OK,” I said, “we get asked all the time. We know people mean well.”

“It’s just, how do we get the communities to the table? We keep inviting them.”

For the past several months, I’ve been on this bent about community engagement and funding equity, especially around education. After talking to Luke, I realize that he’s a nice guy, but his approach is very indicative of the standard approach to community engagement, which has gone nowhere. People wonder, Why are the communities of color refusing to join our table? We’ve invited them countless times. Don’t they want to work with us? We’ve prepared place settings for them and everything!

The reality is that whoever hosts the table has the majority of the power. They can shift people’s seats around, kick them out, refuse to share the recipe for coconut cornbread, or whatever. It is challenging to have authentic engagement when people feel like guests at a table and not a co-host. “Inviting” people to the table is not enough, since this is symptomatic of not engaging people at square one, when the table was being created in the first place.

“Community engagement must begin at square one,” I said. “Too often efforts get to square three or four, usually well-supported by funding at each step of the way, before people stop to realize, ‘Hold on, we’re not doing a good job reaching underrepresented communities.’ They scramble and backtrack, but it may be too late, since funding usually has been allocated without these communities in mind. So then we get asked to participate without being provided resources.”

“Another thing,” I said, “the people most impacted need to lead the effort. This is especially true with an issue like education, where the ‘achievement gap’ is basically kids of color. If this is the civil rights issue of our time, then the people most impacted need to be in the front leading. Allies and supporters are critically important. This work cannot be successful without then, especially since they have the relationships with funders. But they must be on the side or behind supporting the people most affected by inequity. Too often we see well-meaning people coming into the neighborhood saying ‘Hey, we know what works best for you. Come join and support our efforts!’”

“Also, people think that presence equals engagement. I’ve been to numerous ‘community input’ events that are fully attended by diverse communities. VFA has rallied our community members to these events. They have interpreters and UN-style headsets, and the room looks beautiful and inspiring, and no doubt pictures of the event will be posted everywhere afterward as proof of how effective the outreach and engagement was. Many of our community members leave going ‘Huh?’ Then they don’t see any results and feel that their time was wasted, and VFA loses credibility with them for inviting them. They may not understand all the concepts presented, but they know enough to feel shafted and tokenized. Presence is only one-half of engagement.”

“Here, try this vegan lemongrass chicken,’” I said, taking a break from my lecture, which I realized had been welling up for the past few years. “Having names on a list does not indicate engagement,” I continued, “VFA and other ethnic nonprofits get asked to join various coalitions and efforts. Because we are so busy doing direct service, we sometimes say ‘Yeah, go ahead, sign us up and use our name. We’ll drop by occasionally.’ This is a horribly destructive practice, as it stymies responsibility on our part to actively lead in the effort, and it reinforces the system of funding inequity and poor engagement. Funders looking at this list of ‘members’ may not be aware of how actively engaged they actually are. Heck, some organizations on the list may no longer even exist.”

“Finally,” I said, “direct service organizations have tremendous potential for advocacy. After all, they work directly with families and know their needs and can mobilize them to change policies and practices. But we are not funded to do that stuff.”

This was a lot of information to take in. We paused for a while to eat our food. “So what can I do to help?” he asked. I thought about it for a second. For the past year and a half I’ve been involved with the Southeast Seattle Education Coalition (SESEC), which is mobilizing the communities of color and allies to work together to improve education in Southeast Seattle. This is one of the few efforts actually led by the local communities of color to address the achievement gap. We are tired of being “invited” to the table. We must be a table. Trouble is, communities of color are not as connected to funders and decision makers, so we’ve been struggling with funding.

“Introduce me to your millionaire friend Ted,” I said, “I want to talk to him about SESEC.”

“I’ll see what I can do,” he said. We continued our conversation until the bill came. “I’ll pay,” I said, but Luke insisted on getting it. I could have fought for the bill, or at least to pay for my share, but I knew he felt some guilt, and this was his way of appeasing. I let him pay. I guess it’s my way of being selfless.

