The Constare Group was recently highlighted in the South Bend Tribune Business Weekly.
Click here to read the article.
Friday, January 14, 2011
Thursday, August 19, 2010
A Corporate Spin on Nonprofit Partnerships
Written by: Heidi Eckstein
“Without help from corporations, non-profits will surely find themselves increasingly irrelevant to the 21st century.”
Just more than a decade ago Craig Smith put this harsh prediction in his book “Giving by Industry: A Reference Guide to the New Corporate Philanthropy.” Mr. Smith analyzed various industries and examined how charities could match their solicitations with the company’s goals.[i]
It turns out he was right. Christina Gold, CEO of Western Union, says, “Nonprofits would do well to consider the full range of benefits they can offer their corporate sponsors.” A corporation is not just trying to do well; it is creating a positive public image. And, at least in Western Union’s case, this involves working with nonprofits that aligned with their social programming and geographic reach.
Their Our World, Our Family program achieves this by providing financial services expertise to the company’s primary client base. Importantly, the program provides “opportunities for [Western Union] to offer value beyond monetary contributions alone.”[ii]
One example of this type of contribution is the Target Forensics lab. By allowing federal crime investigators to use their labs, as well as fund police forces and create inter-office information sharing technology based on inventory management, Target Corp. increases goodwill while investing in a safer environment. Potential payoffs could include less shoplifting or safer and happier employees.[iii]
Two years ago Target was ranked 11th “Most Admired Company” by Fortune Magazine, in large part because of its policy of giving back to the community.[iv] The company consistently donates about 5% of its pre-tax income and early last year Target leveraged this in a Facebook campaign in which fans could vote for which group they wanted Target to fund.
The two-week long Facebook campaign was intended to spread awareness of Target’s charitable activities. As Chadwick Matlin puts it, corporation philanthropy has two rules. Rule 1: A corporation should do good. Rule 2: It should tell everyone that it’s doing Rule 1.[v]
Now it Target’s case, donating to St. Jude’s Children Hospital may not line up with their public image as a trendy, cheap retailer. But other companies work with nonprofits in corresponding fields. For example, much of the philanthropy of pharmaceutical companies goes to university science programs.
So how can your nonprofit find a corporate partner?
1. Look for a corporation whose vision lines up with yours. If your objectives and those of the company are similar, it’ll be easier to justify why they should give you money.
2. Remember this is a business partnership. As Ms. Gold said, “I appreciate it when potential partners respect our time by coming prepared with ideas that clearly resonate with who we are… Those NGO’s that clearly have done their homework in advance enable us to have a much more productive conversation.”
[i] C. Quinn Hanchette. “Industrious Charities Can Earn Corporate Gifts, Author Says.” Philanthropy.com. Jul 15 1999.<>.
[ii] Caroline Preston. “Rethinking Corporate Giving: Western Union’s CEO Offers Her Philosophy.” Philanthropy.com. Jun 3 2010.<>.
[iii] Sarah Bridges. “Retailer Target Branches Out Into Police Work.” WashingtonPost.com. Jan 29 2006. http://www.washingtonpost.com/wp-dyn/content/article/2006/01/28/AR2006012801268.html.
[v] Chadwick Matlin and Win Rosenfeld. “Target’s Facebook Philanthropy.” May 20 2009. http://www.thebigmoney.com/articles/video/2009/05/20/targets-facebook-philanthropy.
Thursday, August 5, 2010
Why your board needs me
Written by: Katie Valko
I write to you as a summer intern of the Constaré Group, LLC. Perhaps the junior title alone is enough justification for you to ignore my post but I urge you to keep reading for that very reason.
First, picture your organization’s board. How many of them look like me, that is to say, how many of them are younger than thirty? What about thirty-five? Still coming up short? Should this even matter to the success of your non-profit? Enter: me, the young intern here to argue that my generation can indeed make a positive impact on your board and in your organization.
The Facts
The discussion of board diversification with respect to age is no novel topic. Non-profit gurus have been debating the pros and cons of young board members for years. The 2007 Nonprofit Governance Index reported a mere 2% of board members under the age of 30. On the other hand, 62% are 50 or over. Accordingly, 36% are between 30 and 50 years old.
