conversation on capitalizatoin and community€¦ · art and historic artifact conservation ......

nff.org ©2017 Nonprofit Finance Fund

Kick-Off Conversation

IABD, Inc. and the Comprehensive Organizational Health Initiative (COHI)

Denise Saunders ThompsonPresident and CEO International Association of Blacks in Dance, Inc.

Claire Knowlton Director, Advisory ServicesNonprofit Finance Fund

Trella WalkerSenior Associate, Advisory ServicesNonprofit Finance Fund

January 28, 2017

This presentation was made possible with funding from The Andrew W. Mellon Foundation.

nff.org ©2017 Nonprofit Finance Fundnff.org ©2017 Nonprofit Finance Fund

Agenda

2

Introducing Nonprofit Finance Fund to IABD, Inc.

Who is NFF? What does NFF believe?

Comprehensive Organizational Health Initiative

What is COHI? Why should I participate? How do I participate?

International Association of Blacks in Dance, Inc.

What’s planned Your vision

Q & A

3nff.org ©2017 Nonprofit Finance Fund

Co-Developing the Agenda

Other questions or topics you’d like us to cover?


About Nonprofit Finance Fund (NFF)

NFF’s Mission: We unlock the potential of mission-driven organizations through tailored investments, strategic advice and accessible insights.

Over $287 million in loans, $30 million in re-grants and $1.4 billion in leveraged capital

Over 1,300 arts, cultural and supporting organizations

Hundreds of partnerships and publications advancing financial awareness and friendlier funding practices for all nonprofits

FinancialCreative Capital & Financing

IntellectualResearch and

Evaluation

Social Collaboration & Partnership

Human The Right

Expertise & Skills

Tailored Investments, Strategic Advice, Accessible Insights


How NFF Helps

Demystifying Nonprofit Finance

Finance has a language all its own! NFF can break down the terms and concepts, provide one-on-one coaching, and group trainings to provide clarity and relevance in financial conversations.

Telling Your Financial Story

Finances tell a story – but not the whole story. NFF can help you combine the numbers on the page with the lived experience of your organization to communicate what’s happened in the past, and the resources you need for the future.

Thought Partnership

NFF can support your decision-making by asking good questions, helping interpret your data, and sharing what we’ve seen work with other organizations facing similar choices in similar situations.


In the for-profit world,

“Rules” of For-Profit Finance

Customer buys the

product

Price includes the full

cost of doing business

Overhead and profits

are seen as necessary

and regular part of the

business

Direct

Cost

26%

(77¢)

Overhead

& Profit

74%

12-ounce latte = $3.00

Source: Matt Milletto, Vice President of the American Barista & Coffee School


Supply

Demand Need

Nonprofits exist to fill a social need for which there is rarely an obvious commercial return

Client often does not pay or pays partially for the product (e.g., homeless do not pay per night for shelter)

“Rules” of NONPROFIT Finance

Nonprofits rely on third parties (donors and funders) to

pay for the cost of program and services

Donors and funders want most of their contribution to go

directly to the people served “restricted” funding

Overhead and profits are often seen as unnecessary and

unrelated to achieving the mission


Nonprofits Operate (at Least) Two Businesses

Since nonprofits can rarely charge prices sufficient to cover the full cost of their core mission programs, they require support businesses (a.k.a the “subsidy” business)

Subsidy businesses fill the gap between core funding and the cost of operations.

Common subsidy businesses include:

Sweat equity (use of volunteers, underpaid staff, low benefits)

Fundraising

Investment income

Real estate (rental income)

Earned income ventures

When program growth or change occur, subsidy must grow in proportion.


Nonprofits Need Profits:Break-even is Never Enough

Like any organization, nonprofits need to cover the full cost of delivering programs

Tax Status vs. Business Model

Full costs > Operating Expenses > Program Expenses

Operating Expenses

WorkingCapital

TotalExpenses

Reserves

Fixed AssetAdditions

Debt Principal

Repayment

Change Capital

Full cost includes:

Surpluses are necessary to pay for Full Costs!


Context Matters

We Don’t Operate In a Bubble!


Your Financial Story is Powerful

Numbers may explain the what, but not always the why. Telling your financial story can explain, validate and/or even strengthen strategic decisions.

There is power in speaking the same financial language.

If you don’t give context, the reader can provide their own!


Agenda

12







Q & A


What is the Comprehensive Organizational Health Initiative?

COHI is a collaboration between The Andrew W. Mellon Foundation, IABD, Inc., and NFF that will:

Add to the capacity of IABD, Inc.

