We Are All Farmers Permaculture Institute, Crystal Allene Cook, Fall 2012

Five parts to this presentation: take what you can from it....might not apply to all of you....

1. Non-profit Overview2. What I learned from being non-profit management (interim development director, assistant project manager,

project manager, executive director, and founder respectively)3. What I have learned about social change work4. A gleaning from what Bill Mollison says about all of this in Ch. 145. Questions ???

We Are All Farmers Permaculture Institute, Crystal Allene Cook, Fall 2012

1. NON-PROFIT OVERVIEW

A. What is a non-profit? What should it be?Reinvests in its mission rather than reinvests for profit.

I can’t speak for the big players, neither in for profit business nor in non-profit. I have been exclusively involved with small players in both of these realms other than when trying to get some of the big players’ philanthropic dollars.

Lots of different kinds of non-profit structures: associations, membership groups, corporations, cooperatives, trusts, etc.

B. Why did we start We Are All Farmers Permaculture Institute as a non-profit and decide to incorporate it as one?Fill in the gap where for profit and governments miss. Want to be able to legally work together with established non-profits. Wanted to have the legal structure for opportunities that arise to fulfill our mission.

Step 1: Apply at the state levelStep 2: Apply at the federal level

Exempt Purposes – Internal Revenue Code Section 501(c)(3)

The exempt purposes set forth in section 501(c)(3) are charitable, religious, educational, scientific, literary, testing for public safety, fostering national or international amateur sports competition, and preventing cruelty to children or animals. The term charitable is used in its generally accepted legal sense and includes relief of the poor, the distressed, or the underprivileged; advancement of religion; advancement of education or science; erecting or maintaining public buildings, monuments, or works; lessening the burdens of government; lessening neighborhood tensions; eliminating prejudice and discrimination; defending human and civil rights secured by law; and combating community deterioration and juvenile delinquency.

Need to exist for three tax years (or propose budgets) – we are not there yet.

IRS for every stage: http://www.irs.gov/Charities-&-Non-Profits/Charitable-Organizations/Life-Cycle-of-a-Public-Charity

Additional and or alternative modelSocial entrepreneurship

We Are All Farmers Permaculture Institute, Crystal Allene Cook, Fall 2012

How do non-profits support themselves in the United States if they don’t reinvest to only make profit?

Potential Non-profit Business Funding Models

Business Model BIG BETTOR^Essential Questions *Can we create a tangible and lasting solution to a major problem in a foreseeable time frame?

*Can we clearly articulate how we will use large-scale funding to achieve our goals?*Are any of the wealthiest entities, individuals, or foundations interested in our issue and approach?

ExampleRationale *Attract sizable donations because often the problem being addressed can potentially be solved with a huge influx of money

*Attract sizable donations because the organization is using a unique and compelling approach to solve the problem.Typical Funding Streams Relies on major grants from a few entities, individuals, or foundations to fund operations.Pros *Can ensure larger operations on certain key projects, at least during the time of the grant.

*Large program mgmt fees can contribute substantially to funding and back office stability*Fewer donors = Relatively easy stewardship & reporting requirements …sometimes

Cons *Fierce competition *Must go educating, cultivating, engaging, “friendraising” and fundraising beyond current “crop.”*Fewer large donors *Donors may not recommit over time, leaving successful single-donor programs in the lurch.*Large donors often want to proscribe issue areas and approach.

Capacity Needed *Streamlined vision *Strong on-site proposal writing teams *Strong ability to cultivate high net worth relationships over time

Business Model POLICY/PROGRAM INNOVATOR^Essential Questions *Do we provide an innovative approach that surpasses the status quo (in impact and cost) and is compelling enough to attract government

funders, which tend to gravitate toward traditional solutions?*Can we provide government funders with evidence that our program works?*Are we willing and able to cultivate strong relationships with government decision makers who will advocate change?*At this time are there sufficient pressures on governments to overturn the status quo?

Example Rationale *Novel methods to address social issues that are not clearly compatible with existing government funding programs.

