Business Strategy for Nonprofits

Since the USAID cuts and broader donor shifts, I’ve seen an increasing number of nonprofits seriously considering launching commercial arms—essentially adapting social enterprise models to generate revenue for their impact work. Makes sense. Funders are asking about “sustainability,” and social enterprise sounds like a solution. For most of my career, I led development at an organization with a hybrid model— mostly philanthropy, with a bit of commercial revenue. Funders’ eyes 𝘭𝘪𝘵 𝘶𝘱 when we mentioned earned income. But behind the scenes? It was a 𝘀𝘁𝗿𝘂𝗴𝗴𝗹𝗲 to build. At our peak, that revenue covered 15% of the budget. But most years it was much less. Spring Impact’s 2024 report on nonprofit funding kinda backs this up: just 6 of 28 orgs they studied got any funding from end users. Only 4 charged other NGOs or CBOs. Commercial revenue for nonprofits isn’t easy, and usually only makes up a small slice of the budget/revenue. So if you’re thinking about going this route, some questions to chew on:   • 𝗗𝗶𝘀𝘁𝗿𝗮𝗰𝘁𝗶𝗼𝗻 𝗼𝗿 𝗱𝗿𝗶𝘃𝗲𝗿? Do you have the time, capital, and team capacity to build this out? In my experience, this was the core tension. Everyone wants ROI clarity before investing—but you have to invest to get that clarity. 🙃   • 𝗖𝗮𝗻 𝘆𝗼𝘂 𝘁𝗲𝘀𝘁 𝗳𝗶𝗿𝘀𝘁? Design a pilot. Find someone to fund it. Measure both income and impact.   • 𝗗𝗼𝗲𝘀 𝗶𝘁 𝗮𝗹𝗶𝗴𝗻? If your mission is to provide a public good to those most in need, charging them might contradict that—unless the price is truly affordable, or someone else (like government) is footing the bill. 𝘐 𝘣𝘦𝘭𝘪𝘦𝘷𝘦 𝘵𝘩𝘦 𝘥𝘦𝘦𝘱𝘦𝘴𝘵 𝘴𝘶𝘴𝘵𝘢𝘪𝘯𝘢𝘣����𝘭𝘪𝘵𝘺 𝘭𝘪𝘦𝘴 𝘪𝘯 𝘥𝘦𝘴𝘪𝘨𝘯𝘪𝘯𝘨 𝘸𝘪𝘵𝘩 𝘢𝘯𝘥 𝘧𝘰𝘳 𝘱𝘶𝘣𝘭𝘪𝘤 𝘴𝘺𝘴𝘵𝘦𝘮𝘴. 𝘉𝘶𝘵 𝘪𝘵’𝘴 𝘯𝘰𝘵 𝘸𝘪𝘵𝘩𝘰𝘶𝘵 𝘪𝘵𝘴 𝘤𝘩𝘢𝘭𝘭𝘦𝘯𝘨𝘦𝘴, 𝘴𝘰 𝘵𝘩𝘢𝘵’𝘴 𝘢 𝘵𝘩𝘳𝘦𝘢𝘥 𝘧𝘰𝘳 𝘢𝘯𝘰𝘵𝘩𝘦𝘳 𝘥𝘢𝘺.   • 𝗜𝘀 𝗹𝗲𝗮𝗱𝗲𝗿𝘀𝗵𝗶𝗽 𝗮𝗰𝘁𝘂𝗮𝗹𝗹𝘆 𝗯𝗼𝘂𝗴𝗵𝘁 𝗶𝗻—𝗼𝗿 𝗰𝗵𝗮𝘀𝗶𝗻𝗴 𝘁𝗿𝗲𝗻𝗱𝘀? A revenue model needs to be baked into your strategy and impact model, not tacked on as a side hustle. I’m not saying don’t go for it. I’m saying: go in with eyes open. Building a commercial arm takes strategy, time, and deep alignment—it’s not a quick fix, and it won’t look the same for every org.  I’m sharing this not to discourage, but to offer perspective from someone who’s been in the trenches for 8+ years. You’re 𝗻𝗼𝘁 𝗯𝗲𝗵𝗶𝗻𝗱 if your org doesn’t have a business arm. And you’re definitely not failing if grants are still your mainstay. Sustainability has many paths—what matters is choosing the one that fits your mission and reality.🌱 ✨ Check the report here: https://lnkd.in/dVhkcQGC What lessons are you learning on your sustainability journey? Let’s trade notes 👇🏾 #fundingafrica #internationaldevelopment #fundraising #socialenterprise #nonprofitfunding

When I took on my role as Chief Corporate Citizenship Officer at PMI, I set a handful of parameters for myself and my team: 1. Don’t fall into the trap of arm’s-length checkbook philanthropy: One-off cash infusions can help nonprofits in the immediate term, but they don’t get at the issue of sustainable growth. 2. Focus, focus, focus: Diffusion is the enemy of progress. There are an endless number of worthy causes and charitable organizations, but our greatest impact will come from identifying a small number of causes that are intrinsically tied to our values and vision and making those causes priorities. (In our case, this is U.S. military veterans, women’s equity and empowerment, and hyperlocal activations.) 3. Empower—and learn from—those already in the trenches: We’re not going to dictate what happens at the community level. We’re here to listen and learn and find ways to support and expand the good works already underway. 4. Give a “hand up” instead of a handout: Band-Aid solutions may make us feel good in the short term, but they don’t get to the root problem. The cash infusions we give our community-based partners are meaningful, but their value grows exponentially when paired with our business expertise and insights. 