In the Titanic Recession, Which Nonprofits Get the Lifeboats? Editor notes issue #78

Now that we have all become experts on the Titanic, we all know that third-class (steerage) passengers died at substantially higher rates than first-class wealthier passengers. But did you know that nonprofits that serve poor people are failing at much higher rates than those that serve the general population?

In fact, nonprofits that provide "the most basic anti-poverty services for the poor and homeless failed at around twice the rate of more mainstream services," according to the UCLA Center for Civil Society in its recent report on nonprofits in Los Angeles County (and we have no reason to think that other areas are different). And even more telling is this: that among nonprofits serving the poor, those located in African American neighborhoods failed twice as often as anti-poverty organizations in other neighborhoods.

What a sad story this tells about our society in general, and about funders in particular. A sobering statistic is that in terms of foundations, fewer than 16% of grants are targeted to low income communities (National Committee for Responsive Philanthropy).

We suspect that one reason (of many) for the relative lower amounts of foundation funding is -- unexpectedly -- the focus on innovation, social enterprise, outcome metrics, and the coolness factor. Innovation: when serving the poorest in our communities, we know the answers; we just need more money. Social enterprise: in only very, very rare cases can a nonprofit make money by helping the poor. Outcome metrics: funder pressure for outcome metrics forces nonprofits to serve those who can most readily "improve" -- which means serving folks that are relatively better off. And the coolness factor: a start-up run by well educated, cool, high-energy young people is more fun to fund than a long-time provider run by community-embedded nonprofit staff.

Sometimes we need to choose nonprofits because they are doing the most important and pressing human work, not because they are the most innovative or have the best metrics, or because we know and like the leaders. I am guilty of this in my own personal giving, and I pledge to be different. -- Jan Masaoka

* This issue features a blockbuster article from Kim Klein, in which she discusses her Christian faith, an article on Real-Time Evaluation, and a Board Cafe article on how many people should be on a board. Plus: how to make mini-weapons of destruction (and fun) in your very own office.

* What a great response to our last issue with special 4-day discounts for Blue Avocado readers. More than 90 people took advantage of book discounts and more than 1,235 signed up for webinars. Terrific!

Four Day Discounts for Blue Avocado Readers

Offers good only from Tuesday March 20 through Friday March 23, 2012 . . . issue #77

"The nonprofit sector never closes," researcher Paul Light says. We like that image: the nonprofit sector as a library open all night, a wood shop where you can use the tools for free, an inn for the weary that always has another room available. For all the librarians, toolmakers, and innkeepers: thank you for keeping us all going.

And it’s time for our special Four Days of Discounts from Blue Avocado! We do this just twice a year: unique offers and deep discounts that last only four days. Here’s the deal: We’ve lined up a variety of deals exclusive to Blue Avocado readers; you have from now until March 23, 2012 at 5:00 pm (Pacific) to make your move. Don’t delay or you will lose out on some great opportunities.


TWO FREE WEBINARS


  • Ellen Aldridge photoTop 10 Nonprofit Employment Law Mistakes (and How to Avoid Them): free webinar, presented by half of Blue Avocado’s Ask Rita columnist, Ellen Aldridge. Based on Ellen's work at the Nonprofits Insurance Alliance Group (so she knows the real scoop!), the webinar is designed for executive directors, management team members, and board members. April 17, from 1 pm - 2 pm Pacific Time. Click here to register . . . don't forget it's free! Thanks to our sponsor, Nonprofits Insurance Alliance Group.

  • Jan Masaoka photoNonprofit Sustainability: Understanding and Changing Your Business Model in 90 Minutes free webinar. Too often program goals are discussed separately from financial means, although we all know that both must be discussed together. Jan Masaoka and Steve Zimmerman will present the methodology for doing so from the book they co-authored (with Jeanne Bell): Nonprofit Sustainability: Making Strategic Decisions for Financial ViabilityMay 3, from 11:00am - 12:30pm Pacific Time. Take a fresh look at choosing the mix of programs, earned income, and donations that will be sustainable for your organization. This model can be used as an adjunct to or substitution for traditional strategic planning. Click here by March 23 to register free.

FOUR BOOKS AT DEEP DISCOUNT

Two books signed to you (or whomever you choose) by the legendary Kim Klein:


  • Kim Klein photoFundraising for Social Change by Kim Klein, 6th edition, 2011: If you are only going to read one fundraising book in your entire life, this is the one. A classic recently updated, this 400-page guide is used both as a university textbook and a field handbook. A soup-to-nuts guide to raising money from individuals, particularly for smaller organizations and those working for social justice. Normally $45, you can get your signed copy for only $26 plus shipping and handling.

