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Thought Leadership

3 Lessons from the Great Recession

March 26, 2020 by joshjacobson

Hello Charlotte, how is everyone doing? No, I mean it. Are you doing okay? I hope you are.

This post is meant to make you feel better, so I’m going to state that on the front end. All of us at Next Stage remain bullish on where our community is going long-term and want to shed some light on what is happening right now.

The downward trend of the stock market in recent weeks gave me a funny feeling in my stomach that reminded me of another time in my life. I moved to the Charlotte area and found myself working for a local consulting firm for nonprofits in my fourth month on the job when February 2009 hit. The stock market crash that month sent our community hurtling. By April of that year Wachvoia was acquired by Wells Fargo and it felt like the end of the Charlotte world. It was the start of the Great Recession, and it was my introduction to crisis management for nonprofits. My current career really started then.

The next few months were sort of crazy. Nonprofit organizations went into full-on freak out mode. Most organizations ceased any sort of strategic planning or capital campaign activity. Some moved quickly to lay off employees deemed non-essential. Others took a “wait-and-see” approach that included dramatically curtailing programming, operations and fundraising activities. As the Great Recession dragged on, many of us in the consulting space learned the basics of nonprofit mergers and integrations. I remember a local leader at the time predicting that fully one-third of nonprofits would need to merge with a stronger organization in order to survive.

Fast forward a few years and… what? Did nonprofits fold in record numbers? Did the Great Recession set Charlotte back from a social good perspective by a decade or more? Was it the bloodbath that was predicted?

No. None of those things happened. In fact, Charlotte’s system of nonprofits largely rebounded and quickly. And yet, there were still nonprofit leaders in 2011 and 2012 blaming the Great Recession for their organization’s lack of recent success. It became a convenient excuse years after the worst of the Recession had ended.

Working for another firm at the time, I wanted to understand how we had survived such a rocky time in history. It was clear some organizations had fared better than others and my assumption was that innovation must have played a role. I called it the Charlotte Nonprofit Innovation Study, a grandiose completely unfunded and under-resourced investigation into WTF happened. We got some graduate students from UNCC Charlotte to help us and I enlisted my colleague Ally Yusuf to dig through the 990 forms of a representative sample of 150 local nonprofits. We studied 60 data points across five years of 990s (2007-2011) to identify organizations that fared best during the Great Recession and those that underperformed.

Here are the key takeaways:

  • Charlotte kept giving. One of the bigger findings was that charitable giving in Charlotte did not take a very big hit in 2009. There was a modest dip in giving (less than .5%) in 2009 over 2008. But in 2010, there was more giving than in 2007, a year that was considered by most the gold standard for giving in our community. And by 2011, our representative sampling of organizations was raising millions more than they had in 2007.This was a particularly interesting data point as we deliberately included the United Way of Central Carolinas (UWCC) in our data set. For those who were not around then, UWCC had fared the worst as the Great Recession set in, raising 50% less than they had in their largest years. Having taken a $20 million loss into our assessment, it was amazing to see the generosity exhibited by our community.
  • The organizations that fared best were those with strong marketing and fundraising engines. The organizations that cut back on their resource development teams fared worst. The organizations that were still complaining about the Great Recession in 2012 tended to be the organizations that had temporarily laid off the only staff members focused on constituency growth and revenue development. And that trend included safety net and other organizations alike.
  • Best practices work. We hoped to find a smoking gun of innovation that suggested survivability was linked to fresh, new ideas that would lead to a set of dramatic new learnings for our community. I mean, we called it the Innovation Study for gosh sakes. And instead? Boring old best practices. The organizations that thrived invested in marketing and relational fundraising when others pulled back, fearful of being out-of-step with the community.

The data suggests that the organizations that thrived essentially took market share from the organizations that did not. While there was more charitable support put forward in the years after the Great Recession hit, the organizations that thrived grew substantially. It became a very clear “haves” and “have-nots” situation. The data was sort of stunning.

It is said that insanity is doing the same thing over and over and expecting a different result.

