Entries under “Blog”

The holidays are a time of year many of us feel propelled by our hearts and compelled to give to those of us who are not as privileged. In 2017 in the U.S., individuals, corporations, and private foundations gave a combined $410 billion to charity; according to Charity Navigator, 31%  of that giving occurred in December and 12%  in the last 3 days of the year. A tremendous amount of charitable support by any standards! Yet, the truth is that these funds (driven by good intentions) are often tied to economic cycles and tax policy, and too unstable or insufficient to meet our community’s needs.

For for a sector of our economy where we spent $410 billion last year, the question of how to do good in the world still seems under-discussed. Let’s make a resolution in the upcoming New Year to use our hearts and minds, and not only talk about doing good, but how to become better at doing good. Mission Throttle estimates the total amount of capital needed to fund our country’s social needs annually exceeds $3 trillion. I encourage you to continually learn about and seek out tools that help fill this critical gap. Whether you are an individual seeking to make an impact investment into a social enterprise that generates its own revenue, or a foundation curious about investing in capacity building to provide mission-driven organizations with critical infrastructure support, you are in good company among the many who are already pushing the envelope and seeking sustainable ways to fund social impact.

Ultimately, making the world a better place requires not only generosity, but a dedication to gain a better understanding of the problems we are trying to solve, and to constantly evolve the tools needed to give everyone a chance to succeed.

Have a blessed holiday season,

Phillip

Several members of the Mission Throttle team recently had the honor of attending the 2018 Starfish Trauma Summit: Building Resilient Communities. The summit sought to answer two questions that are especially relevant in Detroit, namely:

How can we create a community of strength and hopefulness that recognizes the prevalence and adverse impact of trauma on too many children, families, and communities?

How can we as a community of leaders help build trauma-informed, resilient communities that support healing?

During her opening remarks, the event moderator, Rochelle Riley, reminded us that “every criminal was once a child, just as every lawyer was once a child, and yes, even every journalist was once a child.” Children are often guided down divergent paths by the trauma they experience at a vulnerable age, rather than by deliberate choices. However, children can also be influenced by how the adults in their lives respond to and (hopefully) counteract that trauma.

The entire event was both informative and energizing, but I was particularly inspired by the keynote speaker, Bryan Stevenson.

I first encountered Bryan’s brilliance when I read his book, “Just Mercy,” in 2016. At that time, I was deeply moved by his first-hand experiences working to improve the U.S. criminal justice system and ban the death penalty. During his address at the Starfish Trauma Summit, I heard some of the familiar stories of triumph and heartbreak from his book, but I was reignited by hearing his sentiments through the lens of trauma-informed child care.

Bryan described four steps to enact change in our childcare and education systems, and to provide children with an equitable chance in life:

Get Proximate. “Many of our parents taught us to stay away from the bad neighborhoods,” Stevenson said, “but in order to appreciate the humanity of each individual, we need to make the effort to see our disadvantaged neighbors, to talk to them, and to connect with them person-to-person. Without close encounter, and even embrace, it is far too easy to create a perception of ‘them’ and ‘us’.”

Change the Narrative. Stevenson (who also initiated the National Memorial for Peace and Justice in Montgomery, AL) asserted that “the greatest crime of slavery was not the forced labor or even the brutal beatings and murders that slaves endured, but rather, it was the dehumanization of the black race and the propagation of white supremacy that persists even today.” He explained that in order to overcome racism, we need to first acknowledge and confront the continued, present-day impact that slavery has on our country. “Truth and reconciliation are consequential, he said. “We cannot make peace without first confronting the truth and our own culpability.”

Remain hopeful. Stevenson then cautioned against hopelessness, calling it “the single greatest weapon of oppressors.” He noted that “we can only maintain the strength to continue fighting for ourselves and/or others if we remain hopeful that the status quo can be changed.” This point was acutely appreciated in an audience containing so many educators and caretakers who had experienced recurring indirect trauma during their work with disenfranchised youth.