  • Fundraising for Social Change cover 35% off Kim Klein's Reliable Fundraising in Unreliable TimesThis 2010 winner of the McAdam Book Award details how organizations can survive scandals, move from reliance on grants to a broad base of individual donors, and keep going without burning out staff and board. Written in Kim Klein's accessible, humorous, and very practical style. Normally $35 (unsigned), you can get a signed copy for only $20 plus shipping and handling.

To order either of Kim's books, send a check (plus $5 each for postage and handling) payable to Klein and Roth Consulting, and send to same at 1904 Franklin St #517, Oakland, CA 94612. All books will be signed. Please specify if you want the book signed to a particular person or organization (what a cool gift!). Must be postmarked by Friday March 23, 2012.


  • Nonprofits Guide to HR book cover20% off The Nonprofit's Guide to Human Resources by Jan Masaoka. Nolo Press is offering our readers this book by Blue Avocado editor Jan for 20% off -- you can choose either the traditional book or eBook. This definitive guide offers sound, tested, legal information on everything HR, including nonprofit-specific topics such as the board of directors’ role in HR, nonprofit compensation, and the HR of volunteers. Designed for executive directors, program managers, and "Accidental HR" folks, this is "the essential how-to that should be on the desk of every manager," says Jon Pratt of the Minnesota Council of Nonprofits. To order at this special, 4-day rate, use the promo code BLUE when you click here.

  • $8 off on The Lobbying Strategy Handbook: In this textbook that's not just for students, Patricia Libby provides a 10-step framework that walks you through the elements of a lobbying campaign to change laws you think need changing. Case studies help illustrate the principles. And Pat (who's a professor at the University of San Diego) is letting Blue Avocado readers purchase the book for $33.60 plus S&H (that's 20% off the regular $42.00 price). To order, email or visit www.sagepub.com. Be sure to use the N120309 code during checkout.

TECHNOLOGY: eTapestry, NTEN, flash drives


  • eTapestry graphic50% off a fundraising audit ($250 value) if you buy eTapestry Essential or Pro by March 23: eTapestry will partner you with one of their consultants for an in-depth review of your eTapestry database. To get started and for more info, click here. *Not valid with other offers.

  • NTEN conference graphicGo to a technology conference from your desk: Our friends at the Nonprofit Technology Network (NTEN) are holding their great annual conference, and you can attend from your very own office. The Nonprofit Technology Conference on April 4-5 will be streamed live so you can set up a computer in your conference room and let your whole staff attend. Normally $300 for non-members, if you register by March 23 you can get the NTEN Member rate of just $150. Learn more here and enter the Blue Avocado discount code 12ONTC-7NMEMBA during checkout. An outstanding resource for Accidental Techies and Super Techies in your organization.

  • Special Blue Avocado Flash Drives are available to you! What makes them special? They are loaded with past Blue Avocado hot topics -- and you get to choose the topic! For $15 (plus $5 postage and handling), pick from one of five topics and our top five articles in that category (in pdfs on the drive) will be sent to you. Just make your choice:  boards, human resources, financial management, First Person Nonprofit, or Jan’s Top 10. To purchase, click here.

JUST FOR CALIFORNIA READERS:

California signWe have a special offer from the California Association of Nonprofits. For just the next four days, you can get 15 months of membership for the price of just 12 months: a 25% discount. Click here to fill out the online membership application. Be sure to choose Blue Avocado as how you learned about this offer! Questions or want to sign up by phone? Contact Shannon Smith, CAN’s Membership Coordinator at ssmith@CAnonprofits.org or call toll free at 888-427-5224 x 1027.


Next issue of Blue Avocado -- Look for these upcoming articles in April:


  • Jeanne Bell on how EDs lead strategic planning processes

  • Kim Klein on Christianity

  • Jan Masaoka on "What's the Right Size for the Board?"