*Government funders support these alternate methods because solutions are perceived as more effective and less expensive than existing programs. Typical Funding Streams *Rely on money from governments.Pros *Governments need cheaper and more innovative solutions to certain problems than they can provide.

*Large contracts provide stable funding streams. Cons *Government priorities or policies can change *A group might be under pressure to provide services peripheral to its core mission.Capacity Needed

Business Model DONOR ADVISED FUNDS/PHILANTHROPIC FUND MANAGEMENTEssential Questions *Can we offer a service no one else can provide as well as we can? *Is there sufficient demand for our service?

We Are All Farmers Permaculture Institute, Crystal Allene Cook, Fall 2012

*What is the long-term potential for our service? *Do we know enough individuals or companies whose philanthropic interests you could manage? *Is our board well connected to individuals and corporations that have philanthropic interests?

ExampleRationale *Could provide a civil sector bridge service of sound fiscal management and oversight.

*Potential philanthropists need cheaper and more innovative solutions to certain problems than they can provide. *Potential philanthropists need sound fiscal management. *Potential philanthropists need sound advice and insight into what to fund.

Typical Funding Streams *Grow large by adding more and more projects that raise more and more money. *Managing the foundations or philanthropy of many different groups, interests, people, etc.

Pros *Project leaders must also have sustainable ways and suitable training to earn revenue for their projects beyond the life of the grant.*Generates unrestricted revenue. *Can work with interested parties to meet their philanthropic interests.

Cons *May need to expand beyond mission areas *Possibly more reporting and “high touch” stewardship. *Must set minimum limit of funds & skillfully negotiate very specific parameters of grantmaking function upfront to make the assets management worth it. *High cultivation costs: Must be targeted & audience-specific outreach, promotion, and advertising of services.

Capacity Needed *Staff to do program advisement *Staff to cultivate potential philanthropists *Staff trained to guide philanthropists through a streamlined process

Business Model FEE FOR SERVICEEssential Questions *Can we offer a service no one else can provide as well as we can? *Is there sufficient demand for our service?

*What is the long-term potential for our service? ExampleRationale *Secure “unrestricted” funding from providing services.Typical Funding Streams *Grow from selling a service, even if that service is not mission driven.Pros *Generates unrestricted revenue. Cons *Can eat up the time of a lot of the most expert & senior staff.

*Does not seek or nurture projects or grow NGO capacity. *May need to expand beyond mission areas Capacity Needed *Staff dedicated to income generation *Staff trained in fee-for-service business model and its expansion

Business Model FOUNDATION CONSORTIUM/COLLABORATIVEEssential Questions *Is there a group of foundations interested in our issue? *Can we bring them together to help us fulfill our mission?

Example *US Connect (consortium of powerful foundations working together on US foreign policy)Rationale Large coordinated, aligned pools of money & talent can produce powerful change.Typical Funding Streams Supported by a group of foundations: a funding collaborativePros Need to have large foundations willing to commit to multi-years of funding.Cons *Must do extensive and thorough outreach toward creating this model. What happens when one foundation drops out?

*Need to negotiate *Governance challenges *Program and priority challenges *Tend to be somewhat bureaucratic /paper heavyCapacity Needed *Streamlined vision *Staff dedicated to consortium management/oversight

Business Model HEARTFELT CONNECTOR^Essential Questions *Have a large cross section of people already shown that they will fund causes in this domain?

*Can we communicate what is compelling about our nonprofit in a simple and concise way?

We Are All Farmers Permaculture Institute, Crystal Allene Cook, Fall 2012

*Does a natural avenue exist to attract and involve large numbers of volunteers?*Do we have, or can we develop, the in-house capabilities to attempt broad outreach in even one geographic area?

Example (External examples) *Armenian General Benevolent Union *Armenian Tree Project *Make-a-Wish Foundation *The Susan G. Komen FoundationRationale *Grow large by focusing on causes that resonate with the existing concerns of large numbers of people at all income levels.

*Rationale is that many people giving money adds up to a whole lot of money. *People who give will often give even more. *People who have a something to participate in will give more.

Typical Funding Streams *Build explicit connections between volunteers through special fundraising events: e.g. Susan G. Komen Race for the Cure = 1 million participants. Average donation = $33.

