This morning, I woke up early and realized I was face-to-face with my son Viet, who has been sleeping in the same bed with his mom and me. Looking at our sweet little baby, who was still sleeping peacefully, one tiny hand under his soft and rosy cheek, I was filled with warm fatherly thoughts. Namely: “When is this kid going to get a job and help pay for his keep?” I was tempted to wake him up and say, “You do realize that childcare for you each month is literally more than our mortgage, right? You better enjoy this while you can, little dude, because when you turn 18, you’re on your own.”
And that makes me think about the issue of sustainability of nonprofit programs. In every grant application, there is the “Sustainability Question,” which is basically, “How will you sustain this program or project when funding from the So-and-So Foundation runs out?”
This question seems absolutely reasonable at first glance, but honestly, it’s one of the most annoying questions we face. Most of us nonprofit professionals absolutely hate this question, and each time we see it, we have to leave our desk, go on a walk, maybe do some yoga or watch The Daily Show, then come back to our desk, take a deep breath, and write something like:
“We will continue to develop our staff and board’s ability to fundraise and diversify our revenues, including building relationship with other funders, as well as cultivating support from corporate sponsors and individual donors. Our special events continue to increase in revenue, and the board is leading the effort to explore earned income through program fees and the door-to-door sales of inspiring macaroni artwork made by the children in our extended-learning program.”
All of that is basically a euphemism for “We will leave you alone and bother other people.”
“Just once,” said my ED friend, Maureen, “Here’s what I’d like to put in response to that question:
- Program staff and the board will triple the time they spend praying for money
- Program participants will be asked to pray for money to provide for their services as well
- 10% of general operating funds will be utilized to purchase Power Ball lottery tickets;
- Fund development staff will regularly consult a reputable psychic to help track which direction foundations are trending to support.
Why is this question so aggravating? Why — every time I answer it, do I feel like crap? I sent out an email to my ED friends, asking for their thoughts, and the responses were passionate and insightful. While the issue is complex and requires a lot more time to explore, I’ll try my best to summarize my colleagues’ thoughts:
Who Makes the Call on Sustainability?
Overall, the Sustainability Question is annoying and frustrating (see very annoyed cat below) because:
Sustainability is in large part determined by funders, not nonprofits. As much as we love individual donors, many of us still rely on grants, and grants are usually small and one-year in duration. We get a bunch of one-year grants that are Frankensteined together to support programs, each one with their own set of demands and restrictions, (which I explored here in Nonprofit Funding: Ordering a Cake and Restricting it Too). As one ED puts it, “Why is fidelity to the mission so highly valued and expected of nonprofit leaders and staff but funders expect to ‘sleep around?'”
This lumbering, unwieldy, tenuous system is the antithesis of sustainability, so to be asked how we will maintain and grow our programs within it is kind of like setting a fire and asking how we will be putting it out.
Sustainability depends on the whole organization being strong, yet funders do not like providing general operating funds. Really great programs do not magically appear out of thin air. It takes real people, people who need, like, an office to work at and healthcare for their stress and carpal tunnel and stuff. These things are critical, and yet we have to constantly fight for them. “We will cultivate relationships with individual donors and corporate sponsors, etc.” sounds great, but that requires development staff, which is fundraising, and no one likes to fund “fundraising” and “admin” expenses, because those things are so frivolous and useless.
The Nonprofit Model
The nonprofit model is unique in that success at carrying out our missions leads to increasing costs, not revenues. The more successful programs are, the more clients they will serve, the more staff and other expenses will increase, without a proportionate increase in support.
An example is VFA’s Saturday English School (SES) program, which provides English and Math support to recent-arrival immigrant and refugee students every Saturday for three hours. Five years ago, we had 30 students show up each session. Because of how awesome the program is, we now have over 150 students each session. This is a five-fold increase in number of students served.
The expenses tripled, since more students means more snacks, more teaching staff, more curriculum material, etc. But funders are not going to triple the amount they provide; if we’re lucky, they’ll renew at the same level, and we’ll have to go search for other, newer funders to provide support. This is the Program Growth Paradox, where the more a program is successful and expands, the less sustainable it is.
Other comments from my ED colleagues include:
- Not every program that literally changes people’s lives for the better can become self-sustaining — but should be funded anyway
- I have no clue where my future funds will come from so everything I say sounds like BS
- After five or more friggin pages of explaining just how much you need the bucks, you are now invited to totally reverse yourself
- I will think about this and get back to you after I have several drinks to calm down.