  • A 3-Minute Vacation wreaking havoc in your office

See you then! -- Jan Masaoka & Susan Sanow, Blue Avocado

 

Stuff People Say to Nonprofits . . . editor notes issue #76

The latest internet meme has been a lot of fun: S*** People Say to Native Americans and S*** New Yorkers Say, for instance. So we propose:

Stuff People Say When They Hear You Work for a Nonprofit:

  • So, do you get paid for that?
  • I work for a nonprofit too . . . United Airlines . . . ha ha!
  • The problem I have with nonprofits is that not everybody deserves to be helped.
  • You know I've always wondered: why do nonprofit people people get paid so much?
  • Are there any nonprofits here in Atlanta?
  • Yeah, you know, I volunteered once at a nonprofit, but they were really screwed up.
  • I have a great idea for a nonprofit I'm going to start someday!
  • The problem with nonprofits is that they don't run themselves like businesses . . . where do I work? Oh, at Exxon (or Bain Capital, or Solyndra, or . . . .)
  • I wish I had your job . . . I work too hard.
  • I have a friend who works for a nonprofit in San Diego! Maybe you know her!
  • So . . . do you get paid for that?
  • I could never ask anybody for money. Hey, can you help me move on Saturday?

Put up a sign in your organization and ask people to fill in: "Things people say when they hear you work for _______(your organization's name)" and see what they come up with!

(Thanks to Judy Hatcher, Susan Sanow, Nelson Layag, and their funny friends for help with above.)

* This issue Ask Rita wonders whether employees have to be paid for sleeping on the job, and we wonder why more nonprofits aren't using cell phone messaging for policy alerts, raising money, and special event news. In addition, a fresh look at a frequently-overlooked fundraising vehicle -- scrip gift cards -- and a discussion of how to organize the board to support the revenue strategy (and a 3-minute vacation of course).

* We're looking for one or two investigative reporters with backgrounds in nonprofits to write stories for Blue Avocado. Is that you? If so, please let us know about you here.

* It's going to take me awhile to learn how to balance my new role as CEO of the California Association of Nonprofits with my continuing role as editor and writer for Blue Avocado. Please be patient, and as always I and the Blue Avocado Steering Committee welcome your comments, questions, and advice (click here). --Jan Masaoka

Gratitude and Misgivings . . . editor notes issue #75

Gratitude can be what gets us through a bad day. Or now, as the year comes to an end, gratitude can help us see the good in the past year and look at the coming year with hope. We at Blue Avocado are so grateful to all of you who read Blue Avocado, comment on articles, criticize us and praise us, reprint articles, and send us notes.

Let me take a moment, too, especially to thank our advertisers (see right and at bottom of page), our founding sponsors -- the Nonprofits' Insurance Alliance Group and CompassPoint Nonprofit Services -- and the 200+ individuals who have donated to Blue Avocado (we're like public TV: free to read but there are pledge breaks).

But this season comes with misgivings as well. The recent flurry of activity over the proposed cap on charitable deductions made many of us feel drowned in urgent calls to action pressing us to write to our Congressional representatives to make sure that the most affluent among us don't pay any more taxes as a result of making donations. (Some of the email and OpEd campaigns implied that all charitable deductions would be reduced, not just those in the very top tax bracket.)

Is there something off when the nonprofit's sector biggest campaign of the year is about defending the top 1% because otherwise they won't donate as much?

In fact, the whole exercise felt something like a Kabuki play about Chicken Little . . . mannered, rehearsed movements predicting doom when just about no one really thought the deduction reduction would ever take place.

We support the charitable deduction at its current level, but we couldn't help but have misgivings about the cry-wolf hyperbole and the characterization of nonprofits as charities that rely on donations from the wealthy rather than as economically robust drivers of social change, innovation, and prosperity. Just saying.

So with a mix of gratitude and misgivings, a very merry Christmas and happy holidays to everyone, and a peaceful and prosperous new year.

* This issue is a fun mix: a harrowing update on the Vanguard Foundation story, a hair-raising story of how one nonprofit got through an IRS audit, a helpful (if slightly boring) article on interviewing candidates for the board, and a hilarious "Nonprofit Salary Calculator" just before you get your W-2 for the year. Plus a wonderful, unique gift you can give one of your co-workers . . . for free.

* See you in 2012 . . . Jan Masaoka

The Philanthropic-Consultant Industrial Complex . . . editor notes issue #74

You've probably heard of the 5% payout requirement for foundations . . . but most people mistakenly believe this means that foundations must grant out 5% of their assets each year. Actually, foundations must spend 5% of their assets each year . . . which can include their own salaries, office rents, and so forth.

But perhaps the least examined of all foundation spending is what they spend on consultants, such as consultants to themselves and their initiatives, contract staff, consultants to nonprofits (the $200K strategic planning grant that goes 100% to the consultant, none to you), and so forth.