5. Offer employees a chance to contribute to change: We polled PMI’s U.S. workforce earlier this year about our plans to support military veterans. An astonishing 97 percent of employees raised their hands to get involved. There’s a hunger out there for making a positive difference in local communities and the broader world. Find ways to connect your people to the issues that matter most to them. It turns out that this is the way the next generation of philanthropists is thinking about their impact as well. A recent article (I’ll share the link in comments) shares interesting insights into how our younger generations—millennials and Gen Z—are embracing a more comprehensive approach to philanthropy focused on measurable impact and deeper connections. They’re also showing a greater tolerance for the “long game,” willing to take risks in the short term to lay the groundwork for greater gains down the road. As the next generation of philanthropists takes the reins and starts investing more than money in the causes they care about, let’s make sure our organizations are prepared to do the same.

Nonprofits have a fundraising problem. Not because donors aren't generous. They are. But relying entirely on philanthropy means your mission lives and dies by someone else's budget cycle. When we founded Bright Saver, we made a deliberate choice: build earned revenue into the model from day one. Not to replace philanthropy. To complement it. Here's how we think about it. Philanthropic dollars fund innovation. New programs. R&D. The risky bets that earned revenue can't justify yet. Earned revenue powers the core mission sustainably. For us, that's advocacy, community deployment, and decarbonization work. The work that has to keep going regardless of grant cycles. Right now we're running pilot programs with plug-in solar and battery manufacturers, helping them navigate supply chains, US certifications, safety standards, and a regulatory landscape that's fundamentally different from Europe. Millions of plug-in solar systems are already installed across Germany, Austria, and the Netherlands. The technology is proven. But bringing it to the US requires a different playbook. That's where the nonprofit model becomes an advantage. There isn't a market for plug-in solar in the US yet. We're not trying to maximize margin on hardware. We're trying to open up a market that unites clean, abundant energy with real affordability. We write model legislation. We work with 29 state legislatures. We deploy systems in underserved communities through utility and government partnerships. The pilots generate revenue that keeps all of that moving. We're not fully sustainable yet. We have more work to do. But we built this into the foundation of Bright Saver from day one, not waiting until we were forced to figure it out. Foundations and philanthropists who back us aren't subsidizing the core of our impact. They're funding the innovation layer. New programs in new states. Low income pilots in communities like Stockton. Policy work that opens the door for an entire industry. Thanks again to generous catalytic donors who make this work possible such as Natalie Gordon Lintilhac Foundation Alejandro Foung Lisa Guerra Phillip Hyun and Green Park Foundation. The earned revenue and the philanthropy aren't in tension. They compound each other. One builds the floor. The other raises the ceiling. I used to think nonprofits and revenue were fundamentally at odds. Building Bright Saver changed how I see it. The model works when you let each dollar do what it does best. Philanthropy takes the risks. Earned revenue holds the line. Curious if other founders or nonprofit leaders are experimenting with this. What's working?