So here we are in 2020 facing a similar and yet quite different event. Unlike the Great Recession, which took months to slowly reveal itself, we have all been dramatically introduced to the new normal in spectacular fashion. We are having a moment. Pundits suggest that the stock market will roar back to life once we tame this virus, and I certainly want to fan the flames of that sort of thinking. But while we hunker down in our homes, I see people struggling and in need. I’m observing people trying to figure out how this disruption will play out in real time. Main Street is struggling as Wall Street yo-yos. It’s that funny feeling in my stomach again.

As a firm, we have jumped in the deep end on community response because we feel it is our duty to do so. We want to be a stabilizing force, sharing our insights and working shoulder-to-shoulder with our partner organizations who were mid-stroke on moving forward ambitious agendas. We also understand the crisis leaders are struggling with and aim to make sense of the chaos with them.

Looking back to the Great Recession, we think there are some important learnings there. I hope we can learn from our past mistakes.

Image Copyright : solarseven

Filed Under: Planning & Implementation, Resource Development, Thought Leadership

The New Normal

March 23, 2020 by nextstage

Early last week, life in Charlotte turned upside down as businesses, nonprofits and families rushed to adapt to home-based digital life. Many of us are homeschooling kids, figuring out how to have virtual board meetings (anyone else doing the ZoomMullet?), calculating our TP stock and working to make sure the most vulnerable among us have what they need to weather the crisis. 

By the middle of the week, we started receiving questions from local nonprofit leaders. What are grassroots organizations doing to stay engaged with their constituents? How do you host a virtual board meeting? Will funding be available to support nonprofits? How do we continue messaging our mission when everything is COVID-focused? 

We don’t have all the answers – we’re honestly not even sure what next week will bring. But we are certain that this community has the courage and fortitude to continue moving our missions forward, because they are more important than ever before. We also believe that our community needs time and space to gather, share ideas and learn what is working from our friends in the nonprofit community.  

Beginning this Friday, March 27, Next Stage is hosting a series of 30-minute, online roundtable discussions called The New Normal. Each roundtable will feature several local nonprofit leaders sharing what they are doing to navigate a specific area of the crisis, followed by time for questions and discussion. 

Our first roundtable topic will be “What’s on Your Mind?” featuring Don Jonas, Executive Director of Care Ring; Banu Valladares, Executive Director of Charlotte Bilingual Preschool; and Shannon Binns, Executive Director of Sustain Charlotte. They will discuss the questions and concerns that have been top of mind for them over the last week, as well as how they are navigating short term challenges and changes. 

Register for free and join Charlotte’s nonprofit community as we learn to navigate The New Normal. 

Filed Under: Thought Leadership

A Guide to Social Distancing for Nonprofit Program Staff

March 18, 2020 by nextstage

Now that we’re all on board with social distancing, many of us are starting to settle into a new routine (can we call it a routine yet?) of working from home. Here at Next Stage, we are hosting conference calls, navigating technical challenges and connectivity problems on Google Hangouts, and trying to manage the competing demands of our coworkers and families.

But there are so many people still at work out in the community: grocery store employees, healthcare providers, police officers and firefighters, just to name a few. Many companies aren’t structurally able to transition to remote work – and others simply can’t afford to.

Nonprofits vary widely in their ability to operate remotely, and we know that many are working hard this week to restructure programs and augment activities during this time of transition. In the midst of all of these changes – economic instability, growing unemployment rates, increased home education and childcare needs – we know that our nonprofits are often the frontline of support.

So in the age of social distancing, how should local organizations think about shifting their programmatic priorities to meet the changing needs of our community?

We are in the thick of it ourselves, anticipating the changes we will need to make over the next few weeks to ensure CULTIVATE can pivot to meet the immediate needs of our cohort while still achieving our goal of helping them build long-range strategic business plans. Here’s how we are approaching changes to program implementation in the age of social distancing:

1.    Protect Your People

As of today, the general consensus is to follow Mecklenburg County guidelines: gatherings of more than 50 people have been prohibited, a State of Emergency has been declared, and residents are expected to follow everyday prevention practices to avoid getting sick. Our first priority should always be our people – our colleagues, our volunteers, our families and our communities. It is in everyone’s best interest to follow recommendations related to social distancing until we are able to reduce chances for community transmission of COVID-19.

We have seen organizations and businesses postpone in-person programs and volunteer opportunities and pivot to services that accommodate social distance – using drop-off or pick-up methods to provide resources while reducing in-person interaction, transitioning to virtual meetings for human services support, and creating new online platforms for engagement.