You Versus Me, We Versus Us
The most serious challenge with the Sustainability Question, however, is that it symptomatic of a divisive and patronizing system that perpetuates the unhealthy dichotomy of nonprofits as supplicants continually begging for spare change, and funders as benefactors. “How will you sustain this program? How will you sustain it after our funding that we (might) give you runs out?” We feel like the underemployed college-grad living in our parents’ basement, freeloading off of their good will, until they call us in for a serious talk about our future and demand to know what our plans are to find a job and inform us that it’s for our own good that in six months they will kick us out. We feel like Oliver Twist, who has to beg for another bowl of gruel from the…uh…that one guy, who serves…gruel…
OK, I haven’t read Oliver Twist.
The Sustainability Question is aggravating because the responsibility is overtly placed on nonprofits’ shoulders to fix problems in the world that we didn’t cause in the first place. Once the question is asked, “It immediately becomes somebody else’s problem,” writes one of my ED friends. It feels like funders are at the end of their ropes trying to “help” us nonprofits and if we fail to sustain our work, it is all our fault. This is not working for our field.
There’s No “I” in Team
Every once in a while I meet a program officer who used to be a nonprofit staff. “Ah,” they sometimes reminisce, “I miss being on that side of the table.” And I would say, “Tell me what it’s like on your side of the table?” And we would talk, and I would learn that being on the other side of the table has its challenges, and that it’s not all completely awesome, with ergonomic chairs and dental AND vision insurance and with each person getting access to the company unicorn to ride to important meetings.
But that makes me think: why the heck are we on opposite sides of the table in the first place? Aren’t we all trying to solve the same problems? Why is the relationship between funders and nonprofits so adversarial? It is ineffective. We should be on the same team, where the quarterback supports the . . . uh, linebacker so that he can make a, um, rim shot at the . . . fourth inning . . .
All right, I don’t know anything about sports. Point is: nonprofits and funders must be equal partners, with different but symbiotic roles, and sustainability of the work must be shouldered by both parties. We nonprofits think all the time about sustainability, even without being prompted, and we will continue to build strong programs and diversify our funding. Funders, as equal partners, should provide multi-year funds, general operating funds, capacity building assistance, and help connect us to other funders and partners. And come visit the programs once a while! We must work together to figure out how to sustain and advance the work. We have to, because the needs of and challenges facing our communities are only going to increase.
Vu Le is the Executive Director of the Vietnamese Friendship Association (VFA) in Seattle. His column, Point of Vu, documents the fun of nonprofit work. Vu also publishes regularly on his own blog, Nonprofit with Balls. He can be reached at vu.le at vfaseattle dot org.
Program staff and the board will triple the amount of time they spend praying for money
Since we rent our space from church, I have gone upstairs from our basement office up to the chapel many times to make some petitions to our patron saint, Teresa of Avila, and to St. Jude, the patron saint of lost causes. I do this despite being Jewish. I figure a little extra juice on the Other Side can’t hurt us, and maybe will help in the end.
I raised this issue in comments about a previous article by Jan Masaoka (can't remember which one now) and in comments about your previous Nonprofit Funding: Ordering a Cake and Restricting it Too article. I am so glad you addressed it here, and to see other commentors share my furstrations which you illustrate so well. Jan's reply to my comment to her article and her comment here about creative writing could make me angry, except that has been / is the coping mechanism I use to write a proposal, along with everyone else apparently. Isn't it time to stop this madness! Can't we encourage Centers for Nonprofit Management and other national nonprofit organizations to engage local and national funders in a conversation about the fact that there is usually no good answer to their questions about sustainablity? I'd like to ask some funders how they would continue if all their funds went away. I'd like to answer their question by responding that if knew where funding was going to come from after their funding ends, I sure as hell would be going there for funding without stopping here for a year of funding first. Sometimes I think they ask the question because it is part of their power trip. I've seen a few too many foundation staff members act like it is their personal money — making comments like "what I look for in a proposal is…" when what they sould be saying is "what the foundation board members are looking for in a proposal is…" Anyway, thanks for the conversation about this important issue.
Thanks for the article! My blood pressure had just skyrocketed after reading funding guidelines which stated, "We fund projects not project implementers, therefore salaries should be no more than 20% of your budget." What? I guess we're supposed to do it all with volunteers. And this is to promote democracy in the Middle East — such a neat and tidy place where everyone will surely be happy to work for nothing! I haven't gotten to the sustainability question yet but I'm sure it's there. It's great to know others out there are reacting the same way to these no-win questions. I am not crazy!
Bravo! I am so glad that someone finally had the courage to say this out loud!
The power dynamic between funders and service providers stifles honest dialogue. That’s why funders don’t get straightforward responses to their questions. A completely candid grant application would look something like this:
Q: How will you sustain this program when this grant comes to an end?
A: We won’t.
Q: What is innovative about your program design?
