In the 2000’s, social entrepreneurship was well underway at The Andrea and Charles Bronfman Philanthropies (ACBP). Incubated programs including the Heritage Project, Birthright Israel, and the Karev Program for Education Involvement were in full swing, and several new programs were growing including the Green Environment Fund, the Association for Israel’s Decorative Arts, 21/64, Slingshot, and Reboot. For each, the mission was clear. Each developed a board, which each focused on hiring engaged, energetic, passionate, and talented people to staff these new enterprises. Board members, advisors, and staff of ACBP and the projects were excited about sparking something impactful. However, the new social entrepreneurs quickly realized that ‘organizational’ life gets in the way of mission – that is, building an infrastructure that can support the mission. Among other things, staff onboarding, securing office space, determining taxes, and finalizing audits all are essential to infrastructure but don’t lead to visible mission-related impact.
As an operating entity, ACBP had the capacity to extend its infrastructure to the programs that were being developed. In essence, we shared services. This allowed missions to thrive without the distraction of developing supportive services. In the private equity space, this type of support is commonly provided by an incubator. In looking at the field, organizations that did not have the benefit of sharing services were spending a disproportionate amount of time building and maintaining these services without the corresponding caliber of talent or resources.
To get a better handle on the challenges facing young organizations in the field, ACBP, the Jewish Federations of North America, and the Jewish Funders’ Network surveyed 56 nonprofit organizations with various budgets, sizes, and missions. The organizations most vulnerable were ones with budgets between $1 million and $3 million, or less than 20 staff. These were considered to be in the Limbo Range according to a study conducted by the Management Assistance Group (MAG) in partnership with the Eugene and Agnes E. Meyer Foundation. At this stage, the risk is high that mission and impact will be hampered due to undeveloped resources or the lack of expertise to grow to a size that can sustain the supportive services. Several areas were identified as significant challenges:
Based on the survey and focus groups with membership organizations, charities, and their advisors, we identified common challenges and possible solutions and opportunities. Here are several approaches that boards, funders, and management may consider:
The easy part of freeing up resources to focus on mission is finding the right approach for a given scenario. The hard part is changing existing organization culture to accept that approach. Change is about doing things differently – giving up control, negotiating services, determining costs, leveling expectations, and getting buy-in. There is no single driver of change. It could be boards, funders, staff, or networks. Change starts at the top with the adaption of the belief that how an organization functions today might not be how it should move forward tomorrow. As a private operating foundation, ACBP leveraged its resources and applied its people, including its founder, to fast track growth, highlight opportunities, increase focus on mission, and extend its back-office services to core startup grantees.
This is the nineteenth post in the "Making Change by Spending Down" series, produced in partnership by The Andrea and Charles Bronfman Philanthropies and GrantCraft. Please contribute your comments on each post and discuss the series on twitter using #spenddown. See related content below for more posts in this series.