Episode 135: The Strategy That Gets as Good as It Gives: The GiveBack Strategy
You don't have to start a nonprofit to make an impact in your community. Especially if you have a for profit business. The world doesn't need another nonprofit! Learn how to reduce up to 60% of your adjusted gross income (AGI) and make 3x the impact 3x faster--without starting a brick and mortar nonprofit!
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🔦 NONPROFIT SPOTLIGHT 🙌🏿
Mary Katherine Matalon Pt. 3
👉🏿https://www.linkedin.com/in/mary-katherine-matalon
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🚀 RESOURCES TO HELP YOU RUN A SUCCESSFUL NONPROFIT
How to Price Your Programs for Profit
https://fusion.amberwynn.net/product/how-to-price-programs-for-profit/
Questions To Ask A Grant Writer Before You Hire Them
https://fusion.amberwynn.net/product/questions-to-ask-a-grant-writer-before-you-hire-them/
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Learn more about my success with helping nonprofits
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Podcast Transcript
Speaker 1 (00:00):
Welcome to On Air with Amber Wynn, where nonprofit leaders learn to fuse passion and commitment with proven business strategies to create long-term funding impact and sustainability. And now here's your host and resident, Philanthrepreneur, Amber Wynn.
Speaker 2 (00:23):
Hey fam, it's your girl, Amber Wynn, Philanthrepreneur, and today I'm especially excited to announce my new thing that I'm doing. It's called the give back strategy. And the give back strategy is the strategy that gets as good as it gives. I'm so excited to share this with you. Listen, the world does not need another nonprofit. It does not, but philanthropy is broken. So what do we do? I have been thinking about this for quite some time and I think it's a brilliant solution. So when we come back from the break, I'm going to share with you the give back strategy.
(01:08):
Not sure how to price your programs or how to cover salaries. Are you scared to increase your program fees? If you're struggling to fully cover the cost of running your program, then you need how to price your programs for profit. This workbook provides step-by-step instructions for how to develop programs funders love to fund, determine the cost to charge for your programs and present salary costs in a way that funders will approve. Learn the secret formula I use as an executive director for how to fully cover program costs. Order your copy today. Hey, you're back with Amber Wynn. We're on air, and today we're talking about the strategy that gets as good as it gives and it is the give back strategy. Listen, philanthropy is broken. What do I mean by that?
(01:58):
Nonprofit leaders wear 17 hats. They're doing outreach. They're delivering programs, they're writing grants. They're executiving, they're networking, they're collaborating, they're doing all the things. They're doing all the things because funders only allocate between 10 to 25% of their grants towards operations. In operations is where you have salaries, it's where you have health benefits is where you have retirements. So if only 10 to 25% of each grant can be allocated to that, then there's not a lot of money there, which then means you can't recruit top talent. What ends up happening is our passionate and committed nonprofit leaders end up burning out the nonprofit sector has a burnout rate of 54%. That's higher than any other rate, and this is why I tell you that philanthropy is broken. We need to invest in that part of the nonprofit that's going to help them succeed. When you take a vacation, you're able to let your mind rest and then you come back, rejuvenate it when you can take sick time, you can let your body heal.
(03:10):
When you can create a succession plan and you know that there is an end date for you to retire, you can enjoy your golden years. Indirect costs are in overhead costs, and those are the areas that are the most challenging to be funded. When a philanthropist says, yeah, I'm going to donate a million dollars, and it's in a donor advised fund, they buy law only have to give out 5%. So that's what they do. So that's not a win-win. Eventually you may get that money, but they can hold that money for forever. My recommendation with the give back strategy is that we as emerging business owners, I'm talking about the small business owners, the medium sized business owners, those of us who we wouldn't consider ourselves wealthy, but we are a part of society and we pay our taxes and we pay our dues. I'm saying that we do philanthropy differently.
(04:08):
I'm saying that we establish our donor advised funds just like the wealthy, what it was established for philanthropy was established to help the wealthy retain their wealth because you don't get taxed on it. I'm saying we use our powers for good so that we can strengthen the nonprofit sector. Let me give you an example. My give back strategy is to fund rest, right? So if I give $10,000 to a nonprofit who does not have vacation time, this nonprofit can take a thousand dollars and allow a person to take a vacation for a week. That's my contribution. I'm not starting a whole new nonprofit where I have employees and I have nine ninety's I have to file and accountants I have to pay for and board members I have to recruit, and trainings I have to do and outreach I have to do, but I want to be a part of my community.