Be willing to do things that are uncomfortable and inconvenient. “To really make significant progress, we have to be willing to speak out, and to act out, against unjust systems and prejudiced sentiments, even those that seem immovable and unchangeable,” Stevenson continued. “For those of us who have been blessed to have wonderful opportunities for education, employment, and fulfillment, I believe it is our responsibility to do our part, no matter how big or small, to help ensure that vulnerable children are given an equitable opportunity to direct their future.”

Starfish Family Services is actively carrying out these four steps through their trauma-informed early childhood education and mental health services.

Starfish is dedicated to healing the effects of toxic stress on children who have experienced trauma. While learning to cope with adversity is an important part of healthy child development, undue exposure to conflict and fear can cause PTSD, similar to that which many military veterans endure. This toxic stress can occur when a child experiences strong, frequent, and/or prolonged adversity, such as: physical or emotional abuse, chronic neglect, caregiver substance abuse or mental illness, exposure to violence, and/or the accumulated burdens of family economic hardship—without adequate adult support. When stress occurs continually, or is triggered by multiple sources, it can have a cumulative (lifetime) toll on an individual’s physical and mental health. The more adverse experiences in childhood, the greater the likelihood of developmental delays and later health problems, including heart disease, diabetes, substance abuse, and depression. Research also indicates that early-life supportive, responsive relationships with caring adults can prevent or reverse the damaging effects of toxic stress response.

In 2015, Starfish Family Services enlisted the assistance of Mission Throttle to create a coordinated business strategy to scale several of its core service offerings. The strategies were focused on Starfish’s desire to promote early detection/intervention of mental health issues, mitigate barriers to health care access, and improve behavioral and physical health outcomes. As the project progressed, the vision evolved. It was soon evident that by creating a more integrated organization, Starfish was uniquely positioned to accelerate its core passion of creating resiliency for the children and families it serves.

Mission Throttle identified a host of opportunities for Starfish to accelerate the impact of its programs. Through a collaborative, user-centered process, Mission Throttle and Starfish developed the vision for a trauma-equipped Starfish. By incorporating mental health screening, referral, and treatment into all of Starfish’s Head Start programs, Starfish now creates opportunities for early detection and prevention of toxic stress. This comprehensive service offering demonstrates Starfish’s leadership as a forward-thinking and client-centric provider of early education programming.

Through innovative collaborations like Mission Throttle’s relationship with Starfish, we can begin to forge a strategy to counteract injustice in Southeast Michigan; however, the path to progress is not easy nor is it linear. Thankfully, Bryan Stevenson assured us that uncertainty should not deter us, as we will only discover the answers through proximity to our vulnerable neighbors.

With this encouragement, let us make haste to go out and work to build resilient communities!

Giving USA’s most recent report reflected a 2.7% year-over-year increase in US charitable giving. This growth was met with applause by mission-driven organizations that require donations to survive. However, the cost to address chronic social problems in the U.S., from poverty, to environmental sustainability, to public health, far exceeds available philanthropic funding by approximately $3 trillion. As a capitalist (and philanthropist), I believe in the adage “the way you finance your organization is the way you operate it.” If true, reliance on donations may perpetuate unsustainable habits and behaviors that ultimately prohibit nonprofit mission-driven organizations from effectively addressing pervasive social issues, and making a dent in “this philanthropic gap.”

Although donations are a critically important source of revenue, they are also episodic, unreliable and ultimately, not sustainable. For example, starting next year, millions of individual donations to nonprofits could be sharply reduced due to the new tax bill. Some estimates project that as few as 10 percent of taxpayers will continue to itemize charitable deductions on their returns, down from the current one-third.  Additionally, financing nonprofit organizations solely with donations often creates unintended consequences that can prevent scaling services for those in need, including:

1. Extreme vulnerability during economic downturns: During recessions, the demand for high-quality services increases, while donations decrease.
2. Stretched capacity: Organizations often stretch their capacity to apply for grants that do not naturally align with their programming, in order to qualify for this free capital.
3. Diluted entrepreneurial spirit: Management often focuses on what it will take to raise additional grant capital rather than develop creative earned revenue opportunities.
4. Subordination to expectations of donors: Donor intent often drives strategic development, rather than an organization insisting on its own expertise to effectively drive social impact.
5. Lack of commitment to impact measurement: Nonprofits are not normally held accountable for specific, measurable impact metrics created through donations, and therefore lack insight into the true effectiveness of their programs.
6. Uncollaborative culture: In an attempt to preserve and protect donor relationships, many organizations do not share strategies, programs and visions with others, even though it may result in greater impact on the community.