I have had the opportunity to serve on several nonprofit boards over the years. There's always a period of time -- as is the case currently -- when there is real concern over government funding. That's why it is so important for nonprofits, especiallty those in healthcare, to diversify its revenues streams. Just like businesses, nonprofits need financial resilience to sustain their mission and expand their impact. Here area few ways nonprofits can diversify revenue streams and create long-term stability: 1. Develop Strategic Partnerships – Collaborate with corporations, foundations, or healthcare organizations to co-develop research, technology, or community programs. These partnerships can lead to sponsorships, grants, and new funding opportunities. Too often, folks want to forge their own path. Now is the time for partnerships. 2.  Invest in Mission-Aligned Ventures – Consider sustainable investments such as impact funds or health tech startups that align with your mission while generating financial returns. It's key to have a good financial team to help assess opportunity and manage risk. Many nonprofits have started to create such funds, and more need to do so. 3. Expand Subscription or Membership Models – Offer premium content, exclusive research, or advocacy networks for a subscription fee. Organizations that provide unique insights can turn knowledge into a reliable revenue stream. 4. Utilize social media -- This way can be way to find new funders, who may not be familiar with you work. There is a science to utilizing social media -- you just can't post and think the money will come rolling in. Invest in a seasoned team who knows how to convert metrics into dollars. A diversified nonprofit isn’t just more financially stable—it’s better equipped to innovate, adapt, and drive meaningful change.  It is easier said than done -- and it takes time. What strategies have you seen work in nonprofit revenue diversification?  #NonprofitLeadership #RevenueDiversification #HealthcareInnovation

September to December is a *hot* period for nonprofit fundraising. Many foundations and donors are back to their desks after the summer and looking to make their closing funding rounds before the end of the year. If I were an advisor in your nonprofit organization, this is what I would suggest prioritizing in your fundraising plan from this month through the end of the year: 🫂 Curate Relationships Curating relationships with existing donors or key stakeholders is one of the most overlooked practices in fundraising. Only chasing new donors or funding opportunities goes at the expense of trust-nourishing and enthusiasm of those donors and stakeholders who are already "warmed up" about your work and mission. Don't make this mistake, and create space to strengthen the bonds with those who are already there. Think about personalized engagement and regular touchpoints to make them feel part of your mission and deepen their commitment to your cause. ⭐ Impact Storytelling Creating visibility around all the things your organization and your team have achieved throughout the year is a powerful avenue to leverage your commitment and attract the attention of donors and stakeholders ready to fund. Don’t be generic or conservative when it comes to showing the outputs, activities, results, community feedback, and transformations your work generated. Donors want to feel like they can make a tangible contribution to the end goal of your impact mission. Showing this to them in a compelling, story-based approach will help them understand what and why they are funding. 💰 Do Your Budget Know your number and make your financial plan clear. Prepare a budget that outlines your organization’s funding needs for the next 2 to 5 years. Identify the core areas that require sustained resources and ensure your strategy is aligned with long-term objectives. Create a strong narrative around why these areas need funding, how they will serve your impact goals, and why mobilizing resources into these areas will be foundational in securing sustainability and scalability to your work. 💥 Optimize Your Strategy You must have learned a lot in the past 9 months and got a lot of feedback, observations and lessons learned around your work. This is the perfect time to integrate the learnings into your overarching organizational strategic plan and fundraising strategy and adjust it according to the things you have now gained more clarity on, such as your new targets and goals. -------- Hey! I am Margherita, senior nonprofit consultant and advisor. I am open to working with nonprofit organizations in social justice and accelerating their development goals through fundraising, financial planning, organizational development, and operations. My fee model is equity-informed and open to accommodating all budgets. Contact me to learn more!