A: Our program is entirely innovative. The design is unproven, The approach is untested. The outcomes are unknown. We also have a tried and true service delivery model with outstanding results and a solid evidence base to support it. But you funded that last year and your priority is to fund innovative projects. So we made this one up. Please send money.
Q: What is your overhead rate?
A: It is too low. We systematically underinvest in human resources, financial management and program management to keep it that way. By doing so, we have a nice, low overhead number to put on grant applications like this one. Please send money.
You nailed it! Thanks for the laugh.
Thanks for this hilarious and honest article. This is a perspective that more funders need to hear. I'm an executive director of a community foundation, and community foundations are truly on one side of the table in the morning, and the other side of the table in the afternoon… One minute we're funders, trying to make hard decisions on how to allocate the grant monies entrusted to us, and the next minute we're fundraisers, trying to raise funds to cover our operating expenses as well. It's been said by others, but funders ask the sustainability question because (despite the unicorns) we really don't have enough money to fund all the great projects that come to us. So, many funders prioritize by trying to find the projects that will be successful in the long haul. I am definitely sharing this article with my grants committee!
Thank you! I always feel insulted by this question.
What I want to say in response is: “We have busted our butts to find funding for this program, which we believe in, since the moment it was developed, and we will continue doing that whether or not you fund this request, and after this grant is finished, should we get it. Our responsibility to our clients requires it. And our messed up nonprofit funding system offers no other choice. What do you think we’ll do, lie down and cry when your grant is done?”
…But I don’t. I copy/paste the standard response. Then watch a cute baby animal video to try and reset my mood.
Fantastic! Hit the nail on the head.
Good points were made, but way too many words were used to make them. Also did not like the “ha ha” remark at the beginning about baby not paying its way yet. Just lame.
Yes, there is a definite disconnect between funders and non-profits around expectations on long-term stability of programmatic funding. I keep talking to funders about choosing fewer organizations to fund and fund them for longer periods of time and to fund overhead. There are too many non-profits in the marketplace for funders to do diligence in properly funding all of them and to ADVOCATE beyond funding for the mission of the non-profit they support. More expertise is needed in the philanthropic industry on how to be a good funder. Just because you have or acquired money, you may not know how to best give it a way to have the best long-term social investment gains. More bridges need to be built between funders and non-profits and to do that the culture of funding needs to change and be more trusting and transparent for both parties.
Vu, Thank you so much for this. (I have taken that calming walk — and used the cut-and-paste function liberally afterward — many a time.) Deep down, I think the motives behind the question are laudable — foundations see themselves as enablers, getting things started and developed but not wanting their groups to be dependent on them. But the question becomes like a "gotcha" because, as you suggest, this is usually not a real conversation along the lines of, "How can we work together to build our resources?" Some program officers really do want to help their groups build their resources, and ask, "Who else can we help connect you to?" They are genuinely worried about over-dependence, and the fact that their Boards might cut the cord with some of their groups. And some program officers actually enjoy the opportunity to pitch work their groups are doing and make the connections to their peers. Not always the case, but the more we can work with supportive staff and help them with their Boards and other funders — we can make some lemonade maybe of this lemony question.
I'll join the chorus and congratulate the writer for expressing concerns about the "S" question. He used the SES program as a great illustration-it grew from 30 to 150 participants so now give us more! How did it change their lives? What happened to them as a result of this program? Isn't it about time that impact analysis aka evaluation is tied to our sustainability planning? This is not necessarily about "appeasing" the funder; it's really about honestly looking at what went well, what can be improved and let's us tell the program's story to other prospective supporters. And furthermore, our funding partners, those responsible for providing non-profit seed money, ought to invest in evaluation too. This is not the end-all to the sustainability question-just a significant part of the narrative.
Thanks for a great article!
Sustainability and impact are buzzwords. They sound logical and justify investments. We are born to look for similarities and patterns (think frameworks, methodologies, measures) and these give funders peace of mind. Think we are missing the plot. The board is cautious and unwilling to invest in new hires. Staff are overworked and distracted as time is spent on getting funding rather than on clients.
Well, who has the ‘answer’ anyway? Aren’t all of us just trying to serve a need and hopefully our solution addresses the gap? Hope that funders will keep an open mind and invest in the people in non-profits and give them the opportunity to make a difference.
This article states what we grantwriters are always thinking! Also, grantors look for big numbers, looking for the biggest bang for their buck. What about organizations whose annual number of people helped might be smaller, but those people have their lives changed forever?
