(Photo credit: Businessweek)
What will the future of the nonprofit sector look like in four years, ten years or twenty years? According to a Duke University professor and author David Rendall, social enterprise could be the future of non-profit funding.
Today the U.S. government no longer considers nonprofits to be entitled–or even best qualified–to provide social services. Profit-seeking companies like Lockheed Martin are now winning contracts for such services (…) The change raises fundamental questions about the mission and future of nonprofits. Because nonprofits now find themselves sharing territory with for-profits, sometimes as collaborators and sometimes as competitors, the distinctions between these organizations will continue to blur.
A response to a 2006 report that found 75 percent of nonprofit executive directors were planning to leave in the next five years. The 2008 report surveyed 6,000 emerging leaders in the nonprofit sector, and found 69 percent of them felt underpaid.
The reaction to the Meyer Report have shook the non-profit world and caused many blog discussions, including the emergence of Non-profit 2020, a conference to engage emerging leaders in a discussion on the latest reports on the leadership deficit, and a very interesting discussion of Nonprofits of the Future on Social Edge.
There is a growing desire from the non-profit sector for self-reform.
What are the proposed solutions?
Derwin Dubose, a fundraising professional with eight years of experience in development with non-profits, writes on his blog:
As of 2006, there were nearly 1 million 501(c)(3) organizations in the US — a nearly 70% increase from the 536,000 there were ten years earlier — and I’ve heard that number currently grows at a rate of 1,000 per month. As the number of non-profits grows, inefficiency within our field goes up while the pool of available donors shrinks. Competition will be high for donations, and only well-oiled organizations will be able to thrive in the super-saturated market.
Professor David Rendall, makes the following suggestions:
1. Organizations should combine service with business: Given the conditions of the market for non-profits, how can non-profits protect themselves for the future? One way to look at becoming a social enterprise: a non-profit organization that generates earned income to support its social purpose. Earned income is revenue that’s received in exchange for products or services.
2. Social enterprise should participate in the Experience Economy. More and more, consumers are paying top dollar to have unique experiences. Non-profits should consider eco-tourism, travel, direct service opportunities, and experiential events as new fundraising mechanisms.
3. Don’t take on business models that have been rejected by the private sector. In the age of eBay, we don’t need another thrift store.
4. Consider other audiences for our organization. Too often, groups dismiss social enterprise because the people they serve can’t afford to pay.
5. And finally, don’t start a non-profit, start a social enterprise that can make money and then fund charitable pursuits. Starting a business is far, far easier than starting a non-profit. All of the forms, legal information, reporting, and liability with a non-profit added to the super-saturated market for non-profits is reason enough to concentrate on social enterprise.
What are your thoughts? What will the future of the nonprofit sector look like in four years, ten years or twenty years? Retweet/Share. Leave a comment below and share your thoughts.
Study: Nonprofit Burn Out. 75% of non-profit executive directors plan to leave in the next 5 yrs. (Some work 3 jobs.)
http://np2020.org/ Non-profit 2020. Engaging emerging leaders in a discussion on the latest reports on the leadership deficit.
Nonprofits of the Future, a discussion on Social Edge