In fact, in the blink of 15 years, we've gone from a time when there was hardly any nonprofit infrastructure support to one where it feels as if the infrastructure -- we coined the term Philanthropic-Consultant Industrial Complex -- outweighs the nonprofits doing the actual work.

Even more than the money, the philanthropic-consultant infrastructure is changing who's running the show: rather than supporting nonprofits, foundations and consultants are increasing telling nonprofits what nonprofits should be doing.

(Of course we recognize the value of infrastructure . . . Blue Avocado is even part of that infrastructure. It's the relative size and the shifting center of gravity we're concerned about here.)

These days when a foundation announces it is starting an initiative for low income seniors, we now assume that much of the money will go to regrantors, researchers and consultants rather than to on-the-ground nonprofits and the seniors themselves.

And doesn't it sometimes seem as if the best and the brightest young people in the nonprofit sector want to be foundation program officers, consultants, or donation app makers? To tell the truth, we have enough program officers, enough (so often unsatisfying) consultants (really!), and enough start-up apps. We don't have enough people who aspire to run homeless clinics or foster care homes, to raise money for ethnic theaters or rights for prisoners, to be teachers rather than program officers making grants in education.

Our sector is in danger of hollowing-out. In fact, innovation comes from the ground up, and that's also where the real work takes place. Let's start by honoring, celebrating, and paying more to the people on the ground above how much we honor and pay the people in the infrastructure. Grantmakers and consultants: are you listening?

  • This issue you'll find an executive director evaluation form, an update to the Vanguard Foundation story, 3-Minute Vacation to Nonprofit AcronymLand, a legal guide to the latest in nonprofit social media,
  • How corny . . . but let's be grateful this month of Thanksgiving. I'm very grateful to have the opportunity to work on Blue Avocado. -- Jan Masaoka


We are the 99% . . . editor notes issue #73

We are the 99%. And we who work and volunteer in the nonprofit sector know more deeply than most the suffering that so many people are experiencing, and the frustration that young people in particular are feeling.

The authenticity of this movement is as moving to me as its successes. The Occupy Wall Street movement doesn't have the characteristic lacklusterness of campaigns produced by the political parties or the usual players in the anti-poverty movement. Take a moment to look at the wearethe99percent website to see the real stories of the mostly young 99%ers.

And the outburst has succeeded in changing the narrative. This narrative is particularly refreshing given a high-profile narrative that's all too present in the nonprofit sector: that the wealthiest (the 1%) and philanthropy will be the ones to change the world.

Despite the absence of high-profile individuals, it's clear that there is smart, experienced leadership in the movement. Only when there have been advance, sophisticated talks with the police can large demonstrations and arrests occur without violence and mayhem. A Southern California organizer tells us that many of the New York organizers have backgrounds in unions and in nonprofits.

If you make less than $593,000 per year, you are part of the 99%. (And did you know that the wealthiest 1% of the population owns more than the bottom 90%?) The nonprofit sector has always been about the 99%. Let's embrace this narrative and movement, talk about it, build upon it, join it. I'll see you there.

* This issue we have a high-value set of articles: one on nonprofit staff voting patterns, one on Contract Wizardry, one on executive director evaluations, and an Accounting Procedures Manual Template (now you don't have an excuse for not having one). Enjoy.

* If you'd like to attend a book party for my new Nolo Press book -- The Nonprofit's Guide to Human Resources -- and you'll be in San Francisco on November 15, please email Blue Avocado's project manager Susan Sanow at susan at blueavocado dot org and she'll send you an invitation.

* Changes for me and Blue Avocado: I am pleased to announce that I have accepted the job of CEO of the California Association of Nonprofits, starting in January 2012. I'm very happy that I'll be able to continue to publish Blue Avocado, although we'll have fewer issues per year. I see my new job as an extension of working with the wonderful community of people that read and use Blue Avocado . . . we are the 99% of the nonprofit sector doing the heavy lifting on the ground in our communities. --Jan Masaoka

Only Bad Restaurants Go to Scale

We in nonprofits are good at taking on myths and sacred cows. But perhaps the least examined of these myths is the one about "going to scale." This OpEd takes a closer but brief look at the conventional wisdom in this area:

Myth #1: Nonprofits don't go to scale (get a lot bigger) because they lack the vision or the ambition

The reality here is that the dominant capital markets for nonprofits -- government and foundations -- actively work against nonprofit growth.