Few boards have a well-defined process for Chair succession. Even in high-performing boards, 𝐥𝐞𝐚𝐝𝐞𝐫𝐬𝐡𝐢𝐩 𝐭𝐫𝐚𝐧𝐬𝐢𝐭𝐢𝐨𝐧𝐬 𝐨𝐟𝐭𝐞𝐧 𝐡𝐚𝐩𝐩𝐞𝐧 𝐫𝐞𝐚𝐜𝐭𝐢𝐯𝐞𝐥𝐲, prompted by a resignation, retirement or term limit rather than as part of a deliberate governance process. 𝐘𝐞𝐭, 𝐣𝐮𝐬𝐭 𝐥𝐢𝐤𝐞 𝐬𝐭𝐫𝐚𝐭𝐞𝐠𝐲 𝐨𝐫 𝐫𝐢𝐬𝐤 𝐨𝐯𝐞𝐫𝐬𝐢𝐠𝐡𝐭, 𝐬𝐮𝐜𝐜𝐞𝐬𝐬𝐢𝐨𝐧 𝐩𝐥𝐚𝐧𝐧𝐢𝐧𝐠 𝐢𝐬 𝐚 𝐟𝐢𝐝𝐮𝐜𝐢𝐚𝐫𝐲 𝐫𝐞𝐬𝐩𝐨𝐧𝐬𝐢𝐛𝐢𝐥𝐢𝐭𝐲. It’s what ensures continuity and confidence in leadership when change inevitably comes. Having recently gone through a Chair transition myself, I was reminded of how important it is to plan the passing of the baton. 𝐌𝐨𝐫𝐞 𝐭𝐡𝐚𝐧 𝐬𝐢𝐦𝐩𝐥𝐲 𝐟𝐢𝐥𝐥𝐢𝐧𝐠 𝐚𝐧 𝐞𝐦𝐩𝐭𝐲 𝐬𝐞𝐚𝐭, 𝐥𝐞𝐚𝐝𝐞𝐫𝐬𝐡𝐢𝐩 𝐫𝐞𝐧𝐞𝐰𝐚𝐥 𝐩𝐫𝐞𝐬𝐞𝐫𝐯𝐞𝐬 𝐭𝐡𝐞 𝐫𝐡𝐲𝐭𝐡𝐦 𝐚𝐧𝐝 𝐩𝐮𝐫𝐩𝐨𝐬𝐞 𝐭𝐡𝐚𝐭 𝐠𝐢𝐯𝐞 𝐚 𝐛𝐨𝐚𝐫𝐝 𝐢𝐭𝐬 𝐬𝐭𝐫𝐞𝐧𝐠𝐭𝐡. Here’s a framework I’ve found helpful for thinking about board leadership transitions more deliberately: 1. 𝐃𝐞𝐟𝐢𝐧𝐞 𝐭𝐡𝐞 𝐫𝐨𝐥𝐞 𝐞𝐚𝐫𝐥𝐲. If the conversation starts when a vacancy appears, it’s already too late. Defining the role and ideal profile early helps the board align around expectations. What kind of leader does the organization need at this stage of its journey? What balance of independence, influence, and institutional memory will strengthen oversight? 2. 𝐅𝐨𝐫𝐦𝐚𝐥𝐢𝐳𝐞 𝐭𝐡𝐞 𝐩𝐫𝐨𝐜𝐞𝐬𝐬. Good governance requires clarity. Whose responsibility is it? The Nomination Committee, a dedicated Succession Committee or the Chair? How should potential candidates be exposed to the board’s dynamics? Formalizing these steps ensures consistency when the moment arrives. 3. 𝐈𝐝𝐞𝐧𝐭𝐢𝐟𝐲 𝐰𝐢𝐭𝐡 𝐩𝐮𝐫𝐩𝐨𝐬𝐞. Boards often default to seniority or rotation, but longevity doesn’t always mean fit. The decision should reflect the company’s current needs and direction, not tenure alone. Benchmarking candidates against the defined role brings objectivity and alignment. 4. 𝐄𝐧𝐠𝐚𝐠𝐞 𝐭𝐡𝐞 𝐂𝐄𝐎. The Chair–CEO relationship is among the most pivotal in governance. Involving the CEO early helps ensure alignment and chemistry, fostering a productive partnership from day one. 5. 𝐏𝐥𝐚𝐧 𝐭𝐡𝐞 𝐭𝐫𝐚𝐧𝐬𝐢𝐭𝐢𝐨𝐧. Even the most seasoned director faces a learning curve when stepping into the Chair role. Structured onboarding, through shadowing, joint meetings and mentorship from the outgoing Chair, helps transfer both knowledge and culture. Ultimately, good governance is as much about oversight as it is about renewal. So it’s worth asking: Do the boards you are part of plan for leadership succession as deliberately as they plan for strategy and performance?