Obviously, the soaring representation by the over-50 set is logical. These individuals bring the kind of wisdom and experience that only comes with time. Presumably, they have served on the organization’s front lines. Now they help steer important boardroom decisions based on past successes and failures- experiences the younger age brackets can only dream of having. These young folk probably lack the kind of wisdom, skills and - let’s face it - fiscal resources to be significant contributors to your board. This mindset justifies why aggressive recruitment of Generation Xers and Millennials is slow at best.
What I have a hard time justifying is the glaring disparity in age distribution within the board. Why so heavy for over-50s? Can’t we have a trickle-down effect to better represent all ages?
Why Older Members
Let’s think about this: Generation Xers are roughly between the ages of 30-50, implying a stage in life where family and work take priority over all else, including your organization. This being the case, a leadership role with non-profits probably takes a backseat to family or work commitments. If an evening board meeting means missing your kid’s soccer game or work travel means you don’t have free time, we know where loyalties lie.
Not to suggest they do not care about your organization- no, quite the opposite. It is simply a matter of time, or a lack thereof, which points to two conclusions: (1) you should recruit more board members over this age window and (2) you should look for new members below this window.
Why Try the Younger Set?
Obviously, I am interested in the latter notion. The “under-thirty” crowd would seem to have more free time, without major family commitments. Moreover, this group represents the largest generational demographic since the Baby Boomers. If they (and by “they” I mean “we”) have a high presence in the community, shouldn’t that be reflected in your boardroom?
A lot of the opposition I have read regarding young board members is that their pockets simply do not run deep enough. While it is certainly true that one of the main functions of the board is raising money, we at Constaré preach to the three T’s: Time, Talent, and Treasure.
What we lack in Treasure, we can make up for in Time and Talent. We are the people who will step up with enthusiasm saying, “I can do that” or “I’ll spend time with those who are being served” whereas the board veterans are your key players for picking up the tab from time to time or for understanding their duty to give money on an annual basis. Both parties are giving back to the board and the organization, are they not? In every sense of the word, it is the “giving back” culture of a board that enables a nonprofit to do great things.
You’re going to want some fresh meat, right out of college or further studies. The business majors, like me, have fresh ideas and a keen understanding of modern business practices to kick your organization into high-performing gear and get it up-to-date with modern times, best practices, sustainable measures, savvy technology, accountability and other current buzz words in the business world. The potential board members from other educational focuses bring very similar knowledge, not to mention a level of technological savvy unique to my generation. Regardless of where we focused our studies, having a younger, results-oriented board member will also open your organization to a new network of volunteers and tribe members.
Still skeptical? Perhaps you can try a similar alternative such as a young friend group or allow us to be on a special advisory board or some sort of nonvoting body; just be sure that whatever you choose to do you make the expectations and commitments.
Sure, we will soon hit that phase in life where family and work take the reins but you might as well get all the energy, ideas and smarts out of us before that time his. The clock is ticking. Shake off the “like me” bias that too often narrows the scope of the applicant pool. Why aren’t you recruiting yet?
I write to you as a summer intern of the Constaré Group, LLC. Perhaps the junior title alone is enough justification for you to ignore my post but I urge you to keep reading for that very reason.
First, picture your organization’s board. How many of them look like me, that is to say, how many of them are younger than thirty? What about thirty-five? Still coming up short? Should this even matter to the success of your non-profit? Enter: me, the young intern here to argue that my generation can indeed make a positive impact on your board and in your organization.
The Facts
The discussion of board diversification with respect to age is no novel topic. Non-profit gurus have been debating the pros and cons of young board members for years. The 2007 Nonprofit Governance Index reported a mere 2% of board members under the age of 30. On the other hand, 62% are 50 or over. Accordingly, 36% are between 30 and 50 years old.
Obviously, the soaring representation by the over-50 set is logical. These individuals bring the kind of wisdom and experience that only comes with time. Presumably, they have served on the organization’s front lines. Now they help steer important boardroom decisions based on past successes and failures- experiences the younger age brackets can only dream of having. These young folk probably lack the kind of wisdom, skills and - let’s face it - fiscal resources to be significant contributors to your board. This mindset justifies why aggressive recruitment of Generation Xers and Millennials is slow at best.
