When something isn't working…

Stop doing it.

Some of may have noticed this blog has been on hiatus for the past six months. That's right, I took down a reasonably successful blog and just stopped, cold turkey.

Part of that was due to a long-term contract, but to be truthful part of it was due to a need to re-assess why I write it.

I've always thought that if your advice is worth anything, you should be able to take it yourself.

I started this blog to provide insight for you into the world of start-ups, which I define as any time between the day you think of starting a nonprofit or small business and when it first becomes self-sustaining.

The less altruistic motive was to generate serious clients that truly wanted to provide a service or product and make or attract money while doing it.

 

The blog did generate client interest, but not from the type of serious entrepreneurs and social-preneuers I wanted to help.

Instead, I was seeing a lot of people looking for a get-rich-quick scheme. Maybe that's a result of the hustler world we live in, but part of it was me.

You see, I honestly believed that there were a lot of people out there who wanted to experience the satisfaction of having built something with their own two hands, nurturing it and watching it grow.

I would provide the knowledge via consulting services and the nuts-and-bolts tools like grant writing, planning documents, and web and print content, and they would use them to move forward.

All right, all right, so that was naïve.  In other words, I misidentified the target market.

I just had no idea how naïve until I started the afore-mentioned contract. Without giving away any secrets, it was designed to monitor large societal shifts in attitudes. 

Suffice it to say, this blog was always for people that really want to do the work to succeed. But now it will ask you to demonstrate that commitment.

Here's where this blog is going from here.

Just how serious are you about succeeding?  We're about to find out.

The main content will only be available to readers that ask for it.  It will offer new content on a semi-weekly schedule on a subscription basis.  The topic will be teased before publishing, so you'll know what to expect. 

I still think there are people out there that fit my target audience, but I could be wrong. If, after 3 months, i.e. by September 30 , 2016,  it isn't proving to be viable, the blog goes away forever.

You don't need a grant writer to start a non-profit

Fully 50% of the calls or emails I get regarding my services involve a desire to hire me to help acquire funding for someone to start a non-profit venture or fund one that has just received a determination letter.

I'm flattered, but you don't need me to find you money, because neither I nor any other grant writer can "get" you a grant at that point in time.

The cold hard truth is there are zero grants available from either foundations or government agencies to start a nonprofit.

That's because true grants (money with no repayment required) have to be made to existing nonprofits. Legally, private grantmakers are prohibited by statute from advancing funds they receive or administer for charitable purposes to a for-profit or an individual.

In the case of  newly approved organizations, while it is technically possible for grantmakers to fund you, in practice that seldom happens.

Here's why.

Typically, every grantmaker will require  that you furnish them with a long-form 990 (the nonprofit equivalent of a 1040 or 1120) for at least the prior two taxable years. Some will even go back five years. They may also require audited financials or have a minimum revenue requirement that you must meet before you can even apply for funding.

Additionally, very few foundations or government agencies have rolling grant open application periods.  Thus, you typically can only apply at specific times, and the awards are actually funded as much as a year later. That means that you never have grant funds available at a moment's notice.

Grantmakers do not fund organizations. They fund programs that align with their interests and produce their desired outcomes. For that reason, they are very picky about what organizations they fund, and look for partners with a proven track record. Only about 1 in 10 grant applications submitted are funded.

Grants should never comprise more than 30-35% of your revenue stream, since they seldom if ever provide unrestricted funding, and almost never fund your normal costs of doing business, like utilities or rent.

In this 2012 report, on page 3,the National Center for Charitable Statistics (NCCS) reports that nearly 75% of all nonprofit income originated as fees for services paid by government and private businesses. 

In other words, you must find another way to fund your operations and programs 100% for a minimum of the first two years, and you must maintain varied income streams for the life of your nonprofit.

How do you do that?

The normal funding development progression happens like this:

·         Self funding – the board members either personally contribute the start-up funding or use their contacts to solicit funds from their business or social networks. BTW – don't state that donations may be tax deductible until you receive your determination letter.

·         Community events –think along the lines of auctions, car washes, bake sales, galas, sponsorships etc.

·         Social impact investors – although this option has not taken off the way the nonprofit industry hoped, there are still investor groups that are active in this field. Note that the funds received have to be paid back with interest, just like a traditional business loan or any other sort of angel financing. The investor's ROI expectations are typically within periods ranging from 90 days to three years.

·         Online appeals – Platforms such as GoFundMe don't require that you have nonprofit status to solicit funds. Other online fundraising options may or may not ask you to provide proof of status. There are fees and commissions involved so don't budget for gross donations. As an aside, the "Donate Here" button on your website will only generate a small portion of your needed funds until you have a track record and good outcomes to share.

·         Fees for services – for most nonprofits this is the largest single source of funds. Studies such as the one refernced above have concluded that from 60 to 75 percent of all nonprofit funding comes from contractual arrangements with government agencies or for-profit businesses.

What a grant professional CAN do to help.

Many grant writers, myself included, can and do provide research and development services to start-up organizations.