If I'm in charge of revenue at a large nonprofit, I can't ignore these realities 👇 -Donors giving below $100 are down ~9% (and have been trending down) -Donors giving below $500 are down 4% (and have been trending down) -Slower income growth & less disposable income for most -Middle-class households under economic pressure -The rapid decline of religion (that has giving as a core tenet) -Decline in institutional trust -Not only is charitable giving largely stagnant as a % of the GDP, but we also haven't been able to grow share of wallet -Donors giving $5k-$50k are up 1% -Donors giving $50k+ are up ~3% And if I look around at what other nonprofits are doing, I might see 👇 -Marketing getting louder -Frequency cranked to 11 -Tired tactics with little differentiation And if strategy is about how an organization applies strength against the most promising opportunity or the most critical challenge, I need to address the problem head on. Three ideas... 1) Instead of getting louder, get closer to donors. -Jeffersonian dinners -"Jobs To Be Done" interviews -Measuring donor satisfaction -Rating the donor experience -Cross train across the org on how to listen to donors -More thoughtful prioritization and segmentation -Do things that don't scale; you will likely not "scale" anyways (but you'll very likely grow!) 2) Focus more energy on the people who *can* give more. That doesn't mean you should ignore the $100 donor. Two things can be true at the same time: most of your limited human hours are best spent on people who can give >$10,000, AND, you can treat the $100 donor like they're an important part of the team (because they are). -Create tiered caseloads (A, B, C, D donors) -Develop a donor engagement plan for each tier -Treat mid-major donors like true partners: frequent report backs, project proposals, town halls, feedback loops, in-the-moment updates -Focus your work in the 'mass' file to identify the best prospects for a mid-major treatment, and work to move as many OTGs to recurring (monthly) or re-occuring revenue (quarterly, yearly, etc.) 3) Promote giving from assets across the donor file—and make it easy to do so Russell James taught me this. When people give from their assets, the gift is likely to be larger. And they are more likely to give again. Giving from assets (like stocks and shares, tax-savings accounts, retirement accounts, DAFs, gifts of life insurance, etc.) is often the smartest way for donors to give—no matter the size of gift. But many donors simply don't know it's an option. -- We're partnering with growth-minded nonprofits to implement all of these ideas, and more. If you think it's time you create a solid midlevel giving strategy (not just a standard appeal with an open ask), give me a shout.

You don’t need new funders. Not until you’ve maximized the ones you have. Because donor retention beats donor acquisition. All day every day. Retention over acquisition is a well-known, well-practiced path to private-sector brand growth. But the #nonprofit starvation cycle causes leaders to chase more, more, more... new, new, new... better, better, better. So let’s talk about this vital #fundraising data: 💡 Nearly 7 out of 10 donors will give once, and never again. 💡 Every $100 gained is offset by $96 in losses through donor attrition. 💡 Most major gifts are made after 18–24 touchpoints and five years of smaller giving. 💡 The cost to continually acquire new donors runs 50–100% more than the dollars collected. 💡 The recapture rate of lapsed donors is just 5% — if they stop giving, the chances of them ever giving again are minimal. “Although acquisition of new donors is important, the numbers don’t lie,” says Amy Eisenstein, ACFRE. “The value proposition and financial benefit for your organization falls clearly on keeping the donors you have over finding new donors.” Then what’s the solution to grow existing funders? Create a priority audience — just for them. Generate value propositions — just for them. Develop a positioning strategy — just for them. Execute a communications plan — just for them. Understand the fundraising data — just for them. In other words: brand #strategy — just for them. Because the grass isn’t always greener. Nurture the garden you have. No need to hunt for diamonds. Sometimes, you’re standing on the mine. 💪🏽💛 (𝘋𝘢𝘵𝘢 𝘴𝘰𝘶𝘳𝘤𝘦𝘴: 𝘈𝘴𝘴𝘰𝘤𝘪𝘢𝘵𝘪𝘰𝘯 𝘰𝘧 𝘍𝘶𝘯𝘥𝘳𝘢𝘪𝘴𝘪𝘯𝘨 𝘗𝘳𝘰𝘧𝘦𝘴𝘴𝘪𝘰𝘯𝘢𝘭𝘴, 𝘉𝘭𝘰𝘰𝘮𝘦𝘳𝘢𝘯𝘨, 𝘢𝘯𝘥 𝘔𝘢𝘴𝘵𝘦𝘳𝘪𝘯𝘨 𝘔𝘢𝘫𝘰𝘳 𝘎𝘪𝘧𝘵𝘴) ________________________________ If you enjoyed this daily brand insight: 1. Follow Kevin L. Brown to maximize your funding 2. Click the 🔔 to get notified about new posts 3. Like, comment, or repost below 👇🏽