What I have a hard time justifying is the glaring disparity in age distribution within the board. Why so heavy for over-50s? Can’t we have a trickle-down effect to better represent all ages?
Why Older Members
Let’s think about this: Generation Xers are roughly between the ages of 30-50, implying a stage in life where family and work take priority over all else, including your organization. This being the case, a leadership role with non-profits probably takes a backseat to family or work commitments. If an evening board meeting means missing your kid’s soccer game or work travel means you don’t have free time, we know where loyalties lie.
Not to suggest they do not care about your organization- no, quite the opposite. It is simply a matter of time, or a lack thereof, which points to two conclusions: (1) you should recruit more board members over this age window and (2) you should look for new members below this window.
Why Try the Younger Set?
Obviously, I am interested in the latter notion. The “under-thirty” crowd would seem to have more free time, without major family commitments. Moreover, this group represents the largest generational demographic since the Baby Boomers. If they (and by “they” I mean “we”) have a high presence in the community, shouldn’t that be reflected in your boardroom?
A lot of the opposition I have read regarding young board members is that their pockets simply do not run deep enough. While it is certainly true that one of the main functions of the board is raising money, we at Constaré preach to the three T’s: Time, Talent, and Treasure.
What we lack in Treasure, we can make up for in Time and Talent. We are the people who will step up with enthusiasm saying, “I can do that” or “I’ll spend time with those who are being served” whereas the board veterans are your key players for picking up the tab from time to time or for understanding their duty to give money on an annual basis. Both parties are giving back to the board and the organization, are they not? In every sense of the word, it is the “giving back” culture of a board that enables a nonprofit to do great things.
You’re going to want some fresh meat, right out of college or further studies. The business majors, like me, have fresh ideas and a keen understanding of modern business practices to kick your organization into high-performing gear and get it up-to-date with modern times, best practices, sustainable measures, savvy technology, accountability and other current buzz words in the business world. The potential board members from other educational focuses bring very similar knowledge, not to mention a level of technological savvy unique to my generation. Regardless of where we focused our studies, having a younger, results-oriented board member will also open your organization to a new network of volunteers and tribe members.
Still skeptical? Perhaps you can try a similar alternative such as a young friend group or allow us to be on a special advisory board or some sort of nonvoting body; just be sure that whatever you choose to do you make the expectations and commitments.
Sure, we will soon hit that phase in life where family and work take the reins but you might as well get all the energy, ideas and smarts out of us before that time his. The clock is ticking. Shake off the “like me” bias that too often narrows the scope of the applicant pool. Why aren’t you recruiting yet?
Friday, July 30, 2010
The Nonprofit Sector - Moving at a Slower Pace
Written By: Caitlin Foster, Summer Associate
Constaré’s mission in the non-profit world is to get such organizations to act and think more like for profit businesses, with the ultimate goal of becoming sustainable. While this may seem like common sense, non-profits are notorious for operating inefficiently without sustainable strategies in mind. Although many non-profits are successful, there are weaknesses in how many smaller (and larger) not for profits are managed. One of the main weaknesses of non-profits seems to be the length of time it takes to get things done; many non-profits are plagued with slow paced work and outcomes. This slow pace could mean any of the following things—slowness of grant writing, slowness in launching marketing campaigns, updating website, filing tax returns, etc. This weakness is not to downplay the passion or time that many board members and volunteers put into managing nonprofits. However, passion for helping the needy (or any another noble cause) cannot alone make an organization successful. There are reasons that non-profits operate at a slow pace but if they want to be more successful in fulfilling their missions they must change how they are organized and run.
Non-profits may operate slowly and inefficiently for a variety of reasons. Volunteers and people who have full time jobs often staff non-profits and this has an effect on what people can do/have time for. While a person may be committed and passionate about the organization’s cause, they may have prior engagements that lead to slower turn around time in non-profits. Other issues with time may be related to technology. Oftentimes, communication between board members is not organized and information sharing is less than adequate. Without proper communication, carrying out simple activities becomes slower and the productivity of the non-profit could decrease. Instituting something such as Google Apps, which would create a unified email and file sharing between board members, would ensure that everyone has access to the same documents at the same time. However, non-profits are often slow to change techniques and update technology. Some may still be relying solely on U.S. Mail for newsletters and donations while others have moved to the Internet. While monthly or yearly mailings are still a good idea, a nonprofit cannot be successful without having a presence on the Internet. Every minute longer it takes to get something done or adapt to new trends, means fewer services provided to those in need and potentially less money donated to the cause.