For instance I provide a feasibility service for would-be nonprofit founders. Think of it as a preliminary SWOT analysis as found in a business or more properly, a strategic plan. It evaluates such things as your mission goals, monetary support available for your mission and any other competitors working in your field, both for- and non-profit.

I can't possibly stress enough that you need to have at least a basic plan before you even apply for your nonprofit validation from the Internal Revenue Service.

In essence and assuming that you are just in the planning stages, a well researched and prepared strategic plan provides a step-by-step organizational development roadmap, as well as a series of benchmarks that allow you to evaluate your progress.

When I produce (with your input) a full strategic plan, it will cover such things as setting up your initial budget, based on operational and program costs for the first two to three years, whether to apply using the 1023EZ or the full 1023 application form, board development, what type of state corporation you need to form (a step required in advance of your 1023 application) and a brief overview of solicitation law affecting your fundraising. If desired, it may also have a mission development section that defines not just what your mission will be, but what programs and how much money, property  and manpower will be needed to produce your desired outcomes.

I hope this gives you a brief glimpse into world of non-profit financing.  Feel free to contact me at 208-525-2071, or email me at rightwords@ida.net if you have further questions.

Long-form thinking in today's short-form world

I've written a lot about having a cogent strategy when you start a new nonprofit or small business. I'm beginning to think that the market for that advice is as dead as a fossilized woolly mammoth.

  

I get that in the age of information overload, you have about 7 seconds to capture your target's attention. I've written my share of SEO-friendly 50 character action posts and catchy sales pages.

All that's fine, well, and good, as long as there is some actual thought behind your hastily thumbed tweet.

The problem is that it seems as though our brains are now in permanent short-form mode.

Recently a twenty-something wanna-be nonprofit founder/entrepreneur asked me to come up with some content for their Twitter feed. As she put it, "something that will show people we care about "X" and need their money to help."

So I did what any consultant would do…I asked her to outline her value proposition or mission and vision statement so I could better represent her organization.

She didn't have anything, beyond the idea that if she could separate enough people from enough money, she could "help."

No budget, no program/product outline, not even a firm idea whether she wanted to be a nonprofit or a for-profit with a philanthropic division.

Her reasoning?  She did know that it takes money to make money, and she didn't have any, so she figured she'd get the money first and figure out what to do with it later. 

I'm not sure if she was simply naïve or she'd gotten her hands on some really good weed, but that ain't gonna cut it.

Maybe it's old-fashioned, but believe it or not, people actually want some substance available before they invest in anything.

 

If you want other people's money, you have to provide value.  It's just that simple.

As boring as it might be, you have to have a plan, objectives, results and at least some understanding of why people purchase or support anything.

In short, this business thingie is a lot of real, brain-busting hard work.

Hopefully, there are still people out there that can think in those terms. 

How does your small business find employees?

Recently a friend called me to ask if I had any leads to help her find a part-time administrative assistant.

Julia (not her real name) said she had posted an opening on the state employment office's website, but after three weeks, only one qualified applicant had applied. She did not want to use one of the many private employment firms, feeling that the extra 2-3 dollars an hour they pocketed for their service didn't reflect the value of the services they offered to manage just one employee.

In a town of just over 50K with a well-respected technical college that seemed odd. I decided to look for her posting.

I discovered that the heretofore in-house state managed job listing had been turned over to one of those internet-based job posting firms. A call to the local state employment office netted me a referral to the website.

First of all, I couldn't find her posting through the keyword search function, using "administrative assistant". Only when I used her specific business name did the listing finally appear. Predictably, the posting was titled "Office help wanted". At no point in the posting did the words "administrative assistant" appear.

Interestingly, the posting did show up on Glassdoor and Indeed using the keyword "office". The information did re-direct to the state sponsored website, leading me to wonder why only one person had managed to navigate through the maze to actually reply.

I surmise that most of the people looking for work locally weren't using these sites to search for openings. Typically, local employees tend to use local searches, like the employment office or newspapers.

That points up the problems with our keyword and SEO oriented age.

If the person searching isn't using the same descriptors you are, you might never connect.

I referred Julia to the local college employment office, and had her re-write her ad so it would search more effectively. I also suggested that she run a help-wanted ad in the local paper, since it has both a print and online presence, and that's where she finally found her new employee.

After revising her ad, she received over 50 responses, and of those 50, almost half were well-qualified for the position.

In all of this research, I did notice that there were almost no truly small businesses using the new state job search resource. Most of the listings for openings were from government or large institutional or retail employers.

That leads me to wonder whether there is truly a "shortage of people that want to work" or  is it that they can't find each other?

So I'm asking…if you are a truly small business owner (25 employees or less),  where are you looking for employees, and how much success are you having finding them? Email me here or post in the comment section and let me know. Perhaps there's a way to make this easier and more effective for everyone.

Addendum:  If you are looking for work and can't find openings in your town, feel free to contact me as well. Where are you looking, and why aren't you connecting with employers?

