Nonprofit Business Development For Enhanced Impact and Financial Sustainability

"Nonprofits have to recognize that they're businesses, not just causes. There's a way to combine the very best of the not-for-profit, philanthropic world with the very best of the for-profit, enterprising world. This hybrid is the wave of the future for both profit and nonprofit companies."

From "Genius At Work" - an interview with Bill Strickland,
CEO of the Manchester Craftsmen's Guild and the Bidwell Training Center Inc.

Contents of This Page

• The Changing Nonprofit Environment and the Rise of "Social Entrepreneurship"
• Nonprofit Business Development - Our Practical Approach to Social Entrepreneurship
• The Benefits of Nonprofit Business Development
• Steps You Can Take Now to Explore This Further

The Nonprofit Environment Has Changed

• Community needs are growing in size and diversity.
• More nonprofits are competing for government and philanthropic funds.
• Traditional forms of funding are becoming smaller and less reliable.
• New for-profit businesses are competing with nonprofits to serve community needs.
• Funders and donors are demanding more accountability.

In the face of this new reality, an increasing number of forward-looking nonprofits are beginning to appreciate the increased revenue, focus and effectiveness that can come from adopting "for profit" business approaches. Increasingly, they are reinventing themselves as social entrepreneurs, combining "the passion of a social mission with an image of business-like discipline, innovation, and determination."1

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Nonprofit Business Development -
Our Practical Approach to Social Entrepreneurship

"Nonprofit Business Development" is our term for a group of activities that fall within the broader field of social entrepreneurship. It involves combining the best practices of the nonprofit and for-profit sectors to simultaneously enhance a nonprofit's impact and financial sustainability through mission-related earned income activities.

Our process for nonprofit business development involves:

• Recognizing that your organization's vision, mission and strategic goals represent the purpose and context for your business development.
• Gaining a better understanding of the motivations and support for doing business development, both within your organization and in your community.
• Identifying the major assets and capabilities that your organization has to invest in its business development.
• Identifying your best mission-related earned income opportunities.
• Researching each of your opportunities for feasibility and selecting the most appropriate ones to develop.
• Developing realistic business plans for each of your selected opportunities.
• Implementing your business plans, including adjusting them as necessary.

Nonprofit Business Development can take three primary forms:

1. Enhancing the impact and financial sustainability of a nonprofit's "in-house" programs,
2. Creating freestanding mission-centred enterprises, and
3. Forming mutually-beneficial relationships with corporations.

We offer a range of services to help you to make informed decisions about if and how your organization should develop its own business activities. And we can help you develop and implement a customized action plan that will help you get to where you want to go in a way that works for you. For more about our unique and very practical approach, See our services..

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Benefits of Adopting a Nonprofit Business Approach

Nonprofit Business Development can have a variety of positive impacts on a nonprofit organization, including:

• More accurate understanding of community needs
• Higher quality of service by focusing on what you do best
• More effective and efficient operations in your organization
• Increased financial resources, especially through increased mission-related earned income
• Better use of financial resources
• More freedom and choices of resources to meet community needs
• Improved coordination between board and staff
• Better relationships with clients and other external stakeholders
• Enhanced credibility with clients and funders
• Continuous learning and improvement

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Want to Explore This Further?

• A good starting point is to read our newest article, "Social Entrepreneurship Basics".
• To learn more about social entrepreneurship and nonprofit business development, go to our Resources page.
• If you're ready to get started with developing your own business opportunities, go to our Services page.

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"(Social entrepreneurs) always keep mission first, but know that without money,
there is no mission output.” ~ Peter C. Brinckerhoff

Footnote:
1. From "The Meaning of Social Entrepreneurship" by J. Gregory Dees.