One of our goals at the Draper Richards Kaplan Foundation is to help grantees find sustainable long-term business/revenue models -- and this is a great primer for that dialog. There is a temptation, I think, in small organizations that are constantly plagued by fear of limited cash, to hedge bets and raise money in all sorts of (often frenetic) ways. This disciplined approach to identifying over time targeted revenue sources both avoids the opportunity cost of having too many revenue irons in the fire - collateral, staff and volunteers, ED mindshare - as well as forces a learning agenda/design-centric discipline for fundraising -- test and hone. A great read for EDs, fund development folks and all board members.
Article Excerpt: This piece does a terrific job of explaining the thoughtful path, which is full of trade-offs and hard choices, that growing non-profits need to take to find a sustainable revenue model. The 3 main points in the piece include...
Making the decision to prioritize the cultivation of a primary type of funding aligned with their program goals -- which means, of course, de-prioritizing less strategic funding opportunities.
Institutionalizing the roles and practices required to raise those types of funds over time, often making tough decisions about when to invest in development priorities over program priorities.
Evolving their funding approach over time which often required accepting short-term uncertainty and a commitment to long-term investments that might not bear immediate results.
The piece includes in-depth thoughts on each of these concepts, as well as a number of illustrative examples.