Preparing Your Nonprofit to Move Beyond the Founder

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Stepping away is part of the nonprofit circle of life.

Over the years, I have worked with many founder-led (or until-recently-founder-led) organizations. There is something exciting about being part of that first wave, when a bold new idea emerges, takes shape, and hopefully improves society around it. But for those toiling away in young nonprofits, it is often grueling and sometimes even cruel. And after all the difficulties of starting a nonprofit, the end of the beginning rarely goes well. As anyone who has witnessed Founder’s Syndrome can tell you, the first leader is often abruptly shown the door, maybe under a cloud, leaving the organization in crisis. Not all survive. So how can you avoid this fate?

From Birth to Adolescence in the Nonprofit Lifecycle

The process of creating an organization is messy, painful, sometimes almost tragic (tragic flaws are as common here as in Shakespeare). But these difficulties are part of the larger arc of institutional maturation; at some level, they are unavoidable. If you understand the process in those terms, it might be possible to avoid some of the pitfalls, or at least, take comfort in their necessity.

In short, the founder problem isn’t really a problem, if you understand it correctly. It is a stage of development in the nonprofit life cycle. One that, like actual childhood and early adolescence, is full of hazards, and that inevitably must come to an end.

Birth is an apt metaphor for the founder years. A new nonprofit begins as a figment, something fully realized only in the founder’s mind. What follows is a long and sometimes draining process of getting that idea out of their head and into the wider world.

To the founder, this birth is a labor of love. The process requires someone who can imagine possibilities, playing through scenarios to see what is missing and how to fill that gap. However, day-to-day operations can be a struggle for such dreamers. Moving from theory to practice is heavy labor after all, and sometimes these dreamers falter in the execution of moving from abstraction into reality.

For staff, working in a start-up nonprofit is often an exercise in mindreading. When it comes time to put the idea into practice, the qualities that enable someone to be a founder can manifest as micromanagement or frustration, especially when others cannot see the details as clearly as you can. It can also mean a certain rigidity in how things unfold alongside a tendency to insist that things be done as you envision them, even when there are alternate routes that may play to the strengths of staff more successfully.

In short, from a staff perspective, a frustrating dynamic often emerges. Staff feel like they are supposed to be able to anticipate the founder’s thoughts, adapt to different working styles, and mimic the founder’s professional instincts.

For this reason, new nonprofits often grind through workers. As a founder, you may experience this as a lack of competence, dedication, or understanding, and justify the churn as a matter of finding the right people for the job. But if you are on staff during this period, it is important to remember that you play a vital role, and do what you can to avoid burnout as you carry forward.

The Onset of Growing Pains

As professional staff move in, become embedded in the organization, and commit to fulfilling its mission, other dynamics will emerge over time. As the founder, you may find yourself in conflict with others who seem too cautious, who want to stick with a plan that to you feels outdated or inadequate to the problem you confront. They may hew to an established strategic plan or question ambitious fundraising goals, for example. As time goes by, you may begin to feel isolated, like staff are aligned against you.

But instead of giving in to paranoia, this is a time to take stock of the situation, giving yourself time for self-reflection. And instead of displacing the problem onto others — avoiding responsibility — it is wise look inward, asking: Am I, the founder, who is the problem?

Ask Yourself: Is it Me?

Like children as they grow to independence, there will come times when you may find your relationship to the organization grows confusing and fraught. Wondering if you have outlived your usefulness is a healthy reflection. Indeed, the more you hold the nonprofit close, the greater the likelihood that serious problems will emerge that could derail your plans for a long and healthy future.

Look for the following four telltale signs of Founder’s Syndrome.

Mission Creep

People who found organizations often do so in part because they want the freedom to do what they feel is most interesting or urgent. That desire doesn’t change. You may frequently revise the work plan, despite staff reluctance or resistance. You may resent their lack of vision or courage for change.

Instead of ignoring reluctant staff (or putting them off as lazy), consider that they may have a point. After all, people take nonprofit jobs because they believe in the mission. They take the time to understand the mission, grasp the strategies that contribute to those high-level goals, and see how their work fits into that plan.

Those who join later may have a more faithful understanding of the organization’s purpose than you do. Make sure you are taking their reluctance or even their criticism into account.

Staff Churn

In many nonprofits I have worked with, steady attrition or a sudden spike in turnover often signals to board members that something is wrong. In addition to the stress of constant hiring, you might also notice that the board is becoming more directly involved in personnel matters normally outside their ken.