Last week, Luke emailed me saying he had talked to Ted and that Ted was willing to meet with me. I followed up to schedule a meeting. I am going to meet with a millionaire. Will keep you updated. [Read Part 3]

We need more shows about nonprofit work

Posted on by Vu

Like most executive directors, I come home exhausted from hours of telling staff what to do and taking credit for their work. To de-stress, I’ve started watching ridiculous amounts of television. And I started noticing something. There are plenty of shows about lawyers, doctors, detectives, cooks, servants, zombies, etc., most of them featuring attractive actors who spend endless episodes in frivolous romantic triangles with one another (except the zombies).

Unfortunately, not one of these shows is about nonprofit directors. What kind of example does that set for our kids? Do show producers think we are boring? Do they not realize how incredibly exciting our work is? In either case, I am going to write to David E. Kelley with an idea for a show, called “ED,” featuring a group of Executive Directors of several nonprofits. The show will explore their struggles helping to improve the world while balancing family and other obligations. It will chronicle the hard choices they have to make; the triumphs and challenges; and the friendships they develop, usually through happy hours. There are tons of exciting stuff to mine from the nonprofit world.

Pilot episode: A meeting room at the Coalition for Excellence (CFE). Tension so thick you could carve a statue out of it. Maria, the ED, prepares to present a cashflow report. Things do not look good, and she knows it. Meanwhile, at another nonprofit, Think of the Children (TOTC), Troy is furiously typing. He cries out in pain, cursing his email-induced carpal tunnel syndrome. But this grant is due tomorrow, and it’s a general operating grant! At another nonprofit, Unicycles for Guns (UFG), Vinh, a particularly dashing Asian ED, has a flashback. He is sitting in front of his parents at dinner. He tells them he is pursuing a Master’s in Social Work. They are silent, the sound of their chopsticks clinking on porcelain bowls mournful and ominous. He snaps back to the meeting he’s having with his Development/Human-Resources/Finance-Director/Janitor, Loan. She is tired of having multiple responsibilities and wants to a clearer work plan.

Episode 2: Maria’s board has voted to apply for a line of credit. This is a small victory, short-term. They did not seem to understand that fundraising efforts will need to increase. Staff morale, meanwhile, is down. She calls her Program Director, Arlene, into her office to plan a teambuilding retreat with no funding. At UFG, Vinh’s back hurts from endless hours of meetings. He holds in his hand a grant letter. He is afraid to open it; it could be a rejection. He decides to get it over with, when his phone rings. It’s Troy from TOTC; he got the grant he wrote and is calling, ecstatic, to invite Vinh to happy hour. Vinh looks at the letter in his own hand. “While we had many qualified applicants…” He retraces steps in his mind. Did he talk too much during the site visit? He felt like a failure, imagining all the kids now who couldn’t trade their guns for unicycles.

Episode 3: The Coalition for Excellence wildly succeeds at its annual dinner, and Maria has a good night’s sleep for the first time without Ambien. At TOTC, Troy welcomes an influential board member that he had been pursuing for months, Louis, whom he does not know had a relationship with Maria. He also does not know that Louis has loyalties to Think of the Children’s competitor, Care for the Children (CFTC)! The smart and inexplicably sexy Vinh, meanwhile, finds a coupon for 20% off reams of copy paper. He rushes to Office Depot. Little does he know that at that moment Loan is plotting with the board Treasurer to get Vinh fired.

In the season finale, viewers are left with cliff-hangers: Will Maria get together with Louis? Will Louis destroy Troy’s organization?! Can Arlene find a pro-bono facilitator for the team-building retreat??! Will Vinh be able to carry a ten-ream box of copy paper with his bad back and carpal tunnel???!

If that’s not compelling television, I don’t know what is. I’m going to develop a more detailed script for the pilot episode. Maybe I should add a zombie or two. If they don’t like “ED,” I also thought of another show, one from the perspectives of spouses of Executive Directors and what they go through. It’ll be called “Living with ED.”