Whether you contribute $2,500 a year, $25,000, or $1 million, you can leverage your impact by applying several important principles in choosing the nonprofits you support. Your decisions are even more meaningful now as nonprofits are in greater need in this difficult economic environment.
The first consideration is what you want to accomplish. Imagine your vision of a better world and the issues that matter to you most…educating children for a more promising future, caring for seniors, providing access to healthcare, bringing arts and music into schools, helping people to build micro-enterprises for greater financial mobility, or advancing a greener world.
As you explore the variety of organizations where your dollars can make a difference, here are some key considerations in making a good investment:
- The excellence of the CEO (sometimes called the “executive director”). The CEO who can effectively advance an organization is a savvy entrepreneur in building programs, the team, and the business model, and raising funds. Often, the successful CEO has the sheer force of will to drive success.
- A relevant mission. Particularly in this highly competitive funding environment, the organization that will thrive has a mission that adds compelling value in service to the community.
- An ambitious vision. A winning organization has a CEO and a board who collaborate to envision the organization’s greater potential and map out a plan – including the revenue model – to achieve success.
- A board that is partnering with the CEO to achieve the vision. The successful organization has a fully engaged board comprised of people from diverse backgrounds and perspectives – all of whom are providing meaningful support.
- The revenue model. The key to organizational vitality and sustainability is a thoughtfully constructed and robust revenue model. Philanthropy is critical – from a variety of sources (including board members and their networks). Government funding and fees or other income might also be part of the formula, based on an analysis of past and future opportunities.
- Accountability. The organization’s compliance with accounting and regulatory requirements is essential, including annual audits and filings of 990 forms.
- Partnerships. Organizations can leverage their impact by partnering with other organizations to accomplish greater results.
- Measurement. Consider quantitative and qualitative information that demonstrate the organization’s success in achieving its purposes.
When you look at each organization, consider its overall impact in relation to its budget. Think about the value you can add with your gift and the difference you can make. In some of my next posts, I will give examples of organizations where I think the impact is most significant.
Please share your thoughts and ideas as well as your questions.