In today’s society, there are more non-profits than ever. Many of these organizations are providing competing services. Making sure that your non-profit operates at a fast and efficient pace is, therefore, of the utmost importance.
Constaré’s mission in the non-profit world is to get such organizations to act and think more like for profit businesses, with the ultimate goal of becoming sustainable. While this may seem like common sense, non-profits are notorious for operating inefficiently without sustainable strategies in mind. Although many non-profits are successful, there are weaknesses in how many smaller (and larger) not for profits are managed. One of the main weaknesses of non-profits seems to be the length of time it takes to get things done; many non-profits are plagued with slow paced work and outcomes. This slow pace could mean any of the following things—slowness of grant writing, slowness in launching marketing campaigns, updating website, filing tax returns, etc. This weakness is not to downplay the passion or time that many board members and volunteers put into managing nonprofits. However, passion for helping the needy (or any another noble cause) cannot alone make an organization successful. There are reasons that non-profits operate at a slow pace but if they want to be more successful in fulfilling their missions they must change how they are organized and run.
Non-profits may operate slowly and inefficiently for a variety of reasons. Volunteers and people who have full time jobs often staff non-profits and this has an effect on what people can do/have time for. While a person may be committed and passionate about the organization’s cause, they may have prior engagements that lead to slower turn around time in non-profits. Other issues with time may be related to technology. Oftentimes, communication between board members is not organized and information sharing is less than adequate. Without proper communication, carrying out simple activities becomes slower and the productivity of the non-profit could decrease. Instituting something such as Google Apps, which would create a unified email and file sharing between board members, would ensure that everyone has access to the same documents at the same time. However, non-profits are often slow to change techniques and update technology. Some may still be relying solely on U.S. Mail for newsletters and donations while others have moved to the Internet. While monthly or yearly mailings are still a good idea, a nonprofit cannot be successful without having a presence on the Internet. Every minute longer it takes to get something done or adapt to new trends, means fewer services provided to those in need and potentially less money donated to the cause.
In today’s society, there are more non-profits than ever. Many of these organizations are providing competing services. Making sure that your non-profit operates at a fast and efficient pace is, therefore, of the utmost importance.
Tuesday, February 16, 2010
Who is in your Tribe?
by Andrew Lynn
How many people in the community (outside your board and staff) know your organization’s most urgent need right now? How many know the number of clients you served last month? How many people could articulate your organization’s mission and vision for change in the next decade?
How many people would you say are in your organization’s tribe*?
In 2008 75% of nonprofit income came from individuals (USA Giving Report). As corporate giving and foundations tighten their belts for the foreseeable future, it’s a critical time to think about how you’re engaging individuals in your mission.
Successful non-profits have found ways to build and lead their tribe of followers, groups from which they can draw donors, volunteers, and event attendees. The first step is overcoming outdated communication models that prevent your tribe from growing.
Most people are not a part of a nonprofit tribe, but they say they want to be. One survey shows 7 in 10 Americans say causes like health research, education, or the environment are personally important to them, but less than 2 in 10 donated their time to these causes last year (The Service Gap). That’s 152 million Americans (give or take a few million who just want to appear concerned) who report caring personally about a cause but failed to find an organization that will engage them. Some of that 152 million may give money to charity, but statistics would suggest their giving would be much greater if they had given their time to the organization as well.
Your tribe is out there waiting for a leader. Most people have a natural inclination to join a tribe and be part of something bigger than themselves. Look at the camaraderie that exists among Mac users, or the success the Obama campaign had in turning many $80 gifts (the average online contribution) into $500 million. Before Apple and Obama, these people were out there with the same passions and interests, but it took a leader to engage them. It's the same way with nonprofit tribes. There are people out there with passionate concern for education or poverty (just think how passionate people get about politics), but they've never found an organization that engages that passion.
Your tribe wants what you're offering. Many times nonprofits lose sight of the value of the product they're offering to people. Not only are people naturally inclined to join a tribe, they're also looking for ways that they can make the world a better place. Nonprofits (and churches) are the sole vendor of meaningful change in our society. Most people are waiting for a nonprofit to say, “Look at the change we want to make, now come join us!”
