scale your nonprofit

Five Low-Cost Ways to Scale Your Nonprofit

Scaling your nonprofit means increasing the impact you have. Every nonprofit wants to have more impact, but finding the needed resources and staff is challenging. Here are five low-cost ways to scale your nonprofit, borrowed from the for-profit world. Which might work for you?

Franchise Your Nonprofit

Franchising doesn’t mean morphing into McDonalds. It does mean making your nonprofit easy to replicate in another city, county, state or country. By simplifying and documenting your products, services, and procedures, you make it possible for others to create new versions of your nonprofit.

The cost for franchising your nonprofit is mainly staff time in creating repeatable and successful products, services and procedures. You should be doing that anyway, shouldn’t you? Beyond staff time, you’ll need to perform market research to find places where your franchising can succeed.

Partner With Other Nonprofits

Partnering means sharing and cooperating for mutual benefit. Partnering can give nonprofits access to new products, services, clients, and funders. Ways to partner include

  • Referring clients and donors to each other.
  • Distributing each other’s goods and services.
  • Jointly bidding on work and responding to requests for proposals.
  • Banding together for fundraising.

The cost of partnering is mainly the cost of establishing and maintaining the relationship. It helps to assign relationship managers and agree to goals for the partnership. You may encounter some legal fees related to intellectual property and revenues associated with a partnership.

Merge With Another Nonprofit

You can scale your nonprofit and its impact by growing your organization. One way to grow quickly is by merging with another non-profit.

Two similar nonprofits can merge to gain efficiencies and economies of scale. For instance, two food bank organizations can merge to share back offices, warehouses, and distribution vehicles.

Two complimentary nonprofits can also merge. Say one nonprofit finds housing for homeless people, and another provides mental health counseling to the homeless. Merging can create new efficiencies and synergies in serving those who are homeless.

Merger costs are mostly staff costs in working out the deal. You may have outside consultants for legal, financial, and branding issues. There may be transaction costs in consolidating real estate, assets and personnel.

Offer Open Source Content or Solutions

Open source means offering the ingredients or processes of your goods and services to other, for free. They are able to recreate your goods and services, and to modify and improve them. The open source ethos asks that modifications and improvements also be made freely available.

Open source is very common for software and the internet. There’s no reason why the same approach can’t apply to nonprofit products and services. Read more about open source.

At first, the work of open source focuses on making your goods or services easily replicated by other people. Beyond that, open source has three main costs:

  • Establishing a distribution mechanism. These days, this is likely an internet site.
  • Establishing a community forum, where people can discuss using and modifying the goods and services. This forum is also likely part of an internet site.
  • Promoting the availability of the open source items and the community around them.

Creating and staffing the internet site and forum for your open source project isn’t that expensive, at least to start. Promotional budgets are as big as you want to make them, but can’t be ignored. There’s no sense in being open if no one knows about it.

Adopt a Freemium Business Model

You may not know the term “freemium,” but you see it every day. It’s the business approach of offering a free service plus making add-ons available for a premium. Free + premium = freemium.

Major internet companies such as Facebook, Google, LinkedIn and Yahoo offer free services plus premium add-ons.

Nonprofits can also use the freemium approach. Free items you can offer online include

  • Data sets.
  • Publications.
  • Evaluations.
  • Calculators.

The costs of offering free goods and services are minimal. They are mainly distribution and promotion costs, especially if you are reusing existing materials to create free materials.

You have options regarding what premium add-ons you offer. Premiums can include

  • Access to more historical or in-depth data.
  • A copy of the full publication, where the free version was a summary or introduction.
  • Subscription to upcoming data or publications.
  • Professional services based on the results of a free evaluation.
  • More extensive or personalized report from an online calculator.

The revenue from add-ons can more than offset the cost of offering free items. In fact, that’s the point.

Scale Your Nonprofit

These five methods may not require a large cash outlay, at least to start. That doesn’t mean these are easy projects to pursue. All require ongoing and thoughtful effort from multiple members of your organization.

Not every method here works for every situation or nonprofit. Your nonprofit might be strong in goods and services that can be franchised or made free or open source. Another franchise might have great relationships that lead naturally to partnering and eventual merger.

Either way, be on the lookout for how one or more of these methods helps you grow your impact.

Looking for help in increasing your impact? Contact me regarding marketing services to motivate your clients, funders and staff.

(Image courtesy of Flickr)

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