As a grant maker for 11 years, I applaud the piece and agree with every point. But I must say that no ED or Development Director has made these points to me in all those years. Too many reinforce the fiction that we all labor under. And despite providing multiyear, general op support for 7+ years to the same grantees, few have found new revenue streams while my Board continues to ask: how long will we privilege these few grant recipients over the larger equally deserving universe of
What is wrong with a Donor standing by a few grantees forever? The “equally deserving universe of others” is not your responsibility. It’s like your Board is saying, “well, jeez, we’ve given half a million to DoingGoodWorks.org, and they really are doing good works that wouldn’t get done without us, but what about the Whales, shouldn’t we be saving the whales?”
Hey, what about impact sustainability? You know, when my organization can’t find any more funders how can the community carry on without us? When I see this question on a grant application I can never figure out if I’m supposed to talk about financial sustainability or program sustainability because they are not specific when they are asking the question. Hmmm, when space allows I answer both! When space doesn’t allow, I wing it. Thanks for the article. Janeen Simon, ED WINGS Guatemala
Thanks for a thoughtful column that also made me laugh.
“Why is the relationship between funders and nonprofits so adversarial? It is ineffective.” Exactly. Thank you, Vu. I too would like to send this to all the foundation people for some self-reflection.
Who are you and how did you get your hands on the sustainability sections I’ve prepared?! I loved this column and while it didn’t tell me what the heck to do about it, I did find it affirming (seriously). Thank you for offering us nonprofit folks one more form of procrastination before rolling up our sleeves and getting back to answering the annoying questions.
I WILL share this with everyone I know…especially funders! As a consultant who works with “informal” partnerships of public and nonprofit organizations, I am continually baffled by funders who demand measurable outcomes, but then refuse to fund successful projects for more than a few years. Grant makers (both public and private) could help “scale up” great programs for broader impact, but instead often turn their backs on tried and true programs in search of the next big thing – usually yet another “demonstration” project.
Hilarious column, as always! Thank you!
I recently came across this while researching capacity building funds for a client:
What is the Funder’s Role in Capacity Building? There is growing recognition among grantmakers that providing dedicated funding to help nonprofits build their capacity offers a positive return on the grantmaker’s investment in the nonprofit’s mission. Capacity building paves the way to long-term sustainability. Read about building communications capacity and why this is so critical for nonprofits. (Source: Spitfire Strategies) Multi-year funding is recognized as a way to more effectively support capacity building. Read why we are concerned about the state of general operating support and its essential role in enabling charitable nonprofits to break the starvation cycle of restricted grant funding. – See more at: http://www.councilofnonprofits.org/capacity-building/who-funds-capacity-building#sthash.DRTKRyQB.dpuf
What a great column! I want to share it with everyone I know, especially foundations and program officers, but that would be wrong. At least our experience is not unique and I feel better about the "creative writing".
Interesting column, but after dealing for 30+ years with the inherent unsustainability of any project for which funders refuse to pay the full costs of implementation (limits on indirect costs, or general operating expenses), I have begun to realize that hardly any donor cares.
Here's another annoying funder question: What percentages of your staff and board are a) LGBT, b) 60 years old or older, c) people of color, e) disabled, etc.? All things that are illegal to ask, yet we are required to report.
And as for the "sustainability question," there are creative writing classes available in most communities.
Illegal, and really, just plain stupid … like the foundation that asked how many of the people we served were LGBT. This was when I was working for an agency that provided early intervention services to children with special needs, ages five and younger.
only stupid if your organization is just wallowing in white, cis-gender, het privilege. a smart organization that is providing its community with relevant programming will continue to be relevant if it takes demographics into account in terms of who they are serving. assuming that you are not serving LGBT, especially transgender, children with special needs is a problem. that means, because it is not clearly advertised that the organization has at least some expertise, that families that are LGBT or that have LGBT children, will look elsewhere for services.
but yeah, only those who benefit from the invisibility of, and lack of attention to the needs of, LGBT and people of color, and elders, and youth, think that this question is stupid. And it’s only illegal if it affects decisions about hiring and who to serve.
Our organization asks these questions all the time, and as a result we have one of the most diverse constituencies – in terms of LGBT, race, ethnicity, nationality, age, ability, and income level of any organization in the country, and the world, much less the state in which we are based.
Oh please. The other person was just making a point that asking to report about the sexual orientations of children under five . . . . well, if you don't get it, you won't get it.
Hmmm. So the agency served children but not their families? I would think their statistics would report not only on the children but also the parents and families.
The website didn’t let me reply to the comment just below, but I have worked for programs serving children and funders only asked about stats, demographics, etc. regarding the children not the families. Plus, if you are working with kids (even young kids) whose parents are pretty much checked out of the parenting role, you can’t always get a lot of data from them.
These questions aren’t illegal to ask employees or board members. They are illegal to ask applicants for employment.