Since the days of the dinosaurs, nonprofiteers have debated the age-old question: Should you run your nonprofit like a business? Well, maybe that debate began slightly more recently, but the point is, it’s a really good question. And thanks to our very own Jenny Slack, VP of Sales at Funraise, we now have an answer.
Jenny has walked in both the nonprofit and business worlds, so you might say she’s the Bo-Katan of nonprofits. Prior to changing lives with Funraise, she did fundraising and advocacy work with Invisible Children, and worked in the for-profit sphere, managing customer care and conducting trend forecasting. At the 2023 Nonprofit Marketing Summit (NPMS), she sat down to share insider tips to run your nonprofit as profitably as possible—and that starts by investing in the right technology.
“Changing the way you view technology will radically change your organization’s growth trajectory,” she affirms. “And Funraise is the number one convergent platform for growth-oriented nonprofit organizations.”
If you haven’t heard, with Funraise, nonprofits outpace industry standards by a lot. They grow online revenue 3x faster than the industry average, raise 2x more than the industry standard through P2P campaigns, increase online revenue by 73%, and grow recurring revenue 52% annually.
So, how can you adopt a business mindset, get the right technology, and take your nonprofit to the next level? It starts with knowing how to read the signs, asking the right questions, and getting a high-level overview of your technology investment. Watch the video below for all the details, or review the highlights below. Jenny, take it away.
First, ask yourself: Do you consider your organization a business?
You should, insists Jenny, and a lot of nonprofits don’t. “When we talk about the nonprofit as a designation, we’re really talking about tax status,” she explains. “It really means any revenue that you are raising is going back to serve the mission. And I highlight that to say that as a 501(c)3, as a nonprofit, you are a business.”
Repeat after us: Your impact is your product. Your mission is your customer.
The nonprofit approach vs. the business approach
“The [business] mindset will be really helpful for all sorts of operational decisions, but the one we’re focusing on today is specific to technology,” says Jenny. “It brings in a little more nuance.”
So, how does the nonprofit approach to buying software tend to differ from the business approach? Jenny breaks each one into three parts.
The nonprofit approach
“This is the pretty typical anatomy of a discovery call at Funraise,” shares Jenny. “We talk to someone who has some kind of problem: it can sometimes be pain they’re experiencing, like technology that feels clunky or outdated, or there’s data you can’t see or access. It’s creating friction in the administrative part of your job.” But, she adds, “The ‘problem’ can also be an opportunity. Maybe it’s pain you’re experiencing, but maybe it's also ‘Hey, we’re not taking full advantage of the technology that’s out there.’”
“Whatever the problem is, typically there’s a checklist. It’s either, ‘Here’s how [this other solution] works today and we want to see something that works similarly’ or ‘We really have an idea of all the bells and whistles we want.’”
Finally, we get to pricing. At that point, “We’re looking side by side and asking ‘Which of these is adequate to meet our checklist?’ and then ‘Which is the cheapest one that’s also adequate?’” Usually, cash-strapped nonprofits sign a contract for the cheapest option that checks the boxes.
“It’s a very logical process and covers a lot of what needs to be covered in a decision-making process,” explains Jenny. “But, I would like to bring you the mindset I see nonprofits adopting that actually helps them solve not just today’s problems but really set themselves up for success.”
Which brings us to …
The business approach
Successful organizations have a plan, and that starts with asking themselves: Where are you going to be in three, five, or ten years?
But, cautions Jenny, “I see a lot of nonprofits asking yesterday’s questions. And that’s not bad; it’s important to look at where are we, where is the market going, where is technology going, and what are some problems we haven’t solved yet? But … having a mindset that’s kind of trying to catch up is different from saying not just, ‘What do we need to do today?’ but ‘What is our vision? … What do we want to invest in now so that, as we grow, we have something to grow into?’
The same questions apply to your technology provider. It’s not just where are you going, but where is your technology provider going. Jenny adds, “What you don’t want is to be starting the process again in a year or two because you've had a lot of success and quickly outgrown your technology.”
Technology is “only as strong as your ability to use it,” says Jenny. That’s why you need an amazing team behind whatever technology you choose—a team of lifelong partners who are invested in your success and always pick up the phone. When it comes to critical issues or questions, will you be able to get through to someone? And beyond that, is there someone willing to help you strategize to ensure you’re taking full advantage of the technology? Jenny issues a challenge to every nonprofiteer reading this:
“My challenge to you is to challenge your technology provider: What are some concrete examples of support and how are the humans behind the technology making sure you get the most out of it?”
In other news, we were just reading about Funraise’s incredible 95% Customer Satisfaction Score (CSAT). Coincidence? You tell us.
“This is about shifting your mentality from a cost mentality to an impact- or investment-focused mentality,” explains Jenny.
Here’s the super simple example she shares: If you expect to raise $100k from a campaign and the technology costs $5k, your net is $95k. If you look at another technology and it costs $10k, twice as much, most assume that’s double the cost of the first technology. But it’s not if that new technology, tool set, and support enables you to make $200k rather than $100k.
“Then, the most expensive thing you can actually do is stick with the status quo,” says Jenny. “When you’re doing this calculation, you need to be thinking not just about that second line, cost, but that first line, impact.”
So, ditch the cost mentality and focus on the opportunity cost. Start thinking about software as an investment in your impact.
If you’re ready to start growing with a technology partner that looks to the future, download our handy 10-slide deck for a quick review of all the questions you need to ask to get the right technology and maximize revenue.
How does Funraise set nonprofits up to maximize ROI?
You want a technology provider that’s constantly building toward the future rather than playing catch up. You want to know that they’re innovating and experimenting and evolving, because that’s going to impact your ability to grow and evolve in the years ahead. At Funraise, we post our roadmap on our website and allow you to make suggestions, so you know what we’re actively developing and what we’re thinking about next. We have a vision that’s continually evolving to stay on top of new trends and technologies. For example, we’re the first nonprofit fundraising technology to leverage AI directly in our platform to increase efficiency and conversion rates.
One of Jenny’s favorite examples from Funraise comes from 2020. When COVID hit, many nonprofits had to pivot from live events to online ones with little notice. Our customer success team called down our list of customers and spoke to every single person they could reach. We asked them, “What’s going on and what’s your strategy? Did you know you have this tool set to take a more digital approach? Is it part of your strategy?” Funraise has a 110% net renewal rate, and this commitment to relationships is a big reason why.
Funraise is all about creating an outsize impact for our clients, and we have proof that we’re not all talk! Jenny invited one of our long-time clients, Wags and Walks, to join us at NPMS. Wags and Walks is committed to saving dogs from being euthanized due to overcrowding at shelters, and Chloe, the organization’s marketing and development manager, shared some of their many successes over the years—and how Funraise has helped them raise over $6 million.
“Our goal is to create the conditions for people to give and get involved, and the tools at Funraise allow for that,” says Chloe. “I really appreciate all the wonderful things Funraise has done over the years to help us be as successful as we have been.”
They’ve achieved things they never thought possible, like saving over 10,000 dogs, opening two new shelters in LA and Nashville, and nearly quadrupling annual recurring revenue.
The key takeaway? Changing the way you view technology will radically change your organization’s growth trajectory.
As a nonprofiteer, you want to make the biggest impact possible, and that starts with having the best technology solutions and human support. We hope we’ve given you a new way to look at buying and a path forward to implement some necessary changes. If you’re ready to think like a business and use technology to impact your bottom line, we’d love to chat.