Before anything else, we recommend taking a step back to ensure that your organization is doing everything it can to protect your people. We know it can be tempting to run at the big challenges right away, but our community will be stronger and better off if we give ourselves the chance to breathe, adjust to our new reality and make sure we are taking care of one another. Once policies and procedures are in place that help volunteers, staff and participants stay safe and healthy, nonprofit leaders can start to think creatively about the future.

2.    Assess Changing Community Needs 

As this situation evolves, it will be critical to understand how your constituents have been impacted by economic and community shifts. When appropriate, reach out and ask for feedback to understand what has changed and where new priorities have surfaced.

The CULTIVATE curriculum introduces our cohort to the Community Needs Assessment – an exercise meant to help leaders understand the scope of need within their mission focus area and where they fit within a broad system of resources. It is safe to assume that community needs within most focus areas have changed since just one month ago, and regular checkpoints should be established to keep your nonprofit’s programming informed and responsive

3.    Adjust Accordingly

We’re in uncharted territory right now, with the perfect storm of the Coronavirus pandemic and economic downturn looming on the horizon – and the reality is that there are not really any established best practices on which to rely. Next Stage is here to remind you of the intrinsic strength that exists within the individuals on your team – your volunteers, your leadership staff, and the people who are served by your programs. Tap into that strength to understand how to pivot and give yourself the grace of time to figure out what comes next. We are here to help. 

For additional support, please check out the following groups who are coordinating resources to help nonprofits continue to provide needed programs in the community: 

Apparo – Local IT nonprofit Apparo is hosting a free webinar to help nonprofits adjust to remote work. More info can be found here: Ensuring Nonprofit Remote Work Success (A Virtual Q&A)

Charlotte Community ToolBank – The Charlotte Community ToolBank will happily provide tables, chairs, tents, and other equipment free of charge to those responding and directly supporting the COVID-19 pandemic. If your organization is providing free lunches, sorting food for families practicing self-isolation, staging pop-up testing sites, etc., and has a need for our equipment, please call us at 704.469.5800. We are here to help!

CLT COVID-19 Resource List – A grassroot coalition of community leaders, including Stefania Arteaga and Comunidad Collectiva, Tyler Miller and For Charlotte, Tina Marshall, Kass Ottley, Gemini Boyd and others have created a living document of resources and ways to help. To add resources to this list, contact us and we will put you in touch with its editors.

SHARE Charlotte – SHARE Charlotte is launching #SHAREFromHome, a new platform that empowers the community to do good while practicing social distance. For more information and ways to get involved with local nonprofits, check out the SHARE From Home website.

Filed Under: Thought Leadership

We’ve Got Your Back

March 16, 2020 by nextstage

You’ve received a ton of emails and read a number of blog posts informing you of the many ways companies plan on handling COVID-19.

This is not one of those blog posts.

This communication is about you. As a champion of social good, you are an incredibly important cog in a great big machine that ensures our community does not fall apart amidst a crisis. And make no mistake, we are in crisis. We need you now more than ever.

At Next Stage, we believe in the power of people to come together in meaningful ways, of our empathy and compassion for each other. It is the basis of the nonprofit construct. It is during times like these, when we are most tested as a people, that we can rally together in pursuit of shared goals. It is easy to be pro-community when times are good. We prove our mettle by what we do when times are less certain.

Over the next few weeks, we will be creating and channeling content on our blog and via social media (Facebook, LinkedIn, Instagram, Twitter) to help our community formulate strategies and put them into action. Our team is mobilized to serve as a resource and we encourage you to reach out to us. We are here for you.

Times may be tough, but we can overcome this together. Our thoughts are with you.

Filed Under: Thought Leadership

#NonprofitBookClub: New Power

July 9, 2019 by nextstage

When I started #NonprofitBookClub earlier this year, I hoped to use this platform as an opportunity to drive conversations and engage with others who are reading about nonprofits, community and social justice. In my last post, reviewing Winners Take All: The Elite Charade of Changing the World by Anand Giridharadas, I asked readers for book recommendations for my next post and boy, did I get some great ones.

