All business industries have busts. The technology sector had the dot com bust in the late 1990’s. Next was the banking industry with the housing market bust in 2008. Now, the nonprofit industry is having their bust. The nonprofit bust is the usage of “measurable outcomes” to approve or deny grants.
When I was creating my programs for Dream Big Community Center, I had many people instruct me to have clear, consistent and impressionable measurable outcomes. As I smiled and nodded, I said “ok” without asking the necessary questions. Well, it didn’t take long before I was schooled with the terminology and definition. After my first grant was denied, I was informed on what measurable outcomes looked like and a couple of example nonprofits to use as a model.
A measurable outcome is the result of several micro-actions measured over time as a defining organizational result. The best example of measurable outcomes is in the nonprofit subset of education. These groups use(d) the completion of high school or graduation rate. It was obvious the higher the number or percentage the better the result. To have 100% graduation rate was indicative no one dropout or failed. The emphasis is on the organization helping every student graduate; because the underlying issues of the local demographics prevent on-time graduation.
Believe it or not, to create a new category of measurable outcomes was really hard. Initially, I used other nonprofits to avoid “recreating the wheel” or be considered an outcast. After a couple of years using our own data to plug into these categories, I was informed after several grant denials that our measurable outcomes weren’t substantive enough. Or in other words, they sucked! The feedback was our data wasn’t conclusive to our activities. Therefore, we needed to have a better correlation to the evidence we provided.
What I didn’t realize was the economic influencers impacting the philanthropic efforts of foundations, philanthropists, donors and government agencies. I remembered being denied by a professional grant writer that didn’t conduct businesses with startup causes. He said, “It doesn’t matter if it’s a $500k grant or $5k grant, it takes the same amount of effort. But in most cases, the $5,000 would be more work because startup groups don’t have the systems of a $500k organization.” His words of advice didn’t make a lot of sense to me back then, but his words began to sink in.
Once the housing market bust occurred, nonprofits began to drop like flies. Everything tanked. The stock market hit bottom. Government funding froze. Nationally to locally the “cookie began to crumble.” There was even a local foundation that closed their doors. As I learned how everything was working for me, I stumbled upon another grant writer informing me small start-up causes like mine are being overlooked because foundations are rescuing nonprofits that were subsidized by government assistance. The likeliness for grants would be minimal. Or in other words, startup nonprofits need not apply.
Social entrepreneurs were at the back of the line. My grind to focus on the business didn’t allow me to understand the funding strategies. The philanthropic market was responding to the immediate crises of keeping older organizations afloat. So as I continued to focus on the data we collected to be more “impactful” to our clientele—raw but had traction to our cause—grants were still denied. What I didn’t understand were the measurable outcomes were really for established nonprofits. Those established nonprofits had budgets of six figures or more. They had historic stories and were a pillar within in the community. Startup nonprofits were not the focus when in fact they should have been.
Some may ask, “Why is that?”
To answer that question, here’s a simple answer. Unfortunately, not all causes serve the needs they proclaim. To give context, let me use two famous sneaker brands for perspective. Adidas has dominated the soccer world. Nike has dominated the basketball world. Both are present in each sport, but some athletes prefer one or the other. Both can claim they are the dominant brand, but we as consumers will choose because it’s about preference.
In the nonprofit sector, clients weren’t able to speak about the preference. There isn’t a nationally recognized organization like Yelp to state you had bad service or experience. Nonprofits have made claims of serving and providing needs, but not truly doing as they say and clients refuse to use their services. Thanks to social media, blogs, and undercover media stories, we have learned these measurable outcomes aren’t necessarily accurate tools to determine impact.
I do believe there is a need to have measurable outcomes, but let’s be realistic. To truly have outcomes that make an impact, newer systems need to be applied. Technology has advanced all aspects of life, business and social realms, which is why I believe foundations are having to recreate their ability to judge whether or not an organization is worthy of receiving funding. I believe to solely evaluate on a measurable outcomes will no longer happen, because not every group uses a sophisticated system to track all their services and clientele. Therefore, the measurable outcomes emphasis will soon be obsolete.
I write this because my business is personal. My struggles are for your gain. No strings attached.
Nathan A. Webster, MBA