Pros *Involves many people – they become the bearers of your good news – multiplier effect.Cons *Grows by growing volunteer base which tends to be difficult to manage well.

*Dependent on local initiative and ability to give. Capacity Needed *Marketing and public relations integrated into programs and fundraising *Staff training to integrate marketing and public relations into programs

and fundraisingBusiness Model PUBLIC PROVIDER^Essential Questions *Is our organization a natural match with one or more large, preexisting government programs?

*Can we demonstrate that our organization will do a better job than our competitors?*Are we willing to take the time to secure contract renewals on a regular basis?

Example (External examples) *Success for All Foundation *TMC (formerly the Texas Migrant Council)Rationale In some cases, the government outsources the service delivery function but establishes specific requirements for nonprofits to receive funding, such

as reimbursement formulae or a request for proposal (RFP) process.Typical Funding Streams Work with government agencies to provide programs or services, such as youth leadership or business development, for which the government has

previously defined and allocated funding.Opportunity for EPF for growth

*Management of service provision or programs related to NGO’s mission objectives*NGO support or institution building programs

Pros Gov’t needs cheaper solutions to certain problems than it can provide.Cons *What happens when gov’t interests change?

Capacity Needed

Business Model DIVERSE FUNDING SOURCESEssential Questions *Do we know have enough expertise in diverse fundraising strategies to attempt many at once? What deep training needs to we need to have

settled first? *Do we have the capacity to attempt many fundraising strategies at once? *Can we attract powerful people with money to be our allies? *Can we manage both a fee for service model and other types of fundraising?*Who will invest in our launch of branching into new streams? Can they invest enough to bridge us till we are money making in those new streams?

Example (External examples) *Free Trade Shops at Lutheran Churches (the Netherlands/Germany): Weltladen/Dritte-Welt-Laden*Womens Sports Foundation (WSF) Local Initiatives Support Corp (LISC)

Rationale *Programming or environment calls for varied, nimble responses to changes that can come at any minute.*Organizational impact requires varied approach

We Are All Farmers Permaculture Institute, Crystal Allene Cook, Fall 2012

Typical Funding Streams * Varied & Diverse: ie. a church might receive revenue from: *charitable donations, thrift store (staffed by volunteers = in kind donations); government grants (ie “faith based” initiatives); *nonprofit community development corp; *rental income, *etc. *LISC (largest US Community Development intermediary) is funded through*direct contributions *fee for service (trainings, etc) *For profit tax credit syndication subsidiary (upstreams 10 MIL/yr)*Government funding (HUD, CHDO), etc.

Pros *Diversification of funding streams allows for a more nimble response to changes in any one of EPF’s funding streams (as one diminishes, there is the potential to upgrade another). *EPF has transferable skills and experience with managing many different program types, multiple grantees, etc. *Strategic outreach to new sources and more people involved potentially raises EPF profile

Cons *Must have staff skilled in stewardship and cultivation strategies throughout the organization (including program staff) in order to identify and leverage opportunities *Need initiative and appetite to attempt new methods. *Need powerful people and entities on your side.*Need for ongoing and aggressive relationship building *Requires full Board support and an open rolodex*More donors/inventors = more reports and output channels

Capacity Needed

^Based upon models from: Source URL for 10 most successful single source dominated-nonprofit business/funding models: http://www.ssireview.org/articles/entry/1230/

Excerpt from the article: IMPLICATIONS FOR NONPROFITS

In the current economic climate it is tempting for nonprofit leaders to seek money wherever they can find it, causing some nonprofits to veer off course. That would be a mistake. During tough times it is more important than ever for nonprofit leaders to examine their funding strategy closely and to be disciplined about the way that they raise money. We hope that this article provides a framework for nonprofit leaders to do just that.

The funding paths that nonprofits take will vary, and not all will find models that support large-scale programs. The good news is that all nonprofits can benefit from greater clarity about their most effective funding model, and it is possible for some nonprofits to develop models that raise large amounts of money. As mentioned earlier, almost 150 new nonprofits (not counting universities and hospitals), surpassed $50 million in annual revenues between 1970 and 2003.