Financial support and consulting for IABD, Inc.

Teach NFF and Mellon about the sector, and inform IABD, Inc. capacity building

Financial diagnostic and needs/opportunity assessment of 35 member organizations

Empower IABD, Inc. member organizations to own and tell their financial story

Presentation of findings and financial story-telling workshops at 2018 conference

Visual financial assessment for participating organizations


History of COHI

The Andrew W. Mellon Foundation and NFF have partnered to learn and address needs in other sectors:

Art and historic artifact conservation

Culturally specific and geographically isolated, national touring performing and visual arts organizations

Partnership with National Performance Network/Visual Artists Network

The sectors have data to back-up what they know is true!!!


For decades, Black dance companies, small to mid-sized, have been marginalized by an arts funding paradigm that was not accessible. The financial challenges these organizations have faced to keep their doors open continue to be significant…

– Denise Saunders Thompson, IABD, Inc.

The Dancing Image, Dallas Black Dance Theatre Photo by Sharon Bradferd

Why Black Dance and Why Now?


Why Black Dance and Why Now? (Cont.)

IABD, Inc. has operated for 29 years in spite of systemic oppression and is in a position to bring light to the industry, its struggles and its strengths.

Aggregate learnings from COHI will be used to bring greater awareness to the field of Black dance.

Dallas Black Dance TheatrePhoto by The Dallas Dance Project


Benefit to Participating ‘Organizations

Each organization will receive its own financial diagnostic, a

graphical depiction of financial trends, and guidance on how to use it.

The diagnostic will:

Help organizations name and claim their financial history and future

Support communication with internal and external stakeholders

If you don’t tell your story, someone else will tell it for you!

“The pivot moment came when we asked the staff to imagine all our bills paid off (i.e. being able to order all the supplies they need, faster reimbursements, no more uncomfortable conversations with vendors, etc.). The morale lift was palpable.”

– COHI Participant, on the training using their financial diagnostic


Criteria for Selection in COHI

Dance Company of African ancestry or origin - The majority of the work created and presented is by artists of African ancestry or origin.

Established to serve culturally specific communities of African ancestry or origin.

Current IABD, Inc. member organization

Domestic US-based organizations only

Dance company (not a school)

Operating for more than five (5) consecutive years

Operating budget of $100,000 or more

If you meet the criteria, you will be contacted by Denise Saunders Thompson from IABD, Inc.


Additional Criteria for Selection

Additional criteria to select 35 participants:

Willingness to participate in the assessment and provide data

The depth of community relationships

Excess demand for local based programming relative to organization’s ability to provide

Engages/supports local artists

Loss for the community if this organization no longer existed


Expectations of Participants

If you receive an invitation from IABD, Inc., you will need to:

Provide financial statements (audited or internal)

Income statements for 2013, 2014, 2015, and 2016 fiscal years

Balance sheets for 2013, 2014, 2015, and 2016 fiscal year end

Budget for 2017 fiscal year

Participate in a 90 minute in-person meeting with Baraka Sele and Denise Saunders Thompson, NFF via phone.

Possible follow-up call or email to clarify data


Initiative Timeline

Membership Activities Estimated Timing

IABD, Inc. selects and invites member organizations to participate in diagnostic.

January 2017

Begin gathering financial data from organizations with capacity to provide it.In-person meetings/90-minute calls begin.

February 2017

In-person meetings/90-minute calls continue. March-April 2017

Financial data is analyzed, aggregated and reviewed. May- July 2017

Customized content for educational seminars is designed and finalized.

August-December 2017

Financial analysis data and educational seminars presented at IABD, Inc.’s 30th Annual International Conference and Festival hosted by Lula Washington Dance Theatre in Los Angeles, CA.

January 2018


Reflections

What gives you hope?

What gives you pause?


Agenda

23







Q & A


What’s Next for IABD, Inc.

Dallas Black Dance Theatre Photo by Sharon Bradferd


What’s Your Vision for IABD, Inc.?


Q&A

Alvin Ailey American Dance Theater in Robert Battle's The Hunt Photo by Paul Kolnik


And stay connected: nonprofitfinancefund.org/socialmedia

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Nonprofit Finance Fund

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Contact info

Denise Saunders Thompson Claire Knowlton Trella WalkerPresident and CEO Director Senior AssociateIABD, Inc. NFF NFF202.345.6887 213.623.7001 [email protected] [email protected] [email protected]

Thank you

To learn more about NFF, visit us at nonprofitfinancefund.org

mailto:[email protected]@nff.org

mailto:[email protected]

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