Category Archives: Nonprofits

Highest Paid CEOs in Charity

The infographic here about the highest paid CEOs in non-profits seems useful to me for two reasons.

First, many people seem uncomfortable with non-profit organizations, serving higher social goals, paying market-level compensation to employees. In my years of dealing with students of entrepreneurship there was an assumption that people who work in non-profits earn less than their counterparts in the rest of business. I question that assumption. If the non-profit is funded by donors, doesn’t it have to pay fair rates to keep good people? Do its employees have to be donors as well, in the sense that their salaries are below market rates?

Second, aside from compensation levels for all employees, looking at the CEOs and what they earn (in this infographic), is there a top end to this that goes to far? Should organizations funded by donations pay their leaders salaries like the ones in this infographic? Maybe they have to in order to get the right level of leadership? 

What do you think? 

The Highest Paid CEOs in Charity

Parents: Great Book for Kids, Squared

This is a good cause. I’m proud to post it here. And — hooray — it’s also a wonderful book for parents to read to (or with) children. And today marks the beginning of the holidays. The marketing isn’t all that great, and the distribution isn’t all that great, so I recommend you order it now, not later (order info below). 

I met the author, Greg Ahlijian, last week when he visited our offices at Eugene Social and showed us the book, letters, and documentation on how he has donated every dollar to the Jasper Mountain Home for children. 

Click here to go to the site and order the book. 

Greg wrote the book after volunteering at the home. He’s a teacher there, and a mentor, and a believer. 

This is what the Jasper Mountain site says about the home: 

Jasper Mountain is a unique organization, it is a treatment family, and it is a place of hope for children and parents who search for answers. Since 1982, we have been growing and learning along with the children and families we serve. Jasper Mountain is many things but there is nothing quite like it anywhere!

Jasper Mountain provides a continuum of programs that meets the needs of emotionally disturbed children and their families. Services include an intensive residential treatment program with a therapeutic school, a short-term residential center, treatment foster care program, community based wraparound program and crisis response services.

This is important: Greg’s not donating a percentage of profits. He’s donating all the money, 100%, that’s left over from his direct costs. He’s not taking any money for his time and effort. There’s no salary or overhead.  

And that explains my title for this post. It’s a good book, good for parents and kids; and it helps a good cause. By squared I mean as in numbers: 2 x 2 = 4. That kind of squared. 

Click here to go to the site and order the book. 

I bought a copy from Greg as soon as I saw it and leafed through it. My daughter read it to her nine-year-old son, loved it, and downloaded discussion questions. It’s not just a story — not that there is anything wrong with a story, or that the word just applies — but it’s a story with a conscience, and a wealth of good discussions waiting to happen. 

And I Thought I was a Friend and Colleague…

Don’t you hate it when this happens? With social media and all, I connect with somebody, seems like a smart person, we have some email and even telephone interactions, and then, dammit, I end up as a prospect.

Sad. Quite a demotion. From friend and colleague to prospect.

You do know what I mean, right? A “dear Tim” message that’s obviously based on a single message barely customized to change the first names? And when you get it, don’t you feel just like I do, as in “Damn. I thought I was a friend and colleague. And it turns out I was just a prospect.”

Are you doing that with your email campaign? Or with Twitter, LinkedIn, or Facebook? Because if you are, then I’ll bet you it’s not working.

(Image: Blazej Lyjak/Shutterstock)

Nonprofits with Legs and Teeth

Maybe it’s about baby boomers not retiring, and maybe it’s about ex-hippies in positions to do something they’ve always wanted, or maybe it is just about the world getting more crowded. Could there be a long tail of entrepreneurship, opportunities for people with motivation other than pure profit?  If all was ever fair in love and war, it was always just business for business. Until business became personal. And green. And socially motivated.

I just finished reading the Sunday New York Times piece called “A Capitalist Jolt for Charity”.

Today, the once-struggling venture has morphed into a primarily for-profit enterprise. And the striking transformation of In2Books is emblematic of a larger trend: charities are changing their spots and making use of some of capitalism’s virtues.

