Note to self: Diversify Your Funding Base

An LA TImes article out today noted the woes of nonprofit organizations in New York City and elsewhere whose fortunes rested in the rise and fall of corporate philanthropy.  Highlighted in the article was a nonprofit hunger relief program that was immediately feeling the Bear Stearns failure both from the corporate losses and the laid-off employees.

Note to self: corporate money is good when you can get it but corporate money may not make a very reliable ongoing source of income.  Lesson from long ago: diversify sources so never too dependent on one source. 

The big question for many nonprofits going into a clearly declining (declined?) economy: is it too late to diversify?

Comments

[BrianK]

Here's another problem with corporate money, and in relying on that source of income:

Rent A Center Inc has been leaning on food banks in Ohio to leave a coalition that favors stricter rules on payday lending:

http://www.reuters.com/article/companyNewsAndPR/idUSN0127803320080501

The original WSJ article includes this quote:

"Ms. Goodman said in an interview that endorsing the anti-payday-lending coalition was an error and a violation of the food banks' own rules. "Nobody has put any pressure on us," she said. The Ohio Association of Foodbanks "would never support anything that isn't directly hunger related.""

Here's my question for you: what should nonprofit boards consider when approaching politically sensitive issues that don't immediately impact their operations? Clearly, many of the food banks' (indirect) clientèle are negatively impacted by predatory payday lenders, so an argument could definitely be made for joining the coalition. Any good socially responsible nonprofit should be doing more than sticking their finger in the dam, so to speak, so embracing more preventative measures is defensible. But where should boards draw the line?