(05:06):
I want to support. I don't want to start a new business. So I have businesses saying to me all the time, yeah, once I get established, I want to start a nonprofit. Don't start a nonprofit. The world does not need another nonprofit. If you are committed to making a difference in your community, create a give back strategy, support the organizations who are already doing the work, but if they could just get a little bit more support, they could become more efficient, they could become more effective, you can help them to rest so that they can rejuvenate and continue to do the work. Here's what I want you to know. When you step into the nonprofit arena, now you're competing for the pot that's already small. When you step into the nonprofit arena, now you've got to learn what a nonprofit is. It's not the same as running a small business.
(05:52):
It just isn't. The nuances are different, the compliance is different. So why not support the organizations who've already put in the work, who already has expertise in the area that you're interested in supporting? You can partner with them on different levels, but don't start a nonprofit. Instead, funnel that money into that area that they have so much challenge in funding, health benefits, living wages, retirement, sabbaticals. I'm telling you, when you get to rest that creativity comes back. But when you're riding on fumes, you just burn out. So let's use our powers for good, come together and let's strengthen philanthropy. Let's do it in a way that as entrepreneurs, this is what we do. We have innovation and we have new ideas, and we're just the pioneers of change. Let's be the pioneers of change for philanthropy. Let's support the organizations that are already doing the work.
(06:59):
Let's create a win-win. Here's the win. As I said to you before, philanthropy was created to benefit the wealthy. It's a law though y'all. It's not a law that anyone else is bragging about, but as small businesses, we can start our own donor-advised funds, but we can use our powers for good. When you donate to a public charity, you now qualify to reduce that donation, that taxable income, up to 60% of your annual gross revenue. So instead of paying Uncle Sam that money, you can now invest it and do good by making sure that you grow your money and you use that money to support nonprofits who are already doing the work. I can't tell you how many times my accountant has said, Amber, you need some more taxable expenses. There's only so many times you can go donate clothes to the Salvation Army. This is a business move, right?
(08:01):
Donate, get that taxable revenue and you're doing good. So when I say this is the strategy that gets as good as it gives, that's what I mean. You get a business benefit, the nonprofit gets an infusion of cash, and now they can do what they need to do, which is to have health benefits so they can take care of themselves. They can start a succession planning by investing in retirement or they can take a vacation. So if you are a nonprofit and you're interested in being on the receiving end, it comes with some requirements. But I'm going to drop the link in my bio and for those of you who are thinking about starting a nonprofit, check out instead the give back strategy. And for those of you nonprofits who would like to be on the receiving end, look at the requirements. There are requirements for being on the receiving end.
(08:58):
I'm excited about this because I think as small businesses, we get to do what we do best, which is to come in and be creative and really deliver solutions. That's what we're known for as small emerging businesses and going to let traditional philanthropy do what traditional philanthropy does. And we are going to do what we do, which is to use our powers for good to make a difference in the world. Right? Alright, so when we come back, I get to answer a question from somebody in the community. When we come back, ask Amber, have you been duped by a grant writer promising you the moon and the stars, but after collecting your $2,000, you never win a grant? No. A grant writer can't guarantee you'll get funded, but if you don't know how to vet them, you could walk right into a scam. Check out my guide the questions to ask a grant writer before you hire them to help you determine if a grant writer is a bonafide professional or out to steal your hard earned money with no intentions of yielding results.
(10:00):
This guide explains what to look for in a grant writer if they're novice or seasoned, if they're a fit for the type of proposal you need written, what questions they should ask you. Leverage my 25 years of grant writing experience securing over $10 million in grants for clients to help you find a qualified grant writer and reduce your chances of getting scammed. Order your copy today. Hey, we're back. It's Amber, and now it's the time of the episode where you get to ask Amber. This question is from Gina. Gina is from Cyprus, and here's her question. Hey Amber, we're a new nonprofit. We don't have a lot of success yet. It's like a catch 22. How do you qualify for grants when you can't get the money? So how do we develop a track record if we can't get money to administer successful programs? Well, Gina, if you are a new nonprofit, chances are you don't have any money.
(10:56):
Anyway, my recommendation, and I've always made this recommendation is as a new nonprofit, go finds an established organization where you can compliment the programs that they're already delivering. So let's just say if an established nonprofit does tutoring for kids from six to 12, if your nonprofit is delivering college access services, go to this nonprofit and say, Hey, can we work with you for six months? We're not going to charge you. We need to just create a track record. And nine times out of 10, they're going to say yes, because a nonprofit is always looking to strengthen their programs. So you work with them for six months to a year, you get to get your track record, right? You're not doing anything right now anyway. You're like, well, how do I get grants? Use this time to benefit you by getting results data that proves that what you do work, especially for those of you who started your nonprofit without having a track record, where it's just a concept where you say, this is what I want to do and I've never done it before.