The process is being pushed forward by a new breed of social entrepreneurs who are administering increasing doses of bottom-line thinking to traditional philanthropy in order to make charity more effective.

In the old days there were nonprofits. They were foundations and the like, the alleged “do-gooders” that were conceived on missions like fighting poverty and racism, broadening the meaning of art, spreading education. You know them. You’ve lived with them forever. United Way. Toys for Tots. Meals on Wheels.

It occurs to me that the magic of the social enterprise has to do with control and power. If I build a nonprofit foundation to solve a social problem, I depend on being able to raise money through donations. But if I build a social enterprise instead, and figure out how to make my own money, at least enough to power the enterprise, then I’m in charge. I focus on the business model and the social benefit and the underlying purpose, instead of the fundraising.

So social enterprises are doing things like creating channels for developing country handicrafts, or PlayPumps distributing low-power-consumption technologies for poor countries. Bill Drayton, founder of Ashoka, talks about a new generation of people thinking they could “do better.”

I’m wondering now whether the tradeoffs between social enterprise vs. straight nonprofit isn’t a lot like the tradeoffs of bootstrapping instead of raising money through venture capital. With one course, you own what you build, you get to grow it and steer it and make it work as well as you can. You’re in charge. That’s bootstrapping and, I think, the social enterprise. With the other course, you get more resources but because of that you’re also not in charge, you might be the captain of the ship but you can’t change destinations without permission, and if you change course in mid-journey you’d better be able to defend your decision very well when the board asks about it later.

Of course I can’t make the straight parallel between these two ideas, because where they come apart is the matter of choice. Some bootstrapped business chose that option, but many other never really had the choice of investment. Does the social venture have the option of going straight nonprofit?  That’s hard to generalize. At the very least, these are interesting questions.

All About Leadership

I was at an interesting event Saturday. The Annual Nonprofit Organization Board Training organized by Financial Stewardship Resources.  More than 500 people, almost all of them volunteers, almost all of them running nonprofits, gathering together on a cold and gray Saturday in Corvallis, OR, to learn about nonprofit taxation, leadership, better management, better planning, incorporating a new generation, and so on.

That’s an interesting group. Most of them over 40, dressed comfortably, eager to learn. Very few of them are paid to come. Most of them pay to come. Most were from Oregon, but a lot of other states, and a couple of other countries, were represented. I was with the organizers when they scrambled to find the translator they’d arranged for Polish/English.

I think we all know we’re in tough economic times, and that of course flows over to nonprofits. But that was a pretty good group. What’s important, I think, aside from any single message, is that they were there.

I felt my plan-as-you-go business plan talk went very well. They got it. It’s not just the plan, it’s planning: start with a review schedule, make sure you have focus, metrics, specifics of who-what-when, and build it over strategy. Form follows function.

John Blount, keynote speaker, was recently selected as one of the 17 members of the International Rotary board of directors. He’s also a dentist, lives in Sebastopol, CA, and does a pretty good talk on leadership. He sandwiched his talk around a short video about John Kennedy and NASA and the moon shot in the 1960s. I’ve searched the web for “It’s All About Leadership,” and I’ve come up with a lot of hits, but not that video. Too bad. That’s a great example.  John put leadership into three words: bold, competent, creative. I’m taking the liberty to change bold to courage, for alliteration’s sake, and add my own words as explanation.

    1. Courage: as in having the courage to stick your neck out for a decision, put your ideas on the line, take a stand. Courage to raise your voice in a crowd.
    2. Competence: Yes, I know, as we grow up in the world of adults, it’s surprising to discover how few people are truly competent. John shared a study about what people want in their dentist. Competence. That’s what people want in their leaders too. What a temptation to get into politics. But no, never mind.
    3. Creativity: Are leaders creative? Maybe. Creativity is about focus, perspective, looking at things from the right position, and often from a new position, one that others couldn’t think of. John mentioned the importance of quantity of ideas, more than quality. That’s an important concept.

Finally, one of several amusing quotes in his warmup was this quote from a baseball player named Larry Anderson. I’d never heard of him, or this quote, but:

If at first you don’t succeed, failure may be your thing.