Both problems — constant turnover and increasing board involvement — make it prudent to ask what you might be doing wrong as a manager. Of course, this may simply be a matter of taking professional roles and opposing viewpoints more seriously. But it is also worth understanding that, as discussed above, the process of bringing a new nonprofit into being requires a great deal of effort to understand the founders’ (sometimes changing) vision. Ensuring that you are being clear in your communication, as well as open to others’ views, is essential to avoiding widespread burnout.

Board Underperformance

In the beginning, it is common to have a board composed of a few of the founder’s friends, and for the board to give a great deal of deference to the Executive Director. Over time, however, it is important to build a board with specific competence to understand the challenges nonprofits face — as well as the independence to stand up to you.

In a successful nonprofit, the board’s primary responsibilities include exercising fiduciary duties and supervising the Executive Director. As the organization matures, both will become more complicated, and you need to ensure the board is up to these tasks. A board that acts as a rubber stamp will not be one that can help you avoid the (sometimes fatal) errors young nonprofits make.

Be sure as your nonprofit matures, your board does, too. To build a mature board, you must look for expertise as well as contrasting views that challenge you. This blend of expertise and generative conflict will make the organization stronger in the long run.

Budgetary Overconfidence

Very often, founder problems come to a head when there is a shortfall in the budget. Not infrequently, this involves revenue projections that were set by the ED over the objections of finance and development. If fundraising fails to keep pace with the expectations outlined in your budget, a crisis ensues.

However, this issue is more complicated than it initially seems. Typically, the founder holds (or is integrally involved in) major donor relationships, has the passion and charisma to secure gifts, and has developed a strong intuitive grasp of what is possible. That instinct probably brought the organization to where it is. But it can breed overconfidence, especially in light of changing institutional dynamics.

Growth can be a both an imperative and a source for instability in a young nonprofit. In every organization, the fiscal structure changes as it grows, in ways that founders often fail to perceive. A common example that I have seen concerns the ratio of unrestricted to restricted funds. Many new nonprofits start out with ample unrestricted seed funding: supporters recognize the need for flexibility, wanting to help build the necessary infrastructure for the organization to thrive. But as the nonprofit grows, restricted income creeps in (sometimes in the form of grants). After a few years, restricted income might even surpass general operating funds.

At this point, the nonprofit realizes it has come to an impasse: it has more money than ever and yet is unable to pay the bills. Restricted funding requires more financial and programmatic oversight — specialized expertise that the organization has not invested in. And founders often chafe against requirements that tie their hands with locked-in deliverables. Yet all too often, these organizations do not see the changes happening or recognize the implications until it is too late.

Avoiding this conundrum requires investing in a more professionalized staff as time goes by so that you are ready for the leaps in complexity that occur in healthy, growing nonprofits. As you grow, it is imperative that you plan carefully. This seems obvious, but it is particularly vital in this phase that you hire seasoned finance and development professionals — and that you empower them to lead on decision making where the expertise is theirs. Operating today as you did yesterday will inevitably fail.

Flying the Nest

As you bring on solid professionals who can guide the organization through its tumultuous adolescence, conflicts will inevitably emerge. Things will often not be done the way you would do them if left to your own devices — nor should they be. Different people will come in with different strengths, and playing to those strengths means being flexible in how things are done. Remember, a growing and professionalizing staff brings diverse opinions, many rooted in experience and role, that will inevitably conflict with your own. A failure to tolerate the clashes that result — and listen to the expertise of your senior staff — frequently cause staff churn and ultimately risk the health of your organization.

At this stage, if you want to avoid the pitfalls you are venturing into, you must let go. It means sharing ownership at least. But often, this is the time to move on.

Stepping Away is Part of the Circle of Life

Here again it makes sense to understand things using the metaphor of the nonprofit lifecycle. When people have children, they do so with hopes and expectations that those children, so small and helpless at the outset, will grow to thrive on their own. The time will — must — come when your nonprofit no longer needs you, where your continued involvement may even hinder more than it helps. It is a bit like the conflicts that emerge when our children are beginning to separate from us. You can fight these changes, but the worst possible outcome is that you win.

Like children, nonprofits face new struggles when they leave the nest. A friend of mine once said, “I never join a board before the second ED is gone, because they always get fired.” Whether this is true or not, the change in leadership brings new growing pains as the organization finds its feet as an established organization. These, too, are necessary.

But that is the future. If you see the signs as they emerge in the founding phase, you can step out of the way. You have already left the world better than you found it, but sometimes your nonprofit needs you to step away to really come into its own. That is the test of a true leader. You may be rewarded by seeing your idea soar in ways that surpass your greatest expectations.

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