CHOOSING A FEDERATED NONPROFIT FUNDING MODEL
We recently hosted another thought-provoking edition of our Federation Leaders’ Knowledge Exchange. The exclusive event happens twice a year and brings together senior executives from some of our country’s largest federated charities and nonprofits. It’s a forum to discuss and share ideas, collaborate, and exchange best practices to improve capacity in the charitable sector. This time around, we focused on how organizations can choose the best federated nonprofit funding model. Choosing the right federated nonprofit funding model not only affects the financial health of an organization but its overall success and viability for the future.
Our panel of speakers for the evening included Meghan Reddick from Habitat for Humanity Canada, Kelly Grover from Cystic Fibrosis Canada, and Cheryl McClellan from The Arthritis Society. They shared how their funding models have evolved to reflect changes within their organization as well as the new realities of fundraising. Audience members joined in and shared their insights too.
As someone who has worked in a number of federated nonprofits over many years, there were three insights that jumped out as clear ‘a-ha’ moments for me. They served as a reminder of the complicated challenges and opportunities federated governance models inevitably produce. I’ve collected these tips to share with you today.
Three tips for choosing a federated nonprofit funding model:
- There is no one- federated nonprofit funding model -fits-all approach: Every federation should have a funding model that meets its unique organizational needs. Just as each organization has its own mission, it also needs a critically thought out funding model. Explore different funding models from across various organizations to pinpoint what might work for your cause. Weigh the strengths and challenges associated with them, then build a funding model that uniquely answers and works for your organization’s needs.
- Federated charities and nonprofits are legacy brands: Every federated organization has an origin story that should not be overlooked or forgotten. Its genesis will continue to permeate through your nonprofit and influence how it functions. Instead of trying to forget or move past it – acknowledge it, embrace it, and leverage it. Naming and recognizing your beginning will support all of your stakeholders through the change management process as your organization evolves its mission and the funding model needed to grow capacity for that mission.
- Evolving your nonprofit funding model takes time: While it may feel as though the world is changing exponentially around you, successful, positive, and lasting change takes time. It’s easy to get caught up in urgency, especially when you see other nonprofits making significant strides, overhauls, and adjustments. Don’t jump on the bandwagon, instead take your time to enact change within your organization. Think through the details of a funding model adjustment and be prepared to undertake the sustained continual effort needed to engage all of your stakeholders appropriately. One of your biggest strengths as a federation is the diversity of your stakeholders. Remind yourself (and them) about the time it takes to discover, explore, and implement meaningful decisions to create a lasting change that sticks.
When a federated charity that I worked for made the monumental decision to amalgamate, I remember feeling acutely frustrated at how slow I thought the transition was occurring. When I left six years later, my mind was blown that the process was still underway and had not yet been fully implemented. In hindsight, I now realize that a 12-way federation-wide merger cannot happen overnight – or even in a few years. Evolution is SLOW. Sometimes a slow pace is what’s needed to ensure the right buy-in and an organizational-wide commitment for a successful consensus-based union. In other words, if you work in a federated nonprofit that’s considering a new or adapted federated nonprofit funding model, be patient and don’t give up.
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