The Future of Nonprofits

In Leadership by Shelli Bischoff

I have been spending a lot of time lately reading about B corps (certified benefit corporations), social enterprise, and social entrepreneurship and thinking about the impacts these new types of organizations will have on the nonprofit sector. If we can figure out a way to get a return on investment AND solve social problems, will nonprofits go the way of the dinosaur?

On book I have found especially informative is Social Entrepreneurship for the 21st Century:  Innovation Across the Nonprofit, Private, and Public Sectors by Roosevelt Institute Fellow Georgia Levenson Keohane (McGraw Hill 2013).

Keohane’s book is nicely written, thorough, and objective.  It helped me distinguish between social enterprise and social entrepreneurship (it has to do with scale) and it introduced me to the art and science of impact investing.  The book helped me correct some of my incorrect assumptions and also validated some of my more cynical fears as a person whose professional career is dedicated to the growth of the nonprofit sector and the success of nonprofit organizations.

The conclusion (both Keohane’s and mine) is that social entrepreneurship – while exciting and holding great promise for developing innovating solutions for some of the world’s gravest social problems – it is not a panacea.

Relative to how these trends are likely to impact, this book taught me two important things:

  1. Impact investing is ratcheting up focus on outcomes: My takeaway is that nonprofits must define and measure impact and outcomes.
  2. It’s always about scale and scope:  My takeaway is that nonprofits have a responsibility to ensure they have sufficient capacity to make a dramatic difference. Not every organization has to be global or raise billions of dollars, but it does have to go beyond friends and family and develop a base of engaged constituents.

If you are interested in learning more about these trends, I highly recommend this thought-provoking and informative book.  It should inspire some interesting conversations around the boardroom table!