On the other side of the equation, philanthropists are becoming more disciplined about their nonprofit investing. A growing number of foundations, such as the Edna McConnell Clark Foundation and New Profit Inc., are investing in their grantees to improve both program and funding models. We hope that this article helps philanthropists become clearer about their funding strategy so that they can support their programs more effectively.

**Additional tactics. The above Nonprofit Business Funding Models represent organizational structures. Beyond fundamental structures, many nonprofits continue to utilize the following and many other funding tactics:

We Are All Farmers Permaculture Institute, Crystal Allene Cook, Fall 2012

A Few Additional Funding Tactics

"When I´m getting ready to reason with a person, I spend one-third of my time thinking about myself and what I´m going to say, and two-thirds of my time thinking about her/him and what s/he´s going to say." - Abraham Lincoln, slightly paraphrased

You can make more friends in two months by becoming interested in other people than you can in two years by trying to get other people interested in you - Dale Carnegie

Tactic Brief Description Rationale Capacity NeededSponsored Funder Roundtables

Current large funders host a roundtable, talking about why they support your organization and then they invite other foundations, corporations, agencies, etc. to attend. The large funder plans, invites, and hosts this at no cost to the org.

Funders look good in front of their peers, a whole new set of potential donors is exposed to the org, and a whole new set of donors sees competitor/colleagues making funding in this arena a priority. Funding is unrestricted.

Large funders willing to host.

Affinity Groups/Giving Circles

Business people or other interested groups (wealthy individuals) create a “giving circle” focused on your funding area with a minimum yearly pledge to join.

Business people/wealthy individuals want to be surrounded by similar people of the same priorities and worth. Establishes them in a particular group. Funding is unrestricted.

A few business people or wealthy individuals committed to the cause willing to invite others into the group.

Paid Networking Events Bringing target audiences together to network: NGOS with NGOs, corporate with corporate, grantees with grantees, or mixing it up. Often a restaurant or hotel will donate space in exchange for prix fixe drinks.

Relationships run almost everything. Help your connections get ahead by providing paid instances for them to network. Provides a regular format to highlight your org’s achievements and cultivates new friends for your org. Funding is unrestricted.

List of solid contacts to start and to invite. Regular format. Space donated. High enough cost per event to cover costs, staff time, and to generate some unrestricted income.

Sponsored Gala Events Bringing target audiences together to network. Often a restaurant or hotel will donate space in exchange for covering the cost of dinner. Highlights achievements. Great to “plant” a large donor willing to write a check in front of other potential donors. Offer something “unusual” that other galas don’t provide. The kind of event people can bring their families or spouses to. If you win over spouses, often you win over the funder.

Funders look good in front of their peers. Help your connections get ahead by providing paid instances for them to network. Can sell “corporate tables” and other sponsored tables – good advertising for corporations. Easier to get celebrities to attend than other types of events.

List of solid contacts to start and to invite. Regular format. Space donated. High enough cost per event to cover costs, staff time, and to generate large unrestricted income.

Paid Conferences/Conventions

Bringing target audiences together to network and learn. Relationships run almost everything. Help your connections get ahead by providing paid instances for them to network. Provides a regular format to highlight your org’s achievements and cultivates new friends for your org. Funding is unrestricted.

List of solid contacts to start and to invite. Regular format. Space donated. High enough cost per event to cover costs, staff time, and to generate some unrestricted income.

Silent Auction The kind of event people can bring their families or spouses to. If you win over spouses, often you win over

Funders look good in front of their peers. Help your connections get ahead by providing paid

List of solid contacts to start and to invite. Regular format. Space

We Are All Farmers Permaculture Institute, Crystal Allene Cook, Fall 2012

the funder. Often a restaurant or hotel will donate space in exchange for prix fixe drinks.

instances for them to network. Can auction items sponsored by corporate donors – good advertising for participants. Easier to get celebrities to attend than other types of events. Funding is unrestricted.

donated. Items donated. High enough cost per event and silent auction items to cover costs, staff time, and to generate some unrestricted income.

