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  • Slide 1
  • Exploring Sustainable Funding Models for Your Organization NLP June 22, 2015 Amy Nisenson & Marianne Vermeer 1
  • Slide 2
  • Introductions Name Your Organization and Role The Best Movie Youve Seen in the Last 12 Months 2
  • Slide 3
  • Admin & Housekeeping Format of the course Timing and breaks Restrooms Dining options 3
  • Slide 4
  • Your Objectives What do you hope to learn from this class? 4
  • Slide 5
  • Learn about different funding models for your nonprofit organization Using the matrix map as a tool Evaluate your org.'s sustainability based on your funding model How will you begin to make changes towards achieving sustainability Hear from 2 Richmond organizations that are using the matrix model and how it has assisted them 5
  • Slide 6
  • Sustainability According to Wikipedia... The capacity to endure Ability to generate resources in the present without compromising the future ( Financial Sustainability ) Ability to develop, mature, cycle out programs to be responsive to constituencies over time ( Programmatic Sustainability ) 6
  • Slide 7
  • Vision Optimal goal and reason for organizations existence What are values and beliefs that inform work of organization? What do you ultimately hope to accomplish as a result of efforts? 7
  • Slide 8
  • Mission Long-term direction that guides every aspect of organizations daily operations Nonprofits purpose Groups it serves/benefits from work of organization How it plans to do so 8
  • Slide 9
  • Exercise Pair up with 2 other persons15 minutes Share your organizations mission statement Share your organizations vision statement Is your organization on mission and vision? If notwhy not? If yes-what are some accomplishments towards mission and vision? Who is willing to share with the whole group? 9
  • Slide 10
  • Strategic Plan Road map for operational plan of organization Elements of traditional strategic plan: Define or review the mission and vision of the organization Carry out SWOT (Strengths, Weaknesses, Opportunities, Threats) analysis to assess your strengths, weaknesses, opportunities, and threats Define your goals and objectives Write the plan Draft operational plans Monitor progress 10
  • Slide 11
  • Business Plan Should be part of your initial planning process and makes the financial case for moving ahead. Must be able to justify the need for your organization, rely on continual revenue, and keep expenses under control. Elements of a Business Plan: Executive summary: overview--who, what, where, why, and how. Organization description: past, present, and future activities/nonprofit alignment with mission Market analysis: outside competition, pricing structure, and marketing plan Financials: multi-year analysis of revenues, expenses, and projected cash flows. Operations plan: outline of the daily activities, staffing, and general procedures. Appendices: Additional or back-up documents - Resumes of key staff, an organizational chart, market research results, a list of funding sources. 11
  • Slide 12
  • Funding Model Funding Model Defined as a methodical and institutionalized approach to building a reliable revenue base that will support an organizations core programs and services 12
  • Slide 13
  • Characteristics of a Funding Model Type Decision makers Funder motivation 13
  • Slide 14
  • Type of funding The model typically revolves around a single type of funding, such as government or individual, which constitutes the majority of the organizations revenue and which the organization invests disproportionately in developing. Staffing, marketing, core competencies are generally defined by this funding Funding needs to be appropriate for the work the organization does- there is some logic to this! Other smaller sources often play complementary supporting roles but are not the focus of investment 14
  • Slide 15
  • Funder Decision Makers Within that principal source of funding, the model focuses on a particular set of people who dictate the flow of funds perhaps government administrators or a few wealthy individuals. 15
  • Slide 16
  • Funder Motivation A funding model takes advantage of the natural matches that exist between funder motivations and a nonprofits mission and beneficiaries. These motivations range from altruism to collective interest to self-interest. 16
  • Slide 17
  • 10 Funding Models 1.Heartfelt Connector 2.Beneficiary Builder 3.Member Motivator 4.Big Bettor 5.Public Provider 17
  • Slide 18
  • 10 Funding Models 6. Policy Innovator 7. Beneficiary Broker 8. Resource Recycler 9. Market Maker 10. Local Nationalizer 18