The first recommendation we’re diving into for #NonprofitBookClub is New Power: How Anyone Can Persuade, Mobilize and Succeed in our Chaotic, Connected Age.

Written by Jeremy Heimans, founder of Purpose, and Henry Timms, Executive Director of 92nd Street Y, New Power is a compelling argument for individuals and organizations to embrace new values and models focused on collaboration, transparency and broad-based participation. Heimans and Timms have strong backgrounds in building new power movements – the former founded multiple organizations focused on public mobilization and storytelling, and Timms is the original founder of #GivingTuesday, a global campaign to encourage philanthropic acts.

Old power, according to the authors, is characterized by concentrations of ownership and control. Fortune 500 companies, top-down politics and currency are all cited as examples of old power – traditional approaches to how individuals and organizations accumulate and exercise their influence. New power is more like currents of water or electricity – open, crowd-sourced, and gaining strength through numbers. Increasingly, people and companies are responding to far-reaching cultural shifts in attitudes toward activism and social good by utilizing models of new power to grow their influence and achieve their goals. From a branding perspective, new power has become critical for fostering trust and buy-in from a more socially conscious consumer base.

Through CULTIVATE, Next Stage aims to help emerging leaders get ahead of subtle cultural shifts like the ones outlined above and build nonprofits that are positioned to succeed in a world in which technology and social media drive connection and engagement at scales far beyond traditional human networks. Modules focused on partnership and collaboration, volunteer engagement and online communication provide tools and resources that help cohort organizations create strategies to engage with the broader community and “build the army”.

Yet we continue to advocate – like Heimans and Timms do – for a combination of new and old power approaches (or, as they say, blended power). The combination of innovative or gamified platforms that encourage community-building, co-creation and authentic engagement with more centralized models of traditional support like a well-positioned board of directors are a recipe for nonprofit success.

It is no surprise that this recommendation came from our friends at Share Good – the umbrella organization behind Share Charlotte and its marketing campaigns like #GivingTuesdayCLT and #SummerShareCLT that benefit so many local nonprofits in our community every year. Their online community engagement platform is a great example of how local nonprofits are capitalizing on new power to grow their networks and acquire new volunteers and donors.

If you’ve followed the growth of movements like #MeToo, Black Lives Matter and Occupy – or watched with fascination as politicians like Bernie Sanders and Donald Trump or companies like Airbnb, Uber and Facebook have exploded in popularity (and, often simultaneously, scandal) – New Power is an eye-opening window into the strategies, values and approaches that have made them so effective in their efforts to scale.

The book has left me wondering – if new power is about harnessing the broad collective, how do the smallest, most deeply embedded nonprofits in our community access it? Does the ability to utilize approaches and values characterized by new power inherently require access to the existing social networks that were created by the structures of old power systems?

Next up, I will read Palaces for the People: How Social Infrastructure Can Help Fight Inequality, Polarization and the Decline of Civic Life, in which Eric Klinenburg argues that the future of democratic societies rests on our shared spaces: the libraries, childcare centers, churches, and parks where crucial connections are formed. I heard a great 99% Invisible podcast episode with Klinenburg, and am excited to read more.

Join in on Twitter and Facebook at @NextStageCLT!

Filed Under: Thought Leadership

#NonprofitBookClub: Winners Take All

March 21, 2019 by nextstage

Welcome back to the second iteration of Next Stage’s #NonprofitBookClub!

This month, we’re reading Winners Take All: The Elite Charade of Changing the World by Anand Giridharadas. I know – quite a bold title. But in the spirit of Josh’s column in the Biscuit, “Breaking Good,” Next Stage is sparking more bold conversations in 2019. What better way to do that than by reviewing a book that is about the challenges inherent in American philanthropy and the nonprofit funding model itself?

First of all, if you haven’t read this book yet (which was published in August 2018), it comes highly recommended. Winners Take All was suggested to me by a friend I know through Startingbloc, a social innovation fellowship that educates, inspires and connects emerging leaders to drive impact across sectors. Articles and videos featuring Giridharadas, a New York Times columnist, had been popping up across my social media platforms for years (if you haven’t seen it, his speech from the Aspen Institute’s Action Forum in 2015 is worth a watch), and I eventually got around to cracking open the book earlier this year.

