Local nonprofits face uncertain future

Hundreds of nonprofits call the Asheville area home, providing services ranging from housing to health, environmental advocacy to youth sports. These groups employ thousands of local folks and help pump nearly $2 billion into the local economy, according to the N. C. Center for Nonprofits.

But in the bumpy post-recession landscape, these service-oriented organizations face significant challenges. Xpress asked several local nonprofit consultants to comment on what those challenges are and how they can be overcome.

“Certainly, fundraising is one,” says Greg Walker Wilson, former director of the Asheville-based Mountain BizWorks. “The state is decreasing its support [for programs and services], and the burden falls on nonprofits,” notes Walker Wilson, who’s now a consultant who specializing in helping organizations more effectively achieve their missions. “Often, there’s more need than money.”

Wilson Sims, co-founder of Sims & Steele Consulting, says nonprofits “managed to survive the recession, and they’re very resilient. Their biggest challenge is they still don’t have the resources to respond to the growing needs, take advantage of new opportunities or deal with transitions in leadership.”

Alex Comfort, too, raises the issue of funding. “As the economy heals,” says Comfort, who owns Mountain Non-Profit Solutions, “all of the nonprofits are going into overdrive to raise money.” However, he continues, “The gifts are smaller; there are more trust issues.”

Sims, who came to Asheville in the mid-1990s with a background as a basketball coach, English teacher and fundraiser, says local nonprofits are “remarkable” and “creative,” relying on a mix of government grants, individual donations, estate gifts or annuities, foundation support and fundraising events to support their work. Many of these groups, he notes, “are undercapitalized and trying to get to a sustainable position.” Thus, organizational leaders have “a huge job: They have to be the face of the organization as well as run it, manage the board, ensure program [development] and raise money,” he says.

And if all that weren’t difficult enough, adds Sims, “Nonprofit giving has not returned to prerecession levels, and giving patterns are different.”

A looming generation gap

“Government funding is leaching out,” says Comfort: There’s less of it to spread around. Private donors, he says, can’t replace those lost funds, and fewer individuals are setting up family foundations that will provide long-term support for nonprofits. A UNC Asheville fundraiser for many years, Comfort trains, teaches and offers a “boot camp” for nonprofit leaders; he also runs capital campaigns. At 67 and “moving toward retirement,” he worries about the coming gap in leadership and fundraising: “More people are leaving money in their estate plans and wills, but there’s going to be a 20-year gap as baby boomers age out.” There are only about half as many millennials as baby boomers, he explains, meaning fewer future donors. And meanwhile, millennials approach giving very differently (think Kickstarter campaigns).

The biggest donations today tend to come from people 70 and older, notes Comfort. And as that generation passes, he wonders how nonprofit leaders can connect with younger donors and build relationships with them. This challenge, he says, is more complicated because turnover at nonprofits is relatively high, the leaders themselves are getting older and retiring, and — despite their passion and commitment to their respective missions — “Nonprofit executives may not be comfortable with, or always have, fundraising skills.”

Donors, he notes, give to people and organizations they know and trust. And when there’s a change in leadership, a lack of fundraising experience, or directors and staff who are spread too thin in their duties (a common problem, since nonprofits are often understaffed), raising money becomes even harder.

Walker Wilson agrees, adding that it helps to have a good internal structure — including healthy relationships among board members, staff and directors — as well as clear goals and strategies. Nonprofit leaders, he says, need to think about who their “customers” are — not just the clients they serve, but also the general public, donors and government agencies. “What are their interests? Figure out what they need, and get more tech-savvy. Adap, and evolve,” counsels Walker Wilson.

Passing the torch

For his part, Sims says the nonprofits that will survive in the post-recession landscape will be creative. That means doing things like partnering with other groups to share costs, seeking new revenue streams and applying business-world techniques such as cost-benefit analysis and metrics. “They’ll keep a pulse on what they’re doing and how,” he explains.

One of Sims’ clients, he notes, is considering creating a thrift store or gift shop; another is looking to focus more on estate planning in its fundraising mix; yet another may expand its event season. The Asheville Amadeus Festival in March, he points out, was a joint venture involving several nonprofits — including the NC Stage Company, the Asheville Art Museum and the Asheville Symphony — and local businesses like Highland Brewing Co. The collaboration “made that performance possible, and it was a win-win-win for all,” says Sims.

Walker Wilson, meanwhile, maintains that it’s the combination of business skills and the ability to work with donors, boards, staff and the community that spells success for nonprofit leaders. “There’s so much passion that people bring to nonprofit work,” he observes. “You know that you’re making a difference in people’s lives.”

And, like Comfort, Walker Wilson stresses the importance of passing on that passion to the next generation. “Make sure boards have young people serving on them and getting trained,” he advises. “They can handle it.”

Still, Comfort predicts that many of today’s nonprofits will probably fail in the next few years, while others will merge or team up with partner organizations. At the same time, however, “People will keep doing great things and supporting great causes,” he says.

And those groups that do survive, notes Sims, may be more careful about taking on new projects, making sure they’re “sustainable and not overstretched financially.”

Whatever the challenges, Walker Wilson concludes, “There are lots of needs and segments of the community that need help. We’re fortunate to have strong social support structures, including nonprofits. It’s a way of paying back and paying forward.”

FOR MORE INFO

Greg Walker Wilson: walkerwilson.com


Wilson Sims: simsandsteele.com


Alex Comfort: mn-ps.com