Your tribe needs you to enter the 21st century. Many nonprofits haven't adapted the means to engage their tribes the way presidential campaigns and businesses have. I see many organizations that operate their development/marketing/outreach efforts around the realities of twenty years ago. At that time communication strategies were controlled by cost: printing expenses combined with postage expenses forced nonprofits to think in terms of monthly, quarterly, or even a yearly communication cycles. Maybe thousands of people were informed of your latest client breakthrough, but they were only told once or twice a year. The communication cycles of the past ruled that only a handful of donors could be regularly informed of an organization's successes and challenges.
Tribes are not built on the communication cycles of twenty years ago.
If you've ever updated a facebook or twitter status, you know the world has changed. One guy I know asked his "tribe" on facebook for an air purifier to borrow, and thirty minutes later he had one at his door. The communication cost was zero, his message reached over 1000 people, and he certainly didn't pay to have a newsletter laid out, printed up, and mailed out to people.
Tribes are ready to be engaged in the daily work of your organization, but they need you to lead and engage them.
This is where many nonprofits make a horrendous error. It is easy to confuse the tools of tribe-building with the end goal. Signing up for facebook is a 5-minute task a volunteer can do for you; it won't get you a tribe. Tribe-building is an organization-wide vision that requires a holistic vision of how to engage a large group of people with steady information and opportunities to be part of your mission. It goes back to the first questions of this post: how many people actually feel engaged by your organization? Could you invite some of your print newsletter recipients or annual appeal recipients to engage with you more regularly? Could you focus your next event on laying out a 10-year vision and telling people how they can play a part in it?
Constare can help you develop a plan that builds a tribe of people around your organization. As other funding sources dwindle, it may be a good time to look at how you're engaging individuals. We'd be happy to provide you a free consultation session on building a vision of doubling, tripling, or maybe even building from scratch a group of people engaged with your organization's mission.
To learn more please contact us.
*Tribe marketing is the brainchild of marketing guru Seth Godin, who you can read more about here.
Wednesday, February 3, 2010
How to grow and sustain your mission in a down economy
Do you feel that you're not moving forward?
Are your donor dollars not there as they were before?
These are trying times, not only for society as a whole, but particularly within the nonprofit sector. As jobs are lost, salaries are frozen and retail sales are hitting a plateau, individuals and companies are looking to tighten their belts. The first hole to be ratcheted up, invariably, is discretionary funds for charity (Not the $5 lattes)! You're not alone, and in your role as a nonprofit administrator, board member, volunteer or even friend realize first hand that you have two choices: dig in and hold your line (which resembles the sand being swept away under your feet at the ocean), or you can grow your funding strategies (Yes, I said grow) during this period.
The first step everyone takes is looking to cut internal costs. That might mean using the backside of scrap paper or lowering the thermostat in the office, but those are just efficient business changes. These actions are not growing your income; these are just smart cost-cutting actions. An initial step should be looking at your present income streams and deciding which ones are not being fully vetted, or in other words, who or what is eating into those hard costs. For example, your special event goes to the same location year in and year out, but does the price of the plated meal go up? Maybe this year, it’s time to bid out your event to several competitors (seeing if that per plate price drops $2-3). It's really nothing extraordinary that needs to be done, but it's essential that you look at how you present yourselves to the larger community when asking for donations. Have you updated your outcomes and measurements to show donors how critical your mission is to society? Perhaps, now is the time to work on some new grant-proposals to provide for capital and/or one-time project start-up costs, thus relieving pressure on your main sources of income.
There is no good rule of thumb or industry standard as to how to best evaluate your income streams, but I'm of the opinion that no source should account for more than 1/5th of the entire budget. Doing so only sets your organization up to complacency, which is never good. Therefore, you need to charge your board (and their version of a fund-development committee) with the desire to understand the current revenue streams and see which areas can be increased through a more direct approach, or through negotiations with vendors to reduce hard costs. Really, what this article is getting at is that it just takes a strategic approach to growing and sustaining your mission in a down economy. Now, more than ever, do people need the resources of the nonprofit sector. Instead of hunkering down, take charge, assess the situation and look at the resources you have within the organization, as well as those that you can draw on from the larger nonprofit community to help you meet these financial goals.
