Let's Talk Money and Impact
Monday July 18, 2022
Hey, it's Chyla Graham, welcome to another season of the Nonprofit ACE Podcast this season around, we are doing some replays. So we are taking our top most downloaded episodes and giving you sort of a preview of where other people have started. I'd love to know what you all think, is there an episode that you think should have made the list? Send me a DM, best place to find me is going to be LinkedIn. But you can also reach me on Instagram. So I'll be sure to drop our handle in the show notes.
Today I want to talk with you about can a nonprofit make profit. Yes, while an organization might be called a nonprofit or a not for profit organization, it's not because you're not expected to make any money. It's because that's not why you exist. You didn't go into the nonprofit arena, you didn't decide to found an organization or lead an organization because you were focused on the dollars. You are focused on the impact. And that is the big difference between a for profit and a not for profit organization, is where is your focus?
Is your focus on how much money can we bring in or is your focus on this is the good I want to do in this community? When you are looking at that good, you do have to make money though. I like to compare it with how you run your day, like how you run your daily life. If you went day to day and didn't make any progress, it would be hard for you to say, oh, I want to help this person. Why? You don't have any money?
You can't help someone else if you can't help yourself. It's that put your oxygen mask on first. So how would it look for you to say, Hey, we help people alleviate poverty, we help feed them, but all our all our workers work at food banks. That's not a good look. So you do have to think about making a profit. You just know that that's not your sole focus and you're making this profit because you want to move on. You want to continue your work.
Think of it like your retirement plan. If you don't save for the future, you're going to be working forever or you're going to be living a life that you're not pleased with. If you want to expand your services to the community, you have to think about ways to make a profit, have some money leftover.
Think about what are we saving for the future? What are we saving to make a bigger impact? When people ask, well, how much cash should we have in the bank? I think of three months of operations. If nothing else, if no new money came in, could you last another three months? Yes? Great. Could you last another six months? Even better. Why is that good?
Because now you have a buffer for if you wanted to start a new program. If you said, Oh, we want to expand our services into this neighborhood, now you have the money to do that. But if you're constantly thinking about just the fires in front of you, you are going to be overwhelmed. You are going to be stressed out. You are going to be thinking, we can't do that because you haven't made that plan.
So think about that today. What is it that if you saved some money, your organization could do? Is that adding any program? Is that adding a new staff member? Don't think of it just from the logistics of it. Think about what does it mean for the communities that you serve. What difference would it make in their lives if you could add that? Once you have that, it's easier to focus on.
We have to think about a way that we could increase our revenue or we can decrease our costs. Increasing revenue looks like, Oh, do we need to be more specific when we do our fundraising ask? Do we need to tell people this is what we do and this is how we serve and this is what each dollar does. When you can do that, when you can clearly explain your impact, it makes it easier for people to give you money. So think about what you could do with a little bit more money.
Work your way up to it. Feel bold when you go to your board and talk about it and that confidence that you talk to the board with will help you talk to other people and help them talk to other people and that will get you more money so that you can make a greater impact.
Thanks, let me know what you think. Follow us on social media @CNRGadvisory. Be sure to subscribe to the podcast wherever you're listening now.
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