And Steve Lange, a good editor, read my early version of this post (which changed a lot with this version) and tipped me off to, which has some posters based on similar sentiments.

Essential Business Planning for Nonprofits

I believe that nonprofits and social enterprises need good business planning as much or more than the rest of us. The old mentality that left the nonprofits in their own world, unconcerned with business-like things like planning and performance, are over. Happily, most of the people I talk to in that world agree with me. The nonprofits want and need planning for the same reasons the rest of us do: develop and implement long-term strategy. Manage towards long-term objectives. Develop the right metrics. Set down tracks you can review and revise. Develop accountability. Control your destiny. Be proactive.

Just a few years ago I felt the nonprofits wanted to live in their own world. The language of standard business planning — sales, for example, and profits, and return on investment, similar business terms — was uncomfortable to them. It made me feel cynical when we’d take the standard terms in Business Plan Pro and mask them with appropriate equivalents. Sales became funding. Profit became surplus, and loss was deficit.

Change the vocabulary, but not the core. The core is essentially the same. It’s almost (with my apology to zealots) like dealing with religions, in which different groups apply different words to the same thing. We want to dress our similar realities in our own specific costumes. Whoops, that may be more than I want to take on in this post. So, back to nonprofits. Or, as Gilda Radner would say, "never mind."

Tomorrow I’ll be presenting Essentials of Business Planning for Nonprofits at the Annual Nonprofit Organization Board Training organized by Financial Stewardship Resources. That’s at the LaSells Stewart Center on campus at Oregon State University. The occasion has me thinking about how the Plan-As-You-Go Business Plan fundamentals apply very well to planning a nonprofit organization.

Happily, in the last few years there’s been a steady increase in the sense of metrics and accountability in the world of nonprofits. At least that’s what I’m seeing, that’s what reaches me in my travels. I certainly don’t claim any expertise on the subject of nonprofits, but in my work on business planning, I do get exposed to the growing trend for social enterprises and what feels like steadily increasing demand for accountability and metrics in nonprofits. If I’m wrong on that, please tell me.

One result of this, it seems, is steadily increasing interest in doing the business planning better.

If you’re interested, you’re welcome to download my presentation handouts. I’ll be doing my presentation twice, each one an hour and 10 minutes. I plan to summarize the basic principles of plan-as-you-go business planning, with only very slight modifications for application in nonprofits.

Entrepreneurial Advice: Lighten Up

Successful entrepreneurs are like everybody else. They don’t know what to do with their lives. They aren’t sure how to balance meaning and money when it comes to work. And they have trouble managing their time.

That’s by Sarah Ruby, in Entrepreneurs Ponder What To Do Next, in the latest issue of the Stanford Business Magazine. The Stanford Entrepreneurship Center got a group of successful entrepreneurs together for a reunion. They were a mixed group, of different ages, with their success at building companies the common factor between them. “They sounded like any other group of achievement-oriented people grappling with life’s next steps.”

The youngest among them showed the most angst. They’ve had a few years to play golf, hang out with their children, and dabble in angel investing. Some of them teach, and others joined new companies or nonprofits in an attempt to put their skills to use. It can be fun, some of them said, but does fun lead to fulfillment?

The older alumni seemed to have lost their fear of regret, if they ever had it. They were easier on themselves and took obvious pleasure in each other’s catamaran trips and cross-country bike expeditions—interludes between chairmanships of companies and full-time philanthropy, teaching, or investing.

Some good advice:

The seasoned entrepreneurs had some advice for their younger colleagues. “Lighten up,” said Michael Lutz, MBA ’79, a physicist-turned-inventor-turned-sailor-turned-angel investor-turned-teacher. He recommends packing many careers into a single lifetime but insists on enjoying the ride. “I do see too many of my friends just doing what they’ve done all their life,” he said. “Think about doing something totally new.”

“But dont think too hard,” said Ken Saxon, MBA ’88, an entrepreneur who sold his company and now volunteers for nonprofits and does some angel investing. You also have to give yourself a break. “If I’m always looking for the perfect thing, I don’t act,” he said.