The First Step in Developing an Income Strategy
Most nonprofits know where they want to go. Like New Englanders in January, everyone agrees, they want to go south. Likewise, your nonprofit knows your “south.” That is your mission, whether it is to improve the quality of the bay water, the readiness of children for kindergarten, or the lives of people with developmental disabilities. While you know the direction, developing an effective nonprofit income strategy demands that you stop and clarify the coordinates of your destination. After all, Miami, Tucson, and the Caribbean are south of Connecticut, as are Brasilia, South Africa, and Newark.
What, for example, does it mean to help people with developmental disabilities to live better lives? Your plans will be more fruitful, your execution swifter, and your community of support more supportive, once you develop specifics. It matters if you’re talking about housing, employment, family relations, or health matters. It matters if you’re seeking housing for young adults or seniors. Different destinations require different strategies. Each destination offers separate value propositions. Each value proposition appeals to different buyers (donors, governments, businesses, foundations) and thus infers different revenue opportunities, and (in case you were wondering where I was going with this!) different income strategies.
Would an example help? (Or, what!)
Your south is to help people with developmental disabilities to live better lives.
Destination and Likely Income Strategies Examples
- Young adults housing: Capital: loans, and grants | Operating: earned income
- Children therapy: Donations, supplemented with foundation grants
- Young adults employment: Mixture: government, corporate sponsorships, augmented by individual donations and earned revenue (for employed graduates returning for additional skill)
Choosing specifics allows you to walk a straighter line to it from where you are today to where you want to go. Clarity reduces meandering, false starts, and expensive misguided efforts. Yes, you will have to give up some options–and that may be painful now. But, in the long run, the best way to offer some of those options you have to give up now, is to focus. Once you master your crucial revenue stream and build a base, you’ll be a position to expand to other areas. Getting specifics demands deep thinking, as you evaluate different strategies and their consequences.
Today’s Challenge
With your “south” in mind, generate a list of all the destinations you might pursue. Next to these items jot down who, that is groups of people, who would value this outcome enough to put lots of money into the pot, helping you to achieve it. Congratulate yourself. You have taken a critical first step in developing a nonprofit income strategy.
To watch a video about the dangers of offering too few distinct destination options as you develop your nonprofits strategies, click here.
Need more help with developing your income strategy? Karen is available for a mini-consult or more to help you identify the best way forward, now. Click here to contact her to learn more.