Online giving related to “urgent” campaigns

Best for “single” cause campaigns. Can generate a lot of new “friends” and small amounts of cash ($10,000). Great for advertising “urgent” issues. Use of social networking and targeting of specific audiences.

Best for “single” cause campaigns, for example, “Help send 300 Armenian youth to Youth Bank Leadership Camp this summer!.” Your “$5” donation blah blah blah.

Solid online and social marketing skills. Staff trained in online and social marketing with audience-specific messaging. Need to launch through social networking sites. Need online capacity for accepting funds.

Major Gifts Individual giving makes up most funding for most organizations. Major gift officers have two challenges: the first is identifying major gift prospects (the science of major gift fundraising), the second is asking for a gift (the art of major gift fundraising). ^^

You aren´t asking for yourself, you´re asking for your mission.^^

Strategy for “friendraising” high net worth individuals. This must be strategic, well-planned, and appropriate.^^

Planned Giving Planned Giving refers to several specific gift types, for example: cash, equity, or property. ..

You aren´t asking for yourself, you´re asking for your mission.^^

Strategy for “friendraising” high net worth individuals. This must be strategic, well-planned, and appropriate.^^

Capital Campaigns A capital campaign is an organized drive to collect and accumulate substantial funds to finance major needs of an organization such as a building or major repair project.

Funding is restricted to just the target goal of the capital campaign. Can be a way to engage a corporation or high net worth individual to do a signature project (library, building, etc.)

Needs a definitive plan. Fewer funders fund capital campaigns.

Endowments An amount of given with a stipulation that the funds are invested to earn annual interest rather than spent immediately.

You aren´t asking for yourself, you´re asking for your mission. Can be a way to engage a corporation or high net worth individual to do a signature endowment.

Strategy for “friendraising” high net worth individuals. This must be strategic, well-planned, and appropriate.^^

Running an adjacent business to generate income

As more and more nonprofits compete for limited pools of philanthropic and government support, the prospect of an additional source of earned income becomes increasingly appealing.##

Income from a business venture is particularly attractive because it comes without the restrictions commonly attached to grants and major donations. ##

Must understand challenges, costs, and risks of taking the ride. Can take more time and capital than many people realize. Could pull the parent organization and some of its most valuable resources, such as senior management time, away from the core mission. Requires a firm understanding of the economics of the venture, the market it aims to serve, the competition trying to serve that same market, the direct social impacts of the venture, and any indirect costs or

We Are All Farmers Permaculture Institute, Crystal Allene Cook, Fall 2012

tensions it might create for the parent. Develop a business plan for the venture that combines rigorous analysis, creativity, and action-based learning. Conduct a thorough venture planning process. Crucial to stay focused on the ultimate bottom-line, cost-effective mission impact throughout this process.##

^^Source: http://www.onphilanthropy.com/site/News2?page=NewsArticle&id=5207

## http://local.globalatlanta.com/Nonprofit_Business_Ventures-a1134516.html

Additional Wonderful Resources: Word to explore = Social Marketing. These women are the experts. Worth knowing well.

http://nonprofitmarketingblog.com/ http://www.social-marketing.com/index.html

We Are All Farmers Permaculture Institute, Crystal Allene Cook, Fall 2012

2. What have I learned from being in non-profit management (interim development director, assistant project manager, project manager, executive director, and founder respectively)? What have I learned about social change work/activism work?

Why share all of this? So, you can know your options. Maybe you are more high touch and social change than hands dirty in the earth. Maybe you are both. A range of practical, structured approaches. So, you can mix it up with the alternatives.

Bill Mollison outlines some alternatives in Ch. 14 in Permaculture, A Designer’s Manual—he goes broad and deep, but there is a range of approaches. Not orthodox here.

1. Can’t be all things to all people. Narrow down your focus. Can’t sell what you don’t believe in.

2. Can’t do it all. Delegate. Stack functions with people.

3. More like a for profit business the better it will be: marketing, diversification of revenue streams, connect with people, serve a need, keep good records, invest in people, reward people, recognize good work, don’t overwork people, pay attention to bottom line, spend it like it is finite, make real relationships, etc.