Maybe you should market to a goldfish.

READ THIS NOW TO GET MORE MONEY.

In this age of self-taught ADHD, marketing needs to be read, absorbed and acted upon in just 8.25 seconds, or ¾'s of a second shorter attention span than that of a goldfish.

For instance if you are still reading this, it isn't because the cute headline caught you. Indeed, your brain probably only registered these words:

"Read this" and "more money."

Or so says an oft-quoted study by Microsoft. Considering that pre-social media, i.e. back in the dark ages of the 1970s and '80s it used to be 12 minutes, it's no wonder that long form marketing isn't working.

If your appeal or sales pitch (depending on whether you are a nonprofit or a for-profit) can't compel the reader to stay long enough to read your whole pitch, and most especially if it doesn't promise a reward for that reader, it's going to join the rest of the internet trash PDQ.

All that assumes that your target market is people under 40.

High-end appeals are still being read by people who are old enough to be able to read more than 140 characters.

If that's your market, then you may want to take this advice with a grain of salt.  Nonprofits in particular often eschew modern internet marketing trends because their audience tends to be older.

Why?  Because they're the ones with money. Unfortunately, many of them have picked up their kids bad social media habits, so a tweak here and there could be in order. 

It all goes back to the same basic marketing premise. Know your audience and target your message to it.

That's not to say that once you capture a reader's internet attention they won't stick around for a minute or so. But in the world of instant gratification, if they haven't clicked through to buy or give to something in that length of time, you've pretty much wasted your time.

Think about overhauling your sales approach. You really will make more money.  

Do you use sales funnels in your fundraising?

I asked a prospective nonprofit client that question.  She replied "what's that?"

In its simplest traditional business sense a sales funnel is a parameter for identifying the customer or target market that is most likely to be interested in what you are selling.

The value of using it is that it produces more sales for less initial investment in marketing.

Here's an example of what happens when you waste time and money on a campaign that doesn't adequately define a market.

Bill, a very well-to-do businessman, was approached by a nonprofit as a part of their major donor development after he was mentioned in an article as being interested in helping to provide food for needy people in his town.

The nonprofit's mission was to send food to starving people in Africa.

He responded politely to the letter by indicating that he had no interest whatsoever in feeding people in Africa while children, the disabled and the elderly in the United States are going hungry every night.

That should have been the end of it. They tried, he refused, end of story.

Instead he began to get letters and even phone calls asking for his support. After a year or so of that, he hopped on his jet, went to their headquarters and deposited a stack of mail and phone messages on the receptionists desk, with a not-so-polite note to take him off their mailing and call lists or face the consequences.

The problem was that the nonprofit qualified him simply because he was, well, rich and had an interest in feeding the needy.

All that did was to cost them a lot of money and time and made an enemy out of him.

The sales funnel, i.e. their parameters for qualifying major donors for further development was both overly broad and poorly maintained.

It doesn't matter if you are selling cars or a mission proposal…it behooves you to target your efforts to people who are likely to buy what you are selling.

In general, if you are sending out general appeals, monitoring your response ratio for both quality AND quantity and distilling your mailing list or media campaigns down to the essentials will serve you far better than just buying a mailing list. It also helps if your staff takes the time to really read any personal responses they get.

Cross referencing the donations against your contact or mailing lists can save you a lot of money and time, not to mention improving your response ratio from the customary 1 to 3% up to 20% or more.

Grants that are meant to produce tangible outcomes

Those who follow me, both here and on my other blog know that I am a supporter of a diversified educational strategy.  STEM is great, but someone has to build and run the machinery and use the stuff engineers dream up!

It won't do a lot of good to get more manufacturing and assembly jobs back into this country if  we don't have anyone trained to do them. Not to mention the fact that working with your hands as well as your brain is good for the economy, good for your personal financial situation, and may give workers a reason to pursue other education to progress up the career ladder.

Today's manufacturing jobs are not those of the mid-20th century, and often blend in well with more formal STEM educational goals.

Personally, I find that payng for a kid to go to college to "find themselves and their life work" is both fiscally and socially irresponsible, particularly given the dismal report of the emotional readiness of students to enter college.

If I had my way, every person would have to work for two years before they even considered college.

That's just me, but hey...I'm entitled to my opinion too.

To that end, I highlight grant opportunities that fall into that arena, and here is one that fits. To give credit where is is due, this came to my attention through Grant Gopher, and the lead paragraph reads like this:

"Nuts, Bolts & Thingamajigs awards grants annually to trade schools and community or technical colleges capable of hosting a summer camp program for girls and/or boys ages 12-16. Summer camps have been a successful way of introducing middle- and high-school students to the fascinating, high-tech career choices available to them in today's automated manufacturing industry."

The website is http://www.nutsandboltsfoundation.org.  It doesn't offer tons of money, but it could be a good fit for their target partner demographic. The closing date is November 15, 2015. You can visit their grants page at: http://www.nutsandboltsfoundation.org/camps/grants/