(12:07):
Partner with a company, an organization, a school district, and get the results. And then what usually happens is if your results are good, you can say to the company, okay, we gave you a year for free. If you want to continue with us, this is how much it's going to cost. What you also get to learn is what works and what doesn't work. When it's a concept, it's different than when it's actually being implemented. You may learn, oh, it's hard to recruit people. So I do want to partner with someone who already has my target audience, or you may learn, I don't want to partner with the school district. It's too much red tape. There's so much that you get to learn in the value you get from partnering. But what I'm trying to say to you, Gina, is since you are new, it's important that you have the data that you can prove that what you're saying you want this money for actually works.
(13:01):
A funder's responsibility is not to fund a nonprofit. The purpose of a funder is to meet their funding goals. So people think just because they get a 501(c)(3) a funder's just going to write them a check. No, no. First of all, there are always more applicants than there is money. So what does that mean? That means that the funders in the driver's seat, those organizations that can prove through tangible results and outcomes that they can do what they promised are going to get funded. You have got to get yourself in a position where you can prove that what you do is accurate. And so you're just going to have to tough it out. Go partner six months to a year, get your results, your data, and then go and search for a grant. I wish I could say it's easy, but you're running a business, my love, and this is what it takes to get the money. You've got to have a track record. I hope that helps.
(14:02):
The other thing that people tend to think is that they're just going to get these grants. We're going to shift now to my conversation with Mary Catherine Madeline, who is a development director, and we're going to talk about that. We're going to talk about misinformation, and we're going to talk about grants and developing relationships not only with funders, but program officers. And my conversation. This is part three of my conversation with Mary Catherine. We're going to talk about the mindset of the nonprofit leader and expectations when it comes to generating money. So let's take a,
Speaker 3 (14:52):
Working with individuals can be scary. It requires sort of a team effort. And so for me, when I want to build out an individual giving program, we really start with the folks that are closest to us, right? It's kind of like a concentric circle. So you start with a people that are already engaged. And what I found a lot of times with nonprofits is they, most nonprofits have a core of people who are giving at some level, but because people are stretched so thin on the staff side, maybe they haven't had time to engage these donors and build the kind of intentional relationships that will lead to greater giving. And this doesn't mean necessarily that you're meeting with them every week and giving them an update, but it's really saying, we so value your partnership. We want you to come along with us. How do you see your investment growing?
(15:37):
And so kind of building out the really purposeful relationships with your core donors that are closest to the mission. So to me, that's really step one. And then step two is figuring out who can we bring alongside us? Who does our board know? Who can we bring into the organization and build relationships with them? And so then you start to have a nice base of donors and then thinking through how can we also figure out how can we do some digital campaigns that work very well? But I think some of the kind of pitfalls I see is this idea that if we acquire 9,000 new donors, all of a sudden we'll be making $90 million, right? No, it doesn't work that way. You've got to build the relationships a lot of times, either face-to-face or through personal interaction. So I always advise starting there as opposed to doing some sort of massive acquisition campaign, which we just know is going to cost a lot of money,
Speaker 2 (16:48):
And we are back. This was part three of our conversation with Mary Catherine, if you want to see the full episode, we've got one more episode coming in our next session, our next episode. So we have one more episode with Mary Catherine on my next episode. Or you can just go to YouTube and watch the whole interview, however you want to do it. What I want you to really think about though is what we started out talking about at the beginning of the episode is the win-win we can create, the win-win we can create. If you've been thinking about starting a nonprofit, I'm going to ask you one question. Do you want to start a nonprofit because you want to make a difference in your community, or do you want to own a company? Because a lot of times people start their nonprofits because they want us.
(17:43):
It's my nonprofit. First of all, a nonprofit can never be owned. It is a public charity. I don't care if you put $50,000, 500,000, you can never own it. That is the criteria of a public charity. So if you think you're going to own it, don't start it because that'll never happen. If you think you want to pass it down to your children, you can't own it, so don't do it for that reason. If you want to start a nonprofit because there's a missing in your community or because there's something you want to give back, to create a give back strategy, let's use our powers for good and let's help those nonprofits who are out there already doing the work. If you want to reach out to me, you can hit me up on any of my socials. Be sure to like, subscribe and share today's episode and go check out the give back strategy. It's at www.givebackstrategy.org, and hopefully I'll see you next week, right? But until then, make sure you take care of yourself, like you take care of your community.
Speaker 1 (18:44):
Thanks for listening. If you enjoyed this episode, subscribe and leave a review on iTunes. Head over to www.amberwynn.net/podcast for the links and resources mentioned in today's podcast. See you next time.