  • Slide 19
  • Heartfelt Connector Funding Source: Individuals Funding Decision Maker: Multitude of Individuals Funding Motivation: Altruism Unique Characteristics: Broad mission appeal Benefits touch funders family and friends Nonprofit connects to donors through volunteerism Fundraising Tools to consider: Special events Direct Mail Corporate sponsorship 19
  • Slide 20
  • Beneficiary Builder Funding Source: Individuals Funding Decision Maker: Multitude of Individuals Funding Motivation: Self-interest, followed by altruism Unique Characteristics: Mission attracts individuals pursuing and paying for specific individual benefits Benefits and mission tied to strong individual connection (4 years at University; saving lives) Benefits created viewed as having important societal benefits Fundraising Tools to consider: Fees Major gifts 20
  • Slide 21
  • Member Motivator Funding Source: Individuals Funding Decision Maker: Multitude of Individuals Funding Motivation: Collective Interest Unique Characteristics: Benefits have group orientation that creates collective community to tap into for fundraising Fundraising Tools to consider: Membership fees Special events Major gifts Direct mail 21
  • Slide 22
  • Big Bettor Funding Source: Individual or Foundation Funding Decision Maker: Few individuals Funding Motivation: Altruism Unique Characteristics: Builds majority of support from small number of individuals or family foundations Mission may take many decades to fulfill (finding cure to a certain disease) Fundraising Tools to consider: Major gifts 22
  • Slide 23
  • Public Provider Funding Source: Government Funding Decision Maker: Policymakers Funding Motivation: Collective Interest Unique Characteristics: Provides services that are perceived as core govt responsibility (foster care) Clear definitions exist of the services and processes that nonprofits provide (RFPs) Fundraising Tools to consider: Government contracts 23
  • Slide 24
  • Policy Innovator Funding Source: Government Funding Decision Maker: Policymakers Funding Motivation: Collective Interest Unique Characteristics: Secures govt funds for a significant new approach to a problem or to address a problem not currently viewed as core govt. responsibility Requires a high level champion Succeeds when significant pressures exist on govt as a result of fiscal or medical crisis Fundraising Tools to consider: Legislative appropriation or earmark Executive earmark Government pilot project
  • Slide 25
  • Beneficiary Broker Funding Source: Government Funding Decision Maker: Multitude of Individuals Funding Motivation: Self-Interest Unique Characteristics: Individual beneficiaries decide how to spend the govt benefit Must navigate and influence govt decision-makers for eligibility and compliance with reimbursement requirements Requires individual marketing capability to reach and service end beneficiary Fundraising Tools to consider: Government reimbursement
  • Slide 26
  • Resource Recycler Funding Source: Corporate Funding Decision Maker: Few individuals Funding Motivation: Self-Interest Unique Characteristics: Nonprofit uses goods created in the market-economy where there are inefficiencies that create a surplus (food) Sometimes the marginal costs to produce the product are low (pharmaceuticals) Fundraising Tools to consider: In-kind giving
  • Slide 27
  • Market Maker Funding Source: Mixed Funding Decision Maker: Mass of individuals (one side); few individuals (other side) Funding Motivation: Altruism (one side) and Self-Interest (other side) Unique Characteristics: A funder with some degree of self-interest and the ability to pay exists (a health system buying blood) Often, one of the parties involved in the transaction is motivated largely by altruism (blood donor) Fundraising Tools to consider: Fees Major gifts (corporate or individual)
  • Slide 28
  • Local Nationalizer Funding Source: Mixed Funding Decision Maker: Few individuals Funding Motivation: Altruism Unique Characteristics: The issue is one of a few top priorities for improvement or success in a locality (quality school system) The issue is common enough to exist in many localities nationwide The level of funding available in any single geographic area is usually limited Fundraising Tools to consider: Major gifts (corporate or individual) Special events
  • Slide 29
  • Why are these funding models important? Nonprofits must understand their funding strategy and funding streams to raise money Knowing your funding model helps nonprofits focus more 29
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