Regarding foundations, the common funding policy of "one smallish grant per organization per year" means increased volume doesn't lead to larger foundation grants. In fact, when nonprofits grow, many foundations become less interested in them. A commonly stated reason is "we want to feel where our size grant can really make a difference" . . . which often translates to: "we feel better funding organizations where we are one of their most important funders."

Government -- overall the biggest funder of nonprofits -- is not only the biggest engine for growth but also the biggest barrier to growth. Most community nonprofits . . .

Get A Lot More Out of a Conference . . . editor notes issue #71

Autumn is coming . . . which means we nonprofit folks will be either putting on a conference or going to a conference. Here are some unconventional tips on getting the most out of a conference:

1. Choose the sessions you know the least about. If you're a community organizer, you might feel you ought to go to the breakout sessions that focus on that. Instead, go to one on writing grant proposals. If you work with young people, go to the session on working with seniors. You'll learn something you can apply to your work -- you will. And you won't be bored and/or disgusted with the people speaking.

2. Instead of listening for good ideas (only), listen for things you can quote in your next grant proposal or monthly report. For instance, suppose you hear a speaker say something really stupid. Instead of ignoring it, write it down! In your next grant proposal you can say, "The extent to which this subject is misunderstood was demonstrated by a speaker's recent remark at a national conference . . . " Or somebody might say something obvious, like "it's really important to be flexible when it comes to public policy." Now you can quote: "As nationally recognized expert ___ said at a recent conference, 'It's really important to be . . . '" Get it?

3. Skip at least one session. Go outside. Take a taxi to the River Walk, or go shopping. From the inside of a hotel, you could be in Paris, Kansas City, or Jupiter. Go out and get a croissant or some barbecue. (Works best if you do this by yourself.)

4. Fail-proof way to meet someone: If you're an introvert or just sensitive, you might beat yourself up for not doing enough networking. Instead: get to a session early; other introverts will be sitting there playing solitaire on their cell phones. Sit near one of them, then lean over and say, "Would you mind if I introduced myself? I'm supposed to meet at least five new people at this conference and I haven't met any so far!" The other person will be so grateful that someone has made the first move he or she may even forget to move the six of diamonds up.

5. If you're bored or irritated by a session, walk out.

6. Put up a sign on the bulletin board: "If you want to go out for Thai food and talk about triple diagnosis approaches (or meet other Gen-Xers, or talk about trends in contemporary Native American art, or want to go to the XClub for dancing), meet here at 6:30! Worst case: no one shows up but you. But don't worry . . . no one will know!

And if you're putting on a conference, here's a tip: There's a relaxed camaraderie among staff working together at a conference. Take advantage of this to get to know a co-worker who intrigues you. Talk to the head of a different department, or someone in accounting: "I've always wanted a chance to chat with you . . . isn't it funny it turns out to be at a conference?"

This issue we are publishing a provocative article on Foundation-Nonprofit Partnerships simultaneously with the wonderful National Committee for Responsive Philanthropy. Also a sample Parental Waiver form when you have kids who volunteer, and Dennis Walsh on getting the most out of your audit. Dennis is the author of Blue Avocado's all-time most popular article: a bookkeeping test to give to prospective employees.

Thanks to so many folks who sent in their executive director evaluation forms. Next issue we'll have an article on the subject. And don't forget that subscribing to Blue Avocado is free . . . so encourage your co-workers to do so! -- Jan Masaoka

I Guess That's Why They Call It the Blues . . . editor notes issue #70

Sometimes it seems like the bad news is big (the debt deal, global warming) and the good news is little (one little kid inspired). But our constant focus on the bad news can lead some people to mistake our depression and anger for cynicism. We like to quote the Nigerian novelist Chinua Achebe: "When I have stopped criticizing Africa, you will know I have given up on Africa."

In a similar way, we in the nonprofit sector demonstrate our hope for the future by criticizing the present, and our idealism about America by our criticisms of America. And here at Blue Avocado we would add: when we have stopped criticizing the nonprofit sector, you will know we have given up on it.

Four substantial articles this issue, including the scoop on Getting a Foundation Job, Advice for Boards with New Executive Directors, and an Ask Rita column on Personnel Files. And Kim Klein contributes a Nonprofit Tax Quiz . . . take it with your friends!

Plus a new batch of Blue Avocado webinars coming up and a 2-Minute Vacation. Quick reminder: if you find Blue Avocado useful or fun, encourage others to subscribe? --Jan Masaoka

P.S. Another favorite quote: "Some problems are so complex that you have to be highly intelligent and well informed to be undecided about them." (Laurence Peter)

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