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Corporate concepts in Non-Profit – part 1 May 24th, 2014

Written and compiled by Banu Raghuraman

The opinions are those of the author and do not necessarily represent the official views of Endeavour.

Jason Shim

We reached out to Jason Shim for some thoughts on how to incorporate for-profit concepts in the non-profit sector. Jason, as the Digital Media Manager, oversees the online presence of Pathways to Education and explores how technology can be used to in innovative ways.

What are some of the limitations of borrowing corporate concepts and applying them to the not-for-profit sector? Can you give us some examples?

When starting up a small business, one of the key factors that is taken into consideration is the investment of time and money and the eventual profit that may be made. In comparison, the start-up of a small NFP is often the result of grassroots volunteers who are passionate about an issue in their community; the equation is a bit different. The return in this case is for the greater good of humanity and requires a different kind of thinking when considering how finances are sought out and managed. It’s not as simple as taking out a loan for your initial operating expenses and paying it back over time. It’s a matter of applying for grants, fundraising, and coming up with creative ways to raise money.

In general, the concept of investing in innovation and assuming risk can be simpler in for-profit corporations. In a NFP context, organizations must carefully balance their investments in marketing and innovation with the funds that are directly serving their mission. Dan Pallotta speaks about this at length in his TED talk and his book, Uncharitable. While I don’t agree with everything he says, I think he does raise an important point around the challenges and perceptions around funding non-profit innovation.

Stay tuned for part 2 for the interview.

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