Now more than ever, nonprofits will need more sophisticated operations and programs in order to compete for the investments of selective donors. If the legal frame is lifted from a nonprofit organization, it is essentially a business – and like any business, it requires financial stability, unique programs, and a market-based approach to scaling. So how do we help nonprofit organizations achieve these best practices?

Many funders are increasingly providing capacity expansion grants. These grants are critical for nonprofits to improve their infrastructure, and explore diversified revenue streams including earned income, to improve funding predictability, autonomy, and resiliency. Forward-thinking funders know that sustainable revenue improves an organization’s financial self-sufficiency, which in turn, accelerates mission focus, innovation, growth, and ultimately greater ability to solve our nation’s social needs.

Before making a traditional program donation, funders should pause to think — is the capital you are providing capable of driving true social change?

“Capacity building.”

It’s a nebulous term. It pops up now and again, at conferences, meetings and in various interesting articles about the necessity and often scarcity of resources to fund expansion / growth within impact organizations.  Capacity building is not new. It is described by the Foundation Center and generally, as “a broad term that encompasses actions that improve nonprofit effectiveness in terms of organizational and financial stability, program quality, and growth.” These are not small feats. And yet, for all of their importance, not many of my impact partners and clients seem to be asking for this type of support.

I must admit I haven’t given much thought to this topic until now. I’ve spent the last 20 odd years in the private sector, providing financial advisory services to distressed companies. I’ve recently spent considerable time thinking about the role of capacity building as it relates to my work with impact organizations. In the private sector, the term ”capacity building” means funding R&D, IT, talent, continuous improvement, and often, the hiring of outside expertise to develop and implement such strategies. And yet, when applied to a nonprofit organization, capacity building seems to be a well-meaning abstraction, a catch-all, and often, a luxury. Why is funding these critical activities optional for any organization that wants to be successful?

 Donors and the nonprofits they fund seek to tackle increasingly complex problems from education and health, to community and workforce development, to global climate change. Collective impact on this scale requires, among other things, high-functioning organizations. However, these vital organizations generally lack the equivalent of a for-profit R&D team to propel this systemic change.  Not only are most nonprofits starved of financial capital, they often lack the human capital to be innovative and create widespread change.

Notwithstanding the incredible leadership and knowledge housed within nonprofits, these operating constraints (limited cash, tight staffing issues, and inadequate capacity) often hinder their ability to realize growth.  As a result, many brilliant nonprofit leaders are forced to be a jack of all trades, leaving little time or energy to scale their work and create increased impact.

I recently completed an engagement where within six months, my team successfully helped our client create a business plan and revenue model for a scalable social enterprise. The client received board approval to self-fund this important project.   Our team provided focus and expertise that would have otherwise been difficult to achieve.

There are, of course, no easy answers to addressing sustainability issues within impact-driven organizations but I offer a few thoughts:

 For grant makers:

• Be innovative. Think differently about what your capacity grants can fund – you’re investing in R&D and ultimately growth.
• Do your grantees have sufficient core support to execute their strategies? Capacity grants could provide for this external expertise.
• Capacity building is an investment in an organization’s future. These grants can be used to develop opportunities for scale and earned revenue, ultimately lessening the potential need for grants

For grantees:

• Be bold…ask for a capacity grant. Funders are often overwhelmed with program support requests and may likely welcome ­­­innovative requests. Step up and ask for an investment in the sustainability of your organization.
• Remember, you’re not seeking to operate as usual – you’re striving to be extraordinary.
• Provide a clear path to results. Identify and articulate the purpose of your capacity building, including the desired impact.

While these ideas may appear somewhat unorthodox, I firmly believe that unconventional thinking is necessary in order to address large-scale social issues.   Don’t be afraid to rise above challenging conditions if you have an innovative strategy you think will help your organization, now and in the future.

“What is now proved was once only imagined.” – William Blake