It seems that every day I hear from someone who is starting another non-profit business or ministry and wants me to contribute money. And along with that, there is usually the implication that the non-profit has a higher calling and Godliness than any business that makes money could possibly have. Do you really think that just because an organization lists itself as non-profit that they are doing work that is more worthwhile than a regular for-profit one?
No, what I observe is that many people ignore the basics of making any organization great and simply hope that others will fund their lack of business skills and inefficiency. In a follow-up to Good to Great, author Jim Collins said any organization must blend three components:
(1) What is your Passion?
(2) What can you do with Excellence? and
(3) What is your Economic Model?
Lacking clarity in any of those will cause you to fail. Many worthy non-profits fail because they think they can use “faith” and “hope” as substitutes for having a clear Economic Model?
For-profits go out of business all the time – and rightfully so. Poor financial controls, inability to adapt, fierce competition, ineffective management, and desire to move on all contribute to the rapid closing of businesses. Often a purpose was completed, or a window of opportunity has passed and the business closes its doors peacefully.
No organization should exist simply to exist. In a recent Fast Company article (Why Charities Should Die Edit(7/1/2017): article no longer available) Nancy Lublin said, “A non-profit exists to cure something, address an issue, or elevate the status of a group of people; if and when that’s achieved, we should be done.” If the purpose has been accomplished, new methods have made it obsolete, no self-sustaining economic model is in place, or management is ineffective, any organization should cease to exist. Don’t expect to use guilt or pity as your method of funding your operation.
Social entrepreneurship and Ethical capitalism are honorable forms of doing good in the world today. Check out Tom’s Shoes, Puravida Coffee, Kiva, and many others as examples. Many in the 48Days.net community are building businesses where they are thriving financially AND doing good around the world. You really can do WELL and do GOOD at the same time.
Starting a non-profit is not a Godly thing to do if there is no plan for how revenue will be generated and spent. And no, being unemployed for a long period of time is probably not God’s way of telling you to start a non-profit. Prove you can make money in the real world and you can fund any good works you are drawn to.
Thanks for this Dan. Great comments. My wife and I have worked in church ministries/non-profits for much of our married life and we’ve often been appalled at the lack of business planning and economic management. Somehow many organizations think noble intentions and spiritual foundations can make up for lack of good organizational and business stewardship.
So true and so sad. Non-profits are expecting churches/businesses to carry them through plain trust. Where is the accountability? I have personally funded all of my past, present and future assets and asked countless organizations for donations to keep us afloat. But it has continued to sink. I am not the captain of the ship, nor am I part of the family, nevertheless jumping off is a necessary challenge.
God created mOney to teach us responsibility. And he said that if you don’t work you arnt worthy to eat. The sweat of the brow could be physical or mental. That depends on yor strengths
Great thoughts Dan. Too much is put on God, when it actually man just following his own desires.
This has been on my mind for a while now. Taking Christianity for an example: if we had more of our people trying to become the most profitable in serving other people with heart, intelligence and kindness, then we would have less need for evangelistic ministries. Instead of just focusing on churning out cookie-cutter preachers, churches should have a major focus on training Dan Millers and Dave Ramseys. I think the for-profit “ministries” of guys like you are the most effective in our nation. This is why I think it is ridiculous hearing/reading people complain about how Dave Ramsey (and I suspect yourself) are not serving people because they charge for X product.
Look forward to meeting you in a coaching session!
I have been entrenched in a ‘good cause’ that has been bleeding to death for too long.
Your article is a God send. It’s past due to choose a new beginning, to take flight and
get on the high road, so that I can serve the Lord with gladness not with a daily struggle
to stay afloat.
I agree with you to a point. There are defintely way too many religious ministries out there where all they do is raise money to buy gold plated toilet bowls. But there are many non-religious organizations doing great work that have business savvy, are managed and operated effectively and have plenty of resources. But yes, probably the last thing the world needs is another nonprofit organization.
I live in a mountainous valley that is absolutely spectacular in the summer. People visit, fall in love with it, go back home and quit jobs, pack up a U-Haul and move out here. Then they find that the few jobs available don’t pay much and are mostly service sector, so what do they do? They form a non-profit! In a valley of 14,000, we have over 100 non-profits, many merely duplicating services already being done by someone else. I am a bank president and banks are where you go first to hit up money since we have so much (However banking has become a non-profit business.) So this article speaks to a sore-spot for me.
Thank you! I have to add that it’s pretty easy to be “non-profit” – just let your overhead eat up your revenues and that becomes your situation pretty quickly. I give to charity regularly, but I always get copy of their financials before I donate. It’s amazing how many “non-profits” dole out huge salaries to their founders but very little to the causes they purport to support.