4. Non-profit people love to read their own writing and they will blah blah blah a lot; activists love to hear themselves talk and they will blah blah blah a lot. Do what you have to do to get past this and get real needs met.

5. People are people; non-profit people and activist people will elate you and disappoint you just like people in any other field. Not more ethical or less ethical or whatever.

6. The shape of the problem can help determine the shape of the organization.

7. The shape of the resources to address the problem can help determine the shape of the organization.

8. No such a things as business ethics and/or nonprofit ethics, there is just ethics.

9. Can you live with odd bedfellows? Can you work with odd bedfellows to get something larger than all of you done?

10. Will you take and use the odd bedfellows’ money?

We Are All Farmers Permaculture Institute, Crystal Allene Cook, Fall 2012

11. Follow the legal rules. Check in. Keep good books (if you can’t, hire someone to). Link up with an umbrella org if you need to.

12. Watch out for founder’s syndrome. You can’t beat it.

13. Not the same people for all parts of the non-profit life cycle.

From: http://www.nhnonprofits.org/knowledgecenter/ccat/lifecycle.cfm

We Are All Farmers Permaculture Institute, Crystal Allene Cook, Fall 2012

We Are All Farmers Permaculture Institute, Crystal Allene Cook, Fall 2012

We Are All Farmers Permaculture Institute, Crystal Allene Cook, Fall 2012

4. A gleaning from what Bill Mollison says about all of this in Ch. 14

I. Greens Vision

A. Class Greens vision:

1. No growth

2. No growth population (506 – 510)

3. He lays out a grand plan. Not orthodox on this, but some mapping there worth thinking in the long-term.

B. Green Jobs Agenda—a renewed and more serious discussion in the US in the last five years than before

C. Worth thinking: can we have green growth?

II. Rethinking structures for engagement with people

A. Mollison contributes “affinity groups”

B. Biogregions

C. Take away: ground up participation can take many forms, not just those we know but can envision

D. Place for many forms at the table

III. Some things not usually talked about when we talk about ethics from which to build affinity

A. US Western model: voting, jury, protest, protection (materialist view—democracy in the West expanded due to resources expanding)

B. Other rights? Often highly regulated in the West

We Are All Farmers Permaculture Institute, Crystal Allene Cook, Fall 2012

1. Protect forests

2. Build shelter

3. Grow food

4. Provide ourselves with water (510)

C. Mollison views these points (1 – 4) as wealth access (economists before WW II saw some of this as what makes the economy run, the actual wealth rather than money)

D. Non-profits, businesses, and individuals can take up the slack on these where governments fall short HOWEVER POLICY IS STILL IMPORTANT. Even the great Bill busts that out on page 557. My takeaway: places at the table for them all. Work with these arrangements rather than against them.

IV. Other key principles, around which to build affinity (521):

• Reduce the need to earn

• Earn within the village (bioregion)

• Produce a surplus

• Provide many non-material needs

• Cooperate

• Access to tools

• Entertainment (be creators not just consumers)

• Recreation

We Are All Farmers Permaculture Institute, Crystal Allene Cook, Fall 2012

• Basic life essentials

V. How to achieve IV?

A. Many ways, but get ‘er done:

• As individuals

• As groups

• Non-profits

• For profits

• Skill sharing

• Consulting

• ?????

B. Flexible work, not people as machines

C. Celebrate

VI. Money as energy not an end (Transition Movement with C. Robb Worthington)

VII. Address real and basic problems of a region

• Political and financial action

• Devise strategies to offset problems of politics and finances

• Educate local people

We Are All Farmers Permaculture Institute, Crystal Allene Cook, Fall 2012

• Assess trials for side effects and sustainability

• Leave a local group able to further educate

• Don’t make dependent (557)

VIII. No place for fools. Don’t assume knowledge.

IX. Small trials (Mollison knowingly or unknowingly building on Sir Karl Popper); small changes may not screw up as bad as big changes (The Open Society Parts 1 & 2)

X. Leave a local group able to further extend or educate in such strategies