Monday, July 23, 2012

One Year Aniversary - Why Not a Non Profit

One year ago this week I left my President, CEO role at Cabrini Connections, Tutor/Mentor Connection and embarked on a new journey as the Tutor/Mentor Institute, LLC. If you're interested in seeing why the change took place read these blog articles.

The big challenge has been finding talent and revenue. Most individuals who supported me as a non profit between 1993 and 2011 find it difficult to continue to support the same work under an LLC (for profit) structure. Most foundations only support non profits or social enterprises with a business plan that promises a financial return on investments made. Finding volunteers who can and will manage the technology or help with building a business plan has been difficult, but I have had some help in this area.

Let me clarify a few things:

a) I did not have a volunteer team in place, with civic reach and a commitment to the vision of the Tutor/Mentor Connection in July 2011. Without that a non profit has no chance of finding the investment capital needed to thrive.

b) I'm 65. Thus, in building a new non profit I need to find volunteers who want to "own the vision" and carry it forward for another 20 years after I'm no longer involved. I keep looking for such people. It's a difficult commitment to make.

c) Thus I created Tutor/Mentor Institute, LLC to offer structure, a new way to generate revenue, and a new way to create potential partnerships with people and organizations in many cities who have the same problems of high poverty as Chicago. I've operated for the past year on less than $11,700 in revenue. I've kept expenses to under $24,000. I've paid the difference from my own savings and have not drawn a salary.

This is Chicago. It's the 3rd largest city in the United States. If you search for "tutor mentor" on Google or other search engines my sites come up on the first page. In this "nitch" market, I'm the top resource. Who are the advertisers or sponsors that would want to partner with me?

I've posted several articles over the past year showing that social enterprises do the same work as non profits, but with a different tax structure.

Today I'd like to share the thinking of Susan Ellis, President of Energize, Inc. on why she chose not to be a non profit.

"Why We Are a For-Profit Company

This question arises periodically, so here is what Susan Ellis has to say:

I could have opted to make Energize a nonprofit organization, recruit a volunteer board of directors, raise funds, and put myself on salary. Instead, I had a conscious, philosophical reason for taking the for-profit route. I have watched too many nonprofits convince third-party funders of the value of their services, while those who actually receive the services are dubious of their worth. Since funders rarely ask the end users what they think, grants continue to be awarded mainly on the skills of the organization's proposal writers. The only way that I could be certain that my clients valued Energize's services was to establish a direct, customer relationship with them. Many of our customers pay for our training, books, and other help with money they, in turn, get from donors. But the customer decides how to spend that money. If they choose Energize, I feel that is a true endorsement. And that's why I'm proud to have lasted in business for over 30 years."

I've been trying to figure out a business model to generate revenue for to keep the Tutor/Mentor Connection a free service for parents, volunteers, youth, community leaders, etc. At the same time I've spent time every day for the past year maintaining the web sites, building the network, and doing the work that needs to be done.

Creating a business model to support the strategies that I've developed over 18 years is far more difficult that one that supports a new start-up without an existing set of projects that need nurturing every day. I created this wiki to show the range of work I think needs to be included in efforts that reach kids in all high poverty neighborhoods with long-term, mentor rich learning activities.

I can't drop 90% of the Tutor/Mentor Connection strategy and vision just to focus on a single element that might generate revenue. That would be like trying to fight a war with troops in only one location who are armed with rifles but without bullets. It is a comprehensive plan, as John McCarron indicated when he wrote this article in 1995.

One strategy is to find partners or co-owners of individual parts of the strategy shown on the wiki. These could be people in any part of the country or the world.

As I look for such opportunities, I will continue to maintain this information and reach out every day to share it in a growing network of people that I meet on line hoping that others will step forward to fill the talent gaps needed to do this work.

I hope you'll browse through the blog articles I've written since July 2011 and read the essays I started posting on last October. These have already recorded over 18,000 reads.

School starts again in a month and my focus is on helping build greater visibility so that more volunteers and donors support the tutor/mentor programs operating in Chicagoland. That means I also have been trying to reach out to the programs in the Tutor/Mentor Program Locator to check to see if their information is accurate and recruit intermediary groups to help collect information on tutor/mentor programs in different parts of Chicago.

In a recent series of articles on the Stanford Social Innovation Review (SSIR) the role of "backbone organizations" is discuss, showing how important they are to bringing the entire community together around key challenges. I think the Tutor/Mentor Connection has been doing work that leads to collective efforts, yet without the support of a major corporate foundation or civic leader and in a much larger metropolitan area.

If you agree help me build this platform so it becomes more important to Chicago and can be made available to other cities.

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