Excellent-and much needed. More of these kinds of things need to be published and shared. Many of us are tired of seeing people duped out of their hard earned money-in the name of a good cause. Unfortunately, in many instances the cause is really self. Time to wake up-and smell the coffee-or the skunk, whichever the case may be.
Dan, thank you for having the courage to write this. Some interesting insight…our mission is to bring peace to families of intense children. Our services are purposefully expensive. You wouldn’t believe the number of people who write thanking us for our “ministry” to families, despite the fact that we are for-profit. The reason I think is three-fold:
1. We operate our business with the same spirit as a ministry. We serve, we meet needs, we treat people with compassion and dignity. Our policy handbook is comprised of one sentence: treat every person we meet the way we want to be treated. It feels like a ministry.
2. Because people have to pay for our services, they have an investment. I believe they value our advice and services more precisely because they do require an investment. And personally, I believe WE value our services more as well. There’s a certain self-respect that comes from confidently saying, “Our work and emotional investment in bringing this insight to you is valuable.”
3. Because we are for-profit, we have to be on top of our game. We have to continually strive for excellence. And I think that shows through.
Thanks for the continued wisdom, Dan. I learn from you each week.
Kirk
Where in the bible does Christ focus on making money? I don’t recall Him preaching “business skills” and the need for profit and gain.
there’s no mention of eating three square meals a day either, maybe we should stop eating and forget that common sense thing that was instilled in us from the beginning
Do you recall Jesus asking that we utilize the gifts and talents He gave us to take care of the widows and orphans? Our mission is to figure out how to make that happen.
You suggest Jesus does not want us to focus on money. I agree. I believe we are to focus on serving His people. So what does that look like?
Do you have a better solution for alleviating poverty (hunger, sickness and oppression) than creating self sustainable solutions the lead to income (money) and dignity for the orphans and widows of the world? If so, you’ve got the answer we’ve all been looking for.
Read, reread and think about the parable of the three men who were given “talents.” This is one of the best business lessons there is – and done from a very Jewish perspective at that!
Proverbs 31
Well said! It’s easy to care about the plight of humanity,
and want to do something to change it for the better. It’s easy to point the
finger, get ticked off and to be passionate about a “cause”. None of that is
hard work. It’s human nature. And many think just “caring” should represent the
extent of their effort.
It’s not so easy to create a self sustainable (not reliant
on donors) solution that results in systemic change. And that’s what the people
you’ve set out to serve really need. Sending out a bunch of emails asking for
money doesn’t solve the problem. It just allows you to make a living while you choose
to do nothing more than “care”.
Real world changers are the ones that are committed to
creating long term solutions that aren’t dependent on their ongoing
involvement. If figuring that part out were easy, everyone would be doing it.
But it’s not, so people just create more non-profits instead. At least it has
the appearance of “changing the world”.
Jared — wow, your comments are like a sword cutting through the maze of compassionate, but unrealistic, responses to needs around the world. And spoken by someone who’s “been there, done that.” Thanks for your concise synopsis of the big white elephant in the room.
any one can help me some of money for our deaf people for set team of basketball, which i pray for this about it
friend..
magriz
Funny, this is EXACTLY what I was talking to one of our pastor’s about yesterday. We’re going to start a big project on financial education in the community and we started talking about micro-financing and charity. He mentioned the book, “When Helping Hurts.” (http://amzn.to/1gMhaMR)
The church leadership read it and it changed the entire way that the chuch views charity. Instead of handouts, they have created a small community of entrepreneurs and people who pass it on. It’s small scale so far (about 50 people impacted at most) but if they scale it to 2000, it will transform our entire city. I think we can do it!
Matt,
Congratulations on being a conduit for change in the church community on this issue. For too long we have been enabling people rather than equipping them.
“You really can do WELL and do GOOD at the same time.” Great quote Dan!
Dan, this is great! I’ve been thinking a lot about this over the last year or so. I’ve experienced the frustration that happens when organizations have big dreams but small pockets. Workers get burned out trying to fulfill their mission without adequate resources. When it gets bad enough, the typical non-profit response is to launch a new “fundraising” campaign (really just glorified panhandling). This distracts everyone from working on the goals and when the income results are lackluster, the frustration only builds. There has to be a better way! I think you’ve outlined a fine alternative. Thanks!
Gary, a “mission” without a clear economic engine is just a dream. I know people that if the mission is Godly or humanitarian money should just magically appear but in reality we know that doesn’t happen. And yes, “panhandling” is harder work than just making money in a normal way and using it for whatever cause we want.