Every few weeks, I get emails from younger people asking: “I want to start my own nonprofit. Any advice?” Here’s what I’ve learned after investing blood and sweat building Chintan (Environmental Research and Action Group) : 1. Let your work create livelihoods for others—not lifestyles for yourself. This is not a for-profit hoping to become a unicorn. It’s not about scaling fast or optimizing margins. It’s about showing up for real people with real stakes. 2. Don't use the word ‘beneficiary.’ It assumes a hierarchy. But if you’re earning a living, setting the agenda, speaking on panels, and being quoted—let’s be honest: you are a prime beneficiary too. That clarity changes everything. It grounds your intent. And helps you build with accountability, not abstraction. It also adds ‘collaborators’ to your everyday vocabulary. 3. Map the invisible and involve them early. Every sector has those it forgets: differently abled communities, elderly workers, and caste-oppressed women. They may not be your immediate collaborators. But their perspectives will deepen your design and sharpen your ethics. 4. Don’t chase urgency. Sit with root causes. Fast action often feels good, but impact needs painstakingly gleaned evidence, social infrastructure and amplified voice. If you're working on the green economy, gender, or climate, invest in the hard questions. Build the ecosystem, not just your brand. 5. Seek Co-founders : Embrace people who do what you don’t.  Every organization needs these three:  → Someone who knows the issue  → Someone who handles ops  → Someone obsessed with compliance (pay them best) If you’re building something that hopes to last, let it be built on honesty. And let that honesty begin with the question: Whose voice is leading this, and whose life is it changing? #BharatiWrites #Chintan #NonprofitLeadership #EthicsInDevelopment #SouthAsia #SocialImpact #LanguageMatters

Over the last year, I've been asked to advise several non-profit organizations that are looking to diversify their funding and pursue non-grant revenue streams. Often the most pressure is coming from their current donors, who are looking to reduce their funding and want the non-profit to find the ever-elusive 'sustainable business model'. Unfortunately, this is a REALLY tough ask, for the following reasons: 1. Mission-market tension: Generating revenue requires tailoring offerings to paying customers — which may not always align with the organization’s core social mission. When your solution and strategy have been optimized for years to deliver impact over revenues, you're typically serving the most vulnerable people in the hardest-to-reach communities with lowest ability to pay. 2. Lack of IP protection: Many non-profits have open-sourced their IP. Often this is required within grant agreements. Without protected IP, it is much harder to find opportunities to monetize their solutions. 3. Market failures: Many non-profits are addressing market failures, where the societal benefits of their solutions outstrip any individual market demand. Remember also that need ≠ demand... or as someone once said to me: 'just because there is a gap in the market, doesn't mean there is a market in the gap'. Many non-profits are solving for a lack of domestic financing to pay for public goods that governments really should (but can't) pay for. 4. Capacity gaps: Many non-profits lack the internal systems, skills, or business models to operate commercially. Financial planning, marketing, pricing, and customer acquisition are often underdeveloped. 5. Cultural resistance: Shifting from a grant mindset to an entrepreneurial one can cause friction within teams or boards used to traditional philanthropic models. 6. Brand identity risk: There’s a fear that pursuing revenue might dilute public trust or make the organization seem less altruistic to donors or communities. 7. Access to growth capital: Non-profits typically can’t raise equity, and most don’t have the financial runway to test or scale new models without flexible funding. Non-profits aren’t broken — they’re solving problems markets won’t. Let’s be realistic about what “sustainability” really means.