Tuesday, January 26, 2010
"UBIT" off more than you can chew, the Social Venture Quandry
Ok, I admit, that's a horrible play on words above, but it's the reality of the situation. The Unrelated Business Income Tax (UBIT) stymies the entrepreneurial spirit of the nonprofit sector and is so entrenched, yet so misunderstood by even seasoned tax workers.
The landscape of nonprofits within the United States has transformed from religious base charities providing alms to the poor to sophisticated multi-million dollar organizations networked across the nation. No longer are these entities looking to hold golf outings and galas to raise their revenue, rather they are building and leasing structures for an NFL[1] team while churches “are opening restaurants, private gyms, and even [a] Starbucks coffee franchise.” [2]
The desire and necessity to diversify revenue streams in order to serve their mission has evolved nonprofit leaders into becoming social entrepreneurs.[3] The idealists of these innovative revenue generators view it as an organization embracing its mission; others see elements of both nonprofit and for-profit activities. Social entrepreneurship, defined as the “double bottome line,” requires nonprofits to financially sustain and have a greater impact on their mission by applying and operating with entrepreneurial strategies.[4]
These same social entrepreneurs are entering a field where they look upon the law as irrelevant to their endeavors, when they should be guiding their social enterprises according to the exisiting laws.[5] The controlling law, the Unrelated Business Income Tax (UBIT), taxes the income gained from activities unrelated to the mission of the exempt organization. Struggling nonprofits envision that turning to a social venture will be a quick fix, but often the entity needs to be structurally re-adjusted to conform to nonprofit standards, let alone for-profit elements.[6]
When the question of unfair competition is poised to the nonprofit sector as a roadblock to social ventures, their initial reaction is that small businesses and the government still have a perception that they either pay below market wages or volunteers do all of the work. According to Jed Emerson, Director of the Homeless Economic Development Fund, four main elements should be taken into account before accusations are established[7].
1. Non-profits pay market-based wages or above and therefore can not use “profits” to undercut the market,
2. Significantly increased training, supervision and other costs associated with the employment of individuals whom the mainstream labor markets will not employ[homeless, drug/mental/emotional problems, etc], leaves non-profit businesses at a competitive disadvantage,
3. Because of their community and public service missions, non-profits must consider more than just their own bottom line; they must keep a constant eye toward the broader social mission of the non-profit,
4. Non-profits are disadvantaged because their sources of funding are more limited than those available to for-profit businesses.[8]
The effect of globalization that has exploded within the last two decades has propelled the field of social entrepreneurship to the front of the pack, where “that magic moment when an idea, trend, or social behavior crosses a threshold, tips, and spreads like wildfire,” as the nonprofit sector works to incorporate for-profit business practices within their organizations.[9] Nonprofits survival in the 21st century depends not on charitable donations, but a necessity to evolve into a hybrid social venture, whereas they receive limited charitable tax benefits, enjoy the flexibility of operating like a business and continue to engage the general consumer as a customer first and a donor second.
[1] “Baptist Hospital, Nashville’s largest nonprofit hospital, built a $15 million office and training complex to rent to the Tennessee Titans professional football team, partly for the revenue, but also for the marketing opportunities”
[2] John D. Colombo, Commercial Activity and Charitable Tax Exemptions, 44 Wm. & MARY L. REV. 487, 489 (2002).
[3] Gail A. Lasprogata, Marya N. Cotten, Contemplating “Enterprise”: The Business and Legal Challenges of Social Entrepreneurship, 41 Am. Bus. L.J. 67, 68 (Fall 2003).
[4] Id. at 68-69.
[5] Id. at 70.
[6] Id. at 69.
[7] Heather Gottry, Profit or Perish: Non-Profit Social Service Organizations & Social Entrepreneurship, 6 Geo. J. on Poverty L. & Pol'y 249, 258 (Summer 1999).
[8] Id. at 258-259.
[9] Janet E. Ker, Sustainability meets Profitability: The Convenient truth of how the business judgment rule protects a board’s decision to engage in social entrepreneurship, 29 Cardozo L. Rev. 623, 629-630 (November 2007).
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