The central question posed by Winners Take All focuses on the “new gilded age” of philanthropy, led by increasingly socially-minded business elites – do their market-friendly philanthropic efforts actually have impact on our nation’s entrenched social problems, or do they merely reinforce the status quo of growing wealth inequality and stratification?

It shouldn’t come as a shock to the reader, given the book’s title, that Giridharadas believes that market-driven philanthropy does not present real solutions to our most intractable challenges. In fact, he argues that “win-win” social change walks hand in hand with the perpetuation of a system that, by design, protects the same elites who position themselves as change-makers.

The book introduces us to a series of players in what he calls MarketWorld – including a former president, philanthropists, leaders from Goldman Sachs and McKinsey, social innovators and entrepreneurs – individuals and corporations that operate under the ethos of “doing well and doing good.” Through these stories, Giridharadas illustrates what he believes to be the incompatibility of their “extreme taking,” or the detrimental impacts of their day jobs, with their “extreme giving,” which he refers to as “virtuous side hustles.” What he’s saying is that the five-mile run they took this morning doesn’t negate the entire pizza they ate last night.

I see his point, but in my opinion, the more important argument presented in the book is about the growing centralization of this “change-making” within the private sector elite. Trendy market-driven solutions like impact investing and social entrepreneurism have shifted the onus of social and economic justice out of the hands of the public sector and government institutions, essentially handicapping our participatory democratic system. Nonprofits, Giridharadas argues in interviews about Winners Take All, must advocate for transformative change led by the public sector, advocating for systemic reform in place of charity, social enterprise and “doing good.”

These conversations could not come at a more critical time. According to a 2017 study by Prosperity Now and the Institute for Policy Studies, The Road to Zero Wealth, if the US racial wealth gap remains unaddressed, Black median household wealth will fall to zero by 2053, while white median household wealth is projected to rise to $137,000 by that same year.

Yes – you read that correctly. Zero. That takes a minute to sink in. In an era when we are perhaps more generous and charitable than ever before, disparities along racial and class lines continue to grow at an alarming pace. Something needs to change. But what?

My primary challenge with Winners Take All is that the book does a poor job of facilitating constructive discussion about solutions to these systemic fallacies. I did a bit of online research and found some emerging conversations about liberatory philanthropy and restorative investing – fresh strategies that reconcile philanthropy’s complicity in the systemic nature of wealth inequality. These justice-oriented approaches to the management and investment of endowments promote decision-making processes that restore equity. In other words, how do we get at the root of the problem instead of throwing our money at the symptoms?

Ultimately, liberatory philanthropy and restorative investing require a significant shift in the way we approach the role of capital and philanthropic institutions. According to Rodney Foxworth, founder of the Business Alliance for Local Living Economies, “the goal for foundations should no longer be to accumulate wealth… [but to] change their way of operating by redistributing wealth, democratizing power, and shifting economic control to communities.”

These localized approaches to social change – egalitarian, democratic collaborations and institutions that drive transformation from the ground up – are starting to show up in Charlotte in some really exciting ways. One example is the West Side Community Land Trust, Charlotte’s first land banking approach to permanently conserving our city’s affordable housing stock. Another is United Way of Central Carolinas’ United Neighborhoods Block Building Grants Program, which supports capacity-building for community-based organizations to lead comprehensive, resident-driven community planning in neighborhoods throughout Charlotte.

In Next Stage’s work with our nonprofit partners, we learn about new collective projects and justice-oriented “inside-out” efforts all the time. This gives me so much hope for our city.

Have you read Winners Take All? What did you think? Is there space in Charlotte for a deeper conversation about evolving the way we approach philanthropy and charitable involvement in our community into a groundswell of grassroots-led, authentic social change and reform?

Next month, I’m reading New Power: How Power Works in Our Hyperconnected World–and How to Make It Work for You by Jeremy Heimans and Henry Timms. Shout out to Kelly Brooks from Share Good for the recommendation. Please feel free to read along and join the conversation in April.

As always, if you have any suggestions for the #NonprofitBookClub reading list, please let me know!

Additional Reading:

The Givers: Money, Power, and Philanthropy in a New Gilded Age by David Callahan
Just Giving: Why Philanthropy Is Failing Democracy and How It Can Do Better 
by Rob Reich

Filed Under: Thought Leadership

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