There was an article on Monday, November 11, 2013 in the New York Times discussing the idea of a NASDAQ type of market place for nonprofits. The idea came about when a woman who had founded a nonprofit, merged it with Livestrong (pre-the Lance Armstrong debacle) and subsequently went to business school. Her experience led her to the belief that “some of the most effective organizations struggle to raise funds, while some of the least effective charities are allocated millions.” (You can read the full article, Plan to Finance Philanthropy Shows the Power of a Simple Question by clicking here). The disparity bothered her and the light bulb went off.
According to the article, a Wall Street market place could bring $1 trillion to the nonprofit sector if just 1 percent of wealthy individual portfolios were diverted to this new system. It’s definitely an interesting idea, but I am not sure it solves the problem. Would it help the most effective organizations raise more money or would the economy switch to one in which the biggest organizations, or the ones with the best analysts or public relations would benefit the most? I know I sound cynical – I just can’t see how most nonprofits would be able to completely change their infrastructure.
Of course, I’m not sure that I would have thought Facebook or Twitter would be the successful businesses they are if someone would have asked me during their incubation.
In the meantime…
In the meantime, before this becomes the next big thing, let’s focus on what we can do right now to raise more money for nonprofits across the board.
Let’s start by becoming great fundraisers. Then, let’s make sure we have great fundraisers at every nonprofit. Let’s get development professionals to stay, on average, at jobs for more than two years so that they have the time to see the cycle of an organization more than once, develop good relationships and implement the changes that can improve the fundraising. Let’s make donors happy and retain their support for organizations for longer periods of time by making sure that they understand the impact they have made – even if they are giving at modest levels. In other words, let’s improve upon the model we have. And then, see if we can raise the $1 trillion.